Thursday on Bloomberg Television, Robert Borosage made the case for Sen. Elizabeth Warren’s Bank On Student Loan Fairness Act, which would set student loan interest rates at the same rate banks get from the Federal Reserve discount window:

“There is a universal consensus that we have to educate the next generation. And now college is getting priced out the reach of more and more students who have earned their way into it. What Elizabeth Warren is saying is, look, we shouldn’t be subsidizing the banks and not subsidizing the children that are our future.”

You can help press the Senate to pass the Warren bill by signing this Campaign for America’s Future/Daily Kos petition.

On July 1, interest rates on student loans will double, jumping to 6.8%, according to current law.

While the Big Banks are now enjoying interest rates of almost zero.

Enter Elizabeth Warren with her first bill as a Senator: It solves the problem by giving students the same rock-bottom interest rates as the big banks.

That’s why the Campaign for America’s Future is joining with Daily Kos to help get it passed.

Click here to tell your Senators: Co-sponsor Sen. Elizabeth Warren’s Bank of Student Loan Fairness Act.

College students today already graduate with the terrible burden of an average of $25,000 in student-loan debt. Now they face the dire possibility that their student loan interest rates will double to 6.8% on July 1 if Congress fails to act.

Sen. Warren’s bill offers a simple solution: lower student loan interest rates for one year to 0.75 percent, the same rate at which the government loans money to the banks through the Federal Reserve discount window.

Sen. Warren plainly makes the case: “In effect, the American taxpayer is investing in those banks. We should make the same kind of investment in our young people who are trying to get an education.”

She’s standing up for students. It’s time to stand with her.

The CEO of a big company makes 1795 times what its clerks are making, and the company is now in trouble. Does it matter which company, when so many other companies are in a similar situation? There is a three-year-old law that requires companies to disclose to shareholders the ratio of CEO-to-worker pay, but the law isn’t being implemented.

Law Says Disclose CEO Pay Ratio

There is a law that the government is not implementing, requiring companies to report the ratio of CEO pay to worker pay. The reason the government is not implementing the law is corruption: The people who are supposed to implement the law keep delaying, some then leave government to get huge checks from the very companies that want the already-passed law blocked from being implemented. No one is stepping in from above to make things happen. Meanwhile, Republicans in Congress are getting paid to do what they can to block implementation.

Specifically, section 953(b) of the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act requires public companies to disclose the median annual total compensation of all employees, the total annual compensation of the chief executive officer, and the ratio of the median employee pay to the CEO’s pay. This law has been passed and has been on the books for three years. But three years later the administration still has not implemented it.

From last month’s CEO Pay And SEC Delay,

Something many people don’t know is that the Wall Street reform law was supposed to do this, but years later the regulations still have not been written! The SEC delays and delays, and then the head of the SEC leaves to take a high-paying job with a “bank consulting” firm.

There is a new Chair of the SEC. Will SEC Chair Mary Jo White get this law implemented, or not?

The Story

A recent Bloomberg story by Elliot Blair Smith & Phil Kuntz looks at the CEO-pay law and what is blocking implementation. Bloomberg: CEO Pay 1,795-to-1 Multiple of Wages Skirts U.S. Law begins by looking at the case of JC Penny CEO Ron Johnson,

Former fashion jewelry saleswoman Rebecca Gonzales and former Chief Executive Officer Ron Johnson have one thing in common: J.C. Penney Co. (JCP) no longer employs either.

The similarity ends there. Johnson, 54, got a compensation package worth 1,795 times the average wage and benefits of a U.S. department store worker when he was hired in November 2011, according to data compiled by Bloomberg. Gonzales’s hourly wage was $8.30 that year.

Across the Standard & Poor’s 500 Index of companies, the average multiple of CEO compensation to that of rank-and-file workers is 204, up 20 percent since 2009, the data show. The numbers are based on industry-specific estimates for worker compensation.

Almost three years after Congress ordered public companies to reveal actual CEO-to-worker pay ratios under the Dodd-Frank law, the numbers remain unknown.

So how is this law being blocked? According to Bloomberg story a powerful “Washington-based non-profit called the HR Policy Association, which represents top human resources executives at about 335 large corporations” is leading the charge.

The group has brand names behind it: 17 companies on HR Policy’s board of directors have CEO pay ratios in the top 20 percent of S&P 500 corporations, Bloomberg data show. They include General Electric Co. (GE), with a ratio of 491; McDonald’s Corp. (MCD), at 351; and AT&T Inc. (T), at 339.

How did Bloomberg arrive at these multiples, even though the law is being blocked?

These multiples are based on CEO pay for either the fiscal year ending in 2011 or 2012, as disclosed in the companies’ most recent filings before noon on March 26. Because most companies don’t disclose their average workers’ pay, Bloomberg used U.S. government data on worker compensation by industry. The average ratio for the S&P 500 companies is up from 170 in 2009, when the financial crisis reduced many compensation packages. Estimates by academics and trade-union groups put the number at 20-to-1 in the 1950s, rising to 42-to-1 in 1980 and 120-to-1 by 2000.

And what is going on to block the law? Well, as mentioned above the last Chair of the agency delayed and delayed, and then left to take a high-paying job with a firm that makes its money by selling influence. (See CEO Pay And SEC Delay.) We are waiting to see if the new Chair will implement the law. From the Bloomberg story,

The SEC, which has so far written 39 of 94 rules called for under Dodd-Frank, has no deadline for completing the pay-ratio provision. In February, Commissioner Luis Aguilar suggested that companies voluntarily disclose their ratios until the agency can develop its rule.

… Bartl, at the compensation center, responded with a letter asking Aguilar to “retract” his statement.

SEC Chairman Mary Jo White, who took office this month, and the three other commissioners declined to comment.

The Bloomberg also tells the story of a low-wage JC Penny worker who was fired after being injured. Please go read.

Outgunned

In addition to regulators who sell out the public out by blocking implementation and then leaving to get huge paychecks from the lobbying firms whose mission they were assisting, Republicans in Congress are also working the case for the banks and big corporations.

Gary Rivlin at The Nation, How Wall Street Defanged Dodd-Frank describes the amazingly-funded and powerful lobbying effort against the whole Dodd-Frank law — of which the CEO-pay rule is one part — and the inability of the Obama administration to overcome them. The result,

Three years after Dodd-Frank was passed, only 148 of the 398 rules requiring action by regulators have been finalized, and draft versions have yet to be submitted for half of the remainder. Sheila Bair, head of the Federal Deposit Insurance Corporation between 2006 and 2011, is among those outraged at that record. Bair, a lifelong Republican who was picked by President George W. Bush to head the FDIC, is unhappy that Congress wrote such an overly complex law. She also wishes that the regulators would act more boldly. But the main culprit, she says, is the resistance to reform posed by an industry with enormous firepower. “At the end of the day,” Bair says, “the regulators are outgunned.”

How are Republicans helping block regulations? From Rivlin’s story,

Wall Street’s primary beachhead for fighting Dodd-Frank has been the House Committee on Financial Services, chaired until recently by the Wall Street–friendly Spencer Bachus. “Regulators are there to serve the banks”: that’s what Bachus, an Alabama Republican, said shortly after it was announced that he would replace Barney Frank as the committee’s new chair at the start of 2011.

Examples,

And the very first bill Republicans introduced after taking over the House in the 2010 midterms—HR 1—was a measure that would have cut the CFTC’s funding by one-third. “Anything we can do to slow down, deter or impede their ability to engage in this oppressive overregulation,” Senator McConnell explained in 2011, “would be good for our country.” Congress has summoned Gensler to testify on Capitol Hill fifty-one times over the past four years—more than a visit per month since his February 2009 confirmation hearing.

Rivlin’s story goes into the wider story of efforts to block the entire Dodd-Frank law and is worth reading in its entirety.

Will New SEC Head Implement The Law?

The question everyone is asking is, will the new head of the SEC go ahead and implement the SEC’s parts of the law, or not? This is an unusual question to ask — a law is passed why would anyone ask if the law will be enforced or not? But in our corrupt times and with the corrupt history of the people who are responsible for implementing and enforcing our country’s laws, unfortunately this is a question that people do ask.

Take a look at the AFL-CIO’s Executive Paywatch.
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Take a look at the 2013 Edition of the website called Executive PayWatch from the AFL-CIO. This site, active since 1997, helps drive awareness of the huge wage gap between CEO pay and the average employee. Compare your pay to the pay of top executives. Heck, you might even make more than they do! (Hint: you don’t.)

According to the AFL-CIO, “since 1982, the CEO versus worker pay gap has jumped from 42 times more than the average rank-and-file worker to 2012’s record 354 times greater. In real dollars, a CEO of a Standard and Poor’s 500 Index company averaged $12.3 million a year in total compensation, while the average rank-and-file worker earned $36,654.”

The new 2013 edition of Executive PayWatch:

…unveils several new features this year, including:

• The retirement multimillion-dollar nest eggs of the leading Business Roundtable CEOs—the same group that wants to cut Social Security benefits;
• The records of 40 of the largest mutual funds and their votes on CEO pay proposals for the companies in which they invest;
• The CEO to worker pay gap around the world; and
• Trends in CEO pay.

As in past years, visitors to PayWatch can compare their pay and benefit package to that of a CEO, search the CEO pay database and take action to rein-in CEO pay.

Executive PayWatch also looks at:

• CEO Pay and You
• Trends in CEO Pay
• CEO-to-Worker Pay Gap in the U.S.
• Pay Ratios Around the World
• CEO Pay Data Sources
• Business Roundtable’s Nest Eggs
• Fix the Debt CEOs’ Offshore Profits
• Mutual Funds & CEO Pay

Infographic

Also, take a look at the great infographic at Executive PayWatch.

Some Sample Tweets

1 CEO makes 354x what the average worker makes. How does your pay stack up to #CEOpay? www.paywatch.org #p2

The gap between U.S. #CEOpay and worker pay is by far the widest in the world. Learn more: www.paywatch.org #p2

Hey CEOs: Want to ‘@FixTheDebt’? Pay your taxes. www.paywatch.org #CEOpay is out of control #p2

In 1980 CEOs made 42x the avg. blue collar worker. In 2012 CEOs made 354x the avg. worker: www.paywatch.org #CEOPay

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Republicans criticize government spending when it is about making our lives better. Of course, by definition all government spending is done to make our lives better. (In a democracy government spending is We, the People deciding how and where to spend the money. Would we decide to spend money to make our lives worse?) In a plutocracy, though, it’s a very different story.

If you live in Wisconsin, for example, your tax dollars are used to help drive down your wages – and everybody else’s.

The Washington Post has the story: Wis. taxpayers spend close to $850,000 for lawyers to defend restrictions on public unions,

Wisconsin taxpayers have spent close to $850,000 defending lawsuits over Republican Gov. Scott Walker’s 2011 law that all but ended collective bargaining for most public workers.

And the lawsuits aren’t over yet.

Ending collective bargaining means ending the right of employees to band together so they have collective power. Instead of individuals coming to the boss and saying, “Please throw me a crumb if you feel like it,” with a union it’s all of the workers, together, saying “Let’s talk about how we can work together to grow this business for all of us.”

Who Benefits From Low Wages And Restrictions On Unions?

Ending collective bargaining and other restrictions on unions are about one thing and one thing only: driving down the wages and benefits that working people receive. And when you do that, see if you can guess what happens. From the post 40% Of Americans Now Make Less Than 1968 Minimum Wage,

The chart shows that wages used to go up as productivity went up, but in the 1970s they decoupled. Productivity kept going up but wages stagnated.

That is what happened when trade agreements broke the ability of unions to ask for a fair share of the proceeds. Businesses started moving jobs out of the country to low-wage, “business-friendly” non-democracies, and said to people who wanted raises “shut up or we’ll move your job out of the country, too.” This “decoupled” productivity increases from potential wage increases.

So the benefits of our economy started going to just a few people, instead of being spread around. The post, Is This Where The (Middle-Class) Money Went? tells that story:

Now, here’s another chart. This chart shows that financial-sector and non-financial-sector compensation used to rise together, but in the late 70′s / early 80′s they decoupled. Financial-sector compensation took off, while non-financial-sector compensation did not.

Race To Bottom

The problem isn’t just Wisconsin by any means. In Michigan Races To Bottom With Anti-Union Law I explained, (“lectured,” my wife says. “Shut up,” I mansplained.)

Pay attention to what is happening in Michigan, because it will add even more downward pressure to your wages and benefits, wherever you live and work. Republicans in the Michigan legislature have rammed through anti-union “right-to-work” laws making union dues voluntary even as unions a required by law to provide services to members and non-members. They say this will make Michigan more “business-friendly” by driving down wages and benefits, thereby stealing jobs from states where working people have rights. The actual intent is to get rid of the unions altogether, and their ability to fight for the 99% in the ongoing class war with the 1%.

From this week’s post, Obama Shouldn’t Buy The Lower-Corporate-Taxes Line,

Downward Spiral

Imagine states A and B. State B cuts their tax rates and passes laws that restrict unions, keep minimum wages low and other wage-lowering measures to “attract businesses” and their jobs from state A. As successful as state B might be at getting companies to move there, what is the effect on the larger economy of all of the states? Obviously the overall wages in the larger economy will fall as the same jobs move to a state with lower pay. And even the jobs that remain in state A are under pressure to reduce their wages, with the employers threatening to move their companies to state B as well.

And the government of state A has less revenue to fund their schools and courts and infrastructure, while the government of state B sacrificed revenue to make their state more attractive. So the overall level of investment in public goods also drops.

By reducing standards State B is undercutting the ability of the people in state A to control the companies in state A. State B has enabled companies to extort lower wages and other advantages elsewhere. State B is undercutting State A’s ability to be an effective democracy.

This is what is happening around the world as these giant companies put the squeeze on governments, with the threat to just go somewhere else. This is what happens when corporate power is allowed to reach such a level that it challenges the power of governments to control them. Originally the corporations We the People enabled in order to accomplish things that are good for US have changed into a force with enough wealth and power that instead of providing good jobs and goods and services, they instead demand we pay them tribute.

So as the country converts from democracy (representative government for you nitpickers) to plutocracy, we should expect more of this. Or, alternatively, we can get corporate money back out of our politics, out of the think tanks, etc., and back into the corporations where it is only used to run the business. And then we can try to remember what a democracy is supposed to be like — where we do things to make our lives better.
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Congressional Republicans came to Silicon Valley this week to raise money from CEOs and their companies. They were offering a flat-out quid pro quo: give us money and in exchange we will cut your taxes, block taxes on profits made from moving jobs out of the country, cut government oversight of various schemes you try, and let you import more lower-wage tech-workers from outside the country.

The story is in the SF Chronicle, GOP Rep. Kevin McCarthy in Silicon Valley: Cut regs and corporate taxes,

[Rep McCarthy] spoke the Valley’s language: Nonpartisan. (Didn’t blame Dems or wave the GOP rally flag — CEOs hate that stuff. Just show them the money/tax breaks.) More important, he’s all about lowering regulations and cutting the corporate tax — which even President Obama gave a shout-out to Tuesday in his State of the Union.

Also, Politico: Republicans make another try to woo Silicon Valley,

In a trip this week to California, Rep. Kevin McCarthy, the No. 3 House Republican, is leading a half-dozen colleagues on a tour of its star technology companies, including Google and Facebook, in the hope the tech giants will become partners in upcoming fights over issues including tax reform, cybersecurity and immigration.

At the same time, Senate Minority Leader Mitch McConnell and Minority Whip John Cornyn will headline several Bay Area fundraisers, including a TechNet, Google PAC and Oracle PAC fundraiser at the Stanford Park Hotel in Menlo Park on Thursday.

What are Republicans offering the CEOs in exchange for the corporate cash?

Tech companies have built up their Washington lobbying offices in recent years to help them sway Congress on a host of issues. But on tap in coming months are some of their most important priorities.

They are furious that American universities educate foreign students and send them home, and they want an immigration bill to expand the H-1B visa program to help keep those students in the U.S. Another focus is repatriation to encourage corporations to bring money back to the U.S. at a lower tax rate.

[. . .] Republicans are also looking to talk cybersecurity and the so-called Volcker rule, which they say stifles startup companies’ ability to raise capital. Patent reform is also sure to be on the docket for Silicon Valley businesses — especially startups.

What this translates to:

• The H1-B visa game is that Silicon Valley is notorious for only hiring younger workers and laying off anyone that reaches the ripe age of 40 because they cost more. Since this means there are not enough tech workers, they use H1-B visas to bring in younger, lower-cost foreign tech workers. See here, here, here… and seriously read this one.
• Tax “reform” has two parts. First, just lowering the corporate tax rate so the CEOs and investor class gets more and the schools and all the things We the People do to make our lives better are starved.
• Part II of the “tax-reform” game is the money being kept out of the country for tax avoidance. Companies have moved jobs, factories and profit centers out of the country. (Google made the majority of its profits in Bermuda!) They pretend they don’t owe their taxes on the profits until they “bring the money into the country.” They are holding $1.7 trillion out of the country away from their own shareholders and the US economy, trying to find enough members of Congress to pay to let them just bring it back without paying the taxes due.
• Patent reform. Everyone knows that the patent system is ridiculous and is holding back innovation by rewarding monopolists and rentiers. But how will “reform” shake out? Monopolists and rentiers are willing to cough up good cash to have any changes go their way.

By the way, though this was billed as a trip to “talk with” Silicon Valley the Republicans only met with 1%’ers, CEOs and top executives. They were not interested in discussing the concerns and needs of regular workers here. And the open fundraiser was $10,400 for four tickets.

Same As GOP/Wall Street Corrupt Bargain

This is reminiscent of the post-crash GOP “wooing” of Wall Street cash in exchange for blocking regulations that would have reigned in the big banks.

Feb. 2010, WSJ, GOP Chases Wall Street Donors,

In discussions with Wall Street executives, Republicans are striving to make the case that they are banks’ best hope of preventing President Barack Obama and congressional Democrats from cracking down on Wall Street.

… Last week, House Minority Leader John Boehner of Ohio made a pitch to Democratic contributor James Dimon, the chairman and chief executive of J.P. Morgan, over drinks at a Capitol Hill restaurant, according to people familiar with the matter.

Mr. Boehner told Mr. Dimon congressional Republicans had stood up to Mr. Obama’s efforts to curb pay and impose new regulations. The Republican leader also said he was disappointed many on Wall Street continue to donate their money to Democrats, according to the people familiar with the matter.

Quid pro quo: give us money and we will block this effort to reign you in.

Feb, 2010, NYTimes, In a Message to Democrats, Wall St. Sends Cash to G.O.P.,

Republicans are rushing to capitalize on what they call Wall Street’s “buyer’s remorse” with the Democrats. And industry executives and lobbyists are warning Democrats that if Mr. Obama keeps attacking Wall Street “fat cats,” they may fight back by withholding their cash.

Both “sides” play this corruption game, by the way,

Wall Street lobbyists say the financial industry’s big Democratic donors help ensure that their arguments reach the ears of the president and Congress. White House visitors’ logs show dozens of meetings with big Wall Street fund-raisers, including Gary D. Cohn, a president of Goldman Sachs; Mr. Dimon of JPMorgan Chase; and Robert Wolf, the chief of the American division of the Swiss bank UBS, who has also played golf, had lunch and watched July 4 fireworks with the president.

Lobbyists say they routinely brief top executives on policy talking points before they meet with the president or others in the administration. Mr. Wolf, in particular, also serves on the Presidential Economic Recovery Advisory Board led by the former Federal Reserve Chairman Paul A. Volcker.

Quid pro quo:

The Hill, Republicans block Wall Street reform bill,

Senate Republicans held ranks on Monday and blocked a Democratic effort to overhaul the financial system and crack down on Wall Street.

In a 57-41 vote, Democrats fell short of the 60 votes necessary to proceed to the Wall Street bill.

“Fell short of the 60 votes necessary” is media-speak to mask that the filibustered the bill. The public hates filibusters, but you can filibuster anyway if the public doesn’t fund out.

After the bills passed, Republicans earned their cash: Republicans Fight To Dilute Wall Street Regulations,

Congressional Republicans are greeting the one-year anniversary of President Barack Obama’s financial overhaul law by trying to weaken it, nibble by nibble.

Wary of attempting to dismantle the entire statute and being portrayed as Wall Street’s allies – banks are among the nation’s most unpopular institutions – GOP lawmakers are attacking corners of it.

… Another House panel voted to slice $200 million from Obama’s $1.4 billion budget request for the SEC, which has a major enforcement role.

Meanwhile, Senate Republicans are continuing a procedural blockade that has helped prevent Obama from putting Elizabeth Warren or anyone else in charge of the Consumer Financial Protection Bureau, which opens its doors in two weeks.

So there it is. We have opened the door to bribery, and bribery rules the day. If you can gain from corruption you gain an advantage that drives honest players out of business. In the end the ones with the most money buy up all the advantages and keep competitors and innovators down. They deliver the minimum they can get away with, while draining the economy. Which describes what we have as an economic system now.

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It’s hard to believe considering what happened in 2008 on Wall Street and in Washington, but banking is built on trust.

A worker hands his hard-earned dollars to a teller and trusts the money will be deposited and available for withdrawal when needed. Despite the crash on Wall Street, workers still trust bankers to safeguard deposits from robbers and reckless investments.

Granting banks a little less credulity might be wise. Just consider what happened in the past two weeks. A U.S. Senate investigation revealed that the 2010 Dodd-Frank banking reforms utterly failed in the case of the $6.2 billion “London Whale” gambling loss at JPMorgan Chase. Then a U.S. House committee passed seven measures to weaken Dodd-Frank. And there was the European Union’s demand that Cyprus expropriate money from depositors to prevent that nation’s big banks from failing. That means no depositor can trust that a government won’t dip its hands into savers’ accounts to bail too-big-to-fail banks. The trust is gone, baby.

Last week’s bad banking news began in Cyprus. It’s a cautionary tale about trust in both politicians and bankers. Cyprus is a tax haven for wealthy Russians the way the Caymans are for wealthy Americans. The Cypriot financial institutions, which made bad bets on Greek debt, are teetering on the edge of bankruptcy and were closed last week to stave off bank runs.

Click here to view the video on YouTube.

The European Union, which includes Cyprus but not Russia, was not eager to provide loans to secure moneyed Russians. Euro zone finance ministers and representatives of the International Monetary Fund (IMF) and European Central Bank worked out a deal under which Europe and the IMF would provide $13 billion to bail out the banks if the country took $7.5 billion from depositors’ accounts.

Cypriot and European officials betrayed depositors, particularly small ones whose savings of less than $130,000 supposedly are insured. The newly elected president of Cyprus, Nicos Anastasiades, turned on his own people. He rejected a proposed deal under which Cyprus would take 12.5 percent from depositors with more than $130,000 euros and about half of that from smaller account holders. Anastasiades demanded the rich, often Russian oligarchs, pay less, which meant, of course, the smaller depositors, everyday Cypriot workers, would have to pay more.

As a result, a deal was struck under which 9.9 percent would be taken from the wealthy and 6.75 percent from those with less than $130,000, effectively nullifying their insurance.

Naturally, the working people of Cyprus went crazy. Their president had focused on protecting rich foreigners. And he decided it was fine for the government to reach into workers’ savings accounts and grab money to rescue big banks.

Cypriots asked how a depositor could trust any bank in the Euro Zone now that finance ministers had determined that countries could confiscate money from insured accounts. A 26-year-old Cypriot, Andreas Andreou, told the New York Times he’d withdraw all of his money as soon as the banks re-opened, adding:

“I’d rather put the money in my mattress.”

Trust is seriously breached when a mattress seems safer than a bank vault. Cypriots pointed out that no one should feel immune. If Cyprus can pinch depositors, any government can.

In 2008, the U.S. Congress did not take bailout money from depositors, but instead from every taxpayer. And it wasn’t a mere $700 billion in Toxic Asset Relief Program (TARP) money.  Including loans and other help offered by the Treasury Department, Federal Reserve and FDIC, it’s more like $4.76 trillion, with $1.54 trillion not paid back.

The Dodd-Frank Wall Street Reform and Consumer Protection Act was supposed to give taxpayers some trust that the banks would be sufficiently regulated, that too-big-to-fail wouldn’t happen again. But the London Whale drowned that fantasy.

JPMorgan Chase, long considered the safest Wall Street bank, an institution whose managers lobbied hard for a lily-livered Dodd-Frank, has paid more than $8.5 billion since the crash in fines, settlements and other litigation expenses.

Joshua Rosner, co-author of the New York Times best seller, “Reckless Endangerment,” analyzed JPMorgan for consulting firm Graham Fisher & Co. and wrote in a report titled “JPMorgan: Out of Control:

“JPM has a reputation of being the best managed of the biggest banks. This has enabled the company to employ its muscle with elected officials and thwart regulatory efforts.”

Regulators saw no evil as a JPMorgan trader in London lost $6.2 billion last year. A scathing Senate investigative report released  March 14 says the nation’s largest bank fought with and dodged federal regulators, misinformed investors and the public and circumvented internal and federal rules.

Less than a week after the Senate released the report, a House committee passed seven bills that would gut Dodd-Frank’s already weak-kneed regulations governing the very derivatives that the London Whale traded.

This action is an example of right-wing Cypriot President Anastasiades’ view of government: protect the wealthy and influential and compel the workers to pay.

It didn’t go over well in Cyprus. After massive street demonstrations, the Cyprus Parliament unanimously rejected the initial plan to seize money from small depositors’ insured accounts to rescue the banks.

But unless Americans step up the way Cypriots did and demand real regulation, as well as send the message that they don’t trust Wall Street by moving their money to community banks and credit unions, they can bank on being bilked. Again.

The U.S. Attorney last week confirmed Americans’ fears about Wall Street. The banks, Eric Holder said, were not just too big to fail, they were also too big to jail.

That means bankers operate beyond the pale, outside the historical fence line encircling civil society. Past the pale is where barbarians resided, returning regularly to rampage. These days, bankers operate from beyond the pale, raiding civilization with impunity.

Unlike vulnerable ancient villages, however, the United States has considerable power over these banker barbarians. Banks, after all, are nothing but corporations. Corporations are legal constructs that citizens have the right to rebuild to properly serve society. European countries began doing that last week. Their first steps included limiting banker bonuses and giving shareholders binding say on CEO pay.

Click here to view the video on YouTube.

It started on Sunday, March 3 when the Swiss voted to grant to those who own corporations – the shareholders – the right to determine executives’ and directors’ pay. In addition, the referendum outlawed golden handshakes and golden parachutes. These are massive handouts to corporate executives – like the $78 million that Swiss-based healthcare products corporation Novartis proposed as a goodbye gift for CEO Daniel Vasella.

Nationwide outrage scuttled Vasella’s windfall and withered referendum opponents. The measure, called the Minder Initiative after its author Thomas Minder, passed with 68 percent of the vote. Even before Vasella, the Swiss were annoyed that the country’s biggest bank, UBS, had to be bailed out and that another huge bank, Credit Suisse, gave its CEO $76 million in shares in 2010.

So they did something. They changed the rules to tame banker barbarians and rogue corporations.

Two days after the Swiss referendum, the European Union’s finance ministers voted 26-to-1 to limit banker bonuses. Beginning next year, a bonus may not exceed the amount of a banker’s annual salary. Or, if the bank’s owners – the shareholders – approve, a bonus may be as high as twice the salary.

The intent is to reduce risk taking. When bankers win big gambles, they’re rewarded with big bonuses. When they lose, taxpayers bail them out. The E.U. lowered the bonus payments, lowered the wagering incentive, and lowered the chances of another bailout.

Only Britain, a major banking center, voted to continue the current regime of taxpayer-financed bank gambling. Prime Minister David Cameron took a considerable risk himself to side with banks since the vast majority of the British electorate, suffering under austerity, resents the banking industry for crashing the economy, extracting bailouts and pocketing regal pay.

In addition to capping banker bonuses, the measure stiffens capital requirements for some 8,300 European banks in the 27 European Union countries to prevent another financial crisis as well as mandating that the banks publish detailed information on profits, taxes and subsidies.

Although, obviously, the United States isn’t an E.U. member, the measure appears to affect some American banks and bankers. For example, it likely would cap the bonuses of executives working in New York for London’s Barclays and those working in London for Wall Street bank Citigroup.

That’s good for the United States, which looks like a legislative sissy compared to Switzerland. Congress gave American shareholders a faint say on pay – they may vote, but only every third year and only as a non-binding advisory. Congress said corporate executives and directors are free to ignore the people who own the company and pay themselves whatever they want.

In addition, Congress required corporations to report the ratio of a CEO’s compensation to that received by the company’s median worker. But corporations aren’t doing it – because no one’s enforcing it.

These measures were included in the 2011 Dodd-Frank law, which was hyped as legislation to prevent another Wall Street bailout.

Attorney General Eric Holder eroded confidence in that on Wednesday when he testified that criminal Wall Street bankers are too big to jail. Here’s what he said:

“I am concerned that the size of some of these institutions becomes so large that it does become difficult for us to prosecute them when we are hit with indications that if you do prosecute, if you do bring a criminal charge, it will have a negative impact on the national economy, perhaps even the world economy.”

If these banks are so big that prosecuting outlaw executives in one will take down the economy, then it’s impossible to believe that taxpayers won’t be forced to bail them out again when Wall Street loses its next big gamble.

What Eric Holder said is that these banks operate beyond the pale, outside the rules of society because they’re too gargantuan for society to hold accountable. They can do anything they want. They can gamble like crazy, and when it fails, suffer no consequences. Taxpayers will backstop their losses. And prosecutors will decline to prosecute. That is exactly what happened in 2008.

The E.U. has refused to stand by helplessly again, like The Three Bears, while some European version of Goldman Sachs ransacks their financial house. The Swiss and the 27 European Union countries voted to change the rules in order to restrain corporate renegades and ensure banks operate in ways that benefit society.

What they did is not enough. But it’s a good start. The vast majority of Americans abide by society’s rules and live inside the pale. They need legislation to yank bankers back within that fence.

It may be the creepiest student competition in history. Foreclosure.Com’s essay contest may be trivial compared to what Wall Street’s doing to undermine our educational system and manipulate our thinking, but it reflects the same warped set of values.

The Campaign for a Fair Settlement’s Dan Petegorsky sent me some comments on the contest, which led us to its entry requirements: “You’ve been tasked with analyzing two foreclosure properties to determine which one is a better investment,” contestants are told. “The goal is to maximize profit, whether it is a buy, hold or flip strategy …”

Opportunity Knocks … and serves an eviction notice

I began writing about illegal bank foreclosures before Wall Street’s criminal actions in this area were widely known.  Soon I started receiving heartbreaking emails from people who had been illegally foreclosed upon. A single mother said she’d been contemplating suicide. Another victim said “your article was like morphine to the dying.”

“All this time,” the homeowner said, “I blamed myself.”

But one person’s suicidal homeowner is another’s investment opportunity.

“The goal is to maximize profit,” says Foreclosure.com, “whether it is a buy, hold or flip strategy over the short- and/or long-term.”

Young essayists must “select a property” from two foreclosed family homes. One’s in Stockton, Calif., where borrowers were inundated with offers of no-doc loans, hoodwinked by inflated appraisals, and assured by their bankers that property values had nowhere to go but up.

Ghost Town Cops

Today Stockton leads the nation in foreclosures whose abandoned neighborhoods are a Mad Max landscape -” a city within a city,” as the Stockton Record writes, “a Wild West ghost town” where

Graffiti artists bomb houses. “Urban miners” steal HVAC condensers out of yards for the copper. Burglars steal valuable belongings left inside … Prostitutes sneak johns in and turn tricks. Junkies use rooms for shooting shacks. Squatters sometimes accidentally set the house afire.

After the city filed for bankruptcy the Stockton Police Officers Association put up a billboard that said “Welcome to the 2nd most dangerous city in California: Stop laying off cops!”

Still, a criminal in Stockton might get arrested. That hasn’t happened yet on Wall Street.

Morally Bankrupt

It took an overseas newspaper, outside our corporate propaganda zone, to cite the real reasons for Stockton’s fiscal woes: “America’s cities are struggling with a lack of infrastructure investment and an almost religious aversion to taxes.”

Bankers continued to prosper – thanks to taxpayers – but cities like Stockton soon found themselves struggling, and were harangued with American stories about their alleged “spending binges.”

Binges?  All of the major banks could have faced bankruptcy without taxpayer help. “Foreclosure.com” did. But there were no essay contests celebrating the money to be made in the ruins of their lives.

Hey, contestants, want a hint? Pick the other house, the one in Chapel Hill. It’s the organizers’ obvious favorite. And  Chapel Hill has another advantage. It’s home to the Center For Responsible Lending, which has excellent advice on how to get banks lending to home buyers again in a responsible way.

That would be good for everyone – except the predators, of course.

The Cynics

And speaking of predators: Petegorsky rightly notes that the Blackstone Group is exploiting the foreclosure crisis by purchasing $2.5 billion in distressed properties. And that CEO Steve Schwarzman once compared the elimination of a tax break for hedge fund managers to Hitler’s invasion of Poland. (Schwarzman was enraged at the thought of being taxed under the same rules as a Stockton police officer.)

Blackstone’s other co-founder is Pete Peterson. He’s the billionaire who’s financing much of today’s phony deficit hysteria through shell organizations which promote government cuts rather than tax increases for people like him.

Foreclosure.Com’s contest is a trivial exercise from a small company, but it reflects the misguided values that corporations have spent decades building up through public relations campaigns. And Peterson’s equally cynical efforts have succeeded on a much grander scale, driving our misguided national debates about “fiscal cliffs” and austerity economics.

Peterson and his peers, both large and small, are laboring to reshape our thinking and our values to suit their cynical self-interest.

“Feeders”

That’s the thinking behind the corporate takeover of education. JPMorgan Chase, for example, is financing a $30 million technology center at Syracuse University.

“The Technology Center will bring together students, faculty and JPMorgan Chase employees,” said the school’s Chancellor, “who will work side-by-side to pool their intellectual capital to make a difference in industry, higher education and our region.” The university’s website explains:

“Realizing that it needed a pipeline of technologists who could thrive in such a multifaceted, integrated environment, JPMorgan Chase began looking for a partner—a like-minded university …”

The center offers student internships, too, which ads described as a “feeder” for Chase IT jobs. At least they’re paid internships, which makes them less exploitative than other internships. But the jobs they lead to may not exist much longer, at least in this country.

What are the social implications of an educational system in which universities become “pipelines” to morally-compromised corporations? Universities should help students develop the skills and talents needed to create the jobs of the future, not serve as “feeders” for the corporate jobs of the present – or the past.

This degree was brought to you by …

These corporate relationships can quickly turn universities into product placement schemes, as when JPM execs were featured at a university conference on cyber security. (Prevention of falsified foreclosure documents was not on the agenda.) They also provide big tax breaks – which increase the deficit, Mr. Peterson – and which in this case were used to build a center housing a number of bank employees.

Then there’s the matter of academic integrity. When a Syracuse business professor called Dimon a “hero” of the financial crisis and offered him up as a role model for the financial industry – a remarkable idea, given the bank’s crime spree under Dimon – then, rightly or wrongly, the taint of corporate sponsorship cast a shadow over his academic judgment.

How’s this for product placement? Dimon gave Syracuse’s 2010 commencement address in the school’s Carrier Dome (named after another corporate donor).

Another Speaker in Syracuse

Like Dimon, Dr. Martin Luther King, Jr. once spoke at Syracuse University. But he didn’t speak in a stadium. Instead the Nobel laureate was relegated to a dining hall, where he addressed a packed crowd and quoted then-President Johnson on the need to move “beyond opportunity to achievement.”

Dr. King proposed a guaranteed minimum income of $3,000 (roughly $22,000 in 2013 dollars) for all Americans. (That may seem like an extreme idea, but Republican President Richard Nixon proposed something similar a few years later – and nearly got it enacted into law.)

Dr. King also proposed a Bill of Rights for the Disadvantaged in his Syracuse address, including the right to free education.

Matrix U.

Education? Free? In the corporate world, education comes at a price – and with strings. A school’s role is not to encourage critical thinking, or deepen our understanding of the world. Instead, as stated bluntly in Mitt Romney’s higher education platform, universities should “get back to basics” with “higher education programs directly related to job opportunities.”

Some might argue that our best and higher selves aren’t fed by bank internships alone, that we need the arts, philosophy, history …  But they disagree. They believe that institutions of learning have no purpose, no reason to exist except to serve as corporate America’s “pipelines” and “feeders.”  Theirs is a Matrix-like vision where universities are breeder machines generating living bodies for a vast corporate machine.

To be young and alive: It’s the time to dream of a better future – for the world, and for yourself, a time to explore the limits of possibility. And to ask yourself that age-old question: Buy, hold, or flip?

The Contest

The real contest isn’t an essay question. It’s a struggle over our values and ethics, over the ways we think and the lenses through which we view our world.  Since Dr. King gave his Syracuse speech we’ve become vastly more unequal in income. Higher education has become unaffordable for millions of young people. Prosperity is shrinking, not expanding.

Dr. King spoke to his Syracuse audience of “the day when the fears of insecurity, the doubts clouding the future, will be transformed to radiant confidence, into glowing excitement to reach creative goals, and into an abiding moral balance … undergirded by a secure and expanding prosperity for all.”

And yet today millions of homeowners live in fear of foreclosure. A day filled with confidence, excitement, creativity, moral balance? Prosperity for all? Not if corporations are calling the shots at institutions like Syracuse University.

People were outraged that AIG’s board of directors considered suing its own rescuers last week. As a former AIG employee, I had a slightly different take on that story: The outrage was warranted (and Warren-ted), but there was somebody behind the scenes pulling the strings.

And there was a kernel of truth to their complaint. We talked about it with Thom Hartmann last week on his TV show:

Click here to view the video on YouTube.