Arianna Huffington and Rob Johnson
Posted: December 29, 2009 06:02 PM
Too-big-to-fail banks are profiting from bailout dollars and government guarantees, and growing bigger. Tell us which community bank you use, and why.
Last week, over a pre-Christmas dinner, the two of us, along with political strategist Alexis McGill, filmmaker/author Eugene Jarecki, and Nick Penniman of the HuffPost Investigative Fund, began talking about the huge, growing chasm between the fortunes of Wall Street banks and Main Street banks, and started discussing what concrete steps individuals could take to help create a better financial system. Before long, the conversation turned practical, and with some help from friends in the world of bank analysis, a video and website were produced devoted to a simple idea: Move Your Money.
The big banks on Wall Street, propped up by taxpayer money and government guarantees, have had a record year, making record profits while returning to the highly leveraged activities that brought our economy to the brink of disaster. In a slap in the face to taxpayers, they have also cut back on the money they are lending, even though the need to get credit flowing again was one of the main points used in selling the public the bank bailout. But since April, the Big Four banks -- JP Morgan/Chase, Citibank, Bank of America, and Wells Fargo -- all of which took billions in taxpayer money, have cut lending to businesses by $100 billion.
Meanwhile, America's Main Street community banks -- the vast majority of which avoided the banquet of greed and corruption that created the toxic economic swamp we are still fighting to get ourselves out of -- are struggling. Many of them have closed down (or been taken over by the FDIC) over the last 12 months. The government policy of protecting the Too Big and Politically Connected to Fail is badly hurting the small banks, which are having a much harder time competing in the financial marketplace. As a result, a system which was already dangerously concentrated at the top has only become more so.
We talked about the outrage of big, bailed-out banks turning around and spending millions of dollars on lobbying to gut or kill financial reform -- including "too big to fail" legislation and regulation of the derivatives that played such a huge part in the meltdown. And as we contrasted that with the efforts of local banks to show that you can both be profitable and have a positive impact on the community, an idea took hold: why don't we take our money out of these big banks and put them into community banks? And what, we asked ourselves, would happen if lots of people around America decided to do the same thing? Our money has been used to make the system worse -- what if we used it to make the system better?
Everyone around the table quickly got excited (granted we are an excitable group), and began tossing out suggestions for how to get this idea circulating.
Eugene, the filmmaker among us, remarked that the contrast between the big banks and the community banks we were talking about was very much like the story in the classic Frank Capra film It's a Wonderful Life, where community banker George Bailey helps the people of Bedford Falls escape the grip of the rapacious and predatory banker Mr. Potter.
It was a lightbulb moment. And, unlike the vast majority of dinner conversations, the excitement over this idea didn't end with dessert. It actually led to something -- thanks in great part to Eugene and his remarkable team, who got to work and, in record time, created a brilliant, powerful, and inspiring video playing off the It's a Wonderful Life concept. Watch it below.
Within a few days, the rest of the pieces fell into place, including an agreement with top financial analysts Chris Whalen and Dennis Santiago, who gave us access to their IRA (Institutional Risk Analytics) database. Using this tool, everyone will be able to plug in their zip code and quickly get a list of the small, solvent Main Street banks operating in their community.
The idea is simple: If enough people who have money in one of the big four banks move it into smaller, more local, more traditional community banks, then collectively we, the people, will have taken a big step toward re-rigging the financial system so it becomes again the productive, stable engine for growth it's meant to be. It's neither Left nor Right -- it's populism at its best. Consider it a withdrawal tax on the big banks for the negative service they provide by consistently ignoring the public interest. It's time for Americans to move their money out of these reckless behemoths. And you don't have to worry, there is zero risk: deposit insurance is just as good at small banks -- and unlike the big banks they don't provide the toxic dividend of derivatives trading in a heads-they-win, tails-we-lose fashion.
Think of the message it will send to Wall Street -- and to the White House. That we have had enough of the high-flying, no-limits-casino banking culture that continues to dominate Wall Street and Capitol Hill. That we won't wait on Washington to act, because we know that Washington has, in fact, been a part of the problem from the start. We simply can't count on Congress to fix things. We have to do it ourselves -- and the big banks are the core of the problem. We need to return to the stable, reliable, people-oriented approach of America's community banks.
So watch Eugene's amazing video, then go to www.moveyourmoney.info to learn more about how easy it is to move your money. And pass the idea on to your friends (help make this video -- and this idea -- go viral!).
JP Morgan/Chase, Citi, Wells Fargo, and Bank of America may be "too big to fail" -- but they are not too big to feel the impact of hundreds of thousands of people taking action to change a broken financial and political system. Let them gamble with their own money, not yours. Let's turn big banks into smaller banks. We'll all be better off -- and safer -- as a result.
Make it your New Year's resolution to move your money. We can't think of a better way to start 2010.
WATCH:
Too-big-to-fail banks are profiting from bailout dollars and government guarantees, and growing bigger. Tell us which community bank you use, and why.
UPDATE -- Credit Unions: Some commenters have written us suggesting that we also include credit unions. Like the FDIC for banks and thrifts, the National Credit Union Administration insures the deposits of credit unions and is a good resource for financial data on specific institutions. Credit unions do not disclose financial data in the same way as FDIC-insured banks. As a result, credit unions are not presently included in the IRA ratings database, which covers over 8,000 federally insured banks and thrifts. IRA is developing a method to rate credit unions in a way that is comparable to the IRA bank stress ratings. We'll be updating users of "Move Your Money" on this issue early in 2010.
For more info, go to: www.moveyourmoney.info
http://www.huffingtonpost.com/arianna-huffington/move-your-money-a-new-yea_b_406022.html?view=print
Sunday, January 3, 2010
Egypt: Rooftops Empower the Poor
Sunday 03 January 2010
by: Cam McGrath | Inter Press Service
Cairo - In one of the poorest and most populous neighborhoods of Cairo, Hussein Soliman and his family live in a small apartment that is a model of clean energy living.
The two solar panels and bio-gas unit on the roof of Soliman's building in Darb El-Ahmar provide hot water and cooking gas to his two-bedroom apartment, reducing his family's carbon footprint and energy costs. The clean energy appliances, made mostly from recycled material, have reduced his household's waste and have meant that "my gas and electricity bills are much less than before," says Soliman. They shaved nearly 50 percent off the utility bills.
Soliman ventured into clean energy in 2008 when he joined Solar CITIES (Connecting Community Catalysts and Integrating Technologies for Industrial Ecology Systems), a development initiative spearheaded by U.S. urban planner Thomas Culhane. The project leverages local experience and innovation to develop cheap and robust clean energy technologies adapted to the rigorous operating environment of Cairo's poorest neighbourhoods.
"There is no 'one size fits all' in development and part of the problem is precisely that so-called 'experts' come in and try to promote products and designs that are inappropriate for the local community," Culhane tells IPS.
Culhane and his German wife, Sybille, have brought on board as innovators the residents of the low-income neighborhoods in which they hope to make the greatest impact. Their designs for solar water heaters and bio-gas digesters have evolved through experimentation, group brainstorming sessions, and "jumping into dumpsters to find materials that might work."
Using recycled materials, Culhane's team was able to put together a solar water heating system for under 500 dollars. The system's solar panels are built from scrap aluminum, glass, old copper pipes and styrofoam insulation. It uses two recycled 200-litre shampoo barrels as tanks, one for storing the water heated by the panels and the other as a backup water supply.
Solar CITIES has built 35 solar water heaters in Egypt since 2007. Most of the systems, including 30 units built with USAID funding, are installed on rooftops in underdeveloped areas where frequent power and water cuts cause commercial systems to break down. Stacked tanks and a float valve, similar to the type used in toilets, allow the water heaters to overcome the water pressure fluctuations that lead to failures.
"It took a lot of experimentation because we had to find placements for cold and hot water input and output that would balance the changing flow rate, opening the float valves at the right time," Culhane says.
After a year of operation, Soliman says the only maintenance his homemade solar water heater has required is a twice-weekly washing of the panels to remove the dust buildup.
"The panels heat the water, which pipes carry down to the kitchen and shower," he explains. "We only need electricity to heat water in the winter, and only if we're using it after midnight."
The bio-gas digester that Soliman assembled on his roof - one of eight built by the Solar CITIES project - converts organic garbage into cooking gas. Moldy bread and table scraps are soaked in water overnight, then poured into a 1,000-litre plastic tank to decompose. A pipe carries the gas to a burner in the kitchen, while a spigot drains the effluent, which Soliman sells as organic fertiliser to upscale garden shops.
"I can use any organic waste from our kitchen to create gas," Soliman explains, while pouring a bucket of organic slurry into the tank's intake pipe. "The digester provides one hour a day of gas in winter, and two hours in summer."
The bio-gas unit's capacity for processing organic waste has taken on added value since the Egyptian government's decision last year to cull the country's pig population. Rotting heaps of kitchen waste, previously fed to hogs, have created a health hazard.
"My garbage man kisses me because I have the cleanest garbage on the block," Soliman boasts.
Moustafa Hussein, a career counselor for a local community development project, joined the Solar CITIES project in 2007 after a chance encounter with Culhane that sold him on the idea. The solar water heater he built on the roof of his apartment in Darb El-Ahmar provided hot water for his family until the dilapidated building collapsed three months ago.
His belief in the project unshaken, Hussein is now building another solar water heater, which he hopes to install on the roof of the temporary government housing where he now lives. He also wants to build a bio-gas unit.
"I'm planning to collect the organic waste from restaurants in the neighborhood to increase my gas output," he says. "I'll give the restaurants plastic bags and they can separate out the organics, and I'll collect the bags at the end of each day."
The biggest obstacle to any project in impoverished neighbourhoods is economics, says Hussein. Most area residents subsist on less than two dollars per day, and credit is difficult to obtain.
"It's hard to convince people here to invest in clean energy," says Hussein. "As a household why should they invest up to 1,000 Egyptian pounds (182 dollars) in bio-gas when it costs just six or seven for a butagas cylinder, which lasts two weeks and is much easier to handle?"
Due to Egypt's heavily subsidised gas and electricity, it may take up to 15 years to recover the costs of a Solar CITIES solar water heater or bio-gas digester. The cost recovery time is expected to fall as the government proceeds with plans to phase out energy subsidies in the coming four to seven years.
Hussein says having people who are part of the community involved gives the Solar CITIES initiative more credibility. But the project's success will ultimately depend on whether it can produce a cheap, durable and efficient model for the community.
"If the people see a good example, they will tell each other about it," he says. "Whether it succeeds of fails, everyone will know the same day."
http://www.truthout.org/topstories/010309jr1?print
by: Cam McGrath | Inter Press Service
Cairo - In one of the poorest and most populous neighborhoods of Cairo, Hussein Soliman and his family live in a small apartment that is a model of clean energy living.
The two solar panels and bio-gas unit on the roof of Soliman's building in Darb El-Ahmar provide hot water and cooking gas to his two-bedroom apartment, reducing his family's carbon footprint and energy costs. The clean energy appliances, made mostly from recycled material, have reduced his household's waste and have meant that "my gas and electricity bills are much less than before," says Soliman. They shaved nearly 50 percent off the utility bills.
Soliman ventured into clean energy in 2008 when he joined Solar CITIES (Connecting Community Catalysts and Integrating Technologies for Industrial Ecology Systems), a development initiative spearheaded by U.S. urban planner Thomas Culhane. The project leverages local experience and innovation to develop cheap and robust clean energy technologies adapted to the rigorous operating environment of Cairo's poorest neighbourhoods.
"There is no 'one size fits all' in development and part of the problem is precisely that so-called 'experts' come in and try to promote products and designs that are inappropriate for the local community," Culhane tells IPS.
Culhane and his German wife, Sybille, have brought on board as innovators the residents of the low-income neighborhoods in which they hope to make the greatest impact. Their designs for solar water heaters and bio-gas digesters have evolved through experimentation, group brainstorming sessions, and "jumping into dumpsters to find materials that might work."
Using recycled materials, Culhane's team was able to put together a solar water heating system for under 500 dollars. The system's solar panels are built from scrap aluminum, glass, old copper pipes and styrofoam insulation. It uses two recycled 200-litre shampoo barrels as tanks, one for storing the water heated by the panels and the other as a backup water supply.
Solar CITIES has built 35 solar water heaters in Egypt since 2007. Most of the systems, including 30 units built with USAID funding, are installed on rooftops in underdeveloped areas where frequent power and water cuts cause commercial systems to break down. Stacked tanks and a float valve, similar to the type used in toilets, allow the water heaters to overcome the water pressure fluctuations that lead to failures.
"It took a lot of experimentation because we had to find placements for cold and hot water input and output that would balance the changing flow rate, opening the float valves at the right time," Culhane says.
After a year of operation, Soliman says the only maintenance his homemade solar water heater has required is a twice-weekly washing of the panels to remove the dust buildup.
"The panels heat the water, which pipes carry down to the kitchen and shower," he explains. "We only need electricity to heat water in the winter, and only if we're using it after midnight."
The bio-gas digester that Soliman assembled on his roof - one of eight built by the Solar CITIES project - converts organic garbage into cooking gas. Moldy bread and table scraps are soaked in water overnight, then poured into a 1,000-litre plastic tank to decompose. A pipe carries the gas to a burner in the kitchen, while a spigot drains the effluent, which Soliman sells as organic fertiliser to upscale garden shops.
"I can use any organic waste from our kitchen to create gas," Soliman explains, while pouring a bucket of organic slurry into the tank's intake pipe. "The digester provides one hour a day of gas in winter, and two hours in summer."
The bio-gas unit's capacity for processing organic waste has taken on added value since the Egyptian government's decision last year to cull the country's pig population. Rotting heaps of kitchen waste, previously fed to hogs, have created a health hazard.
"My garbage man kisses me because I have the cleanest garbage on the block," Soliman boasts.
Moustafa Hussein, a career counselor for a local community development project, joined the Solar CITIES project in 2007 after a chance encounter with Culhane that sold him on the idea. The solar water heater he built on the roof of his apartment in Darb El-Ahmar provided hot water for his family until the dilapidated building collapsed three months ago.
His belief in the project unshaken, Hussein is now building another solar water heater, which he hopes to install on the roof of the temporary government housing where he now lives. He also wants to build a bio-gas unit.
"I'm planning to collect the organic waste from restaurants in the neighborhood to increase my gas output," he says. "I'll give the restaurants plastic bags and they can separate out the organics, and I'll collect the bags at the end of each day."
The biggest obstacle to any project in impoverished neighbourhoods is economics, says Hussein. Most area residents subsist on less than two dollars per day, and credit is difficult to obtain.
"It's hard to convince people here to invest in clean energy," says Hussein. "As a household why should they invest up to 1,000 Egyptian pounds (182 dollars) in bio-gas when it costs just six or seven for a butagas cylinder, which lasts two weeks and is much easier to handle?"
Due to Egypt's heavily subsidised gas and electricity, it may take up to 15 years to recover the costs of a Solar CITIES solar water heater or bio-gas digester. The cost recovery time is expected to fall as the government proceeds with plans to phase out energy subsidies in the coming four to seven years.
Hussein says having people who are part of the community involved gives the Solar CITIES initiative more credibility. But the project's success will ultimately depend on whether it can produce a cheap, durable and efficient model for the community.
"If the people see a good example, they will tell each other about it," he says. "Whether it succeeds of fails, everyone will know the same day."
http://www.truthout.org/topstories/010309jr1?print
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