"Occupy Wall Street": Approved!

I want to publicly say thank you to the Occupy Wall Street movement. Thank you for not accepting the status quo. Thank you for not assuming there is nothing to be done. Thank you for rattling the cages.
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In the space of less than a month, the Occupy Wall Street movement has gained national notoriety. A new poll out Monday shows that more than half of Americans are aware of the grass-roots campaign pushing back at the outsize profits, bailouts, and influence of the financial sector. That quick rise has plenty of special interests so worried they have resorted to a pathetic yet popular tact: When you feel threatened, work overtime to marginalize the threat before it establishes traction.

Me? I want to publicly say thank you to the Occupy Wall Street movement. Thank you for not accepting the status quo. Thank you for not assuming there is nothing to be done. Thank you for rattling the cages. Much coverage of Occupy Wall Street has cast this as the beginning of something new. That's only partly true. What I find so encouraging is that Occupy Wall Street's more important message is that this marks an end point. An end to just shrugging and putting up with the inequity. An end to patiently waiting for government to get its act together and take steps to reduce the pain felt by millions of Americans who are unemployed, the millions more who are underemployed, and the millions more again who worry that if we indeed slip into a double dip recession they will soon become unemployed. An end to letting Washington just continue further down its dysfunctional dark hole without being called out.

To deride the movement because it has yet to formulate a well-delineated platform says plenty more about the critics than the protestors. Revolutions tend to be messy, especially in the early going. The unholy alliance of much of Congress, K Street and Wall Street that has set the agenda from day one of the financial crisis is simply trying to protect its turf by casting aspersions on the ad hoc nature of the movement to date. I suppose I shouldn't expect anything less. After all, there's no way they could stage a substantive rebuttal based on facts. It is a real shame that the progress that Congress made last year in passing consumer financial reforms are now being blocked by these same interests.

The recent New York Times' report that inflation-adjusted median household income declined 7.6% from June 2009 to June 2011 has garnered much attention. While plenty bad enough, that income drop is really just an emphatic exclamation point to disturbing long-term trend. Adjusted for inflation, median household income has gone no where since the late 1990s. So much for shared prosperity.

As we all know to make up for the lack of income gains, American households borrowed plenty in the '90s and all the way up to the financial crisis. Yet the response to date has been to bail out the banks but offer virtually nothing to overextended homeowners who are hopelessly underwater on homes. Yes, I am well aware of the various federal housing assistance programs that were launched in the wake of the crisis. But they have been failures. And why is that? Well, our federal government thought it would work to craft programs that offered some small incentives to banks to modify mortgages, and then ask the banks if they would like to participate. It was entirely optional! And we're supposed to be surprised that three years in, banks -- after having happily accepting the bailout money -- weren't exactly eager to participate? Please.

And in my opinion there is no greater example of Washington politicians and K Street lobbyists working against our future prosperity than in the treatment of student loan debt. To be clear, this problem existed even before the crisis; families have been taking on crushing debt to help the kids get ahead for a few decades, as the cost of school has far outpaced inflation. It's just come to a painful head now: graduates with no jobs, or low paying jobs are justifiably panicked that they will never be able to get the loans paid off. Meanwhile, many well-meaning parents who only wanted to help their kids by taking out loans for college, are now laid off, or in new jobs that pay less. Yet where's the relief for these borrowers, who took out loans so their kids could compete in the workplace, or better yet, we collectively could compete in the global marketplace? Far from relief, here's what we have: a bankruptcy system that does not allow student loans to be discharged. Many other debts can be discharged, but not student loans. Look, we want a society where everyone strives to repay their debts. That's clear. But to single out education loans as the one type of debt that our system specifically prohibits from standard bankruptcy is flat-out wrong. We bail out the banks, but offer nothing to American families that borrowed to become more educated and competitive?

And more recently we now have the big bank-fee dust-up. Financial reform post-crisis has reduced banks' ability to collect as much fee income. So some banks have responded by announcing plans to roll out new fees to make up for the new restrictions on what they can charge for the old fees. Let's be clear, this isn't a matter of the banks being able to make payroll. What's at stake is the magnitude of their profits. They are piling on new fees to keep their outsize profits up. Sure, that's absolutely fair play in a capitalistic society. But I don't think this country was built on the fee income that gouged the little guy. Banks used to rely more on income from lending money to qualified borrowers, be it businesses or individuals. Today, the financial system seems less interested in being an intermediary in financing a growing economy and more interested in collecting fees that have absolutely no connection to participating in economic expansion. Is that really how low we're going to let the target be set? Occupy Wall Street is issuing an emphatic no. To that, I give a heartfelt, "Approved!"

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