Page 18


MORE DEREGULATION? Let’s flip back for a second to the assets that the RTC keeps, when an NCNB takes over $105 million of deposits in Galveston. Those assets are on the back of all of us as taxpayers. And because in its infinite wisdom, Congress wanted a lean, mean RTC most of whose work would be contracted out to the efficient private sector these foreclosed assets that are in the public sector are kind of a new carcass around which a lot of buzzards from the legal profession, the accounting profession, and the appraisal profession, are going to eat on for a considerable amount of time. Again, the RTC has not been a smart negotiator in dealing with these bum assets. Many of them have been sold off at 30, 40, 50 cents on the dollar. The cheaper they’re sold and the faster they’re sold, the bigger the bill for the taxpayer. In a lot of ways, what the RTC has done this year is kind of a dress rehearsal for what’s going to happen next year with the big deregulation package. The chorus of criticism in Washington is that RTC is moving too slow. There’s a lot of red tape holding up these deals and we need to cut through it and make it easier for acquirers to take over these tanked S&Ls. Well, the fact is that the real problem for the RTC is that it is giving away too much. Just like Danny Wall did. The argument next year will be on the same kind of theme but on a much grander scale. We’ll hear, over and over, that in order to infuse more money into the banking system and make it globall competitive, we just have to cut back on the ground rules under which the system operates. The third point is about organizing. The press has kind of belatedly discovered that the S&L scandal is a story that they ought to have been covering. It’s really irritating to get a stream of phone calls from reporters who say “Gee, I guess the public is waking up to this stuff now.” The fact is the public woke up to this a long time ago. We’ve done scores, hundreds of talk shows around the country on this. People ordinary people, not political activists, not folks who define themselves as hard line Democrats and Republicans ordinary semi-political people are outraged about this and ready to move. We did a Donahue show on this last year and received 10,000 phone calls to our 800 number within a week which the Donahue people say is an unprecedented response to any show they’ve ever done. The people who took in those phone calls \(and these are people who have some sense of political getting are not from the usual suspects. They were from older people, smaller towns, a lot of Republicans. From an organizer’s point of view, that is tremendously hopeful. At the Financial Democracy Campaign, which is these hundreds of organizations ranging from AFSCME, and the Communications Workers, and the SEIU to Citizen Action, ACORN to Church Women United, to black chambers of commerce in Los Angeles and San Francisco to the Family Farm Coalition, we’re trying to say, “If wehave a bailout, let’s make it a fair bailout.” Let’s let the super-rich who have won so much already at the table of financial speculation, and the financial firms who caused this bailout and benefited from it let’s let them bail themselves out. There are many ways to do that. There are little ways, like having the government create a recapture mechanism that would let the public share in the appreciation of assets that are now being bought up for 40 and 50 and 60 cents on the dollar, two years from now, or six years from now, when Texas gets healthy and those assets are worth $1.40 on the dollar. Then there are bigger ways, like a surtax on the richest 1 percent of the people in the country. If you had a 10-percent surtax on taxpayers whose incomes exceed $200,000 dollars, you could pay off a very large portion of the bailout if the bailout were not another deceptive and lunatic exercise in borrow, borrow, borrow, but instead a straightforward way of saying, “Listen, we’ve got this problem, we’ve got to pay for it now.” Instead of sticking it onto our children and their children. We in the campaign think that there needs to be some real financial reform. First off, so that this kind of debacle doesn’t occur again, we obviously need a safer, sounder system. And secondly, because even a safer and sounder system doesn’t necessarily guarantee a more responsive system with lower real interest rates, [we need] a system that serves the real economy of jobs and production, a system that promotes widespread ownership of the country’s resources including ownership of the financial institutions themselves, and a system that gives citizens much more power over their own counting houses. We want to invite you to work with us in the campaign. The Other Summit Reclaiming RTC Land BY JO CLIFTON Houston IX FEDERAL AGENCIES are routinely ignoring environmental protection regulations while administering “the world’s largest debt relief program,” according to Rick Lowerre, a lawyer with the Texas Center for Policy Studies. That relief program, of course, is the savings and loan bailout, currently projected to cost taxpayers $500 billion dollars. The agencies are the Federal Deposit Insurance Jo Clifton is an Austin-based freelance writer. 8 AUGUST 31, 1990 the Treasury Department, and the Federal Reserve Board. Because of land speculation, such as that which occurred in the Texas Hill Country in the late 1970s and early 1980s, and the subsequent bust, many savings and loans have gone under. As a result, the RTC has acquired millions of acres of land all over the country. Lowerre estimates at least 30 percent of the RTC’s land in Texas is completely undeveloped. The situation presents both a great opportunity and a great potential for disaster, depending on whether these federal agencies enforce laws such as the federal Endangered Species Act. During the ’70s and ’80s, Lowerre said, environmentalists started paying attention to decisions of the World Bank, putting pressure on the bank to fund only environmentally sound projects. For eign countries were encouraged to swap wilderness areas for debt. Now we need to turn our attention to the same sort of possibilities in the United States.. Playa del Rio in South Texas was scheduled for development as a beach and recreational community. It is also the habitat for the endangered jaguarundi and other threatened species, Lowerre said. The FDIC is now left holding this property. If a permit to fill the wetlands is granted, the land will be worth $30 million. Without that permit, the land may only be worth $10 million to $15 million, according to Lowerre. Of course, the filling of the wetlands will mean ecological disaster for the area. But due to economic pressures, the FDIC wants to ignore federal regulations which would prohibit such action, he said.