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WHAT YO U CAN DO Write your Congressional representatives and tell them that you won’t stand for average taxpayers being forced to bail out banks and S&Ls. Contact three friends, tell them what you’ve learned about the bailout, and ask them to write their representatives. Write a letter to the editor of your local paper and call radio talk shows to voice your concern. Organize a town meeting on the S&L and banking bailouts and invite members of Congress to attend. Prepare and release a scorecard with the help of the national FDC office on how your state’s Congressional delegation voted on recent financial issues. Get on the FDC mailing list by writing the Financial Democracy Campaign, 604 W. Chapel Hill St., Durham, NC 27701. did nothing to cause the collapse of the S&Ls. What’s more, the depositors benefiting the most from the bailout would be some of wealthiest. According to a Southern Finance Project study, the 54 largest failed S&Ls in 1988-89 had an average account size of $408,000. At seven of those thrifts, the average size exceeded $1 million. By contrast, most Americans had less than $10,000 in savings. The campaign called for an alternative way of funding the bailout, levying a surtax on wealthy individuals who earned substantial income from interest. It also proposed a one-time fee on finanCial firms that contributed to S&L insolvencies. The coalition called for tough regulations on the industry much tougher than Bush’s proposal. And it insisted Congress should fund the bailout without selling longterm bonds, which would force future generations of working Americans into debt. The only people who would profit from those longterm bonds would be the wealthy bondholders, the campaign argued. When the Bush plan came before Congress, the FDC contacted its member groups, who lobbied Congress, rang doorbells, talked on the radio, staged protests. But the financial industry lined up squarely behind Bush’s proposal, opposing attempts even to discuss shifting the burden of the bailout. Jim Grohl, senior vice president for the U.S. League of Savings Institutions, says ordinary citizens are the ones whose savings are being protected by the bailout; they should pay the cost. “The phrase `S&L bailout’ is a misnomer,” he says. “Depositors are the ones who are being bailed out. The money spent to clean up insolvent institutions is going to depositors who had money in those institutions.” The campaign responds that small-time S&L customers didn’t make the business decisions leading to the multibillion-dollar financial scandal. They compare the current bailout plan to forcing the victims of toxic-waste dumping to pay for the clean-up. Despite that argument, the FDC lost on the big issue of who pays for the S&L debacle, as Congress adopted much of the Bush plan. When Congressmen Joseph Kennedy, D-Mass., and Bruce Morrison, D-Conn., tried to raise the “who pays” issue in the House Banking Committee, they were ruled out of order, says Schlesinger. The campaign did score one victory during the 1989 bailout debate. With affordable housing rising out of reach for so many families, the coalition lobbied Congress to include some far-reaching housing measures in the S&L legislation. Partly as a result of those efforts, the bill makes available thousands of foreclosed properties, now owned by the government, to lowand moderate-income buyers. It also tightens up anti-discrimination provisions. But former Texas Agriculture Commissioner Jim Hightower, now the national spokesperson for the Financial Democracy Campaign, calls those housing measures “mild palliatives to the most regressive, expensive piece of corporate welfare legislation ever.” Fanning the Flames FDC organizers see part of their mission as starting “little brushfires” throughout the country. Between 350 and 400 groups from Maine to Hawaii, ranging from the United Mine Workers to the National Rural Housing Coalition, have joined the coalition. Most have simply lent their names in support, but about 50 have become active in the struggle for fairer S&L legislation. The FDC itself maintains offices in Washington and Durham, N. C., with two full-time staff members in each office. Member organizations particularly the Southern Finance Project and the grassroots group ACORN loan about 12 staff members to the campaign. Foundation grants and contributions fund the group’s work. Each of those member groups has a different strategy: In North Carolina, South Carolina, Florida, and Texas, FDC members stood outside NCNB branch offices charging that the bank is one of a handful that have’ picked up collapsed S&I s and banks at “fire-sale” prices. The demonstrators handed out lollipops with the message: “We’re tired of being played a sucker. No more sweet deals for NCNB.” In West Texas, a group of business owners took out advertisements in small-town papers calling for a boycott of NCNB. They claim the bank cut off their credit when it took over failed thrifts. They’ve taken their fight to the Legislature, where Rep. Pete Patterson wants to tax banks like NCNB that make few in-state loans. In Seattle, the “Bucket Brigade” \(as in “don’t bail out the S&Ls with with hundreds of taxpayers. At one meeting, the brigade invited the entire Washington Congressional delegation to face an angry mob. While it fans the brushfires, the Financial Democracy Campaign is also pressing ahead with the next round of the savings-and-loan struggle: convincing Congress that it’s not too late to shift the burden of the bailout away from working Americans. This spring, the House came within 25 votes of passing a measure to spread the bailout over a much shorter timetable. The campaign, which helped develop the measure, believes such a law would set the stage for taxing financial institutions and the wealthy. “The Financial Democracy Campaign really did a lot of research on how much different proposals could cost over 20, 30, 40 years, how much it would save the taxpayers if we didn’t borrow,” says Ken Rivlin, an aide to Rep. Jim Slattery of Kansas, who co-sponsored the measure. “In less than two days, we were able to win the Democratic vote by 2-1. If we had another day, we could have won.” Slattery plans to reintroduce the proposal this fall. The campaign also plans to turn its attention to what could become an even larger bailout: the federal effort to rescue failing commercial banks. At the same time, it will fight a proposed overhaul of the nation’s banking laws, which would make it easier for commercial banks to expand their branches with less government oversight. FDC organizer Marty Leary hopes there will come a time when his group is no longer necessary when the campaign has developed its member groups into effective crusaders for fairer banking laws. He compares his dream to the reality of the environmental movement, which has developed over 20 years into a network of local organizations throughout the country. “It would be nice if the campaign made itself obsolete,” Leary says. “If we make financial watchdogging as routine as environmental watchdogging, I would be happy.” Caldicott in Austin Dr. Helen Caldicott will speak in Austin on Wedensday, Oct. 9, at 6:45 at the Driskill Hotel, 604 Brazos. For information, call 512/469-0431, 472-3662. THE TEXAS OBSERVER 9