Bernie Sanders' war on the banks

The socialist from OWS says withdraw your money from Wall Street

Published October 25, 2011 2:33PM (EDT)

  (AP/Rich Pedroncelli)
(AP/Rich Pedroncelli)

The Occupy Wall Street movement has been accused of being politically incoherent and leaderless, but among its many salutary effects is something that previously existed only in Rush Limbaugh’s worst, oxycodone-detox nightmare: OWS is making an American socialist politician look mainstream.

For two decades, U.S. Sen. Bernie Sanders has been saying much the same things that OWS is saying, but hollering from Capitol Hill not Zuccotti Park. Sanders, whom Vermonters first sent to the House in 1990 and elected to the Senate in 2006, has been talking about corporate greed and the need for national healthcare since he first went to Washington. With his professorial glasses and doughy face and two white tufts of hair, and vaguely working-stiff accent -- part Brooklyn mouthful of marbles, part New England –- Sanders has always operated out of a trench on no-man’s land somewhere between ignored gadfly and Fox News punch line.

Bernie is for all intents and purposes OWS’s man in the Senate -- whether they want one or not. Not one but two online campaigns have been launched to draft him for a presidential run. His epic eight and a half hour filibuster against President Obama’s extension of the Bush tax cuts last December has been published by Nationbooks under the title "The Speech: A Historic Filibuster on Corporate Greed and the Decline of Our Middle Class. "

“Enough is enough!" he cried out at one point "How many homes can you own?" (The answer, if you are Oracle co-founder and third richest American Larry Ellison, is close to infinite.)

If there’s anyone in Washington who actually links Occupy Wall Street from Zuccotti Park into the stream of American politics, it is Sanders. In mid-October he tweeted: "People might want to think about going to your local community bank and withdrawing funds from these large institutions. #ows.” It's an idea Move your Money has been pushing for a while. Now Occupy Wall Street is talking up Nov. 5 as a National Bank Transfer day when people will withdraw funds from the big banks and deposit it in community banks and credit unions.

In an interview with last week, Sanders said he didn't know about the Nov. 5 action when he made his proposal but he says he thinks the idea will catch on.  The single most important thing Americans can do to save the economy, he said,  is break up the biggest banks.

“I think there is a whole lot of anger and mistrust of large financial institutions and Wall Street that caused the terrible, terrible recession. And at the end of the day, after causing millions of Americans to lose their jobs and homes, CEOs are making more than they ever did and on top of that the banks are now charging $5 on debit cards.

“The country’s six largest financial institutions [Bank of America, CitiGroup, JP Morgan Chase, Wells Fargo, Morgan Stanley and Goldman Sachs] now have amassed assets equal to more than 60 percent of our gross domestic product. That is $9 trillion.”

Sanders said that the OWS effect on American politics is providing a vent for previously unfocused anger. “Polls are pretty clear about this. The people of America are concerned not only about the greed and recklessness of Wall Street but also, as the OWS folks have pointed out, about the growing inequality of wealth in America. You’ve got the top 400 Americans owning more wealth than the bottom 150 million Americans. Most folks do not think that is right. You are seeing a growing anger and an understanding that the middle class is collapsing, poverty is increasing, and those elected officials willing to speak to those issues are going to touch a nerve.”

Since 2008, Sanders has been focusing on conflicts of interest and the role of the Federal Reserve in aiding and abetting the banks that ran amok.

“The Fed put 16 trillion into the big banks during the financial crisis,” he said. “The Fed during that period lent out $16 trillion to every major financial institution in this country and wealthy individuals and central banks all over the world. We are saying to the Fed, if you can bail out central banks in the Middle East and Africa, you may want to help small businesses in this country so they can expand and create jobs.”

Last week, he released his summary of a GAO report he’d requested on conflicts of interest at the Fed. In ordinary times, such a report would have landed in the heaps of white paper that get bundled and shredded without reporters beyond the most obscure business journals paying any attention at all.

Bloggers jumped on the report, which found numerous problems at the Fed that create “an appearance of a conflict of interest,” including the policy of the Fed to give banking industry members the power to both elect and serve on the Fed, and the fact that 18 current or former Fed members had received emergency loans during the financial crisis.

Among those named in the report are:

  • Former chairman of the New York Fed Stephen Friedman, who simultaneously sat on the board of directors at Goldman Sachs and owned stock in Goldman, which was actually prohibited under the Fed’s own rules;
  • General Electric CEO Jeffrey Immelt, who was a Fed board director when  the Fed provided $16 billion in financing to GE;
  • Jamie Dimon, CEO of JP MorganChase, who was a sitting Fed board director when the Fed provided his bank with $29 billion in financing to buy Bear Stearns, and also gave the institution an 18-month exemption from risk-based leverage and capital requirements.

“We have to go beyond shining a light,” Sanders said. “We have to say Wall Street caused this recession. We have been trying to come up with a program.”

The concentration of wealth in the top six banks is “a very dangerous situation for this country,” not least because of the way they can buy political power. Sanders says the same banks and their allies spent $5 billion over 10 years in Washington to deregulate Wall Street. That’s a lot of steak and golf.

On Vermont Public TV last week,  Sanders was again talking about the “greed, recklessness and illegal behavior on the part of Wall Street.” He conceded it feels good to have company.  “Yeah I do!” he responded to a question about whether he felt vindicated by the occupation movement.  “It is nice to hear all over this country in hundreds and hundreds of cities people talking about these issues.”

But he said he had no plans to go down to Occupy Wall Street in New York, D.C. or any other city at the moment.

“I’ve been asked. But they are trying not to get involved with elected officials. They want to maintain their grass roots. I think it’s the right thing. And at this point I’m not going down there.”

By Nina Burleigh

Nina Burleigh ( is author of “The Fatal Gift of Beauty: The Trials of Amanda Knox.”

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Bernie Sanders Occupy Wall Street