America’s biggest banks made billions of dollars issuing mortgage-backed securities that helped inflate a real estate bubble. Then when those assets became risky, the big banks were bailed out by the federal government, yet continued to pay sky-high salaries to their CEOs — even as they initiated mass foreclosures and continued to jack up fees for depositors. Now there’s a depositor revolt under way, and customers are moving to smaller local banks and credit unions.
In Los Angeles, a small business owner put out a call on Facebook declaring Saturday, November 5, to be “Bank Transfer Day.” There’s so much public anger at predatory practices of the big banks that her call went viral.
Credit unions — not-for-profit banking co-ops owned by their members — are organizing a welcome for big-bank refugees. In Portland, Northwest Resource Federal Credit Union, not normally open on Saturdays, is offering a breakfast of Voodoo Doughnuts and coffee Nov. 5 from 9 a.m. to noon.
Chase, Citibank, and Wells Fargo are targets, but Bank of America, headquartered in Charlotte, North Carolina, may be the poster child for “banksterism.” It took in $230 billion in bailout funds, while paying its tellers $11.11 an hour and cutting 30,000 jobs. It paid no federal corporate income tax in 2010, while paying its CEO $10 million. And it was the first to announce that starting next year it will charge $5 a month to its bank customers for using their debit cards — if their balances are under $5,000. That’s on top of the 21¢ per transaction that merchants are charged when a customer uses the debit card.
“Too big to fail? We need to shrink this bank down to size,” said Local 483 business manager Richard Beetle.
The move was approved Oct. 18 in a unanimous vote by members. Beetle wouldn’t say the amount being withdrawn, but acknowledged it is in the six figures. [The demonstration, called to protest Bank of America’s foreclosure practices, was organized by We Are Oregon. We Are Oregon is a community organizing non-profit supported by Service Employees International Union (SEIU) that works on unemployment, foreclosure, and economic problems faced by working class people.] Local 483 is moving the money to Advantis Credit Union. The District Council of Trade Unions, a coalition of City of Portland unions, also voted to move its money.
Meanwhile, the City and County of San Francisco are looking at the possibility of a creating a municipally owned bank where government funds would be deposited. Currently, most of their 133 bank accounts are with Bank of America, the San Francisco Business Times reported.
The Oregon Working Families Party has pushed a similar idea in the Oregon Legislature: Instead of storing Oregon tax funds in out-of-state banks, they propose creating a state-owned bank along the lines of the Bank of North Dakota, which would stimulate the state’s economy by making farm and business loans.
Protest campaigns targeting the big banks have been under way since at least late 2009, when the Move Your Money campaign was launched. That campaign’s web site encourages depositors to divest from the nation’s largest Wall Street banks, and it provides a list of local banks and credit unions to choose from.
In March 2010, the AFL-CIO’s community outreach organization Working America launched an online petition campaign. In the “Wall Street: I am not your ATM,” campaign, signers declare “It’s time for banks to be a safe place for our money, not another place to get nickeled and dimed” … and become members of Working America.
In March 2011, a coalition of community organizations launched the Make Wall Street Pay campaign, encouraging people to tally their own damages from the financial crisis, and calling on Congress to make the big banks pay their fair share.
But the Occupy Wall Street uprising, which began in late September, has given the movement new energy. [Donations to the Occupy Wall Street group itself are being deposited in union-owned Amalgamated Bank and in the Lower East Side People’s Credit Union.]
MoveOn.org joined the campaign Oct. 31, calling on members to sign the Move Your Money Pledge instigated by the group Rebuild the Dream. In one day, close to 20,000 people pledged to close accounts with Bank of America, over 9,000 at Chase, 2,500 at Citigroup, and over 13,000 at other big banks.
To crib a line from the movie V for Vendetta: For the big Wall Street banks, the 5th of November may prove to be a day to remember, remember.