A blog to keep current on MPIRG'S fight for social and environmental justice.

Thursday, January 5, 2012

Why Labor and working people should move their money

As the U.S. economy slowly recovers from its recession nightmare it’s critical that the American people wake up and actively engage in solutions. We have the power to fight against the corporate interests of the institutions that caused this crisis. As average citizens we can choose not to support these financial juggernauts by moving our personal finances into small, local banks and credit unions. There are numerous reasons to move your money from the Wells Fargos and U.S. Banks of the world and this blog series reviews just a handful.

Folks within the labor movement, workers rights supporters, and working people in general should perhaps be the most concerned about supporting the big banks. The financial collapse of 2008-09 was caused entirely by anarchic, out of control banking practices, perpetrated by large banks like JP Morgan Chase, Wells Fargo and US Bank. Many cited this collapse as the worst since the Great Depression; it left thousands of people to finding themselves out of work, in foreclosure, without a retirement savings, and without money to send their kids to college. Working people certainly did not cause this crisis; yet, we are the ones being forced to pay for it.

Shortly after the collapse, Congress enacted the Emergency Economic Stabilization Act of 2008, which appropriated $700 billion to bailout the failing banks. As a result of the bailout, now in 2012, banks are largely seeing record profits; however, by claiming that the country is in dire financial straits, lawmakers argue that ordinary Americans need to tighten their belt, and accept cuts to their wages and benefits. Meanwhile, the high unemployment resulting from lack of investment during bad economic times, further forces workers to accept these concessions or face losing their jobs altogether.

Big banks like JP Morgan Chase, US Bank, and Wells Fargo are literally sitting on billions of dollars that they cannot profitably spend; they’re holding our economy hostage and forcing working people to work harder while only suffering more and more. Credit unions allow customers to have a say in the way their bank is run and their not-for-profit structure ensures that they have the best interests of their customers in mind, not the interests of their shareholder. Average American workers did not cause this financial meltdown and we should not be forced to pay for it. We should refuse to support the institutions that caused it by moving our money out of the big banks and into small, local banks and credit unions.

Written by Tom Raley, MPIRG Campus Organizer

photo courtesy of CBS News

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