Arianna Huffington: Move Your Money: A New Year's Resolution
Tom Davos
Arianna Huffington: Move Your Money: A New Year's Resolution
Too-big-to-fail banks are profiting from bailout dollars and
government guarantees, and growing bigger. Tell us which community
bank you use, and why.
Last week, over a pre-Christmas dinner, the two of us, along with
political strategist Alexis McGill, filmmaker/author Eugene Jarecki,
and Nick Penniman of the HuffPost Investigative Fund, began talking
about the huge, growing chasm between the fortunes of Wall Street
banks and Main Street banks, and started discussing what concrete
steps individuals could take to help create a better financial
system.
Before long, the conversation turned practical, and with some help
from friends in the world of bank analysis, a video and website
were produced devoted to a simple idea: Move Your Money.
The big banks on Wall Street, propped up by taxpayer money and
government guarantees, have had a record year, making record profits
while returning to the highly leveraged activities that brought our
economy to the brink of disaster. In a slap in the face to taxpayers,
they have also cut back on the money they are lending, even though
the need to get credit flowing again was one of the main points
used in selling the public the bank bailout. But since April, the
Big Four banks -- JP Morgan/Chase, Citibank, Bank of America, and
Wells Fargo -- all of which took billions in taxpayer money, have
cut lending to businesses by $100 billion.
Meanwhile, America's Main Street community banks -- the vast majority
of which avoided the banquet of greed and corruption that created
the toxic economic swamp we are still fighting to get ourselves out
of -- are struggling. Many of them have closed down (or been taken
over by the FDIC) over the last 12 months. The government policy
of protecting the Too Big and Politically Connected to Fail is badly
hurting the small banks, which are having a much harder time competing
in the financial marketplace. As a result, a system which was already
dangerously concentrated at the top has only become more so.
We talked about the outrage of big, bailed-out banks turning around
and spending millions of dollars on lobbying to gut or kill financial
reform -- including "too big to fail" legislation and regulation
of the derivatives that played such a huge part in the meltdown.
And as we contrasted that with the efforts of local banks to show
that you can both be profitable and have a positive impact on the
community, an idea took hold: why don't we take our money out of
these big banks and put them into community banks? And what, we
asked ourselves, would happen if lots of people around America
decided to do the same thing?
Our money has been used to make the system worse -- what if we used
it to make the system better?
Everyone around the table quickly got excited (granted we are an
excitable group), and began tossing out suggestions for how to get
this idea circulating.
Eugene, the filmmaker among us, remarked that the contrast between
the big banks and the community banks we were talking about was
very much like the story in the classic Frank Capra film It's a
Wonderful Life, where community banker George Bailey helps the
people of Bedford Falls escape the grip of the rapacious and predatory
banker Mr. Potter.
It was a lightbulb moment. And, unlike the vast majority of dinner
conversations, the excitement over this idea didn't end with dessert.
It actually led to something -- thanks in great part to Eugene and
his remarkable team, who got to work and, in record time, created
a brilliant, powerful, and inspiring video playing off the It's a
Wonderful Life concept. Watch it below.
Within a few days, the rest of the pieces fell into place, including
an agreement with top financial analysts Chris Whalen and Dennis
Santiago, who gave us access to their IRA (Institutional Risk
Analytics) database. Using this tool, everyone will be able to plug
in their zip code and quickly get a list of the small, solvent Main
Street banks operating in their community.
The idea is simple: If enough people who have money in one of the
big four banks move it into smaller, more local, more traditional
community banks, then collectively we, the people, will have taken
a big step toward re-rigging the financial system so it becomes
again the productive, stable engine for growth it's meant to be.
It's neither Left nor Right -- it's populism at its best. Consider
it a withdrawal tax on the big banks for the negative service they
provide by consistently ignoring the public interest. It's time for
Americans to move their money out of these reckless behemoths. And
you don't have to worry, there is zero risk: deposit insurance is
just as good at small banks -- and unlike the big banks they don't
provide the toxic dividend of derivatives trading in a heads-they-win,
tails-we-lose fashion.
Think of the message it will send to Wall Street -- and to the White
House. That we have had enough of the high-flying, no-limits-casino
banking culture that continues to dominate Wall Street and Capitol
Hill. That we won't wait on Washington to act, because we know that
Washington has, in fact, been a part of the problem from the start.
We simply can't count on Congress to fix things. We have to do it
ourselves -- and the big banks are the core of the problem. We need
to return to the stable, reliable, people-oriented approach of
America's community banks.
So watch Eugene's amazing video, then go to www.moveyourmoney.info
to learn more about how easy it is to move your money. And pass the
idea on to your friends (help make this video -- and this idea --
go viral!).
JP Morgan/Chase, Citi, Wells Fargo, and Bank of America may be "too
big to fail" -- but they are not too big to feel the impact of
hundreds of thousands of people taking action to change a broken
financial and political system. Let them gamble with their own
money, not yours. Let's turn big banks into smaller banks. We'll
all be better off -- and safer -- as a result.
Make it your New Year's resolution to move your money. We can't
think of a better way to start 2010.
WATCH:
Too-big-to-fail banks are profiting from bailout dollars and
government guarantees, and growing bigger. Tell us which community
bank you use, and why.
UPDATE -- Credit Unions: Some commenters have written us suggesting
that we also include credit unions. Like the FDIC for banks and
thrifts, the National Credit Union Administration insures the
deposits of credit unions and is a good resource for financial data
on specific institutions. Credit unions do not disclose financial
data in the same way as FDIC-insured banks. As a result, credit
unions are not presently included in the IRA ratings database, which
covers over 8,000 federally insured banks and thrifts. IRA is
developing a method to rate credit unions in a way that is comparable
to the IRA bank stress ratings. We'll be updating users of "Move
Your Money" on this issue early in 2010.
For more info, go to: www.moveyourmoney.info