Kickin' Off the New Year

January — with Congress in recess for most of the month, post New Year hangovers, and December spending sprees to recover from — is often a quiet month for economic policy and organizing. But, the first month of UFE's 15th anniversary proved to be something of a departure from the typical slow drip of news to start the year.

To begin, our thoughts are with the people of Haiti, and our hope is that the attention of the world will remain after the rubble is cleared, leading to solutions to the crippling inequality in the poorest nation in our hemisphere. While the earthquake was an unpreventable natural disaster, the impact was multiplied by entrenched poverty and economic deprivation — which are man made and can be cured.

In our own country, the influence of money — and the political agenda of those who have it — has gained an even stronger foothold with the Supreme Court's landmark decision to reverse long-standing precedent and allow unchecked corporate spending on elections. UFE is standing with thousands of individuals and organizations in demanding action to return democracy to the people.

Pundits across the political spectrum reacted to the special election in Massachusetts as if it was the defining election of our lifetime. But as it turns out, Scott Brown's victory was neither a referendum on healthcare reform nor the death knell for all varieties of progressive policy priorities that we were told it was. When polled about their votes, the people of Massachusetts said that more than anything else, the election was about the demand for results from elected officials in dealing with the state of the economy, and about the personalities and campaigns of the two candidates.

Contrasting with Massachusetts, coverage of two statewide referendums on progressive taxation in Oregon (see Article 3) has been rather muted. With actual policy rather than individual candidates on the ballot, this historic victory for progressive taxation offers a clear lesson: voters want policy solutions to the Great Recession that benefit struggling Americans, not the already wealthy. Some of the Obama administration's initial proposals — like new fees on the biggest banks — are a good start, but much more is needed (see Article 2).

Lastly, we lost a brilliant historian and activist in January with the passing of long-time friend of UFE Howard Zinn. We honor his life and work, and will always strive to challenge the influence of concentrated power through education and organizing.

The beginning of our 15-year anniversary did indeed get off to a busy start. See the stories below for more details about our work this January.

The Battle for Consumer Protections

An out-of-control financial industry brought our economy to its knees. Protecting consumers from the loan sharks and gambling addicts on Wall Street will also prevent the same disaster in the future. That's why we need a strong Consumer Financial Protection Agency.

In December, the US House of Representatives passed a financial reform bill, which includes the establishment of a Consumer Financial Protection Agency (CFPA) — the "lite" version of one, anyway. Now the issue is on the Senate's doorstep, and the prospects for an independent CFPA aren't so great. Sen. Banking Committee Chair Chris Dodd, once thought to be a hard-nosed critic of the banking industry, has indicated he is willing to drop the CFPA on the condition that a consumer protection division is created in an existing federal agency.

We are not giving up on a strong CFPA without a fight. UFE's Responsible Wealth project is looking for the voices of retired or current businesspeople, business owners and investors to join a campaign for Congress to create an independent CFPA as part of overall financial reform.

A CFPA with real policing authority over banks is essential to the financial security of small businesses and individuals across the country. It would protect consumers from unfair and deceptive products and services, and would hold lenders accountable for what they're selling. It's time for the financial industry to take responsibility for what they've been peddling.

If you are a businessperson, business owner or investor, please join us and sign our letter to the Senate today.

Oregonians Vote for the Common Good

UFE commends the voters of Oregon, Vote Yes for Oregon, and TFOC members, Our Oregon and Tax Fairness Oregon on an historic victory for progressive taxation.

Why was the recent statewide referendum in Oregon so important? There are a few reasons, but let's start with a little context. The Beaver State, like so many others, is dealing with a sizeable budget deficit, theirs amounting to $727 million.

On the ballot this month were Measures 66 and 67, which, respectively, called for a modest tax increase for high-income individuals and couples, and an increased corporate minimum tax and new top corporate income tax rate. Measure 66 will only affect 2.5% of Oregon taxpayers, and under Measure 67, 97.5% of businesses will either owe no more than they currently do, or will only pay an additional $140 per year.

Revenue from these taxes will prevent what were inevitable cuts to public education, health and human services, and public safety — all of which serve the common good of the state. These cuts would have in some way impacted each and every Oregonian.

Now, back to why this was so historic.

For starters, the state hasn't voted to approve a general tax increase for nearly 80 years. The last time they did was in 1930, when Oregonians enacted the state's income tax. Additionally, the passage of these measures has opened the doors for Oregon to advance an overall more progressive tax agenda.

Gov. Ted Kulongoski wants his state to stop "budgeting from crisis to crisis." He now has his sights set on reversing Oregon's highly regressive "kicker" law, which would allow budget surpluses to be saved, rather than rebated, in order to better preserve the common good in future economic whirlwinds.

State of the Dream 2010

UFE's much-anticipated, seventh annual Martin Luther King, Jr. Day report was released earlier this month. State of the Dream 2010: Drained — Jobless and Foreclosed in Communities of Color delves into our country's racial economic divide in the wake of the Great Recession, and finds that the way out of crisis is through a targeted policy approach focusing on communities most heavily impacted by unemployment and foreclosure.

This year's report has garnered an extraordinary level of media attention (see below), duly so, as communities of color nationwide are dealing with the brunt of this recession, and have stood in line long enough. We will be working with partners in key cities across the country to raise community awareness of the systemic roots of this issue and to advocate for the sensible policies that will help reverse this trend.

Visit our website for a free download of Drained today. To reserve your hard copy of the report, contact Anneka Landgraf at 617-423-2148 x100 or alandgraf@faireconomy.org.

Media Highlights:

Bob Herbert cites UFE's State of the Dream 2010 in his The New York Times column on how well, or poorly, we as a nation uphold Dr. King's campaign for economic justice.

Dion Haynes mentions both State of the Dream 2010 and a new study by the Economic Policy Institute as he highlights the current dire circumstances for Black communities in this article in The Washington Post.

Profile of State of the Dream 2010 by Daniela Perdomo on AlterNet.

UFE board member and State of the Dream co-author, Ajamu Dillahunt, advocates for a fair jobs policy in this Huffington Post op-ed.

Common Dreams op-ed by UFE board member and State of the Dream co-author Mike Prokosch, sharing his views on recent megabank bonuses in light of persisting unemployment and foreclosures.

Addressing Corporate Mischief from Within

Responsible Wealth's (RW) 2010 Shareholder Actions are off to a great start with two successes before the close of the year's first month.

Earlier this month, State Street Global Advisors responded amicably to a resolution filed by RW with Walden Asset Management, calling for the financial firm to accept greater proxy voting responsibility. In the past, State Street automatically dismissed any shareholder resolution pertaining to social and environmental issues. Now, they are committing to vote in favor of those making a strong case for how shareholder values can be jeopardized.

Another resolution at microchip giant, Intel, put the brakes on the company's intent to hold online-only shareholder meetings. RW and Walden argued that in-person meetings are the only way to generate meaningful dialogue about shared concerns amongst shareholders, and for company management to be held accountable by shareholders.

Stay tuned this year for updates on RW's other shareholder resolutions, which will address executive compensation, shareholder meetings, proxy voting policies and board diversity.

Estate Tax in Limbo

The Senate failed to extend the estate before the end of the year. Because of their outrageous and fiscally irresponsible failure to act, the estate tax has disappeared for one year starting Jan. 1, 2010.

UFE supporters did their part. People like you called the Senate and spoke to the media to express their support for a strong estate tax.

Tamara, an estate tax supporter from Washington, wrote to Congress, reminding them of its importance:

"[The] estate tax is a crucial element of empowering the government to serve the people. Particularly in a time of economic recession, the U.S. needs the funds generated by the estate tax to serve the needs of the living — the middle class who work so hard to make our country strong. The revenue generated by this tax is significant and important to the government's commitments to education, equitable health care, and the development of clean energy sources. Please keep the majority of your constituents in mind as you vote on estate tax issues. A $7 million exemption is more than sufficient for wealthy families. A tax of 55% or higher on the remainder is more than fair."

Tamara has it exactly right, and Congress will need to take action, although it's still unclear when — or if — the Senate will vote on either a temporary "patch" for 2010 or a permanent estate tax law. One possibility is that the estate tax "patch" might be part of the "extenders" package of tax cuts. We will keep you informed as the situation develops in Congress and your calls and support for the most progressive estate tax possible make a difference. Stay tuned...

For more information on how to be involved in the fight for a strong estate tax contact Lee Farris.

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