Reclaim Democracy!

Restoring Citizen Authority over Corporations

President Reagan’s View on Immigrants and Immigration

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From his final speech as President. The entire transcript from the Presidential Medal of Freedom award ceremony is posted at the Reagan Library.

January 19, 1989: Now, tomorrow is a special day for me. I’m going to receive my gold watch. And since this is the last speech that I will give as President, I think it’s fitting to leave one final thought, an observation about a country which I love. It was stated best in a letter I received not long ago. A man wrote me and said: “You can go to live in France, but you cannot become a Frenchman. You can go to live in Germany or Turkey or Japan, but you cannot become a German, a Turk, or a Japanese. But anyone, from any corner of the Earth, can come to live in America and become an American.”

Yes, the torch of Lady Liberty symbolizes our freedom and represents our heritage, the compact with our parents, our grandparents, and our ancestors. It is that lady who gives us our great and special place in the world. For it’s the great life force of each generation of new Americans that guarantees that America’s triumph shall continue unsurpassed into the next century and beyond. Other countries may seek to compete with us; but in one vital area, as a beacon of freedom and opportunity that draws the people of the world, no country on Earth comes close.

This, I believe, is one of the most important sources of America’s greatness. We lead the world because, unique among nations, we draw our people — our strength — from every country and every corner of the world. And by doing so we continuously renew and enrich our nation. While other countries cling to the stale past, here in America we breathe life into dreams. We create the future, and the world follows us into tomorrow. Thanks to each wave of new arrivals to this land of opportunity, we’re a nation forever young, forever bursting with energy and new ideas, and always on the cutting edge, always leading the world to the next frontier. This quality is vital to our future as a nation. If we ever closed the door to new Americans, our leadership in the world would soon be lost.

A number of years ago, an American student traveling in Europe took an East German ship across the Baltic Sea. One of the ship’s crewmembers from East Germany, a man in his sixties, struck up a conversation with the American student. After a while the student asked the man how he had learned such good English. And the man explained that he had once lived in America. He said that for over a year he had worked as a farmer in Oklahoma and California, that he had planted tomatoes and picked ripe melons. It was, the man said, the happiest time of his life. Well, the student, who had seen the awful conditions behind the Iron Curtain, blurted out the question, “Well, why did you ever leave?” “I had to,” he said, “the war ended.” The man had been in America as a German prisoner of war.

Now, I don’t tell this story to make the case for former POW’s. Instead, I tell this story just to remind you of the magical, intoxicating power of America. We may sometimes forget it, but others do not. Even a man from a country at war with the United States, while held here as a prisoner, could fall in love with us. Those who become American citizens love this country even more. And that’s why the Statue of Liberty lifts her lamp to welcome them to the golden door.

It is bold men and women, yearning for freedom and opportunity, who leave their homelands and come to a new country to start their lives over. They believe in the American dream. And over and over, they make it come true for themselves, for their children, and for others. They give more than they receive. They labor and succeed. And often they are entrepreneurs. But their greatest contribution is more than economic, because they understand in a special way how glorious it is to be an American. They renew our pride and gratitude in the United States of America, the greatest, freest nation in the world — the last, best hope of man on Earth.

 

The Arbitration Gambit: The Corporate Takeover of Our Justice System

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It used to be anybody who forged a banking transaction would end up in deep legal trouble. Not anymore – at least if you’re a banker. You might get fired as four senior Wells Fargo managers were recently. But the police won’t be looking for you.

What’s worse, if you are a victim of the fraud, there maybe little you can do about it, because the corporations have come up with a new legal “get out jail free card”  they can use to insulate themselves from responsibility for a wide variety of crimes in almost any line of business.

The fired Wells Fargo executives were implicated in a scheme in which the bank created up to two million phony accounts in the names of its customers without their knowledge. The company then charged the legitimate accounts of those customers for fees created by the fake ones. This went on for about a decade until it was exposed last year.

Although the bank paid a federal fine, no one at Wells is being prosecuted. The CEO, John Stumpf, retired with  $124 million in stock and other benefits — on top of his generous salary.

The bank did fire 5300 workers who created fake accounts under intense pressure to meet sales goals not achievable through ethical sales practices. Yet the supervising executive in charge of the branches, Carrie Tolstedt, retired at the end of last year after being paid $27 million dollars over the last three years (not including stok bonuses). 

So what about the customers who were defrauded? Although the amount each of them lost was relatively small, usually about $25, many of them are understandably outraged and have sued the bank. Ordinarily, no one could afford to take on a large corporation for a $25 fraud claim. Instead the lawyers for the bank’s victims used a “class action lawsuit” in which they can represent large numbers of clients in a single case.

But buried in the agreement customers signed when they opened their accounts was a phrase stipulating all disputes with the bank would be settled through binding arbitration, in which the parties argue before a supposedly independent arbitrator who makes the decision. The arbitrator’s ruling typically cannot be appealed to a public court.

© Mike Luckovich, Atlanta Journal-Constitution

In practice, arbitration favors the corporation contracting the arbitration firms, since those companies depend on repeat business from their corporate clients. However, the arbitration rules don’t offer any protection from these potential conflict of interests.

The problem for the victims of Wells Fargo’s fraud isn’t just that they are unlikely to get a fair shake in arbitration. They won’t get a hearing at all because almost all of these agreements prohibit any kind of class action. Instead each individual has to bring his or her case on their own. This would mean spending thousands of dollars and huge amounts of time to seek restitution for a $25 theft. And if the arbitrator rules against them, they may be liable for a big bill from their lawyer and the arbitrator.

These binding arbitration agreements have spread like a plague since a pair of Supreme Court decisions in 2011 and 2013. They affect just about any business one does with a large corporation including Amazon, Netflix, Travelocity, eBay and DirecTV, AT&T and countless others.

According to a multipart series on arbitration in the New York Times, the legalization of the binding arbitration gambit was the goal of a “Wall Street-led coalition of credit card companies and retailers.”  In 2011 the Court handed down the first of the two crucial decisions, AT&T LLC v. Concepcion, that made get out of jail free a reality. By that time one of the lawyers who worked with the coalition, John G. Roberts Jr. was the Court’s Chief Justice.

The Roberts Court overturned a California state court decision declaring AT&T’s arbitration agreement an “unconscionable contract” because it exempted  the “party with superior bargaining power” from “responsibility for [its] own fraud.” In doing so, the California court’s decision was in keeping with a centuries-old legal tradition concerning unfair contracts.

But the Supreme Court twisted the meaning of a 1925 federal law that simply established the legal standing of arbitration agreements except as long as they don’t violate the legal standards applicable to contracts in general. Instead, the Court decided the law placed the goal of “efficient, streamlined procedures” to solve disputes ahead of any concerns about fraud.

The lower courts responded by throwing out hundreds of class action suits and the number of cases brought by consumers and small businesses dropped precipitously. Then in a 2013 decision, American Express Company v. Italian Colors Restaurant, the court denied a claim by a restaurant owner that an arbitration clause the company inserted into its credit card contract violated antitrust laws. The dissenters on the court made it clear what this decision  meant: “The monopolists gets to use its monopoly power to insist on a contract effectively depriving its victims of all legal recourse.”

Forced arbitration is also a threat to individual victims of corporate crimes who are not part of class action suits. According to the Times, arbitration has impeded legal redress for people dealing with private schools and colleges, doctors, home construction firms, cemeteries and nursing homes.

Binding arbitration is also becoming common in employment contracts. The Times described the experience of a doctor who sued the medical group that employed her for workplace discrimination. When she showed the company had destroyed evidence, the arbitrator fined the company $1,000 and then billed the doctor $2,000 for the time he spent looking into it. When the arbitrator decided in favor of the employer, the doctor was stuck with a $200,000 legal bill, including $58,000 she owed the arbitrator.

Wells Fargo recently agreed to a $110 million settlement with customers victimized by the phony account scheme. It did so despite having successfully played its get out of jail card in court because its management decided to counter the bad publicity. As the bank’s new CEO Tim Sloan explained, the settlement is “another step in our journey to make things right with customers and rebuild trust.”

With forced arbitration, individual citizens as well as small and medium-sized business are being rendered legally powerless against the hostile corporate takeover of a large part of our civil justice system. But there is a silver lining in all of this. The Supreme Court’s rulings rest on the slender reed of a single law. The federal government could nullify those rulings by enacting a new law making it clear the Federal Arbitration Act does not support “unconscionable” contracts.

Getting such changes passed will not be an easy task in the current political environment. On the other hand, the arbitration gambit also creates an opening for a counter move. This issue affects almost everybody who is not extremely wealthy regardless of their race, religion, class or political belief. They can demand that their representatives fix this law. Regardless of whether or not the fix is enacted,  a broad cross section of citizens will find out who in Washington is working on their behalf and who isn’t.

Jeffrey Kaplan writes from the San Francisco Bay Area

Presidential Debates Should Serve Citizens and Democracy, Not Political Parties

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Why We Should Replace the Commission on Presidential Debates with an Independent Non-partisan Body
presidential debates, debates presidential, obama, romney
Barack Obama and Mitt Romney at 2012 CPD event

Overview
The Commission on Presidential Debates (CPD) sounds like an official body, but in fact it is a private non-profit corporation owned and controlled entirely by Republican and Democratic party operatives. Most of  the CPD budget is provided by for-profit corporations and their lobbying groups. The CPD undermines the interests of Americans in many ways, including:

  1. It deliberately excludes viable independent and third party candidates from participating in even a single debate. (This exclusion is the opposite of the parties’ practice in their own primaries of including all serious candidates.)
  2. It creates restrictive formats with minimal follow-up, and pre-determined topic areas allow the candidates to memorize and recite soundbites to an excessive degree, diminishing substantive debate.
  3. CPD-chosen moderators ask questions that emphasize solely the differences between the two controlling parties and their candidates while ignoring critical issues on which they concur, or at least share disinterest in confronting. See our analysis of the 2000 Bush v Gore debates, for example.

With the 2016 general presidential election fast approaching, it’s time to renew the push for non-partisan debates overseen by a publicly accountable institution.

CPD Documents

Reporting on the Debates

Other Resources on the Debates

So what’s the alternative? A Citizens’ Debate Commission which employs criteria resembling that  proposed by the Appleseed Citizens’ Task Force on Fair Debates. New! See FairDebates.com/

Photo from barackobamadotcom  flickr page

Snuffing Runaway Corporate Power at the Source: Our Money

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“If you don’t like the growth of giant corporations, stop giving them your money,” said Jeff Milchen (Reclaim Democracy’s Executive Director at the time) in 1997. While this does not suggest exercising our power as consumers is sufficient by itself to solve the problem of runaway corporate power, we too often find the importance of our spending choices overlooked or diminished in the work to revitalize democracy. Since most of the world’s largest corporations sell directly to consumers, we certainly do have much to gain by finding opportunities to decentralize power with our own purchases.

Milchen later went on to found the American Independent Business Alliance (AMIBA), a non-profit organization helping communities build vibrant local economies based on independent community-based businesses rather than absentee-owned companies. It also builds a genuine pro-small business / pro-community voice to counter the corporate advocacy of entities like the U.S. Chamber of Commerce, which often pretend to speak for small business. While AMIBA focuses heavily on providing direct support to the community organizations that comprise its indie-week-douglas-quotemembership, it also coordinates two national campaigns each year.

Independents Week is a campaign that occurs the first week of July each year. While AMIBA provides a wide array of templates and support material, the campaign is executed through community organizations and individuals around the country. Independents Week engages citizens in celebrating entrepreneurial spirit and the freedom to control one’s own livelihood, rather than being dependent corporations. It also emphasizes the importance of local ownership and control for communities and affirms citizens’ role in shaping their community’s future.

We encourage readers to recognize both the value of integrating a pro-local business perspective with work to revoke illegitimate corporate power, and make clear that one can be an active advocate for community-based businesses while working to stop corporations from wielding illegitimate power.

Taking advantage of the ready-made tools for Independents Week is one simple step that just might spark interest in more ambitious initiatives, such as starting an Independent Business Alliance to differentiate between the interests of Wall St. and Main St., and help your hometown businesses prevent corporatization of your community.

 

Exxon CEO Now Concerned About Local Fracking Impacts…In His Community

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By Dr. Walter Brasch

Rex W. Tillerson, a resident of Bartonville, Texas, like many of his neighbors was upset with his city council. That’s not unusual. Many residents get upset at their local governing boards. And so they went to a city council meeting to express their concerns that the council was about to award a construction permit.

The residents were upset that the Cross Timbers Water Supply Corp. planned to build a 160-foot tall water tower. That tower would be adjacent to an 83-acre horse farm Tillerson and his wife owned, and not far from their residence. The residents protested, and then filed suit to stop construction. The tower would store water to be sold to companies that needed it for high-volume horizontal fracturing of oil and gas wells, the process known as fracking.

Each well requires three to nine million gallons of water, up to 10,000 tons of silica sand, and 100,000 gallons of toxic, often carcinogen, chemicals. The process of horizontal fracking, about a decade old, to extract oil and gas from the earth presents severe health and environmental problems.

The residents, all of whom are in the visual distance to the water tower, said that construction of the water tower would impact their views. They argued that during construction and after the tower was built, there would be excessive traffic and noise.

Michael Whitten, who represents Tillerson, told the Wall Street Journal his client was primarily concerned about the impact the tower would have upon property values. The plaintiffs bought their homes so they could live in an “upscale community free of industrial properties, tall buildings and other structures that might devalue their properties and adversely impact the rural lifestyle they sought to enjoy,” according to the suit.

Rex W. Tillerson isn’t your typical resident. He’s the CEO and the chairman of the board of ExxonMobil, the third largest corporation in the world, and the company that leads all others in exploring, drilling, extracting, and selling oil and gas. It’s also a company that has had more than its share of political, social, and environmental problems. Tillerson was an engineer when the Exxon Valdez fouled the western shore of the United States in 1989. By 2004, he was the company’s president.

In 2012, Tillerson was given $40.3 million in compensation, including salary, bonus, and stock options, according to Bloomberg News. His company had $453 billion in revenue for the year, and a net income of $45 billion.

When you have that much money, every million or so dollars matters, especially if a large ugly tower impacts not just your view but your quality of life and the value of your property.

Large ugly rigs, the kind that go up when ExxonMobil and other companies begin fracking the earth, also affect the people. The well pads average about eight acres, mostly cut from forests and agricultural areas. Access roads, some of which upset or destroy the ecological balance of nature, need to be built. Other roads receive heavier-than-normal damage because of the number of trucks, often more than 200 a day, that travel to each well site.

As early as 2010, a PennDOT official told the Pennsylvania state legislature that the cost, at that time, to fix the roads was over $260 million. Increased diesel emissions, concentrated in agricultural areas, also affect the health and safety of the people.

The noise from the traffic and from around-the-clock drilling affect the people, causing stress and numerous health issues, according to psychologists Diane Siegmund and Kathryn Vennie, both of whom live in the Marcellus Shale part of Pennsylvania.

When the rigs go up, property values decrease. Banks and mortgage companies are refusing to lend money to families who wish to take out second mortgages or who wish to buy property that has wells on it or is even near a well pad. Insurance companies are not writing policies, even if the homeowner opposes drilling but whose home is near those well pads.

In 2012, Rex W. Tillerson said that opponents of fracking are manufacturing fear, and then laid out a corporate truth when he said that his company has in place “risk mitigation and risk management practices . . . to ensure [oil and gas development] can be developed in a way that mitigates risk—it doesn’t eliminate it, but when you put it into the risk versus benefit balance, it comes back into a balance that most reasonable people in society would say, ‘I can live with that.’”

Thus, the energy industry is telling the people there will be accidents. There will be deaths. There will be health and environmental consequences. But, they are acceptable because “mitigation” allows a corporation to accept errors, injuries, illnesses, environmental destruction, and even death if they believe there is a “greater [financial] good” that outweighs those risks.

It is the same argument that Ford used in the 1970s when it decided not to recall and repair the Pinto because it estimated the cost to pay compensation for injuries and deaths from faulty construction would be significantly less than the cost of a recall.

There is something more about Rex W. Tillerson. He’s proud of his association with the Boy Scouts. He’s a former Eagle Scout and was president of the national Boy Scouts of America. (Both the Boy Scouts and ExxonMobil have their headquarters in Irving, Texas.)

Part of the Scout Oath is to “do your duty to God and your country.” A partial interpretation of that is “by working for your country’s good and obeying its laws, you do your duty to your country.” Within the past six months, ExxonMobil has paid more than $5 million in fines and penalties for not obeying the country’s laws.

The 12th part of the Scout Law is to be reverent. A widely-accepted interpretation of that law, according to Scouting Trail, is: “As a Scout experiences the wonders of the outdoors, stormy weather and calm blue skies, pounding surf and trickling streams, bitter cold and stifling heat, towering trees and barren desert, he experiences the work of God. . . . We need to play the role of steward rather than king—tending and caring for our world instead of taking all we can for our own comfort.”

Protesting the construction of a water tower because it might lower property values, even for selfish purposes, is Tillerson’s right as a citizen. But, destroying God’s world to maximize your profits is not his right.

Guest commentator Dr. Brasch, an Eagle Scout and an award-winning journalist, is the author of 20 books. His latest book is Fracking Pennsylvania, an in-depth investigation of the economic, political, environmental, and health effects of fracking.

NY Times Rails Against Fake Drugs, but Ignores the Role of Corporate Power in Creating the Demand

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by Reclaim Democracy staff
December 3, 2012

a victim of fake drugs? Among the many awful consequences of  many essential pharmaceuticals being priced beyond the reach of those who need them is the proliferation of fake drugs. While some counterfeit drugs are  manufactured by unauthorized producers and simply flout patent law, less scrupulous people are making pills or serums with no active ingredients or even toxic substances.

It’s a deadly problem in need of solutions, so it’s unsurprising the New York Times devoted a recent editorial to “The Problem of Fake and Useless Drugs.”But while the Times editors called for several sensible measures, they did readers a huge disservice by neglecting to mention the primary reason why fake drugs are so prevalent: federal actions that ban market competition, creating artificially high prices that are unaffordable to many who need them.

First, our patent laws grant pharmaceutical corporations long monopolies on essential drugs — even though a majority of the most medically-significant drugs derive from taxpayer-funded research (a situation we described a decade ago, but continues today). These exclusive patents enable companies to charge prices unrelated to costs of research and development or production. *

Further, pharmaceutical corporations routinely employ legal manipulations, illicit non-compete agreements and other tactics to further extend patent monopolies and block production of generic competitors that lower prices.

To make matters worse, federal laws ban importation of drugs or even re-importation of genuine drugs manufactured here. Under the guise of protecting consumers from counterfeit drugs, such laws enable gouging that forces us to regularly pay double or triple the price people pay for identical drugs in other nations, driving the demand for cheap counterfeits.

Of course, when privately-funded research yields an important new drug, the creators should be able to reap significant rewards in order to create strong incentives for real research and development. The trouble is, our present patent system rewards political power above innovation.

And when drugs are developed with publicly-funded research, we should contract private companies to produce them at a fair profit, not give away rights to valuable public property.

We’ve been thrilled to see the Times editors call for amending the Constitution twice in recent months to revoke the runaway political power of corporations, in recent months. This excessive power over agencies that purportedly serve the public underlies the tragedy of fraudulent drugs and the lives they claim.

The  arguments by the NY Times editors, and those made by all who call to revoke corporate personhood, will possess more power if they make such real-life impacts clear.

* See, for example, the current controversy over the AIDS drug Norvir.

Sources for further reading on this topic:

image courtesy bayat