ECAG wants an end to the bailout of big banks!

BY ED FELIEN
published Dec. 8, 08

Kim DeFranco of the Welfare Rights Committee was one of about a dozen demonstrators on Wednesday, Dec. 3, protesting the bailout of big banks.

About a dozen hearty souls, members of the Economic Crisis Action Group (ECAG), gathered in subzero wind chill in front of U. S. Bancorp headquarters in downtown Minneapolis Wednesday, Dec. 3, to protest the misuse of the $6.6 billion given to that bank: Bancorp has spent the money buying up smaller banks instead of helping homeowners facing foreclose to re-finance and stay in their homes.

On Nov. 22, a community meeting of around 80 people met at Walker Church to discuss the current economic crisis and try to understand what it will mean to the most vulnerable in our community.

Karen Redleaf explained in simple terms how speculators gambling on bundles of subprime mortgages were able to bankrupt major commercial banking houses. Jeffrey Skrenes of ACORN talked about how mortgage companies used to redline neighborhoods and generally not grant mortgages in those areas, but before the crash were greenlining those neighborhoods to make loans with adjustable rates, low down payments and many fees.

These mortgages became very profitable to lending institutions, particularly since they could sell them to Wall Street commercial banks and not have to worry about the borrower being able to pay them back. It became a house of cards ready to collapse. Linden Gawboy, on behalf of the Welfare Rights Committee, talked about how the crash and resulting loss of revenue for the State of Minnesota is going to mean major cuts in health and social services. She said, “If they can bail out Wall Street, then they should be able to afford to bail out state governments.” The State of Minnesota is looking at a $5 to $7 billion deficit next year.