Transcript: Thom Hartmann: How a City Thrives or Dies. 11 November '11
If we want to save our economy - we need to go local.
Perhaps the most effective - and most important - trend coming out of the Occupy Wall Street movement over the last month and a half is the flight of customers from big banks on Wall Street to local credit unions on Main Street.
Earlier this month - on Bank Transfer Day - 40,000 Americans took their money out of Wall Street’s coffers and moved it into local credit unions - that’s 40,000 people in one day.
And you can add that to the 650,000 people over the last month and a half who’ve done the same thing - taking over $4.5 billion right out of Wall Street.
That’s more people who joined credit unions in just the last month - than did through ALL of last year.
So who said Occupy Wall Street isn’t having an effect?
And there’s good reason to go local.
Far too many cities across America today look exactly the same.
Their streets are lined with same mega retail stores - the same big banks - and the same corporate chain restaurants.
It’s so bad - that you could be airdropped into any city in America - and have no clue where you are because all the businesses around you look exactly the same.
So much for the local diner - the local clothing store - the local bank - they just could’t compete against these giant transnationals that have come in and eaten up pretty much the every town in America.
This is not how a city thrives - it’s how a city dies.
When local businesses flourish on Main Street - then the money funnels through the entire city.
Profits at the local bookstore or clothing store get put into local banks.
The local banks then lend out to local entrepreneurs - who start more local businesses and who hire more local workers who go out and buy local stuff with their paychecks.
But when transnational giants take over Main Street - the money is no longer cycled through the city.
Instead - like a giant vacuum cleaner - all those profits are sucked out of the city - every night somebody pushes a button and [sucking sound] it all goes off to wherever, it;s deposited wherever the transnational giant’s headquarters are -and increasingly that's in a tax haven like the Cayman Islands.
And these transnational mega corporations, they don't really give a damn about the city in which they’re setting up shop - it’s merely a place to hire some cheap labor and extract some profits, make some sales.
And in some cases - corporations even contribute to the bankruptcy of communities.
Take what happened in Jefferson County, Alabama.
The county was forced to file bankruptcy - in fact, it was the largest-ever municipal bankruptcy in American history.
Why? Because the city got screwed over by banksters on Wall Street.
In a twisted scheme of corruption and financial manipulation - mega banks JP Morgan Chase and Goldman Sachs allegedly paid off elected officials to invest in junk bonds to help finance a new sewer system for the county.
But when the junk investments went bust - so did Jefferson County - running out of money.
Meanwhile - the big banks, they were unscathed - made off with enormous profits and fees that they made hustling the system together for Jefferson County.
Had Jefferson County instead decided to rely on local banks or credit unions to finance the new city projects - then they’d still be able to pay their cops and teachers today.
Another thing that makes local businesses better - beyond the fact that they keep their cash local - is that they have to be good citizens in the community - mostly because with local businesses they're family owned, and the families that own them and work at the local company, they live in the local community.
Not only that - local communities preserve regional cultures, personalities, and perspectives.
With local businesses - you can tell the difference between Nashville and Albany.
Plus - there’s more stability in local businesses - since the local economy becomes more self-contained.
If one or two businesses fail - the community can deal with it.
But if a giant transnational corporation decides to shut down a plant and move it off to Mexico - then suddenly hundreds - sometimes even thousands - of people are out of work in the community.
A town is devastated - but the corporation which is far distant goes on to make higher and profits.
In my book "Unequal Protection" - I lay out the primary reason why transnational corporations are eating up our local communities.
It’s something called corporate personhood.
Protected under the law as if they were people - corporations have set out to rig the game - and clear out the competition in the market - especially competition from local small businesses.
They lobby politicians - or now, post-Citizens United - they just buy politicians.
They push for more so-called "Free Trade" agreements - so they can undercut the prices of local small businesses.
And then they buy up other businesses around them - creating monopolies that end up screwing over customers ultimately with higher prices for lower quality stuff - which, by the way, used to be against the law.
And as long as corporate personhood continues - our nation will never again see an entrepreneurial boom.
Luckily though - the backlash is underway.
Thanks in part to Occupy Wall Street, which has already sparked the "move your money" campaign to local credit unions - the transnational's space on Main Street may soon be occupied by a local business.
And with amendments to repeal corporate personhood passing just in the last week in Boulder, Colorado and Missoula, Montana in just the past two weeks - the calls to strip corporations of their secret weapon of personhood are reaching a deafening pitch around America.
Sure, our economy might be in the tank right now - but if we can get rid of corporate personhood - and then keep up with this movement to embrace local businesses again - and kick out the banksters - the outsourcing CEOs - and the big polluters from our towns - then the next great entrepreneurial boom might be just around the corner - and it will be every bit as dramatic as the Agricultural Revolution - the Industrial Revolution - or the Technological Revolution.
Let’s get to work.
Check it out at Move to Amend dot org!
That's The Big Picture.