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Employees international union is encouraging some towns in California to demand -- banks.
So called interest rate swap deals now not getting to -- these deals basically multimillion dollar contracts to help cities managed.
Interest rate risk on bonds.
But now many cities as we know are suffering from a budget perspective.
Why is the FDI you advocating is joining us now from DC is Stephen -- -- is special assistant.
-- SE IU president Andrew Stern welcome the program good to see -- Stephen.
I tell us about your plan what you know you got -- called stop the swaps what do you want to see happen and and why you're going after this.
The first of all I what I want to thank you for the opportunity to be on your show.
It's not just California -- all over the country people community to standing up and saying the banks crashed the economy they got rich doing it.
Then we bailed them out and now they need to take steps to help repair the economy get it going again and again and one of the problems we have -- communities are stock.
With interest rates that are -- in taxpayer money out of the pockets of LA or Oakland and sending it to Wall Street and if we get the economy going we have to keep money.
Invested in into communities not go to Wall Street and one of the things we need to do.
Is deal with swaps with the interest spread is huge between what the banks are paying for the money and what the charge in cities and states.
Well forgetting about the individual deals to that you know we all don't know why each town or city may have made the deal like LA made their swap deal in 2004.
But what about the issue of of contracts right and that's what I was bringing up yesterday have been Andrew which is that you know you want sort of a unilateral pushed by the city's.
To change these contracts but at the same time you guys are some of the strongest advocates for your own membership and their contract -- Where the -- With -- take it in pieces the first part here is there's sort of two rules in the country now the rules for Wall Street and the rules for the rest of us so and what.
On Wall Street and big business when they have a problem.
They change -- all the time on Peter Cooper village in New York to Peter Cooper Stuyvesant.
They bought it for billions from the deal didn't look good they walked away Morgan Stanley -- -- much buildings in San Francisco deal tank they walked away.
All the time banks Wall Street big business they we -- we negotiate deals with conditions changed to a war saying.
Is that conditions have changed and the banks have a responsibility to start getting the economy going again and part of that is.
We're leaving the burden on cash strapped communities that are cutting fire and police and essential services because they're paying money to the very banks we just bailed.
But isn't Daryn -- there is some responsibility.
On the city councils and boards.
That approve these deals and LA did it six years ago they placed a bet basically they lost.
Where is their responsibility.
It's a two things one my name is Stephen.
And I you know I hate that I'm so sorry about that I you know what I thought -- does the outlook and Andy Stern the head of the SE -- U much my -- -- -- probably don't have but I got confused I thought that the third person not a pretty as you -- -- ball because my my my brain is just -- -- -- I apologize for that.
So here's I think what this sort of it in a way.
-- a moral and economic -- going on your argument normally -- fine.
But we had a little thing happening in the last -- year -- -- which is -- worst economic crisis in the history of this country none of us.
No city anybody can anticipate that and one of the things that happened as a result of that not only did the banks get trillions and barrel -- but there are now getting money.
At close to zero from the federal government or from you know at the discount window so one other thing that's a little bit crazy here.
Is the banks are getting a better deal.
On contrast because of the crisis they -- And -- were saying now if they need to step back and say OK people of -- us how we're doing better or bonus pool was actually bigger.
Now we should we -- interest rates to help the struggling communities that have deals with us and if not a matter of breaking contract it's a matter of -- to be Smart for the banks -- could be.
Good for them in how they reshape their policy so people instead of blaming them seem -- picks in the park in fixing the problems all Americans.
They end and Stephen did this is -- and a -- -- I again I really apology always try to get the name -- -- -- promotion unexpectedly.
Steve and it isn't don't mind you know this is that this is the start of a big push though right against some of the ranks you guys have marches -- -- Do this I know that it's explicit it's expensive TV commercials advertisements they're pricing you know marches are expensive and hard -- why do this now.
Well because we think we have a -- a beginning of a recovery on Wall Street we have a beginning of recovery on the stock market.
But almost everybody else in this country has left behind here and we think the banks both caused a huge amount of economic crisis and they're not playing -- role in fixing.
They would get one of the theories here was that if you bailed out the banks they would increase lending small business lending they haven't done it.
They're not fixing foreclosures.
They're not dealing with the problems there and if we don't fix the economy get people back to work.
Then we're going to be in this spiral of greater and greater deficit more and more problems and we think the banks need to play a role in any state not.
-- last question we just talked to Ron Kirk about trade are you happy with the administration right now as a whole.
We -- really supportive of the efforts of the administration to fix the economy to get things going and were part of a larger and larger group of organizations of people in the country that are saying a key part of this is to hold the banks accountable they got a responsibility -- -- mess they caused.
And if they don't I think you're gonna see.
Growing outrage growing demonstrations more more people saying this is whacko we bailed them out and now the -- we got ours to get all you were doing fine again.
Stephen listener passionate advocate for your group we appreciate that I promise to become back I will get your name right you can call -- want to -- -- come on.
Okay thanks floppies I'm Stephen Lerner special assistant to -- president Andrew Stern Avago.
Well embarrassing -- -- --
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