Recently I posted a blog titled Too Big to Fail = to Big to Exist. Today’s Homework is an op-ed in the New York Times written by Paul Volker. Obama appointed Volker to his economic advisory team because of his 60 years as a commercial lender, policy maker, and even as chairman of the Federal Reserve.He says “The phrase ‘too big to fail’ has entered into our everyday vocabulary. It carries the implication that really large, complex and highly interconnected financial institutions can count on public support at critical times.”He then goes on to explain that economies need banks to provide certain functions:· Safe place to deposit cash but where it is still easy to get when needed;· Credit for businesses and people.After describing why we need banks, he describes how “bank capital [placed] at risk in the search of speculative profit rather than in response to customer needs” is a danger to economic systems world-wide.And then he says if a bank is too big to fail it is too big to exist, only he uses different words. He asks for a new “resolution authority” that would be authorized to intervene when a mega-bank is about to fail. This “resolution authority” would not protect stockholders and management. Nor would it protect other banks or people who had loaned money to the mega-bank.Volker says, “To put it simply, in no sense would these capital market institutions be deemed ‘too big to fail.’ What they would be free to do is to innovate, to trade, to speculate, to manage private pools of capital — and as ordinary businesses in a capitalist economy, to fail.I’m glad Obama is listening to Volker. Homework: http://www.nytimes.com/2010/01/31/opinion/31volcker.html?
After watching coverage of Obama going toe to toe with House Republicans yesterday, my phone was tied up for hours. It seems every volunteer on my campaign had seen it, and wanted to share their excitement. I was giddy too. I've waited my entire life to have a president who could demonstrate that level of understanding of facts and issues in answering questions from the opposition party. In my opinion, he was like the boxers of old who would take on all commers and still be standing at the end of the evening. Obama took on 140 members of Congress, and scored a TKO.
On a more personal note, my grandfather was the father of 11 children. During the Great Depression, he was one of those "boxers" who would take on as many contenders as possible for $0.25. He did it to support his family. Today my campaign team and I are meeting to set out our goals for the rest of this campaign. I hope they don't plan on buying any boxing gloves for me!
One of the things I cheered at during Obama’s SOTU address was his pledge to take $30 billion out of money repaid by Wall Street Banks and direct it to Main Street Banks in order to encourage lending to small businesses. This is something I know a little about.The majority of jobs in America are created by small businesses. We’ve lost 7-million jobs since this recession began. With unemployment expected to stay at 10% throughout 2010, we need to divert as much public money into this sector as we can, in order to stimulate jobs creation.I heard a pundit on NPR recently cautioning that government doesn’t really create jobs, all this Obama proposal will do is move money from one program to another. Hogwash. The typical entrepreneur finances his/her business by getting a mortgage on their home and/or from an inheritance when a wealthy relative dies. Right now there is no mortgage market to speak of, and Wall Street Banks are requiring a 40% down-payment on any business expansion project. At the same time, a project that used to be financed over 15 years would be required to pay-back the loan much quicker, if a loan could be found in the first place. Without access to capital, small businesses won’t create any jobs, let alone the million or more jobs that we need to create each MONTH to get Americans back to work.Republicans, Independents, Tea Baggers, and Democrats need to get on board to work together to give entrepreneurs the tools that they need in order to survive. And that’s more than money. Here in House District 54 we have wonderful resources, which have been partially funded by CDBG grants through the State of Colorado. They both do more than just finance small businesses, they help them design successful business plans, and connect them with experienced business people.Homework: Grand Junction: http://www.gjincubator.org/Delta: http://www.region10.net/Colorado: http://www.colorado.gov/cs/Satellite/OEDIT/OEDIT/1165009699730
The News 11 Reporter got it right when she said that the two things that jumped out at me were the plan for tax credits for small businesses and investing in a world class education for our kids. I’ll write more about those two issues in the days to come.Something that was noted by Norm Franke, of Alpine Bank, in an interview with the Sentinel, however caught my eye this morning. “We need to ask him to understand the difference between an investment bank and a community bank.” While I’m sure that Obama knows the difference, I’m not sure that voters or reporters do know the difference. Yesterday, in hearings in Washington, lawmakers grilled Obama’s financial advisers about how the Federal Reserve Bank should have done a better job of regulating derivatives. Clearly not many people know the difference between an investment bank and a community bank, or how they are regulated. The SEC is primarily responsible for regulating investment banks, and they have been underfunded and understaffed for years. All publicly traded companies are required to file quarterly financial statements with the SEC, but the staff is so limited that the best they can do is place a tic mark in an electronic file that the report was received. How do you think that Madoff made off with millions? Community banks are regulated by different and sometimes multiple regulators. Regulators you should know about are linked in today’s Homework. Homework: US Securities and Exchange Commission: http://www.sec.gov/Comptroller of the Currency: http://www.occ.treas.gov/Office of Thrift Supervision: http://www.occ.treas.gov/Federal Reserve System: http://www.federalreserve.gov/National Credit Union Administration: http://www.ncua.gov/The Federal Deposit Insurance Corporation: http://www.ncua.gov/Colorado Department of Regulatory Agencies, Division of banking: http://www.dora.state.co.us/banking/
In a recent blog, I mentioned that the Colorado House was considering a bill to build the legal infrastructure necessary to position schools in Colorado to access federal funding under Obama’s Race to the Top initiative. A few days earlier, our local newspaper noted that School District 51 had improved and were now graduating 70% of their students. Seventy percent is nothing to get excited about, when there are Colorado schools graduating 90%.What I’ll be listening most closely to in Obama’s State of the Union speech is how he plans to spend the six percent increase he is advocating for education. His education secretary said they were going to try to fix the 1,000 worst schools in the US, and try to fix some of the problems with No Child Left Behind. He also said that he wanted to reward good teachers and weed out bad teachers.What I want to hear is how these initiatives will impact the children we need to educate. I want to know how a very bright child can be encouraged to stretch and grow beyond the rest of the kids in a class, and I want to know how a child who struggles with the basics can be helped to over-come the challenges when learning is hard.Knowing me, I’ll probably listen carefully to what he has to say about creating jobs, too.Homework:http://www.washingtonpost.com/wp-dyn/content/story/2010/01/26/ST2010012604153.html?wpisrc=nl_politicshttp://www.politico.com/news/stories/0110/31806.html
Reining in the excesses of Wall Street will never be discussed in the chambers of the House in Denver, but it is an issue that stirs passion in my heart. I have a lot of grey hair, and some of it was caused when the banking industry moved from a collection of many small community banks to a collection of large global banks. In fact, as that trend accelerated, and decisions moved away from the bank on Main Street to global money centers, I decided to call in WELL. I left the world of banking for the world of not-for-profits.I called it Merger Madness. Over a five year period, the company I worked for bought small community banks and merged them into our holding company. I was part of the team that would go into the Main Street Bank and decide what price our Money Center Bank would pay the shareholders. I was part of that team because I understood good underwriting and how to analyze the books of a bank to determine where the threats to safety and soundness lurked.As we grew, it became apparent that we were pursuing policies that threatened the safety and soundness of our own bank. I remember almost falling out of my chair one morning when a community bank showed up on my overdraft list. I had to decide if I should approve an overdraft that was larger than the entire asset base of that bank. When investigating the cause of the overdraft, I learned that the community bank had sent us a deposit that we posted to the WRONG account, and in “fixing” our error we compounded the problem by posting a credit as a debit. The bank wasn’t overdrawn with us, our operations were incompetent. When challenging the operations manager, she told me that it was less than 5% of OUR assets, so it wasn’t important. WHAT? If I would’ve refused to approve that overdraft, that community bank could have FAILED. If a bank is too big to fail, it is too big to exist. They have no idea how their decisions impact the little guy, and they are a danger to our economic security.Homework: http://online.wsj.com/article/SB10001424052748704509704575019032416477138.html
The 5 to 4 USSC ruling last week about campaign finance dangerously changes the dynamic of politics. In a nation that started out giving all power to “we the people,” the court surrendered that power. Corporations with the most money available to influence elections tend to be global, owned by foreign investors like Saudi Princes and China. They now control what we are going to hear about both policy issues and candidates.The people of Colorado, in their wisdom, voted in favor of a constitutional amendment to limit the kinds of influence corporations have in elections in Colorado. The GOP has already announced that they will sue to over-turn this amendment, taking government decisions out of the hands of “we the people.”The only way to keep our government in our hands is to use our voices and skills to fight the take-over of public life by privately owned corporations. Yesterday I lamented the fact that the only news reported about my candidacy was how hard it would be for me to raise money. Today I’m thinking that with People Power we can demonstrate how to take back control of government.Campaign professionals are telling me that I need to raise $100,000 in order to run an effective campaign. No candidate in House District 54 has ever raised much more than $30,000. However, If every registered Democrat in the district contributed $10, we’d have $100,000. Yesterday I directed my treasurer to reimburse campaign volunteers for mileage getting to and from official campaign events. We have a large geographic district, so walking precincts is going to take a lot of miles. At current IRS reimbursement rates, it costs about $25 to drive between Grand Junction and Delta. If the candidate campaigned in Delta once each week from now until election-day, it would take almost 40 trips, or $1,000. Each volunteer attending those same events adds another $1,000. And that’s before we pay for campaign brochures, campaign signs, web hosting, or print, radio, and TV ads. Could you contribute $10 today?Homework: http://www.nytimes.com/2010/01/25/us/politics/25bopp.html?th&emc=th
Yesterday was the official launch of my campaign. I spent a lot of time thinking about how to deliver a message about my values that might resonate with people living in House District 54. The largest local newspaper was not present. That wasn’t the surprise. The purpose of my press release was to announce that I was running, and they had already printed that story. In fact they did a pretty good job of getting out the word that I knew something about creating jobs.
The surprise was that despite filming my entire speech, which included lots of information, all three stations chose to focus on the fact that Republicans and Independents outnumber Democrats and will, therefore, have an easier time raising the cash to run a campaign. Given that the Supreme Court threw out all laws that were designed to give people an even playing field with corporate interests, I was probably naïve to be surprised.
The good news was that the cameras of all three stations panned the room. The images of my supporters looked different. Somehow they managed to edit out the wife of our Secretary of State, but they got the beautiful face of ethnic diversity. For the first time Grand Junction and Delta can see that Native Americans, Latinos, Bikers, and old grey hairs like me care about who represents them in government.
http://www.kjct8.com/global/story.asp?s=11870850 Democrat to run for District 54 House seatPosted: Jan 23, 2010 7:08 PM MST Updated: Jan 23, 2010 7:08 PM MST TAMI BREHSETBREHSE@KJCT8.COMGRAND JUNCTION, COLO. (KJCT) - Until now the race for Colorado's District 54 House seat has been dominated by Republican candidates.But a Democrat is now in the running.Claudette Konola knows it could be a tough fight for a Democrat here on the Western Slope."I'm fighting a really tough race," she says. Konola says she has the time and energy it'll take to make a difference for this community. She says in her mind, the biggest issues facing the western slope are jobs, education, and clean accessible water.On the other side, three republicans are vying for the GOP nomination.David Cox, Bob Hislop and Ray Scott are all in the running for the spot. Konola says one of her biggest challenges will be trying to compete with the campaign fundraising of the republican party.Final nominations for each party will take place in August.http://www.nbc11news.com/localnews/headlines/82527117.htmlDemocrat announces candidacy for House District 54 Democratic candidate officially announces she will run for House District 54. Reporter: Ashley PrchalEmail Address: firstname.lastname@example.org
GRAND JUNCTION, Colo. (KKCO) - Democratic candidate officially announces she will run for House District 54.
Claudette Konola announced Saturday morning at La Bomba Mexican Restaurant on Main Street, that she would run for the House District 54 seat.
There was concern she wouldn't be able to raise funds in a highly Republican community, but she's way ahead of everyone.
"I'm collecting donations online through Act Blue, which is an organization that collects money for democratic candidates. So I'm trying to reach outside of the community to bring in the dollars that it will take to mount and run an effective campaign," says Konola.
If you would like to support Konoloa for the seat in the House District 54 visit her Konola for Colorado.
The campaign officially launched today. I'll write more about it tomorrow. We should have news coverage this evening.
On another bit of news, our website and campaign brochure are both now available in Spanish thanks to the translation by Maria Cuthbert.