Archive for December 18th, 2012

It appears the White House is ready to ship senior citizens down a river.

According to credible press reports, the White House is considering the idea of changing the way Social Security benefit increases are indexed to inflation. The Obama administration is proposing calculating inflation adjustments according to the “chained” consumer price index (CPI), which considers modifications in consumer spending as the prices of goods and services fluctuate, instead of calculating inflation adjustments according to the consumer price index (CPI) for wage and clerical workers, as is the current practice.

Don’t let the wonkiness of this policy proposal fool you. In real terms, this change would mean cuts to current Social Security beneficiaries, and it would amount to huge cuts over time.

It is profoundly immoral that the administration is entertaining this conversation when it could generate far more revenue with a financial speculation tax on Wall Street. Even a very modest speculation tax would raise more than $350 billion over 10 years – that’s more than three times the amount that is gained from the proposed tampering with Social Security benefits.

By now it’s not surprising that the Obama administration seems comfortable putting Wall Street’s interests ahead of Main Street’s. But the fact that the White House appears ready and willing to harm our seniors before considering adopting a financial speculation tax is truly deplorable.

Robert Weissman is Public Citizen’s president.

HSBC logo removed from building

Flickr photo by Will Survive

Who, precisely, will pay the $1.9 billion fine that international mega-bank HSBC has agreed to pay in order to settle charges with the government that it illegally laundered money for Mexican drug lords and al Qaeda terrorists?

One fine payer is a plumber in Lowell, Massachusetts. Another is a school teacher in Boise, Idaho. A third is a nurse in La Jolla, California.

They’re paying the fine, but did these three really mastermind the HSBC scheme explored by the U.S. Senate Permanent Subcommittee on Investigations? Did one of them mask the name of Iran on 85 percent of $19 billion in transactions that HSBC completed with this country? Did another supply an al Qaeda-connected bank with $1 billion? Did one actually wave through money from the Mexican drug lords, as investigators discovered?

No, no, no and no. Not only are these fine payers innocent of HSBC’s infractions, they probably are unaware that they are paying the fine. They are HSBC shareholders. They may not even know that they are shareholders — they might own shares through one of the giant institutional investors such as Fidelity, Vanguard, or Dodge & Cox, all of which have substantial stakes in HSBC.

When the government fines a company, the money doesn’t come from executives or any individuals at the company. It comes from the owners of the company — meaning average Americans who own stock, largely through mutual funds.

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