Visualize this: You go into a bank with a mask and a gun, and you announce, “This is a holdup. All you tellers empty your cash drawers into this bag.”

Then you walk out of the bank, having stolen $3,000.

Later, you are caught, and your sole punishment is that you must give back $500.

See anything wrong with that?

That question occurred to me when I read the following:

Political Pressure Forces Wells Fargo Executives to Give Back $60 Million As Punishment

Wells Fargo was first exposed three years ago by journalists and it has taken this long to finally see some repercussions.

In a first-of-its kind banking scandal punishment, Wells Fargo CEO John Stumpf and banking unit executive Carrie Tolstedt will have to give back a total of $60 million.

Although Stumpf initially tried to blame the scandal on his low-level employees, recent political pressure is forcing him to take additional steps.

Wells Fargo is facing enormous scrutiny over routinely opening unauthorized accounts for clients in order to make sales goals. The bank  already has been fined $185 million.

Wells Fargo also fired 5,300 employees, all at lower levels.

The executive in charge of the branch that was responsible for pushing for and implementing the fraudulent accounts, Carrie Tolstedt, was set to retire later this year with a payout of $124.6 million.

But now, after pressure from senators such as Elizabeth Warren, Wells Fargo’s board is forcing the top executives to pay up out of their own pocket.

John Stumpf will have to forfeit $41 million in past compensation and Carrie Tolstedt, who has already resigned, will have to give back $19 million of her own.

Get it? For years, the Chief of Fraud earned millions of dollars and left with $124.6 million extra.  Her “punishment”: $19 million.

The boss, Stumpf, who earned massive yearly salaries and bonuses, will give back the comparative pittance, $41 million.

If that’s punishment, I volunteer. Punish me, PLEASE.

Clawbacks are an important concept for banking regulation. Normally banking executives aren’t affected if their company gets caught bending, or breaking, finance rules to help company stock rise.

Actually, clawbacks are an important part of conning you, the public, into believing banksters are being dealt with harshly.

Are you suitably conned?

I can just visualize the Wells Fargo boardroom: “Well, we got caught, but let’s not kill the goose that lays the golden eggs.

“We stole hundreds of millions, so let’s give back a few million and hope this all goes away. Then it’s back to business as usual.”

Stumpf may claim that he “knew nothing, nothing I tell you,” which is obvious BS.

But let’s take him at his word, and assume he did know nothing. If the president of the bank doesn’t know about systematic criminality in his own bank, how could  regulatory agencies do what the president can’t?

Clearly, the bank president, who works full time at the bank, and is paid hundreds  of millions to know what’s going on in his own bank, is in a far better position to uncover wrongdoing than is some underpaid FDIC accountant, who visits the bank once a month, if that.

Bottom line: If the full-time, bank president doesn’t know his own bank, and the little FDIC accountant surely doesn’t, regulation of privately owned banks is impossible, especially with laughable “punishments” for crimes.

Stumpf, Tolstedt et al were motivated by bank profits and personal greed.

A federally owned bank would be run by salaried federal employees. Our Monetarily Sovereign government has no need for profits. So, it won’t pay outrageous bonuses (i.e. crime motivators) to obtain what it doesn’t need.

Wells Fargo is the poster child for Step #9 of the Ten Steps To Prosperity (below): Federal ownership of all banks.

Now if only we could wean Congress off the bribes they receive from the banks.

Is it too late to ask Elizabeth Warren to run for President?

Rodger Malcolm Mitchell
Monetary Sovereignty

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The single most important problems in economics involve the excessive income/wealth/power Gaps between the rich and the rest.

Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.

Implementation of The Ten Steps To Prosperity can narrow the Gaps:

Ten Steps To Prosperity:
1. ELIMINATE FICA (Ten Reasons to Eliminate FICA )
Although the article lists 10 reasons to eliminate FICA, there are two fundamental reasons:
*FICA is the most regressive tax in American history, widening the Gap by punishing the low and middle-income groups, while leaving the rich untouched, and
*The federal government, being Monetarily Sovereign, neither needs nor uses FICA to support Social Security and Medicare.
2. FEDERALLY FUNDED MEDICARE — PARTS A, B & D, PLUS LONG TERM CARE — FOR EVERYONE (H.R. 676, Medicare for All )
This article addresses the questions:
*Does the economy benefit when the rich afford better health care than the rest of Americans?
*Aside from improved health care, what are the other economic effects of “Medicare for everyone?”
*How much would it cost taxpayers?
*Who opposes it?”
3. PROVIDE AN ANNUAL ECONOMIC BONUS TO EVERY MAN, WOMAN AND CHILD IN AMERICA, AND/OR EVERY STATE, A PER CAPITA ECONOMIC BONUS (The JG (Jobs Guarantee) vs the GI (Guaranteed Income) vs the EB) Or institute a reverse income tax.
This article is the fifth in a series about direct financial assistance to Americans:

Why Modern Monetary Theory’s Employer of Last Resort is a bad idea. Sunday, Jan 1 2012
MMT’s Job Guarantee (JG) — “Another crazy, rightwing, Austrian nutjob?” Thursday, Jan 12 2012
Why Modern Monetary Theory’s Jobs Guarantee is like the EU’s euro: A beloved solution to the wrong problem. Tuesday, May 29 2012
“You can’t fire me. I’m on JG” Saturday, Jun 2 2012

Economic growth should include the “bottom” 99.9%, not just the .1%, the only question being, how best to accomplish that. Modern Monetary Theory (MMT) favors giving everyone a job. Monetary Sovereignty (MS) favors giving everyone money. The five articles describe the pros and cons of each approach.
4. FREE EDUCATION (INCLUDING POST-GRAD) FOR EVERYONEFive reasons why we should eliminate school loans
Monetarily non-sovereign State and local governments, despite their limited finances, support grades K-12. That level of education may have been sufficient for a largely agrarian economy, but not for our currently more technical economy that demands greater numbers of highly educated workers.
Because state and local funding is so limited, grades K-12 receive short shrift, especially those schools whose populations come from the lowest economic groups. And college is too costly for most families.
An educated populace benefits a nation, and benefiting the nation is the purpose of the federal government, which has the unlimited ability to pay for K-16 and beyond.
5. SALARY FOR ATTENDING SCHOOL
Even were schooling to be completely free, many young people cannot attend, because they and their families cannot afford to support non-workers. In a foundering boat, everyone needs to bail, and no one can take time off for study.
If a young person’s “job” is to learn and be productive, he/she should be paid to do that job, especially since that job is one of America’s most important.
6. ELIMINATE CORPORATE TAXES
Corporations themselves exist only as legalities. They don’t pay taxes or pay for anything else. They are dollar-transferring machines. They transfer dollars from customers to employees, suppliers, shareholders and the government (the later having no use for those dollars).
Any tax on corporations reduces the amount going to employees, suppliers and shareholders, which diminishes the economy. Ultimately, all corporate taxes come around and reappear as deductions from your personal income.
7. INCREASE THE STANDARD INCOME TAX DEDUCTION, ANNUALLY. (Refer to this.) Federal taxes punish taxpayers and harm the economy. The federal government has no need for those punishing and harmful tax dollars. There are several ways to reduce taxes, and we should evaluate and choose the most progressive approaches.
Cutting FICA and corporate taxes would be a good early step, as both dramatically affect the 99%. Annual increases in the standard income tax deduction, and a reverse income tax also would provide benefits from the bottom up. Both would narrow the Gap.
8. TAX THE VERY RICH (THE “.1%) MORE, WITH HIGHER PROGRESSIVE TAX RATES ON ALL FORMS OF INCOME. (TROPHIC CASCADE)
There was a time when I argued against increasing anyone’s federal taxes. After all, the federal government has no need for tax dollars, and all taxes reduce Gross Domestic Product, thereby negatively affecting the entire economy, including the 99.9%.
But I have come to realize that narrowing the Gap requires trimming the top. It simply would not be possible to provide the 99.9% with enough benefits to narrow the Gap in any meaningful way. Bill Gates reportedly owns $70 billion. To get to that level, he must have been earning $10 billion a year. Pick any acceptable Gap (1000 to 1?), and the lowest paid American would have to receive $10 million a year. Unreasonable.
9. FEDERAL OWNERSHIP OF ALL BANKS (Click The end of private banking and How should America decide “who-gets-money”?)
Banks have created all the dollars that exist. Even dollars created at the direction of the federal government, actually come into being when banks increase the numbers in checking accounts. This gives the banks enormous financial power, and as we all know, power corrupts — especially when multiplied by a profit motive.
Although the federal government also is powerful and corrupted, it does not suffer from a profit motive, the world’s most corrupting influence.
10. INCREASE FEDERAL SPENDING ON THE MYRIAD INITIATIVES THAT BENEFIT AMERICA’S 99.9% (Federal agencies)Browse the agencies. See how many agencies benefit the lower- and middle-income/wealth/ power groups, by adding dollars to the economy and/or by actions more beneficial to the 99.9% than to the .1%.
Save this reference as your primer to current economics. Sadly, much of the material is not being taught in American schools, which is all the more reason for you to use it.

The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.
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MONETARY SOVEREIGNTY