The Rise of the 99%
From Wall Street to State Street, citizens take a stand. And Jay Stevens tells us how this all began.
Monday, October 24. Dave Rocco visits the Occupy Erie encampment in Perry Square with a message from the city administration: take down your tarps and stop sleeping in the park.
In charge of permitting for Erie's Department of Public Works, Rocco is an intimidating figure. He's big through the chest and shoulders. He has dark, intense eyes framed by thick brows, and the wide face of a brawler. He's not here to fight, though. He's the good cop, the well-intentioned intermediary who sympathizes with the protest, the one who can reason with the group.
About 50 or so protesters form a circle in the park's rotunda. In each corner of the structure is equipment from the group. In one corner is a large stack of sleeping gear: blankets, sleeping bags, and pads. In another stands a whiteboard with announcements and a schedule of events amid neat stacks of protest signs. Over there, against the west wall under a sign announcing the times for breakfast, lunch, and dinner, is a table with crock pots, a coffee pot, and containers of bread, apples, and other staples. Tarps are spread out on the rotunda's concrete floor. Folding chairs cluster around a table that usually houses the laptop that films the live feed of the protest displayed to the outside world.
Right now, the computer is in the lap of a protester who sits in the middle of the circle, pointing the laptop's camcorder at whoever is speaking. She's pointing it at Rocco.
"I've been here every day," he says, voice rising. "I'm your biggest supporter. Every day! Making sure everything's okay." He's speaking passionately. "You can't sleep in the park! You can come here at six in the morning, you can stay in the gazebo, you can do all your protesting," he says, "you just can't have sleeping blankets and sleep here in the park. You can't have tarps up. You can't stay here overnight."
A city official with Rocco mentions Erie city ordinance 955.03, banning the "erection of structures" in city parks. There's also 955.07, which says, "no person shall sleep or protractedly lounge on the seats, or benches, or other areas..." On their side, the protesters have the First Amendment of the U.S. Constitution, which states that "Congress shall make no law restricting...the right of the people to peaceably assemble" – although there is precedence (in Clark v Community for Creative Non-Violence) for prohibiting protesters from camping out in a public park.
Protesters bombard Rocco with questions. What if banners are added to the tarps? What if the tarps come down during the day, and are up only at night? What if there's someone here, but not sleeping?
"You're losing your focus on your main goal!" he says, clearly exasperated. "I'm trying to offer you the ability to make your own choice, before that choice is made for you!"
That choice was hinted at before the general assembly when a protester asked Rocco, "If we stay, will we get arrested?"
"I can't answer that," answered Rocco. "That means – "
"How would we be stopped?" she interrupts.
"I'll let you use your imagination."
* * *
Occupy Wall Street began on September 17 in response to an Adbusters' proposal to occupy New York's financial district in protest of corporate greed. Its visibility grew quickly after a New York City police officer, without provocation, maced several young women in the face during a march. Since then, the protest grew quickly, spreading to hundreds of US cities—San Diego, Portland, Nashville, Atlanta, Pittsburgh, Cleveland—and abroad. Erie's protest began on October 15.
Its goal is simple: to bring attention to the struggles of everyday Americans in an economy plagued by growing income inequality and a government that's bought for and run by big business. Its method is simpler: camp out in a public place and talk to and include anyone who shows up.
The flashpoint for all of this action—the Occupy protests, the Tea Party, the emergence of a movement opposed to the alliance of big business and big government—was the 2008 financial crisis, the bailout of the financial industry by the federal government, and the resultant recession.
You're probably familiar with the story.
Some Wall Street genius figured out how to bundle home mortgages into a tradeable security with a gold-plated AAA rating. Only as the mortgage-backed security grew more popular, banks started lowering the requirements for a home mortgage, giving out enormous home loans with complicated, hidden-cost fees to anybody and everybody. While most banks knew the loans were junk, they were conveniently hidden, bundled as they were with hundreds of other mortgages in the security.
The mortgage-backed security quickly became popular with pension fund and mutual fund managers, who snapped them up for the retirement portfolios for millions of Americans.
At the same time, the banks that bundled these crap mortgages into AAA gold—rated, incidentally, by firms paid by the same people who created the investments they rate—began to bet against their creation by buying up insurance against their own securities, a derivative known as credit default swaps.
You can guess what followed. A lot of homeowners found themselves unable to make their payments. The housing market screeched to a halt. Prices dropped. No one could sell, even at cost. A massive rash of foreclosures followed, turning mortgage-backed securities into trash overnight, and the bets against them had to be paid off. Only the bets were too many and for too much, and financial firms began toppling like dominoes.
That's when the federal government stepped in and began handing out taxpayer money to the banks like dimes to Bangladeshi street children.
At first the feds started bailing out individual firms. Bear Stearns for $30 billion. Fannie Mae and Freddie Mac for $400 billion. AIG for $180 billion. Then came the Troubled Asset Relief Program—or TARP—which has, so far, distributed over $700 billion in taxpayer money to buy up the junk investments that Wall Street created.
That TARP is mostly paid back isn't shocking considering the same institutions that received TARP funds also received trillions in zero-interest loans from the U.S. government. In secret.
Meanwhile, the millions of homeowners whose houses were foreclosed, whose pensions and savings were suddenly and irrevocably halved or worse, who lost their jobs in the resultant recession, none of these people saw a dime.
* * *
Rocco is gone. Now it's up to the General Assembly to decide what to do.
The General Assembly is the engine of the Occupy protests, the heart of the organizational structure that makes the movement unique. In the gazebo here in Erie's Perry Square, as it is every day in the myriad of other Occupy encampments—New York's Zuccotti Park, or Pittsburgh's Mellon Park, or Public Square in Cleveland—people form a circle and talk. There are no leaders, just rotating moderators chosen from the crowd. They take turns; everyone gets a chance to have their say. Hand signals are used to express agreement or disagreement or hurry along the speaker.
All decisions, from the simple ones about food and sleeping arrangements to the bigger ones like, yes, whether tarps should continue to hang on the park gazebo, are decided by consensus. Ninety percent of the vote is required to pass anything. Majority does not rule. Factions don't emerge. Leaders can't take over. The movement can't get hijacked by radicals or activists or political parties.
It's called "horizontal" organization, and it was inspired by the organization of similar protests in Spain and Italy earlier this year. If there's anything revolutionary about the Occupy movement—and there's not much radical here, by the way, no calls for a dictatorship of the proletariat—it's the general assembly. It's a revolution in discourse.
And now it's time to discuss the tarps.
The Occupy Erie protesters circle. It's a mix of people. Young and old, activists and newbies. There are nice jackets and ripped hoodie sweatshirts. Hands are in pockets: it's in the 50s, and it seems like it's been raining since September. Sweater and raincoat weather. Sturdy shoes. It's not unpleasant if you're walking your dog, but if you stand outside for hours—or even days—the cold and damp has long settled in your skin, bones. Expressions are grim, marred by frustration, anxiety, and the cold.
Talk swirls around ways to get around the city's request. Put the tarps up at night, take them down during the day. Put signs on the tarps, thereby "beautifying" them. Leave them up and see what the city would do.
After an hour and a half of discussion, patience is running thin. Many have already left. Some of the experienced activists are visibly annoyed. They're not used to consensus and long, pointless discussions about tarps. They're all about action. Today's moderator isn't helping. He's constantly interrupting and trying to direct the conversation, even while some people want to talk.
"We're disorganized!" a man says. He doesn't think risking arrest over the tarps is a good idea. "It ain't gonna mean shit!"
"We need to remember why we're here," agrees another man. "It's not for the tarps. It's for the people."
The determined voices hammer through a proposal. They'll take the tarps down and stay in the park tonight, but not sleep. Tomorrow, they'll discuss in the general assembly whether they'll take Rocco's suggestion and stop occupying the gazebo altogether.
A vote is taken. It's near consensus. Only one protester sitting in a walker chair—an older man with a slightly unruly salt-and-pepper beard and baseball cap—folds his arms over his chest. A block. He thinks they shouldn't fold to pressure from the city. The discussion must continue. Groans are heard. Some even stalk out of the conversation.
But it's 90 percent, consensus. The proposal is passed. The blocker storms off. This isn't how general assemblies are supposed to go, a small group has essentially bullied a proposal through the General Assembly.
Someone climbs the railing of the gazebo and takes the tarps down.
* * *
The Occupy movement, of course, was not the first protest the financial crisis spurred. That was the Tea Party, which originated among independent stock traders who were opposed to the federal government's underwriting of the irresponsible risks made by fraudulent Wall Street firms.
But the movement really got its kickstart when cable-TV business commentator Rick Santelli speaking from the floor of the Chicago Stock Exchange in February 2011 heatedly denounced President Obama's proposal to help individual mortgage-holders after the crash and bailout—to the applause of the traders around him. Santelli called on people join him in a "tea party."
The movement was on, and it was already focused away from Wall Street and on the "deadbeats" who were losing their houses to foreclosure.
It's no surprise then that the Tea Party's focus devolved into separating "us" from "them." The movement—the "us"—was overwhelmingly white and old, and "take our country back," became its rallying cry, presumably from the brown-skinned president with the funny name and mysterious origins and the deluded, morally corrupt pack of socialists, Muslims, and minorities that put him in office.
The message fit neatly in with the Republican party's strategy since the 1970s of dividing voters who shared economic interests—the working- and middle-classes—using incendiary and divisive rhetoric on race, abortion, homosexuality, immigration. And it was no surprise when deep-pocketed Republican operatives like former U.S. House majority leader Dick Armey began funding rallies across the nation, channeling conservative ire against healthcare reform and into the 2010 elections, helping sweep a new wave of Republicans into Congress. Gone with the election was also any talk of cutting the ties between government and corporate America. Instead, the Tea Party paved the way for more talk of tax cuts and deregulation for big business.
It was not always this way. History is rife with examples of Americans setting aside differences on social issues and banding together over economics. The Populists. The Progressive Era. The advent of universal suffrage, the 40-hour work week, a graduated income tax, health and safety regulations.
Through the 1930s and 1940s the working- and middle-classes gained more political and economic power and wages and living conditions shot up rapidly for most Americans. Even through the tumultuous era of the 1950s and 1960s, the country split by Vietnam and Civil Rights, American prosperity grew.
And then the social issues split the people on economics, and the market fundamentalists had a free reign.
* * *
Tuesday, Oct. 25. Occupy Oakland protesters are evicted from Frank Ogawa Plaza. Their encampment is trashed. Tents are trampled, supplies scattered. As police make arrests that day, they are surrounded by protesters and pelted by paint. In the pictures, fear is evident on the officers' faces as they wield batons in the middle of an angry crowd.
Some twelve hours later several hundred protesters—perhaps as many as a thousand—march to reoccupy their camp. They are met by 500 police, who are dressed in full riot gear: helmets, batons, shotguns out and pointed at protesters.
Witness-filmed video from that night shows the rest. A series of loud, bright explosions scatters the crowd, tear gas streams from canisters. The rest is confusion. An eerie yellow fog that shadowy figures lurch through. The loud, thunderous bang of flash grenades clearly heard among the shriller, sharper explosion of tear gas canisters. The constant pop pop pop of "non-lethal projectiles"—"bean bags," small canvas bags filled with lead shot and fired from a 12-gauge shotgun at protesters. A woman in a wheelchair is pushed through the gas. "Are you okay?" is heard over and over on video, as are cries of "medic!" Oakland has become a war zone, only one side is armed.
The footage that will be seen over and over in the ensuing days is of 24-year-old Iraq War veteran Scott Olsen lying on his side, unconscious, in front of a metal barricade lined with riot police. Several people run to his assistance, and a police officer lobs a tear gas canister among them with the same easy nonchalance as if he's playing a game of cornhole. It explodes in sparks and gas, and the protesters scatter. Olsen remains. Later, as they carry him away, he stares senseless. Blood streams from his forehead.
Evictions in Baltimore, Atlanta, Clarksville, and San Diego happen simultaneously that same night. Dozens are arrested, pushing the total number since the beginning of the movement to above 2,500. Rumors swirl that the Department of Homeland Security is coordinating the evictions. Who knows?
In Erie, the General Assembly agrees to keep a "24-hour presence" in the park. Protesters will take shifts during the night to occupy the gazebo, awake.
* * *
"Market fundamentalism." "The free market." These terms are used so frequently, they're almost meaningless. But to sum the idea behind them is simple: the business of government is business.
To understand the effect of that philosophy, you need look at only one chart: the growth of productivity and average overall wages over the past 30 years. There are two lines that stretch to the right, marking time. At first, through the 1940s and '50s and '60s, the two lines rise steadily together. When productivity rose, so did wages.
The two lines continued to rise together through the 1970s, and then, neatly, around 1983, they split. Productivity continued to rise. More work and product was produced with the same amount of labor—no doubt as a result of technology and increasing expertise. But the line representing wages warbles—and then goes flat. As time passes, the gap between productivity and wages widen. More and more is constantly being produced, but the worker isn't seeing a rise in wages.
And to understand what that means, add a third line to the chart. Have it represent the average income of the top one percent of American earners. Again, at first, its growth keeps steady with productivity and wages. The three lines rise together. Everybody prospers as productivity increases. And again, about 1983, the new line jumps a bit – like a heartbeat, say – until – wham! – it leaps upward in successive surges. Where once the three lines traveled together at the same angle, the graph now looks like a child's drawing of a bent fork with three widely split tines headed in different directions.
That uncharted expanse between wages and productivity has been gobbled up by the top 1 percent.
And now you know why Occupy protesters call themselves the "99 percent".
Of course, the increase wealth of the rich would be understandable if, say, they were earning their fortunes. Instead, laws have been written and rewritten, public money plundered, and crimes committed. In short, the system is rigged.
Essentially, big business has bought the government. According to Open Secrets, a nonprofit that tracks political contributions, business has spent over $25 billion in lobbying federal and state officials since 1998, dwarfing by a factor of 50 the $480 million spent by labor. In a recent New York Times report, one anonymous money manager sniffed at New York Senators Schumer and Gillibrand's lack of support of Wall Street during the Occupy protests: "They need to understand who their constituency is."
And business has seen a decent return for its investment. Congress has worked hard for corporations and their CEOs.
Income taxes for corporations and the wealthy have consistently shrunk over the last 30 years. To allow these interests to further shirk their civic obligations, Congress writes loopholes into the tax code, so now Exxon Mobil can earn $19 billion in profits in 2008 and not only pay zero in taxes but also get a nice $150 million tax refund.
The government has also signed a series of free-trade agreements, allowing corporations to set up shop in countries with a cheap labor pool and lax environmental regulations, costing the U.S. hundreds of thousands of jobs. Corporations and CEOs pocket the savings from making products in China, where trade unions are illegal, and children and slaves make the products unionized American workers used to. Even as the Occupy protests raged, the U.S. signed a free-trade agreement with Columbia, a country where labor leaders are killed with impunity. Entire industry sectors—like steel and paper—vanish from the US, leaving entire workforces in the lurch.
Laws regulating industry are repealed—like the 60-year old Glass-Steagall Act, which tempered Wall Street speculation by separating the banks that collect money from those that create securities. Once the bill was repealed, banks had the cash to create the derivatives and wild gambling that led to the financial collapse. Of course, the government is ready to step in and make good any losses these people make—like they did in the 1980s for the savings and loans banks, in 1994 for speculators in Mexican pesos, and, of course for the 2008 Wall Street crash.
Trillions have been spent over the years saving the financial whiz kids from their own greed—and as a "punishment" for all of this incompetence, allows the most insolvent and troubled banks to borrow money against the government's credit rating, essentially guaranteeing that Main Street will again pick up the tab for Wall Street's spins on the financial roulette wheel.
These things, of course, are just the tip of the iceberg. Corporate America has broken the pension system by betting pension funds on the market and pushing workers to invest in risky 401(k) plans. Unions' power has been severely curtailed, the 40-hour work week is now a joke, and healthcare costs spiral out of control thanks to for-profit hospitals that substitute expense procedures for care and the pharmaceutical companies outrageous profiteering on the back of government-funded research. Congress continually raises the rates that credit card companies and other lenders charge to levels that would make loan sharks blush, while bleeding money from the educational system, leaving students with enormous, high-interest loan debt upon graduation.
A recent study by the Bertlesmann Foundation measured various population's access to participation in their country's markets—using key indicators such as access to education, poverty prevention, the state of healthcare, and the inclusiveness of the labor market to gauge a people's general ability to prosper in their economy.
The United State ranked near the bottom.
Which means that it's increasingly difficult to pull yourself up by your bootstraps and succeed in this country. Or to do better than your parents. Or to be a self-made man. Opportunity isn't knocking on doors anymore. The American Dream is quickly becoming a memory.
Most Americans didn't need a think-tank study to understand this. A growing sense of unease afflicts the country. Polls over the last decade or so consistently show that Americans think the nation is headed in the wrong direction. They're worried about jobs, the deficit, government spending, and the control of corporations over our representatives. And that unease spans the political spectrum.
* * *
Thursday, Oct. 27. Cameron Jensen reads to the general assembly a letter from the ACLU to Erie mayor, Joe Sinnott. "We represent Occupy Erie," begins the letter. It's cold; snow was predicted to fall today. Twenty to twenty-five have showed up. "We are writing to ask you to allow the demonstrators to continue sleeping in the park overnight," reads Jensen, "and to use sleeping bags, blankets, cushions, and tarps to stay warm..." Jensen is one of protesters who slept out on October 15, the first night of Occupy Erie. He's 21, wears glasses and a baseball cap.
"We are interested in working with you to achieve a resolution that will allow Occupy Erie to peacefully exercise its First Amendment right to demonstrate..."
This is big news. Occupy Erie now has a lawyer. Spirits are high, despite the cold. Jensen finishes the letter, and the general assembly races through its business. The search for an indoor office continues. A friendly labor union offered the group a conference room for meetings. A course in non-violence is scheduled.
Jensen suggests the first proposal: "I say we immediately put the tarps back up, as is our right under the First Amendment." Others disagree. They want to wait for the city's reaction to the ACLU's letter. The group agrees to calling their lawyer. Another of the original occupiers—Abby Count—calls. "The lawyer advises putting the tarps up at night," says Abby after a few minutes, "but taking them down during the day."
"I propose we roll them up," says Jensen. Another protester asks, "when is night? When is day?" Discussion ensues.
After the General Assembly is over, I corner Count. She's a young woman, in her mid-20s, today wearing a blue cap and matching jacket. She's lived in Erie only a couple of years, moved here to be close to family, and works as a waitress. Her aspiration? She wants to be a welder like her father. Count has a open face and a loud voice tinged with laryngitis. "I guess I'm just kind of a loudmouth," she says, laughing.
It's hard to connect Count and the rest of the protesters with the venomous comments written about them on Twitter, say. "I wish Barack Obama would legalize pot already, so those kids could go home and shower." "OWS is plain and stupid. Stop being violent and you won't be arrested!" "OWS = Marxists, Leeches, and Halfwits."
And according to surveys taken in New York, Occupy protesters aren't what their detractors make them out to be. Just 13 percent are unemployed, and 30 percent earn over $50,000 or more a year. Most interesting is that only 27 percent labeled themselves as "Democrats." The vast majority—70 percent—are political independents.
Polls, too, show that the Occupy movement has broad support among Americans. A CBS poll showed that 43 percent of Americans agreed with the protest, twice the number that disagreed. A Time poll had 54 percent of Americans with "favorable" feelings towards the movement. In New York, where the protest began, Quinnipiac found that two-thirds back Occupy Wall Street.
"It does bring attention," Count says about the protest and sleeping in the gazebo, "but that's not really what it's about. I think it makes you really identify your values." She's gotten sick and hurt her back sleeping on the concrete, so she's staying nights home for a couple of days.
"I'm an advocate of dissent," she continues. "I believe that in order to make democracy truly work, you need to have people who are saying, 'no!' This is what democracy looks like.
"Having a voice is more than just checking a box on a ballot, you know? If you really want something done about what's going on with the government, you can't just sit there, saying you can't do anything about it. Nothing's going to happen."