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General Electric

PRESS FAIL: AS GE CEO STEPS DOWN, BOSTON JOURNALISTS MUST DO THEIR JOB

AH-GE-TOP

 

June 14, 2017

BY JASON PRAMAS @JASONPRAMAS

recent column by the Boston Globe‘s Shirley Leung perfectly encapsulates the problem with local media cheerleading for General Electric’s decision to move its headquarters to Boston. The title alone says it all: “Will GE’s new CEO remain committed to Boston?” Because, like so many pieces on the subject by Leung and company, it fails to ask the key question: why did state and local government shovel huge amounts of public money to a private enterprise, and put it in a position to potentially cause grievous harm to a major city’s economy, to begin with? And why did the region’s newspaper of record — and much of the Boston press corps — back the scheme so uncritically?

But now, after all the prattle by fawning journalists about the days of wine and roses to come, it turns out that the various moves GE CEO Jeff Immelt made to reinvent the conglomerate as an “innovation” company came at the expense of a significant drop in profits. And it looks like the GE board balked and forced Immelt out — although the official line is that he “stepped down.” Doubtless after noting a rise in share prices in March after activist investors told Fox News that he might be pushed into retirement. He’s been replaced with a new CEO from within GE’s own ranks, John Flannery. Who hails from Chicago, and may not have the same warm fuzzies for the Hub that Immelt at least pretended to have. If Flannery doesn’t back the Boston deal as strongly as Immelt that could mean disaster for everyone who shilled for it. And if GE’s stock prices continue to tank, fuggedaboutit!

In that spirit, it’s worth recalling that the whole boondoggle was dumped on the public by Mayor Marty Walsh and Gov. Charlie Baker as a done deal in January 2016. There were no public forums on the plan, no deliberation by the state legislature or the Boston City Council, and certainly no referendums. The whole thing was cooked up on the quiet by high level politicians, their aides, and top GE brass. In the end, over $145 million in state and city tax breaks and direct aid was promised to GE — together with another $25 million in state money to fix up the area around the site of the company’s new Fort Point HQ, and up to $100 million in repairs to the Old Northern Ave. bridge. Up to $270 million in public money in total. Although the bridge project is now up in the air; so the final total — as with all final totals in public spending — remains to be seen. Still, a huge amount of money to spend on a vast multinational any way you slice it. Especially when GE is not yet being asked to pay rent for the 20 year lease on the public property its new headquarters is using.

As my own series of columns on the deal showed last year, GE has a decades-long track record of screwing government at all levels, communities it operates in, and its own workers six ways from Sunday. Which is why unearthing corporate crime after corporate crime by way of demonstrating why the people of Massachusetts have absolutely no reason to trust the company did not require much new reporting on my part. It was a relatively simple matter of looking at major investigative stories on GE by several news outlets — including the Globe itself. What I found was disturbing in the extreme. Yet the largest Boston news outlets were virtually silent about the very obvious downsides to championing the payoff of a corporate behemoth to relocate its HQ to our fair city. And now the most prominent of them is clearly getting worried about its violation of the public trust.

To review, General Electric has done a lot of bad stuff over the last forty years — much of it in Massachusetts. It slashed tens of thousands of good unionized jobs here. Destroying the economies of Bay State cities like Lynn, Pittsfield, and Fitchburg in the process. GE played highly illegal games with municipal bond investment funds nationwide — and got away with it. It wreaked havoc with the environment in many of the places it did business. Notably in Pittsfield and the Housatonic River valley south to Long Island Sound. Which it polluted with carcinogenic PCBs. A horrendous mess that it partially cleaned up after a protracted struggle with the EPA and local activists. Yet it continues to try to weasel out of finishing the job to save some small fraction of its annual profits. Like it did in a similar Hudson River cleanup. GE also played a major role in creating the toxic housing debt that led to the 2008 financial crash, and was then bailed out by the federal government with boatloads of practically free public money. In exchange for ruining the lives of thousands of poor mortgage holders. And it did all this while paying hardly any taxes at all relative to its huge size.

Ultimately, far too many area journalists dropped bags of balls with the GE Boston Deal story. If they had been doing their job — instead of engaging in a particularly crass form of unthinking civic boosterism that one would expect of low rent PR consultants for a down-on-the-heels rust belt city — Boston might not be in the position it’s now in. Stuck with a bad deal and light a bunch of money that the city and state desperately need during our ongoing fiscal crisis. Which was created by the very neoliberal playbook that still guides both government policy and kid glove news coverage of same.

But that’s what passes for thinking on economic development in the American press of today. My colleagues in major news media generally don’t push for regional planning controlled by democratically elected politicians and overseen by the public in real ways. They don’t support a grassroots process directly involving local communities that start by asking “what do working families need, and how might those needs be best served?” No, they just figure “let’s encourage the pols to throw public money at big corporations, and then they’ll come to Boston, and we’ll have a great economy.”

Well an economy that’s not great for working people is not a great economy. It’s a bad, unequal economy. And that’s the root of most of our major societal woes in this era.

Whatever happens going forward, I hope that next time top politicians cook up another backroom deal with corporate titans that the rest of the Boston news media will join my teammates and I at DigBoston in calling it what it is: corruption. Those who won’t should just go ahead and get jobs in the sleaziest PR operations they can find. Because they’re not fit to be journalists.

 

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director, and executive editor and associate publisher of DigBoston.

Copyright 2017 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

PROGRESSIVE CONFUSION

Clinton campaign image

Only multiparty democracy will ensure that left policies are enacted in Mass

May 10, 2017

BY JASON PRAMAS @JASONPRAMAS

There is a persistent myth that Massachusetts is a left-wing state. The basis of this demonstrably false conceit is that the Commonwealth has had a Democratic majority in its legislature for as long as anyone can remember. In that context, a recent State House News Service article, “Mass Progressives See Something Missing on Beacon Hill,” makes sense. It examines the political travails of the left-leaning Democratic Party pressure group Progressive Massachusetts, and questions why a progressive grassroots organization in such an ostensibly progressive state can’t get its bills passed with any regularity.

A state that just 50 years ago could build public housing, significantly expand public transportation, and build public colleges, today can’t pass any forward-thinking social program of any significance. Unless you think cutting taxesslashing public spending, and throwing public money at giant corporations like General Electric is a social program. Yet all along, the state has been run by politicians calling themselves progressive Democrat.

The answer to this quandary lies in the fact that the meaning of key terms in politics is  always shifting, as thought leaders modify them to suit the times. So, “progressive” has  had a variety of definitions over the last three centuries — all of which center around the  idea of modernity. From early “laissez-faire” free market capitalist modernity in the 1700s  and 1800s, to socialist modernity from the mid-1800s to the present, to the capitalist  social reformer modernity of the Progressive Era in the US between the Civil War and  WWI, to welfare state social democratic capitalist modernity from the 1930s to the 1970s,  followed by a full-circle return to free market ideology with neoliberal capitalist modernity  since that time. And its meaning continues to be contested to this day.

Key terms sidebarEspecially since a main feature of neoliberalism has been its ability to seduce once social democratic formations like the Democratic Party and produce so-called “Third Way” political leaders like Bill and Hillary Clinton — who have proved themselves more than willing to do tremendous damage to their core working and middle class constituencies. Via right-wing economic policies barely obscured by an ever-shrinking layer of critical social welfare programs, and a somewhat thicker layer of policies extending human rights guarantees to LGBT folks and other oppressed minorities.

So, in a sense, virtually all the legislators in the Mass State House today can call themselves progressive with a straight face. And many do, including lots of neoliberal Clintonite Democrats who play the role of Republicans in Bay State politics — the actual  Republican Party being quite weak here. Which leaves left-leaning Democrats like the  organizers of Progressive Massachusetts, heirs to the social democratic tradition of  reform-minded Keynesian welfare state policies as they are, in a bit of a pickle.

Because the main version of progressivism in American politics — electoral politics anyway — remains the neoliberal one. The Hillary Clinton wing of the Democrats, which just drove the party off a political cliff, and will continue to speed its descent to earth as long as its corporate paymasters wish them to do so. That wing, backed by multinational corporations, took power from the earlier generations of union-backed social democrats within the Democratic Party by the 1990s. It will not give power up without a major political struggle, and therein lies the heart of the problem facing groups like Progressive  Massachusetts.

In countries with more democratic electoral systems, this would be less of a problem than it is in the US. Or in Mass. We would have a multiparty democracy. The Republicans would be a smaller (but still powerful) right-wing capitalist party with smaller ascendent hard right parties on its flanks. The Democrats would be a smaller (but still powerful) center-right capitalist party. Progressive Massachusetts would be part of a center-left social democratic capitalist party. Socialists like me would have at least one significant left-wing party. And there would be smaller hard-left parties on its flanks.

Both the Democrats and Republicans would have to form coalition governments at the national and state levels. And it would be possible for smaller parties to drive their policies through in exchange for joining such ever-shifting coalitions. Messy perhaps, but far more democratic than our two party American system — where both “big tent” parties are dominated by corporations and the rich.

In that situation, a center-left party built around a group like Progressive Massachusetts could actually get its bills passed and have more influence in state politics. And a democratic socialist party of the type I’d like to see formed would join it in fighting for all of the good reforms it would back: single payer health care, free higher public education, etc. Then seek to influence the center-left party to back its policies … like a state bank and municipal control of utilities, for example.

The term “progressive” might devolve back to its original meaning: “believers in human progress, in modernity.” And be used more sparingly as a yardstick of societal advancement rather than a marker of a particular political camp.

Until then, many people — being creatures of habit we all are — will continue to use “progressive” to refer to the broad left. Or the even more misused term “liberal.” Various kinds of capitalists will continue to refer to themselves as “conservative,” “libertarian,” and, yes, progressive, and liberal. Massachusetts politics will remain to the right on economic matters and to the left on social ones — until new mass movements rise to shatter the status quo.

And we’ll muddle through somehow until then.

 

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director and senior editor of DigBoston.

Copyright 2017 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

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CHECK OUT THE 2017 AGENDA FOR PROGRESSIVE MASS

GE BOSTON DEAL: THE MISSING MANUAL, PART 4

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February 29, 2016

BY JASON PRAMAS @JASONPRAMAS

In May 2012, three former GE executives were imprisoned after being convicted on multiple charges of conspiracy to commit wire fraud and defraud the United States. Dominick Carollo, Steven Goldberg and Peter Grimm had all worked for GE Capital—the financial division that operated as a semi-legal “shadow bank,” and that accounted for about half of its parent corporation’s profits until the global financial collapse it helped precipitate began in 2007. Between 1999 and 2006, the trio conspired to skim millions from municipal bond investment contracts. With the full approval of their bosses.

According to Rolling Stone’s Matt Taibbi, the scam worked as follows for the company that Marty Walsh, Charlie Baker and cheerleaders like the Boston Globe have welcomed to Boston with open arms: Municipal governments commonly partner with big banks to sell bonds to pay for significant capital costs—like building schools. The banks invite investors to buy the municipal bonds and deposit the resulting funds in tax-exempt accounts from which all necessary project expenses can be paid. However, since all the bond money does not get spent at once, municipal governments typically hire brokers to find major financial institutions to invest it for them through a public auction process. In general, it is legally required that brokers get bids from at least three financial institutions—and the one that offers the highest annual rate of return wins the contract to invest the spare cash from a given bond fund.

But for GE Capital—and a host of other major financial institutions—the process was rigged from top to bottom. In the case of GE’s Carollo et al, the defendants conspired with executives at the brokerage CDR and financial institutions like Bank of America, JPMorgan Chase, Wells Fargo, and Morgan Stanley to divvy up investment contracts for municipal bond funds. CDR would drum up business with local politicians around the country—often bribing them with various kinds of campaign donations and gifts. The pols would then reward CDR with contracts to invest unspent funds from municipal bond issues, while CDR would work with the GE Capital—in concert with the other major financial institutions—to illegally decide which corporation would win which auction for such investment contracts in advance. The “winner” of each auction would collude with the other bidding financial services companies on the bid rate to ensure that the “winning” bid was as low as possible. The agreed upon rate was usually lower than a fair market rate by just a few tenths of a percent. But that was enough to make a killing.

For example, if a fair bid in an auction might have been that GE Capital would invest a municipal government’s unused bond funds at a 5.04 percent annual rate of return, CDR would coach the company to only offer 5 percent. The other bidders would purposely offer lower rates, losing in exchange for winning future rigged auctions. GE would then pocket the .04 percent windfall. A municipal bond fund that might have $200,000,000 to invest in its first year would return around $80,000 extra to GE in that fashion. Which doesn’t sound like much. But such bond funds would be invested by GE Capital for years until they were spent down fulfilling their original purpose to build schools and the like. And GE Capital and CDR colluded on huge numbers of such illegal arrangements, pouring vast sums into GE’s coffers. While depriving municipal governments of that same money. GE Capital then kicked back some of its take to CDR as “fees.”

Given the complexity and ubiquity of this practice, no one knows exactly how much was stolen. But since fines paid by large corporations to governments at various levels for such crimes tend to be vanishingly small, it’s possible to get an idea of the scale of the crime. According to the Securities and Exchange Commission (SEC), GE paid a $70 million coordinated settlement in 2011 to the SEC, Department of Justice, Internal Revenue Service, and a coalition of 25 state attorneys general. The SEC alleged that “from August 1999 to October 2004, [GE Capital] illegally generated millions of dollars by fraudulently manipulating at least 328 municipal bond reinvestment transactions in 44 states and Puerto Rico.”

GE committed yet another massive crime against the public interest. And got away with it. In November 2013, Carollo, Goldberg and Grimm were freed on appeal. The reason? The government had taken too long—ten years—to build its case against the former GE executives.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director.

Copyright 2016 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

GE BOSTON DEAL: THE MISSING MANUAL, PART 3

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Image by Kent Buckley

February 15, 2016

BY JASON PRAMAS @JASONPRAMAS

Returning to our ongoing look at General Electric’s recent and inconvenient history of violating the public trust, in part 2 of this “missing manual” the corporation got out of the subprime housing loan market just in time to avoid destruction in late 2007. But it could not escape from the consequences of an economy based on selling toxic home loans to poor people who were defaulting in vast numbers by 2008.

That year, everything began to unravel for GE—as it did for all other large interlocked financial services companies that derived a substantial percentage of their profits from predatory loans in the same period.

According to Fortune magazine, after reporting an unprecedented first quarter loss of $700 million, GE’s stock price began spiraling downwards in April 2008. Failing to sell off its light bulb, appliance, and private-label credit card businesses over the summer due to the worsening economic climate stopped the corporation from making typical course corrections to get back on its feet.

In September 2008, GE’s stock price crashed after Lehman Brothers—a financial services titan—collapsed on the heels of Bear Stearns’ disintegration that March. The company became starved for operating funds. But the private credit markets were frozen in terror.

On September 30, GE made two desperate moves. At 7:30 am it sold $3 billion in preferred stock to billionaire investor Warren Buffet’s Berkshire Hathaway Inc. on very bad terms. At 1:44 pm, GE announced its deal with Buffet and said it would sell $12 billion of common stock the next day at prices far lower than it had paid to buy back $15 billion of its own stock over the preceding year. Meaning it was selling the stock at a huge loss in exchange for ready cash.

The next day, the coup de grace: Word spread throughout the markets that GE would be unable to cover billions in regular payouts to holders of its commercial paper. Basically a kind of I.O.U., commercial paper is a kind of short-term promissory note that big corporations like GE are able to issue on an ongoing basis to raise money to cover things like daily expenses. There is no collateral behind commercial paper. Only the good name—and, ideally, top-flight credit rating—of the company issuing it. In normal times, it’s a far cheaper way to borrow money than a line of credit with a commercial bank. But 2008 was not a normal time. At one point that year, GE had over $100 billion dollars out in commercial paper as it tried to stay afloat.

Executives clearly knew their company was doomed unless the government bailed it out. Already on September 30, a GE spokesperson “e-mailed the media with a message that Congress must act ‘urgently’ on the pending financial bailout package.” But the company didn’t wait for congressional action. Since it was not a traditional bank, GE did not qualify for a significant direct cash infusion under the infamousTroubled Asset Relief Program (TARP). So it spent the next few weeks brokering a backroom deal with the Federal Deposit Insurance Corporation (FDIC).

According to the New York Times, on November 12, 2008 the FDIC announced that it would back GE’s commercial paper for up to $139 billion under the Temporary Liquidity Guarantee Program (TLGP). A program that the federal government changed overnight to allow GE to qualify—just as TARP was changed to benefit Goldman Sachs et al—according to Pro Publica and the Washington Post. GE had “joined major banks collectively saving billions of dollars by raising money for their operations at lower interest rates.” The company was able to sell $74 billion in government-backed commercial paper and longer-term notes by Spring 2009.

And how did GE survive the period between its early October 2008 financial collapse—when it was still short on funds despite the precipitous sale of $15 billion of its stock—and its November 2008 bailout by the TLGP program? In 2010, Pro Publica reported that Federal Reserve Board documents released that year showed that GE had effectively borrowed $16 billion more dollars at that time by selling commercial paper through the Fed’s Commercial Paper Funding Facility (CPFF).

So General Electric was saved by two government programs that provided it with upwards of $90 billion dollars of cheap credit. According to the corporation’s own September 30, 2009 10-Q filing to the Securities and Exchange Commission, GE paid only $2.3 billion in fees for its participation in the TLGP and CPFF programs. Meaning that GE got unbelievably good loan terms—the equivalent of a flat 2.56 percent interest rate. Less than the rates that Americans pay on most any other loans. Including the housing loans that wrecked the economy in 2007-2008. And the student loans that could very well lead to another financial catastrophe before this decade is out.

That is how GE got to survive the recession it helped create. By gaining access to a massive pool of public funds totally unavailable to its tens of thousands of subprime housing loan victims. The same company under the same leadership that Massachusetts officials are paying $270 million to bring to Boston. Excelsior!

Coming soon in part 4: GE’s municipal bond scandal and other amusements.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director.

Copyright 2016 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

GE BOSTON DEAL: THE MISSING MANUAL, PART 2

18.04 AH IMAGE GE

Image by Kent Buckley

February 1, 2016

BY JASON PRAMAS @JASONPRAMAS

Two weeks after the first installment of this Missing Manual, we now know that GE will receive up to another $100 million of Boston’s largesse in the form of reopening the Old Northern Avenue Bridge and $25 million in state money for work on roads, pedestrian walkways, and bike lanes near the corporation’s new Seaport District HQ. Pushing the total giveaway to over $270 million in public funds.

Gov. Charlie Baker, Mayor Marty Walsh, and boosters like the Boston Globe claim that the investment will be worth it. Yet GE’s record of slashing jobs, despoiling the environment, and evading taxes says otherwise. And their role in the subprime mortgage crisis further repudiates such official optimism.

Back in 1999, the Glass-Steagall Act—a critical piece of Depression-era social legislation that put up a firewall between commercial banks and investment houses—was torpedoed by Congress. One of the excuses for the deregulatory push was the claim that so-called “shadow banks”—institutions that perform banking functions outside of the traditional system of federally-regulated banks—were doing great business with less regulation. The now-diminished GE Capital was then one of the largest shadow banks, since as the finance arm of an industrial concern it was not classified as a bank. Thanks to that fact and the happy coincidence that GE Capital owned a small Utah savings and loan operation, it was allowed to “engage in banking under the lighter hand of the Office of Thrift Supervision.” Rather than the more strict banking regulations overseen by the Federal Reserve—which do not allow banks to engage in commerce—according to a 2009 report by ProPublica and the Washington Post.

Ironically, the deregulation of the banking system proved to be a key factor in the 2007 subprime mortgage crisis and the resulting 2008 financial crisis. And the much-praised practices of shadow banks like GE Capital were precisely the ones that nearly wiped out the US economy. GE had long used GE Capital, equivalent to the seventh largest banking company in the US until 2008, to fatten its bottom line. According to Maureen Farrell of the Wall Street Journal, “GE got into lending decades ago and grew that arm of its business steadily in the years before the crisis, as it was able to leverage its triple-A credit rating for access to cheap capital. Before the credit crisis, GE relied upon lending for around 50 percent of its earnings.”

So in 2004 GE Capital had plenty of ready cash to buy California-based WMC Mortgage Corp.—a company that specialized in foisting subprime housing loans on poor families that couldn’t really afford them, using highly unethical sales tactics—for about half a billion dollars. According to a 2012 report by Michael Hudson of The Center for Public Integrity, even before the purchase, WMC “… was producing $8 billion a year in subprime home loans and boasting profits of $140 million a year.”

Then in 2006, US housing prices declined sharply. Subprime borrowers with no reserve cash were unable to refinance their home loans as their adjustable-rate mortgage payments increased mercilessly. Subprime lenders then began to automatically slap late-paying borrowers with even higher penalty rates. More and more people defaulted on their loans. Lenders like WMC suddenly went from being cash-rich to being cash-poor.

GE Capital was hemorrhaging money by 2007. During the first half of that year WMC lost over $500 million as the mortgage industry “spun into chaos.” By October 2007, the Center for Public Integrity report concludes, “WMC Mortgage was effectively out of business, dead after having pumped out roughly $110 billion in subprime and ‘Alt-A’ loans under GE’s watch.”  

Meanwhile, GE Capital, like many other financial institutions of the period, had rolled packages of subprime mortgage debt into Residential Mortgage-Backed Securities (RMBSs)—which it then sold to investors. Including institutional investors like government-sponsored housing lender Freddie Mac. When the WMC subprime mortgages collapsed in 2007, the GE Capital RMBSs based on them followed suit. And the whole house of cards built on bad mortgages to poor people fell down. GE Capital immediately put hundreds of millions of dollars aside to pay off its investors. But not its mortgage holders. WMC-issued mortgages failed at rates of up to 75 percent in some areas. Ruining the lives of tens of thousands of working families in the process.

GE had gotten out of the subprime racket just in time to stay solvent into 2008. The most significant federal blowback from the episode came in 2011 when the Federal Housing Finance Agency that regulates Freddie Mac sued General Electric for selling them $549 million in subprime-based RMBSs. According to American Banker, they “charged GE’s former mortgage lending unit with presenting a false picture of the riskiness of residential mortgages behind securities that were sold to Freddie Mac.”

GE settled the suit in 2013 for just $6.25 million.

Coming soon in part 3: the 2008 financial crisis and federal bailout of General Electric.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director.

Copyright 2016 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

GE BOSTON DEAL: AN ACTIVIST HANDBOOK

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Images (from 2012 protest against GE in Boston) by Chris Faraone

January 28, 2016

BY JASON PRAMAS @JASONPRAMAS

Say friend … is a multinational corporation with a terrible reputation, a limitless PR budget, and a penchant for backroom deals with fawning politicians bleeding your state for hundreds of millions of public dollars that would be better spent on virtually anything else? A multinational named General Electric?

Are you afraid of the consequences of such malfeasance for your community and for democracy itself? Want to do something about it? Then look no further. What you need is a corporate campaign. Sourcewatch—a fine resource for journalists and researchers alike—has a concise definition of the term:

Corporate campaigns were developed in the mid twentieth century by activists and organizers such as Saul Alinsky, and honed in recent decades by labor unions and non-governmental organizations in the environmental, social justice and consumer movements. The goal of a corporate campaign is to publicize undesirable behavior or practices by a corporation through various strategies and tactics that can force change upon the company and thus allow the campaigning organization to claim a victory for its cause. At any given time organizations and even individual citizen activists are waging scores of corporate campaigns, some of which last for years, with varying results.

In my own experience, a corporate campaign is a limited strategy. It does not automatically lead to a broader democracy movement in a society, but can be a stepping stone along that path. It is not always a progressive strategy, although progressives probably use it more than any other political current. NIMBY activists in rich towns use it to keep apartment buildings and wind farms out. Right-wing Christians use it to attack companies that publicly support things they oppose—like reproductive rights, gay marriage, and the wheel.

That said, a corporate campaign is still a useful arrow in the proverbial quiver of justice. And here’s how you can run one.

  • First, decide that a campaign is needed. Gather some like-minded friends into a loose organization, and agree to work together towards a common goal.
  • Second, see if there’s already an organization running such a campaign. If there is, check them out. Do they seem to be a real grassroots expression of the needs of some definable community? If they do, then consider joining them or working with them in coalition. Or do they look like what seasoned activists call an “astroturf” group—a fake organization typically set up by some powerful interest or other to help confuse its antagonists and stop them gaining public support. If so, give them a wide berth and spread the word that others should do the same.
  • Third, start researching your target corporation. Talk to librarians, journalists, academics, and experienced campaigners for advice. Find out everything you can about the company —with a focus on their recent activities. Look for proof of bad behavior in their business and political dealings.
  • Fourth, research possible remedies. What have other communities done to reign in the power of your target corporation and corporations like it? Court action, regulation, and legislation are all good avenues to pursue.
  • Fifth, publish your evidence. Papers, articles, broadsides, podcasts, and videos are all good ways to get the word out.
  • Sixth, if you haven’t already, start fundraising. You’ll need money to win a corporate campaign. You might get some small grants from open-minded foundations early on, but your lifeblood will (and should) be donations you raise from your personal network, your new organization’s network, online via crowdfunding using platforms like GoFundMe, and through fundraisers of various types. You’ll never have anything like the money of your opponents. But you’ll have the strength of your convictions, and—if you do your job well—the support of your community. And can therefore overcome any obstacle if you persevere.
  • Seventh, organize your allies. Pull together community organizations, religious groups, non-profits, labor unions, friendly politicians—anyone who is going to aid your campaign and is willing to work with you.
  • Eighth, build a solid social media presence. Make use of widely available free communications technology to make friends and turn them into supporters. Create a page on Facebook, and a central Twitter account—both with your campaign’s name on them. Regularly feed your presence with updates about campaign activities and links to relevant material. Converse directly with your followers as interaction is key on social media.  Keep in mind that you may never have to create a full website for your campaign if you make good use of social media, but it’s usually a good idea to at least launch a blog on one of the many free blogging communities.
  • Ninth, prepare your public relations campaign. Develop contacts in the press. Plan events and actions that will get and hold the public’s attention. Encourage journalists to cover those events and actions.
  • Tenth, hold your events and actions: open forums, lobby days, protests, and boycotts are all good ways to pressure politicians and corporate leaders to change their policies.

Finally, mobilize as many people as you can to support your campaign. Be sure to give them simple things they can do to show their support and attract even more people: like wearing one of your campaign buttons or putting one of your bumpers stickers on their car. If you’ve done your job well, so many people in your community will agree with you that it will become possible to win your campaign goals—whatever they are.

For a useful model, check out the recent successful #NoBoston2024 campaign—which wasn’t a traditional corporate campaign, but that nonetheless had all the elements of one. And it was a slam dunk resulting in a resounding popular victory against putting the City of Boston in hock for decades for a sporting event with a long history of corruption.

Questions? Feel free to contact me at jason@binjonline.org. And for those of you who might launch a corporate campaign against GE: let’s be careful out there.

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director.

Copyright 2016 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.

GE BOSTON DEAL: THE MISSING MANUAL

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Image by Kent Buckley

January 18, 2016

BY JASON PRAMAS @JASONPRAMAS

The saga of GE’s flight from Connecticut began with the June 2015 passage of a very much needed package of state tax increases aimed at raising an extra $1.1 billion over the next two years. By extending a temporary 20 percent surcharge on its corporate profits tax and by implementing a more straightforward way of calculating corporate taxes, the Constitution State expects to pull in $700 million of that total from major corporations. The money will be used to fund social programs and improve mass transit. Imagine that.

GE brass immediately flipped out. And followed through on a threat to move their headquarters out of Connecticut. They began publicly courting cities around the US to get the best possible deal. Boston moved to the front of the pack by the fall. Then last week, GE officially announced that they would be moving their HQ to the Hub—specifically the so-called “Innovation District” on our soon-to-be-flooded waterfront.

What followed has been one of the most disgusting spectacles of press release transcription by the Boston mainstream news media in memory. Fulsome praise was lavished on Gov. Charlie Baker, Boston Mayor Marty Walsh, and their busy lieutenants like John Barros for literally selling out the people of this city and this Commonwealth. A massive giveaway of $25 million in city “property tax relief” and $120 million in state “grants, tax incentives, infrastructure improvements, and help with real estate acquisition costs” to GE was treated as if it was the product of genius, rather than another nail in the coffin of democracy. The record of one of the most vicious and capricious corporations in world history was soft pedaled by focusing on the supposed benefits of the deal to the people of the Bay State. Which are … what exactly? The 800 predominantly transplanted jobs at the new GE Boston HQ? The up to 600 jobs at the new Marlborough branch of GE Healthcare Life Sciences by 2017? The assertion that the company will “base a new division, focused on lighting and energy, in a to-be-announced location in the Boston area” at some point? Airy claims about GE’s presence attracting other businesses to the state? Blather about “corporate philanthropy to the arts?” And something about “bragging rights?”

Stuff and nonsense. For starters, the vast majority of jobs that will be created locally by GE in the coming years will be professional/managerial level. Worked by the kinds of helicopter yuppies that will then buy some of the expensive condos that are being built all over the region. These few new jobs are not the jobs that are needed. They are not the tens of thousands of regular jobs that are going to help get beleaguered working and middle class families back on their feet after the economic depredations of the last 40-plus years. Depredations that GE pioneered.

The company had 13,000 mostly unionized workers in Pittsfield, MA decades back. Last fall, the Saudi Arabian-owned remnant of the former GE plastics division based there announced that it was leaving for Houston and taking the last significant group of ex-GE jobs, 300 in total, with it. GE had over 12,000 mostly unionized workers in Lynn, MA as recently as the early 1980s. Now there are about 1,400 unionized workers left, and 3,000 workers overall. GE closed its plant in Fitchburg, MA in 1998—taking 600 good jobs with it. GE is closing its Avon, MA plant later this year. Another 300 jobs gone. Cuts that devastated a number of communities, and contaminated the Housatonic River around Pittsfield with PCBs that GE is still fighting to avoid fully cleaning up—an issue capably reviewed by International Business Times last week.

Over the past year, GE leadership has continued such labor “innovations” by cutting medical and life insurance benefits to all non-unionized retirees over 65 on January 1, 2015. And cutting the same benefits to all unionized retirees over 65 at the start of this year. Tossing a mere thousand bucks a year to tens of thousands of GE retirees around the country and telling them to buy their own supplemental medical plans somehow.

Given this disturbing backstory, the claim by feckless pols that property taxes and other taxes that GE will eventually have to pay Boston and Massachusetts will soon outstrip the $145 million being handed to them beggars belief. GE is a vast corporate behemoth that employs hundreds of tax specialists to avoid paying any taxes at all. According to Citizens for Tax Justice, between 2010 and 2014, GE earned $33.5 billion in profits but claimed federal tax refunds of $1.4 billion—an effective tax rate of -4.3 percent. And paid a combined state tax bill of only $530 million—an effective state tax rate of just 1.6 percent for the period.

This is GE. This is the corporate scofflaw that Charlie and Marty and their many business buddies cut a bad deal with. Now what are readers going to do to stop it and #makeGEpay?

Apparent Horizon is syndicated by the Boston Institute for Nonprofit Journalism. Jason Pramas is BINJ’s network director.

Copyright 2016 Jason Pramas. Licensed for use by the Boston Institute for Nonprofit Journalism and media outlets in its network.