Shelterforce, the journal of affordable housing and community building, has published a number of articles covering The New Bottom Line and our partners. We'll post new articles about The New Bottom Line as they are printed, but for now, check out this round-up of New Bottom Line coverage from Shelterforce!
The New Bottom Line: A Coalition Built to Last
by Matthew Brian Hersh
The New Bottom Line, an alignment that is highlighted in the Fall 2011 issue of Shelterforce, recently received the "Most Valuable National Coaltion" honor from The Nationas part of the magazine's "Progressive Honor Roll":
"Objecting to a politics that makes Wall Street's bottom line the nation's top priority, National People's Action, People Improving Communities through Organizing (PICO National Network), theAlliance for a Just Society, the Right to the City Alliance and the Main Street Alliance declared in 2011, "We need a new bottom line that puts the economic interests and financial security of working American families first." As the New Bottom Line coalition, they organized multi-state projects like the Move Our Money campaign to take $1 billion out of big banks. And the coalition allied with the Occupy movement in its Occupy Our Homescampaign, which supports families fighting foreclosure and eviction and helps homeless families move back into their vacant foreclosed homes."
Those organizations mentioned in that blurb are only the national ones -- The New Bottom Line's scope comprises a much larger group of local and regional organizations as well.
In the Shelterforce article, "The New Bottom Line," SEIU's Stephen Lerner and NPA's George Goehl explain the foundations of the coalition, and how so many organizations, while sharing common goals but disparate in many ways, came together behind certain fundamental principles:
Wall Street bankers crashed the economy, but none of them have been held accountable for their crimes. They have not paid to fix what they broke, and they continue to duck from paying their fair share of taxes. The result: a shrinking middle class, widening gaps in wealth inequality, and our most vulnerable populations spiraling into deeper debt, wealth loss, and joblessness.
Read more here.
The Unlikely Activists
Wall Street’s criminal recklessness and its impact on millions of people across the country is making activists out of an unlikely selection of people.
Peggy Mears is a 52-year-old African-American woman living with her husband in suburban San Bernardino County, California, one of the epicenters of America’s foreclosure crisis. Donna Vieira is a 42-year-old Chinese immigrant living with her husband and six-year-old son in San Leandro, California. In normal times, these two women would appear to have little in common.
But these are not normal times.
Over the past year, both women were arrested after joining others in the fight to stop foreclosures and curb Wall Street abuse. Neither had ever been arrested before, and neither thought she ever would be. And yet, both see this arrest as one of the proudest moments in their lives. And when talking to both of them, there’s one thing you’ll hear loudly and clearly: “The banks are the criminals. The bankers are the ones who should be locked up.”
Mears and Vieira both say the time has come for everyday people across the country to band together and take on the power of Wall Street, and big corporations more generally. The survival of what they see as the “American way” depends upon it.
We are in a moment in time when making the connection between the out-sized power of big corporations in our body politic and the crisis on the ground—in our lives and in our neighborhoods—cannot be missed. The nation’s largest banks engaged in predatory lending, crashed the economy, got bailed out, continue foreclosing on millions of homeowners, and continue to rip-off our cities and states with disadvantageous loan and bond deals.
People get it. People like Mears and Vieira are outraged at the bailout of Wall Street, while Main Street suffers. The Refund California campaign in California that Peggy, Donna, and thousands like them are involved in begins with an analysis that as much about addressing income inequality long-term as it is about stopping bank foreclosures here and now.
Since early 2010, the Alliance of Californians for Community Empowerment, or ACCE, and its members have examined the role of Wall Street banks in our economy and in our lives as we have waged campaigns to reduce foreclosures and “make the banks pay” for the havoc they have wreaked on our communities. We spent time looking into the issue of Wall Street money and its influence on California politics. Through this process our members have come to understand that community organizations with ambitions to build power in order to achieve some measure of economic, social, and racial justice need to spend at least as much or more time taking on the corporate elite—the shadow government behind the elected officials who we try to hold accountable—as we currently spend fighting “city hall.”
Organizers often look for the intersection between a “hot” base or constituency—one that is ready to move—and a strategic campaign that has the potential to deliver wins and build power for our communities.
Increasingly, many of us look for opportunities to wage campaigns that shift the narrative from blaming government, unions, immigrants, and other scapegoats to forcing big banks and big corporations to be held accountablefor fixing the crisis they created. Right now, we have an opportunity to tap into peoples’ anger and go on the offense with a campaign that goes after a central culprit—Wall Street.
Since mid-2010, ACCE has been working with partners such as PICO California and various SEIU locals to build a coalition campaign, now called Refund California. This campaign advances interim solutions to reduce foreclosures, raise revenue, and stabilize neighborhoods, while organizing and building a movement with others to hold banks accountable and reform the financial system. Similar efforts are being mounted across the country and being linked together as a national campaign, called New Bottom Line (see p. 8). Our longer-term goals are nothing if not ambitious. Our only chance of success is through a national movement to hold Wall Street accountable.
In California, our campaign is a fight for fairness.
- Fair Share: Advance local and state policies that make banks mitigate the costs incurred by the foreclosure tsunami and pay their fair share in taxes. This includes enacting “bank blight” ordinances that fine banks $1,000 per day for failing to maintain vacant properties that they own. There is also a proposed state foreclosure tax, currently stalled in the legislature, that would have banks/servicers pay $20,000 per foreclosure to help reimburse local and state government and schools for the fiscal impact of the foreclosure crisis
- Fair Finance: Get Wall Street banks to cancel or renegotiate the interest rate swap deals that are ripping off many cities, school districts, transportation districts, and the state.
- Fair Lending: Demand that banks use principal reduction as a standard loan modification strategy and that they clean up their loss mitigation process.
In addition to taking our demands directly to the banks, we have been working on three goals at the state government level: passing state legislation to prevent the practice of “dual tracking,” where a bank moves forward with the foreclosure while the borrower is still in the middle of negotiating a resolution with the bank; pushing the state attorney general’s office to include principal reduction as part of the 50-state settlement being negotiated; and securing a court-based mediation program that brings banks before a retired judge and helps to enforce fair loan modification negotiations. The program currently only exists in Orange County, leaving the rest of the state’s homeowners with no form of due process.
To work on all of these goals, the Refund California campaign is starting with a strategic organizing process. We aim to build a large base of struggling homeowners who move into escalating direct action on banks and in support of the agenda, develop the knowledge and leadership capacity of core activists and build a broad and diverse coalition both locally and statewide. Working with this organized base, we are putting direct pressure on targeted corporations, including escalating actions by homeowners and supporters, divestment by cities and major shareholders, exposing the issue of bank influence over politicians, running local and state policy campaigns to get elected officials to stand up to the banks, and turning our agenda into campaign issues during electoral season. We are also implementing a strong communications plan that brings statewide, if not national, attention to the coordinated local activities across the state and helps to make the role of the banks in rebuilding California a major topic in the news.
We’ve had a number of victories:
- ACCE, together with SEIU and PICO, passed ordinances in Los Angeles, Oakland, and Richmond that have the potential to bring in millions of dollars in fines on banks for leaving vacant, blighted properties in our neighborhoods.
- Our campaign partner SEIU Local 1021 got the city of San Francisco to push JPMorgan Chase to renegotiate an interest rate swap deal, saving $43 million and insuring that a major cultural landmark—The Asian Art Museum—remained solvent.
- In both Los Angeles and San Francisco counties, assessors collected some $15 million each in additional funds from property taxes after ACCE, SEIU 721, and SEIU 1021 pushed them to reassess bank properties that had changed hands.
As much as Refund California is about action on the policy level, it’s also about building a popular movement around these incremental policy changes. It is about the people who are fed up with bank abuse and are coming together across the state to do something about it.
Take William and Esperanza Casco, owners of a small market in the city of South Gate. They have raised their three children in their Long Beach home of over 17 years, but in late 2009, despite the fact that they had a stable income from their business and were not having trouble with their payments, they were put into a forbearance plan that significantly reduced their payments and were then encouraged to apply for a HAMP modification. Like so many, they were given a trial modification with lower payments. They continued making on-time payments until August 2010 when JPMorgan Chase told them that they were $50,000 in arrears and put them into foreclosure. On September 12, 2010, even though they never missed a payment on their loan, the Cascos’ home was sold and the family faced eviction.
But rather than give up, the Cascos found the ACCE Home Defenders League. On November 23, 2010, ACCE members held a press conference at the family’s home followed by an action at the nearby Chase Bank branch. Armed with roasted turkey, greens, corn bread, pumpkin pie, and more, we set up a long table, chairs, and tablecloth, and joined the Cascos for their Thanksgiving dinner at Chase Bank—since they would soon have no place else to hold it.
ACCE members kept the pressure on, and by mid-December the Cascos were back in negotiations with Chase. By January, their foreclosure was reversed, a fair modification agreed upon, and they had their home back.
The lesson here is that playing by the rules created by the banks works for Wall Street. Collective direct action works for Main Street.
Home Defenders League has taken the fight to the streets to save someone’s home from foreclosure or demand that the banks pay to clean up their mess at least once a week since the campaign launched. These actions are the fuel that leads to immediate wins, keeps our members motivated, and builds public and political support for the policy demands that hold the promise of helping our communities as a whole over time.
Regular people like Peggy Mears and Donna Vieira are leading the charge. Driven by their conviction that the banks are harming America and the American Dream, they speak to some of the angry millions who are struggling to pay their mortgage, credit cards, or college loans while they watch the banks get away with unconscionable acts of recklessness and fraud that crashed the economy and meant job loss, home loss, and an overall loss of wealth to millions of working- and middle-class families.
“One chopstick breaks easily. Many chopsticks cannot be broken.” Vieira shared this Chinese proverb as she talked about her strong commitment to organizing. Born in China and having lived there until her early 30s, this kind of activism did not come naturally to her. When she and her husband, a real estate appraiser, learned that Wells Fargo was foreclosing on their home, she felt shame. She didn’t want people to know. But all this changed once she understood better what the banks had done. Then she got mad. She found ACCE and PICO, two community groups helping struggling homeowners and the community fight back.
Vieira began participating in community meetings and actions. In April 2011, she joined over 500 people in a march on the annual Wells Fargo shareholders meeting in downtown San Francisco. Armed with shareholder proxies that gave them entry, Vieira and nine others attended the shareholders meeting. They went up to the microphone in pairs, told their foreclosure horror stories, and demanded that CEO John Stumpf agree to renegotiating mortgages based upon a significant reduction in principal, which would prevent tens of thousands of foreclosures. Pair after pair of protestors were escorted out by the San Francisco Police Department. Our group completely took over the meeting and forced the discussion to be about the abhorrent actions of Wells Fargo for nearly an hour, making the shareholders and top bank executives listen to the real life effects of their decisions. In the end, a total of eight people were arrested, and the event received significant positive media coverage that framed the issue as homeowners standing up to Wall Street.
Far from a radical, Vieira sees herself as simply standing up for truth and integrity against the dangerous and criminal abuses of the big banks. As she puts it, “When you see a wrong, you need to speak up. People are just trying to live with some dignity. It’s up to us to fight to preserve homeownership—the American Dream.”
Mears’s story is similar in that when she first got the foreclosure notice she was depressed. But then she got angry. She and her husband Alvin have owned their home for over 20 years and raised two kids there. “The house is nothing fancy, but my husband worked very hard for it. He put his blood, sweat and tears into it,” she says.
After hearing a news report about an ACCE rally organized for a family refusing vacate their home, Mears called up the ACCE Home Defenders League, got involved, and quickly became a leader.
Then in December 2010, Mears, her husband, and 125 struggling homeowners, community residents, and their supporters gathered in downtown Los Angeles for an action at a Chase Bank office tower. They formed a circle in front of the building, and held hands in a prayer. They prayed for strength and prayed that their actions and words would touch the hearts of the bank executives.
The event resulted in a complete shut down of the bank and effectively all the other businesses in the 26-story office building. Roughly 100 police officers were on the scene, as were a dozen press outlets. After the protestors spent an hour singing and chanting and attracting the attention of lunchtime passersby, the police arrested all of them and walked them, one by one, to a waiting paddy wagon.
Mears is proud of this moment. “Even though we were fighting a mighty bank, it’s like the story of David and Goliath. I felt like David on that day.”
The Sword and the Shield
Boston’s City Life/Vida Urbana is finding success by turning conventional wisdom on its head and entering the pictureafter a foreclosure has taken place.
It was a hot August day when more than a hundred people gathered outside Drusilla Francis’s home in Boston’s Dorchester neighborhood. Signs emblazoned with “We Will Not Be Moved” and other candid sentiments regarding bank behavior were on display as two policemen looked on. A constable, equipped with a moving van and orders to evict the 60-year-old Francis and her two foster children, talked frantically on the phone to his client, U.S. Bank. Perhaps he did not expect to be challenged.
Several lawyers on Francis’s side explained to the constable that he did not have the appropriate paperwork to evict Francis, a Central American immigrant, and eviction was avoided that day. Had he brought the proper documents, the policemen would have walked through the marching protesters to arrest various the members and allies of City Life/Vida Urbana (CLVU), an affordable housing and tenants’ rights organization, who had volunteered to stand peacefully in the way of eviction. The eviction and the arrests, had they occurred, would have been captured by news cameras and print reporters, and it would have been another devastating loss for a family in bank foreclosure. But all that was averted thanks to collective action and resistance that let the banks know that they could no longer easily upend peoples’ lives and avoid public relations debacles.
Tisa Taylor, whose home was saved by a similar action, but not before her father suffered a devastating stroke soon after the family home was foreclosed upon, explained why she took a day from work to attend the blockade: “I keep coming back to these actions to help because CLVU was there for us. I don’t want to see my neighborhood boarded up. I want to see my community flourish.”
CLVU has long employed a paired organizing-legal defense method known as The Sword and the Shield to save tenants from displacement due to harassment and attempts at gentrification. Recently, these tactics have been adapted and applied to prevent evictions of foreclosed owners and their tenants, creating public relations nightmares for large financial institutions.
So how did a local, traditional tenants’ rights organization end up in the national spotlight and in the thick of the foreclosure crisis? While CLVU organizers could see the problem and the pain of people caught in the middle of the foreclosure crisis, they did not immediately see a role for their organization. Organizing homeowners to prevent a foreclosure means getting entangled in casework, which was not their strong suit, while there were other organizations helping homeowners in trouble. Typical organizing campaigns balance smaller tactical victories with larger strategic objectives, and it was unclear to CLVU what they would be in this case. CLVU decided to stay out of it.
But Steve Meacham, a community organizer who has worked for CLVU for 11 years, noticed growing numbers of tenants and owners being evicted from their foreclosed homes in no-fault evictions in 2007 and 2008, and he saw an opportunity. Massachusetts is one of 30 states that does not require judicial review for foreclosure, meaning banks can foreclose on a property without going to court. In its long and successful history, CLVU had learned how to fight evictions. Here was a clear opportunity to “collectivize,” to use Meacham’s word, the individual struggles of homeowners. CLVU decided that it had a promising course of action: organize owners and tenants after foreclosure and before the inevitable no-fault eviction.
This was a tactical innovation. Many organizations work with homeowners to prevent foreclosures, but post-foreclosure organizing played to CLVU’s strengths. They could organize rallies, stage actions, and use public relations as a weapon against financial institutions, and they could do this using symbols and art, repurposing the sword and shield for bank tenants.
The post-foreclosure campaign gives CLVU a way to merge short-term gains, long-term demands, and political education. It has three goals: Prohibit no-fault evictions of tenants and foreclosed owners, with an interim goal being to block as many individual evictions as possible. Force banks to negotiate with foreclosed owners who want to buy back their properties. And secure mortgage principal reduction to current market value, rather than the bubble-inflated price created by the speculative boom, for owners both foreclosed and in danger of foreclosure. Financial institutions see threats to their way of doing business behind each of these three demands.
The Sword, the Shield, and the Offer
One of the first things City Life/Vida Urbana did was to organize the Bank Tenant Association, a multicultural, multiethnic group of foreclosed owners and tenants in foreclosed properties. The BTA wields the sword part of the equation, which is CLVU’s tiered confrontational approach to blocking foreclosure sales and preventing banks from evicting foreclosed owners and tenants. Using foreclosure lists, CLVU staff and cadres of volunteers canvass homeowners in trouble and assess their situation and willingness to take action.
“Many people experience a feeling of shame in losing their home to foreclosure. Some don’t even tell their own family members,” observes Curdina Hill, executive director of CLVU. For CLVU organizers, one of their most significant tasks is to address this feeling of shame and isolation so that foreclosed owners can acknowledge their situation in a public setting and make a conscious decision to engage in collective action. “The Bank Tenant Association is a place where people find their voice and sense of power after hearing from and connecting with other people going through the same experience,” says Hill.
Upon joining the BTA, members take part in a range of interventions including auction protests, vigils, “block rebellions,” and eviction blockades. Block rebellions include actions such as occupying vacant buildings with community residents. At least one person who occupied a vacant foreclosed property has won the opportunity to buy the property. Other forms of protest include bank pickets, and un-rent strikes, where a group presses a bank to accept rent payments from tenants or foreclosed owners of a property. One bank function, a demonstration at Deutsche Bank’s annual golf tournament, gained local media attention and scored huge public relations victories for CLVU and the nascent BTA. As a result of this action, Deutsche issued a letter to their servicers urging them to pursue alternatives to eviction post-foreclosure. It was a defining moment for CLVU that served to coalesce the campaign.
The shield part of the equation suggests protection. In one sense this comes from the power of being part of a group rather than a lone agent or victim. But the shield also refers to legal protection. Lawyers from partner organizations such as Greater Boston Legal Services and Harvard Legal Services Bureau attend BTA meetings to discuss individual situations and alternatives in private meetings with members.
The centerpiece of The Sword and the Shield is the weekly BTA meeting, which now attracts upward of 100 people. Participants are invited to talk about their situation, in a sense to give testimony. Many of the participants at the meetings are people who have resolved their situations and attend to express their solidarity. The meetings have a flavor of movement politics and are animated by the spirit of revival, complete with slogans and songs.
For many homeowners in foreclosure situations, loan modifications without principal reduction are not practical because their homes have lost a significant share of their bubble-inflated values and are worth tens of thousands of dollars less than the mortgage amount. However, given the opportunity, many would jump at the chance to buy back their homes at current market value. The third element in the CLVU campaign, the Offer, is the result of an innovative partnership that the community development financial institution Boston Community Capital has forged with CLVU and other nonprofits, called SUN, or Sustainable Urban Neighborhoods. BCC buys the often-occupied foreclosed properties from banks at current or discounted prices. It can then sell the property back to the former owner and provide a mortgage loan at an affordable monthly payment.
Banks typically cite “moral hazard” in refusing to sell back to former owners. According to them, eliminating the consequences of foreclosure may change the behavior of current or future mortgage-holders for the worse. CLVU organizer Steve Meacham takes issue with this invocation of moral hazard. As he told Bill Moyers in a 2009 interview:
These are the same guys who have run our entire economy into the ground and who have been rewarded with billions in taxpayer bailouts and have used billions of that money to give bonuses to the very executives that drove their companies and the whole economy into the ground. And they are citing moral hazard as the reason why they can’t resell that property to the existing homeowners at the real value? That is hypocritical in the extreme.
Of course, the BCC solution can’t help everyone. Some former owners are unemployed or underemployed and can’t take out a mortgage with BCC or afford their houses even at current market value. In those cases, CLVU also will work with other organizations to find options for foreclosed owners and tenants and their properties, including conveyance to organizations like CDCs to develop co-housing and limited equity co-ops.
CLVU works with about 1,000 families in Boston and has expanded its efforts to selected cities throughout the state. Through the BCC collaboration, 60 families have bought or are in the process of buying back their homes. The BTA has carried out 30 eviction blockades. Thanks to these blockades, foreclosed homeowners and tenants in foreclosed properties have gained months, in some cases more than a year in their homes. If they have to move, they have negotiated dignified arrangements allowing them to move on their own time in a stable fashion. Also, backed by organizing leverage, tenants have negotiated settlements of at least $10,000 to move out rather than the $500 “cash for keys” that previous tenants had been forced to accept.
What’s more, the tenants that formed the base of the organization for decades are now joined by an ever-growing number of current and former homeowners.
The Long-Term Strategy
While the blockades are energizing, of course CLVU and its allies would like to see systemic change so that each success does not come at the cost of a pitched battle. They would like to see permanent eviction protections for foreclosed homeowners, general acceptance and adoption of mortgage principal reduction, and banks giving foreclosed homeowners another chance to purchase at current market values.
There is some movement. In 2010, the Massachusetts legislature passed a law preventing banks from evicting tenants in foreclosed properties except for just cause. In practice, this eliminates no-fault evictions after foreclosure. CLVU and its legal partners, which include Harvard Legal Aid Bureau and Greater Boston Legal Services, and Massachusetts Alliance Against Predatory Lending (or MAAPL, which CLVU co-founded) worked hard for the enactment of this law. MAAPL’s legislative agenda also includes advocating for laws that would provide judicial review and that would grant owners the same protections from eviction as those won in 2010 by tenants.
The state legislature is currently deliberating on Boston’s petition to be allowed to deny a bank a permit (enforced by the state) to foreclose unless the bank first participates in mediation in good faith. In August, the Springfield, Mass., city council passed the strongest foreclosure ordinance so far in the state, which fines banks that don’t participate in mediation before a foreclosure (a move that doesn’t require state approval) and requires lenders to post a $10,000 bond on vacant properties. If the law is upheld, lenders will be required to provide upkeep to foreclosed properties or forfeit their bond. The Springfield No One Leaves Campaign, a grassroots organization modeled after CLVU, played a central role in getting these ordinances passed.
We celebrate BCC’s financial innovation because there are few, if any, parallels in which foreclosed owners are given the opportunity to buy back their homes in communities they love. But in the absence of people motivated to turn out for rallies and demonstrations or willing to engage in civil disobedience, it is doubtful that CLVU would have gained so much for its members. “Before we started this campaign there was no financing vehicle to give foreclosed owners another chance,” says Curdina Hill. “The power of organizing is motivating banks to change the way that they do business.”
The day after the eviction blockade for Drusilla Francis, U.S. bank announced that it would negotiate with BCC. BCC has now entered into an agreement to buy the property and Francis expects to enter into an agreement with BCC to buy back her property at current market value, which she can afford. Thanks to CLVU, she will not be moved.
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