Big Greed On Small Street

Posted by: Stacy Perman on October 21, 2008

In the tsunami of news regarding the economic crisis and government bailout, the narrative that has formed largely follows the line of a greedy Wall Street swindling the victims of Main Street. So, it was with great interest that I read a brief opinion item in today’s NYT that focused on small business owners exploiting their employees. At issue is the arrest of two executives at a local grocery store in the Bushwick neighborhood of Brooklyn, who were recently arrested on felony charges. Their crime: allegedly cheating immigrant workers out of hundreds of thousands of dollars in pay. Although the execs deny the charges, prosecutors contend that they forced baggers to work 11-hour days without wages, earning just about $20 in tips among other allegations.

The arrests are the culmination in part, of the work done by the community activist organization Make The Road New York. The group has long documented the sub-minimum wage and no overtime pay practices of a number of retail shops on Knickerbocker Avenue, a one-time redoubt of mom and pop shops that had for years been owned by and largely served a predominantly immigrant community. The group’s report: Street of Shame garnered the attention of the New York State’s attorney general’s office. The lessons here are fairly rich. Certainly, it shows the vital role that community organizers can play. Moreover, greed and bad business practices are not solely the purview of those sitting in the corner offices of Wall Street.

Reader Comments

Rod Norwood

October 22, 2008 08:09 PM

The Latest, Greatest Con

If you couldn’t tell from the title, I am going to put a disclaimer here at the beginning of this article: I fully believe that anyone supporting the original administration plan, or any plan that would pay real money for worthless paper, is either gaining something from the Con or too stupid to be allowed out on the street alone.

In pitching the administration’s mortgage bailout plan, Treas. Secy. Paulson says (and I paraphrase somewhat) there is, “enough blame to go around” and “It pains me tremendously to have the American taxpayer put in this situation…but (we) Americans are resilient and we can get through this.” Let me translate.

(“enough blame to go around”) Administrators, Legislators, Mortgage Bankers, Hedge Fund Managers, Impetuous/Unsophisticated Home Buyers—Because the Fed., OFHEO, the Treasury Secy., legislative committee members with mortgage banking & finance over-sight, and ‘others’ were derelict in their duties, and the manner in which it was done, there is really no one person (or small group) that can be fined or send to jail.

( “It pains me but... we are resilient …”) My friends have carried off an impressive scheme. (In fact it is the grandest, most audacious, theft since the shenanigans that precipitated the stock market crash of 1929 and the great depression.) They used the lack of sound mortgage banking/finance oversight and an environment of ‘I want it now. I will figure out how to pay for it (or someone will save me) later.’ to create counterfeit wealth, leading to financial institution failures and causing an overwhelming “clog” in our financial system. Now we (I really mean you, the American general public.) are going to pay $700 billion to my friends (domestic and foreign) for some of these ‘securities’; by the way I, your trustworthy Treasury Secretary, get to deliver the final stroke. I pick which securities to buy, from both American and foreign entities. I’ll decide how much to pay for each, possibly above current market price; you have a very low probability of ever seeing any of your capital returned—you will likely be asked for more—and you will get over it; you always do.

We can sit still for that—Or

We can insist our money be exclusively used to:1.buy troubled mortgages at current real estate value; 2. leave said mortgages on the current holders/servicers books at original sale value (adjust capitalization requirements if necessary); 3. leave homeowners in said properties at original sale value (with strict guidelines for relief of the debt); 4. restructure mortgages to 30yr/fixed with rate based on ability to pay, at the date of origination; 5. not later than 10yrs, through sale/refinance, taxpayer money returned, with share of equity (negative equity forgiven to homeowner-without tax consequence); 6. restrict executive compensation in any way related to bailout funding for the duration; 7. allow the US Senate & House 90 days to draft and pass legislation to prevent a repeat performance.

Please forward this to everyone you know and
CLOG the U.S. Senate/House e-mail/phone lines--Today

Ralph

October 23, 2008 01:56 AM

You know, there's greed everywhere if you want to look for it. Yet, a great majority of us small business people are top shelf employers-- and the backbone of employment in this country.

Immigrants, especially those who are here illegally, are at the mercy of those who worship the dollar-- on Main Street, Wall Street and in most elected government offices (you've got to follow the money to know who they really represent). It's all about them, and screw everyone else.

Yet, with an illegal immigrant, they have a choice. Like, don't be here if you don't like being taken advantage of. Legal citizens have rights to fair employment through state and federal laws.

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What's it like to run your own company today? Entrepreneurs face multiple hurdles new and old, from raising capital and managing employees to keeping up with technology and competing in a global marketplace. In this blog, the Small Business channel's John Tozzi and Nick Leiber discuss the news, trends, and ideas that matter to small business owners. Follow them on Twitter @newentrepreneur.

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