Banks that received bailout funds also lobbying against public interest policies like employee free choice
Total taxpayer subsidies are much higher than the TARP

As Congress brings CEOs from eight big banks that have received a combined $125¹ billion in taxpayer bailout funds since October before a U.S. House Hearing on Wednesday, February 11, there's more than their expenditures on bonuses that taxpayers deserve to know.

While taking taxpayer money, they are also lobbying against public interest legislation like the Employee Free Choice Act, a measure that would ensure workers the freedom to form a union for a voice for improved wages, benefits, and working conditions.

In addition, some are also costing taxpayers much more than the bailout money being provided through the Troubled Asset Relief Program (TARP) because either their direct employees or the employees of companies the banks own are not provided affordable health coverage or living wages and must rely on taxpayer-funded healthcare, income support, and food stamp programs.

Congress should move swiftly to protect the American people from having companies that are receiving massive taxpayer subsidies from simultaneously spending money on public policy lobbying that may be against taxpayers' interests. The bipartisan Feinstein-Snowe Accountability for Economic Assistance Act (S. 3698) would be a good step in this direction.

THE 8 BIG BANKS

• Bank of America, Wells Fargo, Citigroup, JPMorgan Chase, State Street, Goldman Sachs, Morgan Stanley, and Bank of New York Mellon have together accepted more than $125 billion in taxpayer funds since October. Top executives from all eight have been called before the U.S. House Financial Services Committee at 10 a.m. on Wednesday, February 11. (Ken Lewis, Bank of America; Jamie Dimon, JPMorgan Chase & Co; Vikram Pandit, Citi; Ronald E. Logue, State Street; Robert P.Kelly, Bank of New York; John Stumpf, Wells Fargo; John Mack, Morgan Stanley; Lloyd Blankfein, Goldman Sachs)

• Bank of America, Citigroup, Wells Fargo, and JPMorgan Chase are members of the Financial Services Roundtable² , which spent $8,670,775 on lobbying in 2008 according the Center for Responsive Politics, including lobbying against the Employee Free Choice Act in every quarter last year. Goldman Sachs, Citigroup, JPMorgan Chase, and Morgan Stanley are members of the Business Roundtable³ , which spent 15,849,000 on lobbying in 2008 according to the Center for Responsive Politics, including lobbying against the Employee Free Choice Act in the third and fourth quarters last year⁴.

BANK OF AMERICA

• Just three days after receiving $25 billion in federal bailout funds, Bank of America was caught holding a conference call with clients to organize opposition to the Employee Free Choice Act and fundraise for those efforts. Home Depot Co-Founder Bernie Marcus led the call along with Rick Berman, an aggressive Employee Free Choice opponent. "If a retailer has not gotten involved in this, if he has not spent money on this election, if he has not sent money to [former Sen.] Norm Coleman and all these other guys, they should be shot. They should be thrown out their goddamn jobs," Marcus declared. (Audio of the call is at http://www.huffingtonpost.com/2009/01/27/bank-of-america-hosted-an_n_161248.html)

• In the first nine months of 2008, Bank of America and Merrill Lynch spent a combined $10 million on lobbying.

• Bank of America costs taxpayers as much as $50 million a year because the company does not provide its workers with affordable health benefits and Bank of America employees must instead rely on publicly-funded health programs like Medicaid.

• In 2006, Bank of America CEO Ken Lewis brought home $99.8 million in compensation. The median salary of a Bank of America teller is $23,597. Ken Lewis made more than 4,000 times as much as a Bank of America teller in 2006.

• Since 2004, Bank of America has laid off more than 34,000 workers. The company recently announced up to another 30-35,000 job cuts over the next three years.

GOLDMAN SACHS

• Goldman received $10 billion in taxpayer bailout money⁵ and then paid out $6.5 billion in bonuses.⁶ Goldman, along with other stakeholders in AIG, received up to $37 billion in bailout funds associated with its rescue.⁷

• Goldman is a top owner of Burger King⁸ controlling the fast food company's board along with TPG and Bain Capital.⁹ From 2006 to 2008, Burger King has spent $319,648 in lobbying, including lobbying against the Employee Free Choice Act.¹⁰

• Together with other top Burger King owners, Goldman allows the fast food company to cost taxpayers an estimated $273 million a year because workers lack access to affordable employer health coverage, are paid sub-poverty wages, and must rely on publicly-funded healthcare, income support, and food stamp programs.¹¹

• Lloyd Blankfein, the CEO of Burger King owner Goldman Sachs, netted over $70.3 million in total compensation in 2007,¹² the most ever for a Wall Street CEO.¹³ Burger King chief executive John Chidsey received total compensation of nearly $5.4 million in 2008.¹⁴

• Burger King fast food workers struggle to get by on a median wage of $6.93 per hour.¹⁵ For full-time employees, this wage amounts to just over $14,000 annually, well below the federal poverty line for a family of three.¹⁶

• The Goldman Sachs bonuses alone could have provided an $18,000 pay increase for each of Burger King's 360,000 corporate and franchise employees¹⁷ ⎯ more than doubling a worker's $14,000 annual salary and contributing to a meaningful economic stimulus by putting discretionary income in the hands of hundreds of thousands of American families.

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¹http://www.usatoday.com/money/economy/tarp-chart.htm
²http://www.fsround.org/about/member_companies.htm
³http://www.businessroundtable.org/about/members
⁴http://soprweb.senate.gov/index.cfm?event=selectfields.
⁵http://www.nytimes.com/2008/10/14/business/economy/14treasury.html?_r=1&scp=10&sq=treasury%20bailout%20recipients%20goldman%20sachs&st=cse ⁶http://www.bloomberg.com/apps/news?pid=20601087&sid=aQjVhGLMflj8&refer=home ⁷http://www.cjr.org/the_audit/goldmans_backdoor_bailout.php
⁸Burger King Holdings Inc. Public Ownership Summary. Capital IQ, accessed January 22, 2009.
⁹Goldman Sachs Group Inc. Committee Summary, Capital IQ, accessed January 27, 2009. ¹⁰http://soprweb.senate.gov/index.cfm?event=selectfields.
¹¹In Ohio in 2007, 3,522 Burger King employees and their dependents received Medicaid at an average annual cost per recipient of $2,643 (estimated cost: 3,522 x $2,643 = $9,308,646); 2,915 Burger King employees received food assistance at an average annual cost per recipient of $1,212 (estimated cost: 2,915 x $1,212 = $3,532,980); and 260 Burger King employees received cash assistance at an average annual cost per recipient of $1,830 (estimated cost: 260 x $1,830 = $475,800). Total estimated cost: $13,317,426. In Ohio, there are 40 restaurants owned by Burger King Holdings, Inc. and 311 owned by franchisees (total: 351). Given $13,317,426 in costs to taxpayers related to Burger King's Ohio restaurants in 2007, the per-restaurant cost in Ohio is $37,941.38 ($13,317,426 / 351 = $37,941.38). If this pattern holds true for all of the 7,207 Burger King restaurants in the U.S., the total cost to U.S. taxpayers is $273,443,558.92 ($37,941.38 x 7,207 = $273,443,558.92). Sources: http://www.policymattersohio.org/pdf/PublicBenefits2008_0731.pdf; Burger King Holdings Inc. 10-K for the fiscal year ending June 30, 2008, p. 8.
¹²Goldman Sachs Group Inc. Def 14A for the April 10, 2008 annual meeting, p. 24.
¹³The New York Times says that Blankfein's 2007 compensation was $68.7 million, the most ever for a Wall Street CEO, but Goldman Sachs' SEC filings show that Blankfein's compensation was even higher: $70.3 million. Sources: http://www.nytimes.com/2008/09/28/business/28lloyd.html?em; Goldman Sachs Group Inc. Def 14A for the April 10, 2008 annual meeting, p. 24.
¹⁴Burger King Holdings Inc. Def 14A for the November 20, 2008 annual meeting, p. 29. ¹⁵Based on a median wage of $6.93/hour and a work year of 2080 hours (wage figure as of January 21, 2009). The resulting annual pay is $14,414. http://www.payscale.com/research/US/Employer=Burger_King/Hourly_Rate, accessed January 27, 2009.
¹⁶Based on a median wage of $6.93/hour and a work year of 2080 hours (wage figure as of January 21, 2009). The resulting annual pay of $14,414 is more than $3,000 less than the $17,600 federal poverty line for a family of three. Sources: http://www.payscale.com/research/US/Employer=Burger_King/Hourly_Rate, accessed January 27, 2009; http://aspe.hhs.gov/poverty/08Poverty.shtml.
¹⁷If the $6.5 billion was divided evenly among 360,000 Burger King employees, each employee would receive $18,055.56 ($6,500,000,000/360,000). Source for Burger King employee figure: http://www.bk.com/CompanyInfo/careers.aspx.