Richmond Mayor Gayle McLaughlin is just the latest
voice in the East Bay railing against government
inaction over the past five years.

LEGISLATURE/FEDERAL GOVT | Those in high finance decry the gambit being employed by Richmond Mayor Gayle McLaughlin as underhanded. Ironic, huh? The same group of greedy practitioners of high-risk loans that put Richmond and other cities homeowners underwater take such stances because the plan to take back foreclosed homes by any means necessary deeply inhibits Wall Street’s huge scam.

McLaughlin, a Green Party mayor more in touch with constituents than possibly any other politician in the Bay Area, is trying to stick it the new age robber barons sucking her residents dry. Taken another step, Richmond’s plan is actually yet another loud cry for the state and federal government to merely do something to alleviate its woes.

Whether its keeping people in their homes in Richmond, fighting rising crime in Oakland or continuing state takebacks that crippled cities like Hayward from providing simple services to its residents, all continue to receive a deaf ear from Sacramento and Washington.

The situation in Richmond is the clearest sign yet municipalities are becoming more desperate to alleviate the woes of its citizens. The anti-foreclosure proposal approved Tuesday night by the Richmond City Council is an ingenious end around of the banking industry’s stranglehold of toxic loans. The city would purchase or use eminent domain to take over underwater mortgages and set up a Joint Powers Authority to implement the plan. This move isn’t something Wall Street is taking lightly.

Unless Richmond is an island from the rest of the country, the plan is fraught with danger. Retribution from Wall Street, in fact, has already occurred when investors turned a blind eye to a recent bond sale by the city. We are all still connected and there are ways for high-finance to exert enormous pressure on a city like Richmond. “We knew the empire was going to strike back. This is no surprise,” Richmond Councilmember Jim Rogers said Tuesday night.

Conversely, the federal government has done little to help cities like Richmond rebound from the speculative and proven illegal use of toxic loans by big banks. Wall Street got away without even one captain of industry doing a perp walk to the federal pen. In this case, how can you blame Richmond for being proactive?

In Oakland, there is a similar refrain when it comes to the notorious Goldman Sachs swap still costing the city’s general fund millions each year. The feds did nothing to punish Goldman Sachs, so attempts to police the financial giants misdeeds falls on a small group of local council members. “When we look at the malfeasance of Goldman Sachs,” said Oakland Councilmember Rebecca Kaplan this summer, “it would be really nice if the federal government took this on. It is really a nationwide issue and the misconduct of these corporations has caused financial devastation throughout the country. I support us moving forward because someone has to step up and say that behavior is not okay.”

Unlike Richmond’s plan, Oakland’s proposed move to exclude Goldman Sachs from bidding on city contracts in somewhat symbolic. Nevertheless, the Quan administration continues to sidetrack the city’s investigation even before its starts. But, even though the debarment of Goldman Sachs may be for show (Oakland still has to pay back the loan swap, nonetheless) the idea of landing a hard jab to Wall Street’s jaw is a powerful statement potentially copied across the country. One that Wall Street almost fears as much as Richmond’s eminent domain plan.

When it comes to rising crime and a sorely needed boost in police officers, Oakland still can’t bother the state and federal government to help. Therefore, local leaders have to turn to a band-aid approach or, if you’re Oakland Assemblymember Rob Bonta, use legislative methods like authoring a bill granting the city a waiver to preempt state gun control laws. Bonta’s bill passed the Legislature last week and awaits the governor’s approval. The bill doesn’t put more cops on the streets, but it is potentially a very important step toward lowering crime without the help of much-needed funding. But, yet again, it raises the point of why Oakland must consider cheap and secondary actions for protecting a community clearly shell-shocked by violent crime?

Over the past few years, Sacramento papered over its woeful budget mess year-after-year with excruciating takeback from local government. Theoretically, the takebacks were loans, but good luck finding any local official who believes they would ever see those tax dollars ever again. Then the dissolution of redevelopment agencies happened and although, some cities and counties blatantly misused those funds, others municipalities used it to become economic engines and rebuilt aging infrastructure. Every city in the state was left to scramble to first make sense of the end of redevelopment and then figure out how to shift dollars and balance their respective accounts with the state.

No other city in the East Bay unleashed more vitriol towards the state’s propensity for takebacks and the end of redevelopment than Hayward. From its mayor, to the entire city council and even down to the city manager, you could barely escape a public meeting when a handful of that group didn’t rail against Sacramento. Hayward Mayor Michael Sweeney routinely urged groups and those watching city meetings online and on television to call Hayward’s representatives in the Legislature. During one meeting in late 2011 discussing an unexpectedly large payment by the city for redevelopment, Sweeney summed up the lament heard in every city in the state.

“This is torturous and those of you watching this torture at home, thank Sen. Ellen Corbett and Assemblywoman Mary Hayashi and their colleagues in the state Legislature for imposing this on us all.” When a Hayward resident later told Sweeney to “suck it up,” he tersely responded by saying, “I’m sure you’ll be pleased to suck it up when we have to reduce services because the state continues to take general fund money.” Without a doubt, this sort of rhetoric has been ubiquitous in every single city in the East Bay over the past five years and it continues today.

State and federal officials are simply not listening to the locals on the ground. Yet, their inaction will only breed bolder and even more desperate moves than the proposal highlighted in Richmond. The message is now, if Sacramento or Washington doesn’t take control, we will. Because, clearly, mayors and council members inherently understand government by the people for the people better than those in Congress and the State Legislature.