Recession fires worldwide May Day rallies
Irish Talk up a Tax to Prevent Wall St Shenanigans
Millions around the world (tho’ not in America) demanded that government protect them from the recession. Here’s a Wall-St-eye view of what went wrong and from Ireland how to make it right. We trim, blend, and append three 2009 articles from: (1) AFP, May 1, on rallies by Simon Sturdee; (2) New York Times, May 3, on Lehman Brothers by Devin Leonard; and (3 the Irish Times, May 5, on land tax by Frank McDonald, Environment Editor.
by Simon Sturdee and by Devin Leonard and by Frank McDonald
Recession fires worldwide May Day rallies
Global Labor Day, people rallied by hundreds of thousands. While rallies were mostly peaceful, some protesters turned ugly.
The leaders of France's eight main unions -- presenting a united front for the first time since World War II -- linked arms to lead a rally in Paris. The CGT union claimed 1.2 million took part in 300 marches nationwide; police said 465,000 turned out.
Tens of thousands turned out across Spain including over 10,000 in the capital Madrid.
Around 36,000 people rallied in Tokyo's Yoyogi park, demanding more welfare benefits and others protesting military spending.
In South Korea, some 8,000 workers and students answered the call. People rallied in Manila, the Cambodian capital Phnom Penh, and Taipei.
In Russia, about 2,000 demonstrators gathered by a statue of Karl Marx in Moscow calling for a return of communism.
Zimbabwe Prime Minister Morgan Tsvangirai told 7,000 people that the unity government can pay allowances but no raises, despite inflation. “All of us from President Mugabe to government workers are earning a hundred dollars."
In Germany, on course for its biggest slump since World War II, almost half a million people assembled across the nation, unions said. Police arrested dozens who turned violent.
Security forces fired tear gas and water cannon in Istanbul and Ankara, with dozens of police and protesters hurt and over 100 youths landing in cells. Violence was also reported in Greece.
In Austria, Chancellor and Social Democrat leader Werner Faymann told up to 100,000 supporters in Vienna that he would oppose proposals by employers to impose a wage freeze. In the city of Linz and in Switzerland police and some protesters clashed.
In Mexico City -- despite a suspension of traditional May Day rallies by the government and unions amid a five-day lockdown triggered by the swine flu -- 200 protesters tried to march on the federal government's palace.
JJS: Protesters can read what to be against below.
How Lehman Brothers Got Its Real Estate Fix
Mark Walsh was considered the most brilliant real estate financier on Wall Street. At Lehman Brothers, he financed blockbuster property deals in Manhattan, including the Seagram Building. Real estate developer Aby Rosen recalls the deal closed in four weeks. “He was fast,” says Rosen. “He doesn’t try to kill you or retrade. To be honest, there are very few people in the industry you can say that about.”
Carmine Visone, one of Lehman Brothers managing directors, would lecture Walsh about the importance of fundamentals: land values, construction cost, and rents.
Walsh would wave his hand dismissively and argue the best way to make office buildings spew cash was through repackaging the debt for investors. Lehman pocketed a fee every step of the way.
The US attorney in Manhattan has subpoenaed Walsh and other former Lehman executives, investigating whether the firm overvalued its real estate holdings. The New Jersey attorney general, Anne Milgram, accused Walsh and 17 other former Lehman officials of defrauding the state’s pension funds by misrepresenting Lehman’s real estate exposure.
As real estate went into overdrive in 2003, Walsh, in order to help clients pump up their bids, lent Lehman’s own cash, too, exposing Lehman. So, once a deal closed, the firm would sell its stake quickly -- until prices fell and nobody would buy. Lehman was left with worthless shares.
One partner was the SunCal Companies of Irvine, Calif., an operation that bought land, sought government approval for development, then sold approved land to builders for an enormous profit. Walsh lent the middleman, SunCal, billions, just before Southern California real estate imploded.
In short order, Lehman collapsed. The bank’s chief, Richard Fuld, had a close relationship with Jerry Speyer, chairman,of Tishman Speyer (buyer of the Chrysler Building). Both were board members of the Federal Reserve Bank of New York.
JJS: Protesters can read what to be for below.
Ireland urged to tax land
The Government is being urged to adopt a new property tax based on site values, covering all commercial, industrial, and domestic properties, to raise revenue and stabilize the market.
The advocates include the Urban Forum, which involves architects, engineers, planners, and surveyors, and FEASTA, the Foundation for the Economics of Sustainability.
James Pike, a former president of the Royal Institute of the Architects of Ireland (RIAI) and founder member of the Urban Forum, said the Department of the Environment had “shown a great deal of interest in the idea”.
An annual land tax is also being considered by the Commission on Taxation, which may include it in its eagerly-awaited report to the Government. According to Pike, it would replace stamp duty and commercial rates. “It could generate as much as income tax, replacing it altogether.”
Economist Dr Constantin Gurdgiev, lecturer in finance at Trinity College and former head of research at NCB Stockbrokers, is fleshing out the proposal for the Urban Forum.
Had it been applied in Ireland, Pike said we could have avoided the “mad frenzy” among developers paying exhorbitant prices for sites in Dublin. “It would be an incentive to use land properly and consolidate development in cities and towns”.
Jeffery J. Smith runs the Forum on Geonomics.
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