City of Berkeley could move funds out of Wells Fargo

The Berkeley City Council is considering moving its funds from Wells Fargo into local credit unions.
Gracie Malley/Staff
The Berkeley City Council is considering moving its funds from Wells Fargo into local credit unions.

Distrust of big banks became a common theme of the Occupy movement and inspired thousands across the nation to move their money to smaller credit unions. Now, the city of Berkeley may follow suit.

At its Tuesday meeting, the Berkeley City Council will consider a proposal to move Berkeley’s assets out of Wells Fargo. Eventually, if the city decided to leave Wells Fargo, it would transfer $300 million and would be one of the first cities in the Bay Area to do so — a loud political statement that Councilmember Jesse Arreguin hopes will encourage other cities to do the same.

Tuesday’s item, pushed by Councilmembers Arreguin and Darryl Moore, asks for the city manager to explore possible alternatives to Wells Fargo, such as local credit unions and community banks. The city of Berkeley has had a contract with Wells Fargo since 2004, according to Arreguin.

“That contract is set to expire at the end of this year,” Arreguin said. “Councilman Moore and I felt that we should really look at alternatives to Wells Fargo — particularly credit unions or community banks, a bank which is locally run so we can use our tax dollars to invest in local businesses.”

The Occupy Berkeley movement has been actively involved in contacting city officials about the possibility of moving into local credit unions, according UC Berkeley junior and Occupy Berkeley organizer John Holzinger.

“Obviously, it’s great that they’re doing this,” Holzinger said. “Once it’s finalized, I’ll be much more happy.”

The item, if passed Tuesday, would require the city manager to gather information by May to bring to City Council regarding costs of transferring and possible alternatives that fit the city’s needs. The decision to either renew the contract with Wells Fargo or move to a different bank will then be made at some point in the fall, Arreguin said.

Arreguin likened the move to actions the city took against apartheid South Africa, when the city worked extensively to boycott firms that conducted business in the country.

Now, Arreguin hopes to start a new boycott — this time to send a political statement to big banks as well as to inject money into the community.

“I think it’s taking the principles of the Occupy movement into action,” Arreguin said. “I think things like this are ways in which we can try to change our system of government. We need to take more direct action and action that will actually influence policymakers — influence banks to try to see the kind of changes that we want.”

Arreguin cited Wells Fargo for its record of alleged “subprime lending, predatory lending and lack of investing in communities” — a record he says hurt communities with foreclosures and financial difficulties.

Wells Fargo spokesperson Ruben Pulido said in an email that the bank has long advocated for responsible lending and will continue to work with Berkeley’s leaders to demonstrate the company’s positive impacts on the community.

“I am confident that when current or potential customers compare us to competitors regarding the value and service we provide, and learn about our extensive efforts to strengthen communities where we do business and our team members live and work, we are in a strong position,” he said in the email.

The city last had the choice to renew or end its contract with Wells Fargo in 2009. Though there were discussions of moving out, the city ultimately renewed its contract, deciding to revisit the issue later.

Now, four years after the economic crisis of 2008, Moore and Arreguin are reigniting that conversation. Arreguin said he thinks the renewed interest is a reflection of the changed current political atmosphere.

“I think with the Occupy movement, it’s the right time to move this issue forward,” Arreguin said. “I think there’s a lot of support in the community. Now is the time to raise this issue and move ahead.”

Nevertheless, this is far from final. The city still must decide if credit unions or community banks can meet the city’s banking needs, Arreguin said.

“It is conceivable that in the end of all this that we may just stay with Wells Fargo,” Arreguin said. “I certainly don’t support that, but that is a possibility.”

Jaehak Yu covers city government.

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  • [As usual with your buddy Tony M, blah, blah, blah]

    Back when I was in the Air Force, we had an expression “If you can’t dazzle them with brilliance, baffle them with bullshit.” You’re clearly incapable of the f0rmer,  evidenced by your meandering pontifications regarding what is and what is not Marxism, so it’s pretty obvious that you are attempting the latter…

  • Moremoney

    Taxpayers are being screwed by the big banks, too.  So it’s ok if  big banks uses poor judgement and questionable professional skills while investing in risky business plots.
    But the City of Berkeley shouldn’t even investigate other financial options because of your victim mentality?

    • Sounds a lot more like the decision was based more on having some political beef with Wells Fargo than concerns over the financial risks of banking in that particular institution.

      • Nunya_beeswax

        If you want to characterize concerns about the ethics of WF’s business practices as “politics,” then go ahead.  It’s about time you showed your true neo-con colors anyway.  For all your blather about morality, it always comes down to a purely pragmatic decision based on what will make the most money.  I wish you’d stop pretending otherwise.

        • I don’t recall “blathering about morality”, but please do tell me, what has Wells Fargo done so terrible that it justifies some form of economic sanction or divestment, and is such a move worth the cost (time and effort) to move funds out of one bank, open up accounts at others, print new checks, mess around with payroll and direct deposit services, etc? As I stated previously, most of these moves are of little or no benefit, and are done based on symbolism and feelings. While I know such things are of more importance to liberals/progressives than actual results, they are piss-poor reasons upon which to base business decisions. I sense that you have never tried to run any sort of business or association before (profit or non-profit) but it’s clear that you have no idea of the work required to fulfill the silly demands of activists and other people who are far, far removed from reality.

  • Current student

    Can you imagine what would happened if Berkeley moved its assets to a rinky dink community bank, and that bank went under?

    $300 million is assets, and FDIC insurance covers $250K.  Wow would the taxpayers get screwed.

    • francis

      I’d say Wells Fargo is just as likely, if not more likely, to go under

      • Source and cites to back your assertion?

    • Nina C

      Credit Unions are certainly Not rinky dink and have been a stabel instituition during All the financial ups and downs.  They could move the assets to The Credit Unions.

      • Nina C

        Stable Institution!!!

      • Current student

         uhhhhh, no.

        Credit unions get seized by the feds due to imminent collapse every month.  Look it up.

        Despite the lefties’ hatred of Wells Fargo and BofA, they aren’t gong anywhere.

  • Financial decisions based on emotional appeals and/or to “make a statement” rarely work out to the benefit of people making such decisions, regardless of one’s political views. More proof of the poor judgement and reasoning skills of those involved in Berkeley politics, whether on the campus or local front…

  • ShadrachSmith

    Obama’s Occupiers have inspired thousands to shout “Capitalism is Evil.”

    That is a stupid thing to say, much less shout. Are there any Marxists (by whatever code-name) out there who want to argue for the Progressive Cause? Socialism Sucks, want to discuss it? Got game? 

    Marxists have no moral principles. Anybody want to debate that one…Anybody?

    • Guest

      Go for it bro! I think that this is a good move. The only way a local credit union would go under would be if the whole city was in shit like Vallejo or something, in which case there would be no money left in the account anyways. Either way, it’s not like banks of Wells Fargo status don’t go under lol.

      • Current student

        “The only way a local credit union would go under would be if the whole city was in shit like Vallejo or something”

        That’s a factually incorrect statement.  It’s fairly common for small banks to fail (or be seized by the feds because they are about to fail).  It happens dozens of times every year.   On the other hand, it has been a long long time since a bank on the scale of wells fargo collapsed.

    • Nunya_beeswax

      Do you really want to start a discussion about moral principles?  Neither capitalism nor socialism can claim a moral high ground, so just zip it the fuck up.

      • Looks like you just lost the argument, child.

      • ShadrachSmith

        I absolutely want to start a discussion about moral principles. Got any?

    • Ericw

      Do you know what Marxism is? Have you read any bit of Marx’s work? Do you know why it is pervasive in the academy? Marx is so much more than offering socialism as an alternative to Capitalism. Capitalism is evil, its why there are human beings all over the world starving to death so we can tip tap away on our computers. That structural order is reinforced by capitalism. I agree that experiments in socialism have been utter failures. That doesn’t mean that capitalism is the zenith of human progress or the best way to live our lives. 

      I might be unfairly collapsing your politics with the general conservative outlook in the US today, but you remind me of this fool: 

      • ShadrachSmith

        “A Marxist is someone who has read Marx,
        An anti-Marxist is someone who has read and understands Marx.”
        Guess Who?

        I ask you to define and defend Marxism. It is a total load of intellectual immaturity. 

        But, Marxists never define or defend their views, and neither will you. Because you can’t. All you will do is shout Capitalism is Evil. That is the whole show…pitiful, really.

        Come on smart guy, educate me, what does a Marxist believe? Do you even have a clue? Or, are your skills too limited to state what you believe?

        If you can’t even define or defend Marxism against a dummy like me, that would make you a total fraud… bummer, huh?

        • What Leftism Does to People

          Leftism is bad for people. It makes them awful. The unwashed, ill-mannered, anti-Semitic, entitled, and now violent mobs littering various parts of the nation under the banner “Occupy” believe their ideas will lead to a better society — but they actually are the society their ideas lead to. Their behavior when compared to the polite, law-abiding, non-racist demonstrations of so-called tea partiers tells you everything you need to know about the end results of statism on the one hand and constitutional liberty on the other.

          This is not, of course, to say that every left-winger is a miscreant but rather that the natural, indeed inevitable, result of statism is to produce nations of miscreants. When the state is permitted to make the individual’s moral choices, the individual is forced to become either a slave or a criminal; when the state is permitted to redistribute wealth, it chains the citizen into a rigid, two-tiered hierarchy of power rather than freedom’s fluid, multi-layered rankings of merit and chance; when the people are taught to be dependent on entitlements, they are reduced to violence when, inevitably, the entitlement well runs dry; when belief in the state usurps every higher creed, the people become apathetic, hedonistic, and uncreative and their culture slouches into oblivion.

        • Ericw

          I think we’re talking past each other because you only read the entire body of Marx’s work for its pieces on socialism and revolution. That’s like saying “Christianity is the belief that God created the world and evolution doesn’t exist.” Sure, Christianity can be that, if I wanted to limit my understanding of Christianity to be so; but level heads prevail. 
          I’d be surprised if you’ve read the Marx-Engles Reader and Volume 1 of Capital. They are foundational texts for studying the conditions of capitalism and how it exploits people. The Eighteenth Brumaire of Louis Napoleon lays it out plain and clear in less words with an actual materialist conception of history. Do you really know what the implications are of those texts? I don’t think you’ve studied the history of history, but its a big deal. 

          And FYI, I’m not a sheltered academic, I’m writing this from my office of a small business that I started several years ago predicated on cheap labor and materials from China, being sold to people in America and Canada who simply lack the capital to source the goods on their own. I’m a good capitalist because I don’t pay my workers 1/5 of the money that I earn, give them minimal health benefits, and certainly don’t kick back extra money to the Chinese employees across the sea. What I do instead is reinvest my capital to make more money that alienates the bottom line workers from the profits that I will make from basically selling their labor. If you think that’s fair, that’s great. I don’t think it is, but I’m also greedy as hell, and try to undo it in ways that still let me drive a prius and eat organic granola dont you know.  

          Back to what is at stake. Marx negates the Hegelian dialectic and gave the academy a new way of thinking about the world, in which ideas aren’t the primary object of analysis, but things, items, materials are. Marx says that things/commodities/the world structures the way in which life works. That has nothing to do with revolutions or socialism, but everything to do with scholarship. 

          I agree that Marx’s idea of a mass revolution has ultimately failed and that because of human greed a true socialist system is unlikely to ever emerge unless it is in some sort of dystopia. I don’t think many would argue a hard line on that one. And if you think that’s all Marxism is, then bravo sir, you win! But its not, and Marx’s analytic contributions still permeate and undergird the academy and motivate so much political action in the world across time and space. 

          • ShadrachSmith

            I ask you to define and defend Marxism and the closest you come is: ”
            Marx negates the Hegelian dialectic and gave the academy a new way of thinking about the world, in which ideas aren’t the primary object of analysis, but things, items, materials are.”

            That is the purest example of vapid, pseudo-intellectual gibberish I have seen in years. What do Marxists believe? Define and defend a tenet of Marxism if you can. As I predicted you haven’t a clue what Marxism means, much less have the game to defend it.

            I draw this out only as a demonstration of how totally immersed in their own BS Marxists are. And one more tip, don’t loan them money.

          • Ericw

            I think its clear that you’re not looking to engage in good-faith. What I wrote is clear and lucid. Marx’s departure point is the Hegelian dialectic. I don’t have the time or the effort to give you the run down on Hegel, and then bring you forward to Marx. But an easy way is this: in philosophy, before Marx, philosophers were concerned with the notion that ideas shape human life. Marx thinks that things shape human life. That is a basic tenant of Marxism. Which brings me back to my main point, that trying to reduce the entire body of work of one of the most prolific writers of the last two centuries into a term, and trying to put that term into practice without qualifying what you’re talking about will inevitably lead to two people talking about two different things. Re-read my example of Christianity, I think its pretty clear what I mean. If you don’t agree, and you think that there IS indeed a clear cut definition of Marxism then please, enlighten me and help me to collapse this liberal intellectual house of cards that I have built. 

            Just upon reflection, here’s a tenant that is in line with your very narrow conservative view of Marxism. 
            Capitalism as a way of structuring human life inevitably leads a situation in which a small percentage of people have most of the wealth and the means to control it, while the rest do not, and this is not the way in which the culmination of humanity should live. 

            As usual with your buddy Tony M, so much of what I said that you could possibly engage in conversation with including my actual cognitive dissonance of being a capitalist and being anticapitalism, my general agreement that socialism has failed, and my pointing out of my favorite texts by Marx, you chose to write what you did. I only take this as further evidence that people who denounce Marxism are not willing to engage in an actual conversation to further mutual understanding, do not actually understand the large body of work that Marx produced, and also simply do not care. They are fixated rather on maintaining a status quo in their minds, in which the vast inequality that exists in this world from Berkeley to Boston to Berlin to Bangkok, is in no way shape or form informed by an economic system that is predicated on extracting cheap labor from the poor. A person in India can grow up, and live their entire life in relation to a factory without any hope of a vacation, days off, sturdy shoes, a computer, or a better life for their children. Sure there are other factors involved, but our transnational economic system is the primary one.    

          • ShadrachSmith

            If you are giving Marx credit for Geography is Destiny, I don’t think he was. If so good observation, but not a political theory. And I do believe that History is the story of men and Ideas. The story of why the west came to possess Freedom of Thought covers the politics from Henry II to Elizabeth. The History of Freedom of Thought is far more instructive to me than the Race, Class, Gender prism. Your view is better: because: …? That is the part you can’t do. You keep claiming the brilliance of your conclusions, and frankly I don’t believe you.

            It is not Capitalism that is evil, people are evil, or not. Some are Capitalists, sure. Stalin was no sweet-heart either. If you are saying that you are blaming Capitalism for all the evils and poverty in the world, I would disagree, in any detail you can handle.

            Poverty didn’t start with factories, prosperity started with factories. Capitalism = Prosperity. There is no other way to get there. Your bitterness that some people get to be rich is your own burden, and I don’t share it. 

            So stop with the BS that you represent a brighter future for the children of India. You don’t. Tell me something good about Marxism, if you can.

      • [Do you know what Marxism is?]

        It’s a failed social and political system, whose wreckage can be seen scattered all over Europe and Asia. Ever seen a communist or former communist country up close? I’m willing to bet you have not. It’s a system that has been pretty much abandoned except for a few holdouts and kooks in places such as Zimbabwe, Venezula, Cuba and North Korea – countries that are either failures, or on the way there. Nobody in their right mind endorses or supports marxism or communism anymore. In fact, the only ones who do are usually megalomaniacs, sheltered academics completely insulated from reality, or narcissistic little children who think they could somehow make marxism work – if only THEY were put in charge, and could force their will on others.

        [Capitalism is evil, its why there are human beings all over the world starving to death so we can tip tap away on our computers.]

        Funny how most of the people “starving to death” are doing it in places that have been the most diehard supporters of marxism, places such as Cuba, Zimbabwe, and North Korea. Funny how most of those people would happily swap places with your sorry ass and come to the USA in a heartbeat. So why don’t you pack your bags and get the hell out of here, if you think capitalism is so evil? I hear Pyongyang is pretty nice this time of year:

        • Ericw

          It’s a failed social and political system”
          Nope. That is not what Marxism is. Even Newt Gingrich would tell you otherwise. Socialist experiments which have taken parts of Marx’s ideas have been complete and utter failures yes, but that’s akin to calling capitalism “Smithism” or “Friedmanism.”

          On the evil of capitalism comment, I didn’t know that Cuba, Zimbabwe, and North Korea represent “most of the people” in the world. You have a very skewed perception of the world and the people in it, and there isn’t much that I can do to help you see otherwise. I suppose I could link you to income disparity in the United States which is a direct result of capitalism, and the reason people don’t starve is because of what what what??? The government. But I guess that’s fine and dandy, since their lazy black/brown assess need to get off welfare and get a damn job. 

          • Marxism IS a failed philosophy, despite your attempts to pretend otherwise, because it is built on a flawed economic model. However, it is funny to see you dance around the examples I mentioned above (Cuba, Zimbabwe, and North Korea) because you just can’t bring yourself to admit that those countries are built on a marxist/communist model, can you?