Madoff Fallout

“Were any of your supporters invested with Madoff?”

I’ve lost track of how many times I’ve been asked that question in the last few months.

At first, I could answer: “not that I know of.” Then I received the following letter from a supporter:

“Some time ago …. I had put my pension from thirty years work into an investment that was indirectly hooked into the Madoff fraud. [A]ll of [my] savings were stolen in this scheme. We’re struggling now to re-build some reserve and retain our sense of equanimity.”

My heart goes out to these people and so many others, caught up not only in this fraud, but others which haven’t even been recognized as such, since the beginning of the Reagan revolution of selfishness and greed. From crony capitalism, to the mortgage mess, to bank bailouts that amount to little more than stealing from the most vulnerable members of our population to line the pockets of some of the richest, our system has become almost unimaginably corrupt.

Over the years the RFC has invested funds in its ongoing quest to become a multi-year source of dependable support for the children we help. As a public trust, we are more conservatively invested than most. Consequently while other’s investments have dropped 30%, 40% or even more, ours have not lost so much of their value. But we’ve lost some and some of that loss was the result of buying “very safe” bonds that because of underlying fraud turned out not to be safe at all. I am enraged by this situation because any loss has a negative impact on the entire RFC effort.

Dealing with these kinds of financial shenanigans makes our community so much more precious. In contrast to the financial manipulators and corporate criminals, RFC folks rally to aid children in families who are struggling to build a more equitable and just society. These are the people with whom I want to cast my lot.

So many of us will have a hard time making up our losses during this recession. But I believe that this is a time when our cooperative ethic not only will help provide us with the emotional and material support we need, but also will resonate with the broader society to facilitate the type of progressive change so many of our beneficiary families have sacrificed so much to achieve.
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My father is an RFC supporter. He was just about to retire when the economic floor dropped out from under him these last months. Though not invested with Madoff, he's been adversely affected by what you correctly refer to as other frauds, "which haven’t even been recognized as such." He went ahead with retirement in May, but has had to reassess what lifestyle he can now afford, and take a much harder look at how he spends every dollar.

Despite these setbacks, I know he is still committed to financially supporting the RFC. Instead of each of us hunkering down and hoarding every penny of what we've each got individually, (which is how some are reacting), a collective and cooperative ethic in response to these hard times feels like the right thing to do.

I'm glad you pointed out that it's not just Madoff; his (admittedly mind-bogglingly vast) scam is just the tip of the corrupt iceberg. The REAL crime is the incredible "legal" redistribution of wealth to the top 1 to 2% in this country during the Bush administration (and before).

It is heartening to hear that RFC supporters continue to give generously to your necessary project during these difficult economic times.

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