A group of protesters pushed back against the Chicago Public Schools' plan to close and consolidate schools this weekend, taking their fight to Bank of America on Saturday where they rallied against the price of costly interest-rate swaps.
Carrying signs and chanting “banks got bailed out, children got sold out,” a group of about 30 protesters, organized by the Grassroots Collaborative and Pilsen Alliance, marched from Pilsen Elementary Community Academy to two Bank of America branches hoping to get a letter sent to the bank’s Illinois president.
“Big banks sold school districts and government ‘interest-rate swap’ agreements on the premise that they would reduce the costs of borrowing. But the opposite has happened,” the letter to Tim Maloney, Illinois president of Bank of America, said. “In Chicago, even though the city just announced 54 school closings, the most ever shut down at once in the nation’s history, banks like Bank of America are gouging the Chicago Public Schools for $35 million a year."
Facing a $1 billion budget deficit, CPS announced last week it planned to close 54 schools and turnaround another six, affecting approximately 30,000 students in the district. Pilsen Academy was included on the preliminary list of schools slated for closure, but was spared during the final notice.
“This is a false crisis,” said Rosalie Mancera, board president of Pilsen Alliance. “This crisis exists only because the money is not being appropriated in the correct places.”
Costing the City of Chicago $74.2 million each year, local government and taxpayer-backed organizations like CPS are locked into interest rates of 3 percent to 6 percent for loans negotiated during the Great Recession. If the interest rate goes up, banks cover the losses and return money back to the public organization by “swapping” a certain percentage back under interest-rate swap deals.
But after the economy crashed, the Federal Reserve lowered interest rates to less than half percent in an effort to bail out the failing institutions. The banks, however, didn’t drop their interest rates for the public organizations.
Ten interest-rate swaps from Bank of America reportedly take $35 million from CPS annually. Bank representatives told the Chicago Teachers Union in July 2011 they were not committing to renegotiating the loans.
“Pilsen Academy was held hostage during the last few months, and why is that? Because banks, like Bank of America, are keeping money that belongs to our children,” said Mancera.
Tammie Vinson, a teacher at Robert Emmet Elementary School in Chicago’s West Side neighborhood of Austin, also participated in the protest, saying “nobody cares.”
Vinson said representatives from her school “begged and pleaded” against the actions during some of the 34 community meetings CPS held before the final list of school closures was announced. District officials say they heard from 20,000 people during the course of the meetings.
Vinson added that CPS was setting her students up for “failure” and that she expects dropout rates to increase because students are being forced to cross gang lines to attend schools where “they’re not wanted."
Here’s more from Vinson:
Once protesters marched into the Bank of America branch at 1705 W. 18th St., the attempt to deliver a letter to the Illinois bank president was less than successful. According to demonstrators, the branch manager said he couldn’t submit the letter because “he said he was just a worker here.”
The result was largely similar at the second branch, at 1212 S. Ashland Ave.
“This means we have a bit of work to do,” Eric Tellez, research and communications coordinator for the Grassroots Collaborative. “But the fact that Bank of America has gone on with this deal for about four years is unacceptable.”
Tellez said his organization aims to raise awareness of the bank’s high interest loans to CPS saying “there are systemic reasons as to why our schools are getting closed, it’s not just a budget problem that came out of thin air.”
Here’s more from the protest:
According to the district, this wave of school actions will save $560 million over the next decade. But majority of the closures occur on Chicago’s South and West Sides and approximately 80 percent of the students affected by the school closures are African-American.
Despite district officials’ assurances the actions are in the interest of addressing low-performing and underutilized schools, many education activists are making accusations of racism.
“They’re stripping the neighborhoods of everything and now they’re taking the last thing the neighborhoods have,” said Cynthia Smith, a teacher at Lane Technical High School, who participated in Saturday’s protest. “They’re trying to drive the predominantly African-American population, and Hispanic population, out.”
Here’s more from Smith: