A Collaboration to Strengthen the United States Federal Reserve System
April 16, 2018
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April 16, 2018
Alexander R. Mehran
Chair of the Board
Federal Reserve Bank of San Francisco
Dear Mr. Mehran:
We are writing to offer you our view about the urgency of appointing an individual who deeply understands the economic realities facing working class Americans to serve as President of the Federal Reserve Bank of San Francisco.
For all of the dynamism and strength of the US economy, it has come to be characterized most fundamentally by enormous disparities in wealth, income and opportunity that strongly correlate to race, ethnicity and geography. Failing to address significant disparities in income and net worth between major segments of our population, and particularly in segments that are driving our nation’s demographic growth, will result in a less globally competitive US economy. This is a significant economic risk for the 12th District and the United States.
The San Francisco Fed will be strengthened by having a President whose experience and expertise better reflect the large segments of our population that are not proportionally experiencing the benefits of our economy. Ensuring that this expertise and perspective is represented within the Fed is a critical way to prepare for the challenges and opportunities in our economic future. This will require considering candidates with more diverse experience including in the fields of community development and philanthropy. We submit that the San Francisco Fed has a historic opportunity to name the first Hispanic, East Asian American or Pacific Islander President of a Federal Reserve Bank.
We applaud Chairman Powell's insightful comments on the necessity for diversity in Federal Reserve System and the larger economics profession. In his testimony before the Senate Banking, Housing and Urban Affairs Committee on November 28th, 2017, he stated, “We make better decisions when we have diverse voices around the table—both at the Board of Governors and at the Reserve Banks…We’ve seen what works. It’s about recruiting. It’s about going out of your way. It’s about bringing people in. Once they’re in, it’s about giving them paths for success. And it’s about having an overall culture and company that is very focused on diversity and sticks with that focus for a long period of time. That works.” This recognition must be coupled with bold leadership and action.
In order to decide the course of monetary policy through an informed assessment of different regional economic conditions from diverse points of view, the Federal Reserve System was designed to be decentralized, independent and include representatives of the public in its governance. The Fed’s mission is undermined when regional Reserve Banks fail to recruit leaders who live up to the mandate to “represent the public.” Selections that fail to allow meaningful opportunities for public input and engagement have tended to result in the elevation of Fed insiders. This insularity undermines the Fed’s public credibility and increases the likelihood that Congress will ultimately intervene to reform the process. The process for selecting the President of the New York Fed perpetuated the status quo. We urge the San Francisco Fed to avoid the same mistake. As a first step, we call on the San Francisco Fed to include the Chair of its own Community Advisory Board in the official selection committee for the next President.
Please accept this letter as an offer of support. We will do anything we can to help identify strong candidates as well as to publicly support actions that the San Francisco Fed takes to ensure progress on diversifying its Board of Directors and executive leadership.
Thank you for your service to the 12th District and our nation.
Respectfully submitted,
California Reinvestment Coalition Center for Popular Democracy Chicanos Por La Causa Community Council of Idaho Greenlining Institute NALCAB – National Association for Latino Community Asset Builders National Coalition for Asian Pacific American Community Development TELACU
cc: Jerome Powell, Chairman, Board of Governors of the Federal Reserve Lael Brainard, Governor, Board of Governors of the Federal Reserve Randal Quarles, Vice Chairman for Supervision, Board of Governors of the Federal Reserve
San Francisco Fed Board Chair Alexander Mehran's April 20 Response to Coalition Outreach re: Collaboration Surrounding San Francisco Fed Presidential Appointment
April 20, 2018
Noel Poyo Executive Director National Association for Latino Community Asset Builders 5404 Wurzbach Rd. San Antonio, TX 78238 Dear Mr. Poyo: Thank you for your letter of April 16, 2018, concerning the appointment of the next President and Chief Executive Officer of the Federal Reserve Bank of San Francisco. We appreciate your taking the time to reach out and share your perspectives on this important undertaking. As Chair of the Board of Directors for the Federal Reserve Bank of San Francisco, I know that I speak for all of my board colleagues in saying that the appointment of a Federal Reserve Bank President is among our most important responsibilities and one that we take very seriously. We share your desire to find a qualified candidate to fill this important role that understands and is able to represent the varied needs and interests of the richly diverse people and business communities throughout the Twelfth District. The Federal Reserve Bank of San Francisco has a legacy of success with regard to recruiting, developing and promoting women and minorities into leadership positions within its senior ranks. As you are well aware, Janet Yellen served as President and Chief Executive Officer of the Bank from 2004 to 2010 before going on to become Vice Chair and later Chair of the Board of Governors of the Federal Reserve System. Under President Williams' leadership, the Bank continued to strengthen its focus on diversity and inclusion at all employee levels but particularly an10ng its leadership ranks where women now occupy over 30 percent and minorities over 45 percent of seniorlevel roles. In addition, President Williams established the Bank's Community Advisory Council in 2017 to give even stronger voice to those representing the district's underserved communities and to contribute to his ongoing economic analyses and monetary policy views. The Federal Reserve Bank of San Francisco has set a high bar for its executive leadership that we fully intend to uphold. Our board has not yet publicly communicated about the selection committee, job specifications or the processes that we will undertake to gather a list of qualified candidates for this important role. We expect to do so in the near future and will keep you apprised of our progress. For now, please know that we are absolutely committed to gathering input from various community and business leaders like you and your colleagues regarding the appointment of the next President and Chief Executive Officer of the Federal Reserve Bank of San Francisco. While I appreciate your suggestion to include Mr. Matsubayashi, who chairs the Bank's Community Advisory Council, as part of the official selection committee, the Federal Reserve Act stipulates that only the Class B and Class C directors (those not affiliated with banks or financial institutions) are eligible to participate in the appointment process. As such, Mr. Matsubayashi is unable to serve in this capacity. However, we recognize that he is doing an outstanding job leading the Community Advisory Council, and we would greatly value his input and suggestions, as well as input from you and your colleagues, regarding qualified candidates for this important role. I wish to thank you once again for reaching out and offering your support of this important undertaking. We look forward to continuing this open, constructive dialogue, and with your support, doing all that we can to find the absolute best person from a diverse candidate pool to lead the Federal Reserve Bank of San Francisco. Sincerely, Alexander R. Mehran Chair of the Board Federal Reserve Bank of San Francisco and Federal Reserve Agent cc: Danielle Beavers, Diversity and Inclusion Director, The Greenlining Institute David Adame, President and Chief Executive Officer, Chicanos Por La Causa Irma Morin, Chief Executive Officer, Community Council of Idaho Jerome Powell, Chairman, Board of Governors of the Federal Reserve Jordan Haedtler, Campaign Manager, Fed Up, Center for Popular Democracy Jose Villalobos, Senior Vice President, TELACU Lael Brainard, Governor, Board of Governors of the Federal Reserve Orson Aguilar, President, The Greenlining Institute Paulina Gonzalez, Executive Director, California Reinvestment Coalition Randal Quarles, Vice Chairman for Supervision, Board of Governors of the Federal Reserve Seema Agnani, Executive Director, National Coalition for Asian Pacific American Community Development Coalition's Response to Chair Mehran's LetterMay 4, 2018
Alexander R. Mehran Chair of the Board Federal Reserve Bank of San Francisco
Dear Mr. Mehran:
Thank you for your letter dated April 20 and for your commitment to finding a San Francisco Fed president who “understands and is able to represent the varied needs and interests of the richly diverse people and business communities throughout the Twelfth district.”
We appreciate that the San Francisco Federal Reserve Bank has shown its commitment to public representation by strengthening diversity among Reserve Bank staff. Unfortunately, that commitment has not extended to the position of President. Similarly, diversity and public representation on the San Francisco Fed’s governing board remains lacking. The Twelfth District is one of the most demographically diverse districts in the country, yet a recent analysis by the Center for Popular Democracy found that the San Francisco Fed’s board of directors is the least diverse in the Federal Reserve System.
Your letter indicated that it would not be possible to include a Community Advisory Council member on the search committee because “only the Class B and C directors (those not affiliated with banks or financial institutions) are eligible to participate in the appointment process.” We would like to clarify our request regarding Mr. Matsubayashi’s inclusion. Following established precedent, Mr. Matsubayashi can play a critical advisory role on the search committee by suggesting, interviewing, and advising on candidates under consideration. We are not suggesting or expecting that he would have final decision-making authority over which candidate is ultimately chosen.
The Federal Reserve Act clearly designates Class B and C directors as the final arbiters of who serves as president of each Reserve Bank. We do not agree that inclusion of a member of the public on the search committee would in any way violate the law. We have consulted with legal experts on the Federal Reserve Act, and they concur. Whenever a regional Reserve Bank encounters a presidential vacancy, it is customary to hire an executive search firm to identify and vet candidates who can fill that vacancy. We posit that employees of those executive search firms are participating in the search process. In 2014, outgoing Dallas Fed President Richard Fisher solicited the participation of non-Class B/C directors when he reportedly convened an advisory committee consisting of former Dallas Fed chairmen to help choose his successor.2 Freedom of Information Act requests have also revealed that members of the Board of Governors have occasionally suggested candidates to fill Reserve Bank presidential vacancies, thereby going beyond the final approval role that the Federal Reserve Act prescribes for governors. We fail to see how the inclusion of Mr. Matsubayashi on the search committee in an advisory capacity is distinguished from these other examples of involvement by non- Class B and C directors in recent Reserve Bank presidential selections.
In your letter of April 20th, you identified the establishment of the Community Advisory Council as an important step toward giving an “even stronger voice to those representing underserved communities,” in the District. The Council includes individuals selected by the San Francisco Fed itself as credible representatives of diverse communities. If the San Francisco Fed is unwilling to find a way to meaningfully include a leading member of that advisory council in the selection process for the next President, it is difficult to understand how underserved communities are truly gaining a stronger voice.
It is also difficult to be assured that people of color will be given due consideration for the position of President when communities of color and other important segments of the District’s population are not adequately reflected in the selection process. Despite clear calls for consideration of diverse candidates from members of Congress and the public, the last two Reserve Bank presidential vacancies have resulted in the selection of white, male, longtime Fed insiders. Including the Chair of the San Francisco Fed’s Community Advisory Council on the search committee in San Francisco is an essential step to maintain the credibility of the selection process for the next President of the San Francisco Fed.
In light of this clarification, we respectfully request that you consider including the Chair of the San Francisco Fed’s Community Advisory Council in the search process in a manner consistent with the Federal Reserve Act. If the San Francisco Fed chooses not to accept this recommendation, we would appreciate an explanation as to why. Regardless of your decision, we look forward to your continued collaboration as you take on the important responsibility of finding a qualified candidate to fill a policymaking role of crucial importance to the public.
Thank you for your service to the 12th District and our nation.
Respectfully submitted,
California Reinvestment Coalition Greenlining Institute Center for Popular Democracy Community Council of Idaho Chicanos Por La Causa NALCAB – National Association for Latino Community Asset Builders National Coalition for Asian Pacific American Community Development TELACU
cc: Jerome Powell, Chairman, Board of Governors of the Federal Reserve Lael Brainard, Governor, Board of Governors of the Federal Reserve Randal Quarles, Vice Chairman for Supervision, Board of Governors of the Federal Reserve
Report: Women unduly harmed by unpredictable scheduling
Al Jazeera - 05-12-2015 - Irregular hours and just-in-time scheduling are pervasive throughout the low-wage economy, but they do...
Al Jazeera - 05-12-2015 - Irregular hours and just-in-time scheduling are pervasive throughout the low-wage economy, but they do particular harm to working women, according to an analysis released Tuesday by the Center for Popular Democracy.
Women still disproportionately shoulder responsibility for child care and other family obligations, and more than 6 million women have cited those constraints as the primary reasons they are not employed full time, according to the report.
The Center for Popular Democracy argues that juggling family responsibilities with the unsteady work hours that often come with part-time employment leads to additional challenges for women.
“Women working more hours are likely to experience the stressful effects of overwork and may often have no choice but to work overtime hours or lose their job,” the report says. “However, the over 12 million women working part time in hourly jobs are at greatest risk of both highly erratic schedules and of extreme income fluctuation."
Women were found to be slightly more likely to work jobs paid on an hourly basis: 61 percent compared with 56 percent of men. As a result, their income is more likely to fluctuate based on how many hours they are assigned to work per week or month. Additionally, their off time can be difficult to control or predict because of last-minute scheduling.
Erratic hours can be particularly hard on women, who tend to spend more time than men performing household chores and caring for children. A 2014 Bureau of Labor Statistics survey found women in households with children under the age of 6 spent roughly an hour a day attending to their physical needs, whereas men spent roughly half an hour.
On a conference call with reporters to discuss the report, Albuquerque, New Mexico, activist Kris Buchmann said she has been “treated like my life outside of work didn’t matter” while working hourly jobs in retail.
“I can’t tell you how many times I was asked to close and then turn around and come back in after five or six hours off,” she said. “It’s not enough for a full night’s sleep or showering or anything else I have to do."
Other times, “they would call me into work, I would show up, and they would say, ‘Oh, never mind. We don’t need you,’” she said. Such unpredictability made it difficult for her to know when she would need to find child care for her son.
University of Massachusetts at Amherst sociologist Naomi Gerstel, who wrote the book “Unequal Time: Gender, Class and Family in Employment Schedules” with Dan Clawson, said erratic scheduling exists “across the entire class spectrum” but falls especially hard on low-wage workers.
If you’re in a stable, full-time position, “you’re more likely to be able to say no or find substitutes” such as baby sitters and other care workers, she said. Additionally, some higher-paying workplaces are “changing occupations to make it possible for especially women workers to take on what’s defined as flexibility."
But perks such as maternity leave have not filtered down the income ladder. And long-term changes in family structure have created a “double-edged sword” for some workers, said Gerstel. Births to unmarried women have risen steadily since the 1940s, according the U.S. Census Bureau, so more single mothers have been forced to negotiate child care on top of their work schedules.
That’s beginning to change in some parts of the country. Carrie Gleason, the Center for Popular Democracy’s Fair Workweek Initiative director, told reporters on a conference call that 11 states “have introduced some form of work hours legislation, and this is an issue that was basically not on the map last year.”
Buchmann is part of a campaign to get predictable scheduling legislation passed in New Mexico. In November, San Francisco’s Board of Supervisors approved a legislative package known as the Retail Worker Bill of Rights, which is, in part, intended to enforce more predictable scheduling for retail workers.
Source: Al Jazeera
Congress to Consider Bill to Help Part-Timers
New York Post - July 22, 2014, by James Covert - Part-timers with increasingly unpredictable work schedules are taking their beef to Washington.
A congressional bill is slated for...
New York Post - July 22, 2014, by James Covert - Part-timers with increasingly unpredictable work schedules are taking their beef to Washington.
A congressional bill is slated for introduction Tuesday that would give workers more control over their hourly schedules at big retailers like Walmart, Home Depot and JCPenney.
Led by Walmart, major chains increasingly are switching around workers’ shifts on short notice, making it difficult and often impossible for part-timers to work second jobs.
The practice — common in retail, restaurant, janitorial and housekeeping jobs — has hit working mothers especially hard, according to critics.
Unpredictable work hours make it difficult to schedule everything from babysitters to doctor’s appointments.
“I think it’s gotten to a crisis point,” said Carrie Gleason, director of the Fair Workweek Initiative, a new campaign by the Center for Popular Democracy, adding workers need “some amount of predictability and stability in our work hours so we can live and manage our lives.”
The bill, sponsored by US Reps. George Miller (D-Calif.) and Rosa DeLauro (D-Conn.), would require employers to give an extra hour of pay to workers summoned less than 24 hours in advance.
The bill would also guarantee a minimum of four hours’ pay if an employee is sent home early — a frequent occurrence at restaurants.
Source
How Janet Yellen Is Embracing The Fed’s Role In Racial Justice
How Janet Yellen Is Embracing The Fed’s Role In Racial Justice
Oh, what a difference a year can make.
Last July, Federal Reserve chairwoman Janet Yellen endured criticism for House testimony in which she seemed to imply that there was little the Fed...
Oh, what a difference a year can make.
Last July, Federal Reserve chairwoman Janet Yellen endured criticism for House testimony in which she seemed to imply that there was little the Fed could do to address the disproportionately high African-American unemployment rate.
Not so on Tuesday. In her semi-annual testimony to the Senate Banking Committee, Yellen emphasized that the failure of the economic recovery to reach communities of color influences the Fed’s decision-making, and made a strong commitment to improving diversity at the central bank.
“Jobless rates have declined for all major demographic groups, including for African Americans and Hispanics,” Yellen said, according to her prepared remarks. “Despite these declines, however, it is troubling that unemployment rates for these minority groups remain higher than for the nation overall, and that the annual income of the median African-American household is still well below the median income of other U.S. households.”
Yellen’s policy argument has not fundamentally changed. It is the Fed’s job to maximize employment in the economy as the whole, she says, and it lacks the tools to target particular communities. And the Fed chief has clarified since last summer that she takes seriously how the Fed’s adjustment of interest rates can have an especially big impact on African Americans and Latinos, who have higher jobless rates.
But Yellen’s remarks and actions on Tuesday represent the Fed’s greatest demonstration yet that it is putting the concerns of communities of color front and center on its agenda.
The Fed Up campaign, a coalition of progressive groups that has led the push to make the Federal Reserve more responsive to workers in general, and communities of color in particular, was pleased with the focus of Yellen’s testimony.
“Each time since Yellen spoke last July, when she got pushback over what she said, she has gotten a little bit better,” said Jordan Haedtler, Fed Up’s campaign manager. “Now she is proactively showing that the Fed is assessing this data and does take this data into account.”
Diversity is an extremely important goal and I will do everything I can to further advance it.
This week’s hearings, held every six months in both chambers of Congress — the House will hold its hearing on Wednesday — are an opportunity for the Fed chair to update lawmakers about the overall state of the economy. As part of the briefing, the Fed releases an accompanying monetary policy report summarizing its economic assessment and research.
For the first time, the Fed chose to devote a section of its report to whether the “gains of the economic expansion [have] been widely shared.” That section focused on how the recovery affected different races and ethnicities differently.
The results are discouraging. Despite years of job growth, the rates of full-time work for African Americans and Latinos are a few percentage points lower than they were before the recession, while the rates among white and Asian-American workers have more or less reached pre-recession levels. And the median income of black households, which took the biggest hit of any group during the recession, has also been slower to recover, reaching only 88 percent of what it was in 2007, compared with about 94 percent for the other three groups.
Responding to a question about the new section from Sen. Sherrod Brown (D-Ohio), Yellen insisted that weighing the disparate impact of economic growth on a range of different groups is a key part of the Fed’s mission.
“There are very significant differences in success in the labor market across demographic groups,” she said. “It is important for us to be aware of those differences and to focus on them as we think about monetary policy and the broader work that the Federal Reserve does in the area of community development and trying to make sure that financial services are widely available to those that need it, including low- and moderate-income [households].”
Yellen also recognized the importance of diversity — of race, gender, professional background and ideology — within the Fed’s ranks in ensuring the bank remains sensitive to a broad array of Americans’ economic experiences.
She touted her creation of a task force in the Fed to improve its gender and ethnic diversity, but acknowledged there is more to be done.
“Diversity is an extremely important goal and I will do everything I can to further advance it,” Yellen said.
Progressive groups and their allies in Congress trying to make the Fed more accountable to the public have focused on increasing diversity and reducing Wall Street’s influence at the central bank. Eleven senators, including Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.), and 116 House members sent a letter to Yellen on May 12 urging her to prioritize the diversity of Fed officials, especially at the 12 regional Fed banks, which are privately owned. (Hillary Clinton expressed similar sentiments in a statement later that day.)
The makeup of the regional Fed bank boards is important because they are dominated by the big banks and have free reign to appoint their presidents. The regional Fed bank presidents hold five seats on the Federal Open Market Committee, the central bank panel that adjusts the benchmark interest rate. Currently, regional Fed presidents make up half of the FOMC’s influential votes.
As a result, the Fed officials with the power to raise interest rates and effectively increase unemployment are selected by people who are disproportionately white, male and from the finance and business sectors.
In the interests of changing that, the Fed Up campaign on Monday released a slate of 39 candidates for the regional Federal Reserve bank boards of directors. The candidates not only reflect racial and gender diversity, but also come exclusively from academic institutions, community groups and labor organizations.
“On racial and gender diversity there has been modest progress, though it has not taken place at the rate we would like to see,” Haedtler said. Haedtler added that there is even greater room for improvement when it comes to the diversity of professional backgrounds of board members and other top Fed officials, an area where he said there has been “regression” under Yellen’s watch.
By Daniel Marans
Source
A City Invokes Seizure Laws to Save Homes
The power of eminent domain has traditionally worked against homeowners, who can be forced to sell their property to make way for a new highway or shopping mall. But now the working-class city of...
The power of eminent domain has traditionally worked against homeowners, who can be forced to sell their property to make way for a new highway or shopping mall. But now the working-class city of Richmond, Calif., hopes to use the same legal tool to help people stay right where they are.
Scarcely touched by the nation’s housing recovery and tired of waiting for federal help, Richmond is about to become the first city in the nation to try eminent domain as a way to stop foreclosures.
The results will be closely watched by both Wall Street banks, which have vigorously opposed the use of eminent domain to buy mortgages and reduce homeowner debt, and a host of cities across the country that are considering emulating Richmond.
The banks have warned that such a move will bring down a hail of lawsuits and all but halt mortgage lending in any city with the temerity to try it.
But local officials, frustrated at the lack of large-scale relief from the Obama administration, relatively free of the influence that Wall Street wields in Washington, and faced with fraying neighborhoods and a depleted middle class, are beginning to shrug off those threats.
“We’re not willing to back down on this,” said Gayle McLaughlin, the former schoolteacher who is serving her second term as Richmond’s mayor. “They can put forward as much pressure as they would like but I’m very committed to this program and I’m very committed to the well-being of our neighborhoods.”
Despite rising home prices in many parts of the country, including California, roughly half of all homeowners with mortgages in Richmond are underwater, meaning they owe more — in some cases three or four times as much more — than their home is currently worth. On Monday, the city sent a round of letters to the owners and servicers of the loans, offering to buy 626 underwater loans. In some cases, the homeowner is already behind on the payments. Others are considered to be at risk of default, mainly because home values have fallen so much that the homeowner has little incentive to keep paying.
Many cities, particularly those where minority residents were steered into predatory loans, face a situation similar to that in Richmond, which is largely black and Hispanic. About two dozen other local and state governments, including Newark, Seattle and a handful of cities in California, are looking at the eminent domain strategy, according to a count by Robert Hockett, a Cornell University law professor and one of the plan’s chief proponents. Irvington, N.J., passed a resolution supporting its use in July. North Las Vegas will consider an eminent domain proposal in August, and El Monte, Calif., is poised to act after hearing out the opposition this week.
But the cities face an uphill battle. Some have already backed off, and those that proceed will be challenged in court. After San Bernardino County dropped the idea earlier this year, a network of housing groups and unions began working to win community support and develop nonprofit alternatives to Mortgage Resolution Partners, the firm that is managing the Richmond program.
“Our local electeds can’t do this alone, they need the backup support from their constituents,” said Amy Schur, a campaign director for the national Home Defenders League. “That’s what’s been the game changer in this effort.”
Richmond is offering to buy both current and delinquent loans. To defend against the charge that irresponsible homeowners who used their homes as A.T.M.’s are being helped at the expense of investors, the first pool of 626 loans does not include any homes with large second mortgages, said Steven M. Gluckstern, the chairman of Mortgage Resolution Partners.
The city is offering to buy the loans at what it considers the fair market value. In a hypothetical example, a home mortgaged for $400,000 is now worth $200,000. The city plans to buy the loan for $160,000, or about 80 percent of the value of the home, a discount that factors in the risk of default.
Then, the city would write down the debt to $190,000 and allow the homeowner to refinance at the new amount, probably through a government program. The $30,000 difference goes to the city, the investors who put up the money to buy the loan, closing costs and M.R.P. The homeowner would go from owing twice what the home is worth to having $10,000 in equity.
All of the loans in question are tied up in what are called private label securities, meaning they were bundled and sold to private investors. Such loans are generally the most unfavorable to borrowers and the most likely to default, Mr. Gluckstern said. But they are also the most difficult to modify because they are controlled by loan servicers and trustees for the investors, not the investors themselves. If Richmond’s purchase offer is declined, the city intends to use eminent domain to condemn and buy the loans.
The banks and the real estate industry have argued that such a move would be unprecedented and unconstitutional. But Mr. Hockett says that all types of property, not just land and buildings, are subject to eminent domain if the government can show it is needed to promote the public good, in this case fighting blight and keeping communities intact. Railroad stocks, private bus companies, sports teams and even some mortgages have been subject to eminent domain.
Opponents, including the Securities Industry and Financial Markets Association, the American Bankers Association, the National Association of Realtors and some big investors have mounted a concerted opposition campaign on multiple levels, including flying lobbyists to California city halls and pressuring Fannie Mae, Freddie Mac and the Federal Housing Administration to use their control of the mortgage industry to ban the practice.
Tim Cameron, the head of Sifma’s Asset Management Group, said any city using eminent domain would make borrowing more expensive for everyone in the community and divert profits from the investors who now own the loan to M.R.P. and the investors financing the new program. “Eminent domain is used for roads and schools and bridges that benefit an entire community, not something that cherry-picks who the winners are and who the losers are,” he said.
Representative John Campbell, Republican of California, has introduced a bill that would prohibit Fannie, Freddie and the F.H.A. from making, guaranteeing or insuring a mortgage in any community that has used eminent domain in this way. Eminent domain supporters say such limits would constitute a throwback to the illegal practice called redlining, when banks refused to lend in minority communities.
Opponents have also employed hardball tactics. In North Las Vegas, a mass mailer paid for by real estate brokers warned that M.R.P. had “hatched a plan to make millions of dollars by foreclosing on homeowners who are current on their payments.”
In a letter to the Justice Department, Lt. Gov. Gavin Newsom of California complained that the opposition was violating antitrust laws and that one unnamed hedge fund had threatened an investor in the project.
But not all mortgage investors oppose the plan. Some have long argued that writing down homeowner debt makes sense in many cases. “This is not the first choice, but it’s rapidly becoming the only choice on how to fix this mess,” said William Frey, an investor advocate.
Mr. Frey said that the big banks were terrified that if eminent domain strategies became widespread, they would engulf not only primary mortgages but some $450 billion in second liens and home equity loans that are on the banks’ balance sheets. “It has nothing to do with morality or anything like that, it has to do with second liens.”
Many of the communities considering eminent domain were targeted by lenders who steered minority families eligible for conventional mortgages into loans with higher interest rates and ballooning payments. Robert and Patricia Castillo bought a three-bedroom, one-bathroom home in Richmond because their son, who is severely autistic, would anger landlords with his destructive impulses. They paid $420,000 for a home that is now worth $125,000, Mr. Castillo, a mechanic, said.
They have watched as their daughter’s playmates on the block have, one by one, lost their homes. But they are reluctant to walk away from the house in part for the sake of their son.
“We’re in a bad situation,” Mr. Castillo, 44, said. “Not only me and my family, but the whole of Richmond.”
Source:
Minority Groups Rally Outside Fed Against Interest Rate Hike
Observer - March 5, 2015, by Will Bredderman - Minority activist organizations demonstrated in the snow outside the Federal Reserve Bank of New York, insisting that the institution keep interest...
Observer - March 5, 2015, by Will Bredderman - Minority activist organizations demonstrated in the snow outside the Federal Reserve Bank of New York, insisting that the institution keep interest rates low until stubbornly high unemployment rates in nonwhite communities drop further.
Immigrant advocacy group Make the Road NY and neighborhood organizers New York Communities for Change joined other left-leaning groups outside the lower Manhattan headquarters of the New York Fed, a branch of the national system that controls the interest rates at which lending institutions may borrow money from the United States government. The Fed has left the rates near zero since the financial crisis of 2008 in order to encourage investment, but it has indicated it might raise them this summer amid an improving economy.
The protesters, however, argued that black and Hispanic communities in New York City are still languishing in an economic doldrums, with jobless rates sitting at 11.2 percent and 5.7 percent respectively.
“These unemployment rates are not going to be better by this summer. We’re not a couple months away from a recovery,” said Shawn Sebastian from the Center for Popular Democracy, arguing that the Fed is looking only at a general joblessness picture that averages in the relatively low unemployment rates among whites. “They’re trying to look at the aggregate levels of unemployment and ignore how it’s disproportionately affecting minority communities to push this narrative about a recovery that we’re not experiencing.”
Chanting “don’t raise the rate,” the demonstrators insisted that New York Fed President William Dudley meet with their organizations to discuss the special needs of minorities.
“We need to sit down with him and have an honest conversation about why he needs to keep interest rates low in order to fight for our communities of color, so that we can make sure we are supplying jobs to all,” said Victoria Ruiz of Make the Road.
The protesters also lashed out at the Fed, which has the additional duty of regulating large banks, for failing to prevent lenders from issuing, packaging and selling dubious mortgage loans—which disproportionately went to black and Hispanic homeowners, with areas like Southeast Queens now leading the country in foreclosures.
“The banks, while the Fed was not watching what they were doing, was not doing its job supervising them, they went around snapping up subprime lenders and fueling all of that toxic subprime lending that happened,” said Alexis Iwanisziw of the New Economy Project, noting many major financiers have since paid out massive settlements to the Department of Justice for their activities.
The Federal Reserve Bank of New York referred the Observer to chairwoman Janet Yellen’s remarks after the Fed’s meeting last December, when she said “it can be patient in beginning to normalize the stance of monetary policy.”
Source
NYC debe apoyar a la numerosa población inmigrante para asegurar una fuerza laboral exitosa
NYC debe apoyar a la numerosa población inmigrante para asegurar una fuerza laboral exitosa
Marta tiene dificultad para encontrar trabajo últimamente. Con frecuencia, cuando va a solicitar empleo haciendo comida o labores domésticas, lo primero que le preguntan es, “¿Habla inglés?” Marta...
Marta tiene dificultad para encontrar trabajo últimamente. Con frecuencia, cuando va a solicitar empleo haciendo comida o labores domésticas, lo primero que le preguntan es, “¿Habla inglés?” Marta siempre responde la verdad, que solo sabe un poco.
Con frecuencia, los empleadores la rechazan porque quieren personas que dominen el inglés. “Estos días, la verdad que es muy difícil conseguir trabajo”, dijo Marta.
La ciudad de Nueva York tiene la población inmigrante más diversa entre todas las grandes metrópolis del mundo. Los inmigrantes constituyen más de 40% de la población y casi la mitad de la fuerza laboral de la ciudad.
Pero la ciudad enfrenta una paradoja: si bien la tasa de empleo entre los inmigrantes es más alta que la de los oriundos de Nueva York, un porcentaje desproporcionado de aquellos tienen empleos con poca paga, sus ingresos promedio son más bajos que los de las personas nacidas allí y, con frecuencia, se ven más afectados por la pobreza. Muchos de ellos, al igual que Marta, tienen conocimientos limitados de inglés, lo que puede dificultar que encuentren un trabajo bien remunerado.
Desde que el alcalde de Nueva York Bill de Blasio asumió el mando hace poco más de dos años, la ciudad ha comenzado a reestructurar el sistema de desarrollo de la fuerza laboral, lo que crea una oportunidad importante de eliminar las injusticias que enfrentan los neoyorquinos inmigrantes.
El nuevo marco de la ciudad para su sistema de desarrollo de la fuerza laboral, llamado Career Pathways, promete invertir un nivel sin precedente de fondos en capacitación laboral y educación orientado a los trabajadores más vulnerables de la ciudad, para asegurar que la inversión de la ciudad en la fuerza laboral sea uniforme en las diversas agencias municipales y colaborar con los empleadores y otras partes interesadas a fin de mejorar la calidad de los empleos con salarios más bajos en la ciudad.
Ahora que se está implementando el nuevo marco para el desarrollo de la fuerza laboral, se debe aprovechar la oportunidad para asegurar que se atiendan las necesidades de la numerosa fuerza laboral inmigrante de Nueva York. La gran mayoría de los trabajadores en las ocupaciones de mayor crecimiento en la ciudad, desde auxiliares de servicios de salud a domicilio hasta obreros de construcción, enfermeros diplomados y programadores de computadoras, son inmigrantes. Como tal, los trabajadores inmigrantes son fundamentales para la vitalidad económica de la ciudad, y su éxito debe ser primordial en la reforma del sistema laboral de la ciudad.
Los trabajadores inmigrantes y postulantes a empleo enfrentan muchas barreras singulares que limitan su superación en la fuerza laboral. Por ejemplo, un número considerable de inmigrantes no hablan inglés bien y tienen, en promedio, un nivel más bajo de educación formal.
Al mismo tiempo, hay miles de inmigrantes con grados universitarios u otras credenciales educativas que no se reconocen en Estados Unidos y, por lo tanto, no tienen otra opción que realizar trabajos en los que no se aprovechan del todo sus aptitudes y talento. Además, entre los trabajadores con salarios bajos, que son mayormente inmigrantes, la explotación es algo común. Esto es particularmente cierto en el caso de los trabajadores indocumentados y quienes trabajan en la economía informal.
El éxito del plan de Career Pathways depende de su capacidad de eliminar las principales barreras que enfrentan los neoyorquinos inmigrantes. Un informe preparado conjuntamente por el Center for Popular Democracy y Center for an Urban Future identifica estas barreras y describe una estrategia coordinada para enfrentar los obstáculos que impiden que los trabajadores inmigrantes alcancen plenamente su potencial.
Específicamente, la ciudad y las entidades privadas que financian la fuerza laboral deben invertir en clases de inglés, educación de adultos y programas de capacitación y titulación para trabajadores con diversos niveles educativos y de dominio de inglés. Esto les permitiría aprender las destrezas que necesitan para ser competitivos en la fuerza laboral y evitaría que se estanquen en empleos con poca paga.
En segundo lugar, la ciudad debe asegurar que los trabajadores inmigrantes estén enterados de estos servicios al asegurarse de que se ofrezcan en los vecindarios donde los inmigrantes viven o trabajan. Una gran manera de hacerlo es asociarse con organizaciones sin fines de lucro en las comunidades inmigrantes y asegurar que los fondos disponibles estén llegando a los programas laborales en las comunidades inmigrantes.
Finalmente, una estrategia de desarrollo de la fuerza laboral que es eficaz para los inmigrantes debe mejorar la calidad de los empleos con salarios bajos que ocupan a tantos de ellos. Esto incluye mejorar las leyes de protección laboral y velar por su cumplimiento, algo que con frecuencia no se hace, además de lograr un sueldo mínimo más alto y acceso a licencia pagada por enfermedad. Los mismos empleadores son una parte importante de esta conversación, y la ciudad debe usar su influencia para ayudarlos a mejorar la calidad de sus empleos peor pagados.
Sin un enfoque coordinado para asegurar que los servicios de desarrollo laboral estén atendiendo a los inmigrantes, el plan de la ciudad corre el riesgo de pasar por alto a un grupo enorme de trabajadores y personas que buscan empleo. En este momento tenemos la oportunidad de asegurar que se incluyan a los inmigrantes como parte esencial de este plan.
By Kate Hamaji & Christian González-Rivera
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