School Voucher Opponents Ready for Fight as Bill Advances
The Tennessean - March 3, 2015, bt Jason Gonzales - Anti-voucher groups are digging in for a fight as the second of two almost identical voucher bills easily passed the House Education and...
The Tennessean - March 3, 2015, bt Jason Gonzales - Anti-voucher groups are digging in for a fight as the second of two almost identical voucher bills easily passed the House Education and Planning Subcommittee by a 7-1 vote. State Rep. Kevin Dunlap, D-Rock Hill, was the lone dissenter.
The proposed legislation that passed Tuesday is sponsored in the House by state Rep. Bill Dunn, R-Knoxville, and has considerable backing from pro-voucher groups and legislators alike. A separate bill sponsored by state Sen. Brian Kelsey, R-Germantown, narrowly passed the Senate Education Committee.
The legislators hope to provide low-income students a voucher program to pay for private school tuition with a state-funded scholarship. The program targets students eligible for free and reduced-price lunch who attend a public school ranked in the bottom 5 percent of the state in academic achievement.
Several groups have publicly voiced opposition to the bills, including the Tennessee Education Association. The teacher's union has been against proposed voucher legislation for years. In past years, opponents have been successful in their fight, as bills have continually struggled in the House and Senate finance committees.
Between the two bills, Haslam said the administration agreed to fund the measure from Dunn and state Sen. Todd Gardenhire, R-Chattanooga. On supporting the Dunn-Gardenhire bill versus Kelsey's, Haslam said Tuesday morning the bill most resembles the one he supported last year.
Kelsey is a sponsor of both bills, and House Majority Leader Gerald McCormick, R-Chattanooga, recently told The Associated Press the plan could survive in the House this year.
Volunteers with Tennesseans Reclaiming Educational Excellence were the visible face Tuesday of the anti-voucher group at Legislative Plaza. They were there to pass out brochures and stickers that said, "No School Vouchers."
Anne Marie Farmer, a volunteer with the public education advocacy group, said the group argues vouchers don't have the desired effect in a time when schools need more resources. The group also contends vouchers only give private schools a choice, not parents.
"We don't believe it is an effective way to raise student achievement," she said
Americans United for Separation of Church and State and Tennessee Transgender Political Coalition have also voiced opposition to the bill.
A recent poll by the Public Interest and the Center for Popular Democracy, however, says Tennesseans are not concerned with school choice. The TEA sent out a Tuesday media release weighing in on the poll.
"When Tennesseans were asked to rank important issues facing the state's public schools, school choice came in dead last," said Barbara Gray, Arlington Community Schools administrator and TEA president, in the release. "This poll shows that legislators need to redirect their attention to the issues that really matter to Tennesseans, like parental involvement, over-emphasis on standardized testing and cuts to programs like physical education and music."
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Dear Senators Flake, Collins, and Murkowski
Senator Flake, you were confronted on national television by two activists, both claiming to be rape survivors. Maria Gallagher and Ana Maria Archila gained national fame over the video of that...
Senator Flake, you were confronted on national television by two activists, both claiming to be rape survivors. Maria Gallagher and Ana Maria Archila gained national fame over the video of that confrontation, and both say they’ve never spoken about their experiences before. The testimony of Christine Blasey Ford gave them the strength, they said, to come forward. But they haven’t, at least as far as I’ve seen so far.
Read the full article here.
Fed Up Campaign Celebrates Victory for Working Families as Fed Holds Off on Rate Hikes
“This is a victory for the working families who stepped up with innovative organizing to send the Fed a clear message: Our voices belong in the debate about our economy,” said Ady Barkan, Campaign...
“This is a victory for the working families who stepped up with innovative organizing to send the Fed a clear message: Our voices belong in the debate about our economy,” said Ady Barkan, Campaign Director for Fed Up. “With the recovery still far too weak in too many communities, it would have been economically devastating – and immoral – to slow the economy.”
“We applaud Chair Yellen and the Federal Reserve for resisting the pressure being put on them to intentionally slow down the economy. Weak wage growth proves that the labor market is still very far from full employment. And with inflation still below the Fed’s already low target, there is simply no reason to raise interest rates anytime soon. Across America, working families know that the economy still has not recovered. We hope that the Fed continues to look at the data and refrain from any rate hikes until we reach genuine full employment for all, particularly for the Black and Latino communities who are being left behind in this so-called recovery.
The campaign held a rally outside the building where Chair Janet Yellen made the announcement this afternoon. Fifty workers gathered to tell their stories and call on the Fed not to intentionally slow down the economy. They were joined by Rep. John Conyers (D-MI), who introduced today the Full Employment Federal Reserve Act of 2015, which would enhance the Fed’s full employment mandate.
Throughout late 2014 and 2015, the Fed Up campaign has elevated the voices of working families, meeting with four of the five Fed Governors and six of the twelve regional Fed presidents. Workers across the country have talked about the tremendous racial and economic disparities that still afflict the economy, and the need for genuine full employment that creates rising wages and more jobs for all communities. It has enlisted the support of economists like Nobel Laureate Joe Stiglitz, the involvement of four of the nation’s largest progressive digital advocacy organizations, and over 120,000 supporters around the country.
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The Center for Popular Democracy promotes equity, opportunity, and a dynamic democracy in partnership with innovative base-building organizations, organizing networks and alliances, and progressive unions across the country. CPD builds the strength and capacity of democratic organizations to envision and advance a pro-worker, pro-immigrant, racial justice agenda.
Can New CEO Tim Sloan Fix Scandal-Plagued Wells Fargo’s Corporate Culture?
Can New CEO Tim Sloan Fix Scandal-Plagued Wells Fargo’s Corporate Culture?
Scandal-plagued Wells Fargo’s recent selection of long-time bank insider Tim Sloan to replace John Stumpf as its CEO has done little to mollify critics, given Sloan’s central management role...
Scandal-plagued Wells Fargo’s recent selection of long-time bank insider Tim Sloan to replace John Stumpf as its CEO has done little to mollify critics, given Sloan’s central management role during more than a decade of consumer and community complaints.
Sloan has largely escaped scrutiny during the thumping Wells Fargo has taken from Congress, the media, and bank reform activists for boosting its own stock price by secretly creating more than two million unauthorized checking and credit-card accounts. As lawmakers and state and federal regulators line up to investigate the bank following Stumpf’s resignation, Sloan now replaces him on the hot seat. Sloan’s role as a member of the bank’s inner circle at a time when Wells Fargo stood accused of reckless and discriminatory practices is sure to interest investigators.
“I remain concerned that incoming CEO Tim Sloan is also culpable in the recent scandal, serving in a central role in the chain of command that ought to have stopped this misconduct from happening,” said House Democrat Maxine Waters, of California, in a statement. Waters is the ranking Democratic on the House Financial Service Committee, which is investigating Wells Fargo, as are the Senate Banking Committee, the Justice Department, the Labor Department, and the attorneys general of several states.
Paulina Gonzalez, executive director of the California Reinvestment Coalition, a consumer watchdog group, also has singled Sloan out for special criticism. There are “a lot of unanswered questions as to when and what Tim Sloan knew about these fraudulent consumer accounts,” says Gonzalez, who has called on the new CEO to help mend public trust by ending Wells Fargo’s practice of forcing former employees and fraud victims into arbitration to get their grievances resolved.
Sloan recently acknowledged that Wells Fargo had made serious mistakes regarding the phony accounts scandal, including placing too much of the blame on branch employees. “We failed to acknowledge the role leadership played and, as a result, many felt we blamed our team members,” Sloan told an audience of 1,200 Wells Fargo employees at the Knight Theater in Charlotte on October 26. "That one still hurts, and I am committed to rectifying it.” He said that the bank has ended the aggressive sales goals that led its employees to create the phony accounts, and pledged to rehire some rank-and-file employees who were fired for creating those accounts, though it’s unclear how many.
“Getting an apology when the company is backed into a corner doesn’t fix how Wells Fargo’s predatory, high-pressure sales goals hurt millions of working people and their customers,” says Erin Mahoney, a spokesperson for the Committee for Better Banks, a nationwide coalition of bank employees and community groups. “If Sloan really wants to rebuild trust within the company, he should start paying frontline workers a fair wage and working with them to collaboratively to improve working conditions and serve the best interests of employees and customers.”
The nation’s leading home mortgage lender, Wells Fargo has already agreed to pay $185 million in settlements with the federal Consumer Financial Protection Bureau, the federal Office of the Comptroller of the Currency (a federal bank regulator), and the City of Los Angeles, which sued Wells Fargo on behalf of its victimized customers. Those fines are a drop in the bucket compared with Wells Fargo’s 2015 profits of $20 billion, note consumer watchdogs spearheading their own investigations and lawsuits.
Sloan, 56, was a key member of Wells Fargo’s upper echelon throughout the period leading up to the falsified-accounts scandal.
Sloan, 56, was a key member of Wells Fargo’s upper echelon throughout the period leading up to the falsified-accounts scandal. Having started his climb up Wells Fargo in 1987, Sloan headed the bank’s corporate real estate and social responsibility divisions before being named senior executive vice president and Chief Financial Officer in 2011. That’s the year Wells Fargo started firing some 5,300 low-level employees for opening the fraudulent accounts and quietly refunding millions of dollars to customers.
Last year, Sloan was promoted to Chief Operating Officer, a post that made him the executive responsible for Wells Fargo’s Community Bank and Consumer Lending divisions—ground zero in the current scandal. Among other duties, Sloan was in charge of supervising Carrie Tolstedt, who ran the Well Fargo’s community-banking division at the center of the current firestorm. Tolstedt was forced to resign last month. Under pressure from Congress and shareholders, Wells Fargo’s board withdrew Tolstedt’s severance and bonus pay as well as all of her $19 million worth of unvested stock awards. She also agreed not to exercise about $34 million in stock options. Even so, she left owning more than $43 million worth of stock that she had accumulated during her career with the bank.
Although Sloan is relatively unknown nationally, this is not the first time he has faced public scrutiny. In 2012, California bank reform activists picketed his home to protest Wells Fargo’s efforts to evict a wheelchair-bound homeowner who had missed a few mortgage payments due to a health crisis.
The owner of the residence in question, a tiny, 949-square-foot house in the gritty, working class Los Angeles suburb of South Gate, was Ana Casas Wilson, a court interpreter who had lived there since she was 12 years old. Wilson lived in the house with her husband James (a school janitor), her mother Becky (a retired factory worker who worked as a home health aide), and her teenage son Anthony.
In 2009, Wilson was diagnosed with breast cancer and underwent a double mastectomy. She also suffered from cerebral palsy and was confined to a wheelchair. Her husband quit his night job as a security guard to care for her, reducing the family’s income. During her hospitalization and chemotherapy, the family fell behind on its mortgage payments, and Wells Fargo started to foreclose on Wilson’s property.
Wilson sought to resume payments once the family’s financial situation stabilized, but Wells Fargo refused to accept the Wilsons’ checks and pursued foreclosure and eviction. A feisty disability rights activist, Wilson fought back, contacting the Alliance of Californians for Community Empowerment (ACCE), a community organizing group on the front lines of the foreclosure crisis that is known for confronting banks through negotiations, protests and civil disobedience to draw attention to their abuses of consumers and communities.
In October of 2011—a month after the Occupy Wall Street movement had started in New York City and started spreading to cities across the country—ACCE members lodged their first protest outside Sloan’s house, a $5 million, eight-bedroom Spanish-style mansion on a cul-de-sac in San Marino, one of California’s wealthiest suburbs. It’s only 10 miles from Wilson’s South Gate home, but it might as well be a world away.
After Wilson and her supporters picketed outside Sloan’s house, the five-member San Marino City Council adopted a new law that requires protesters to remain 150 feet away from a target residence, or 75 feet from the curb adjacent to the home, whichever is further.
“The purpose of the ordinance is not to reduce picketing, but to protect the people who are the victims of picketing,” San Marino city manager John Schaefer said at the time. “We’re a prime target. We have a lot of people who fit the profile to be the victim of this type of crime.”
The following April, after Wells Fargo continued to refuse to help the Wilsons stay in their house, Wilson and about 100 supporters from ACCE and the Service Employees International Union showed up carrying signs and chanted “Wells Fargo, shame on you!” in the street in front of Sloan’s house. Wilson even brought a check for her mortgage payment, and crossed a police cordon in her wheelchair to deliver it to Sloan. She knocked several times, but nobody answered the door.
“He's embarrassed,” Wilson told The Los Angeles Times. “That's why he won't come out. ... He knows that what they are doing is wrong.” About 90 minutes into the demonstration, police formed a line around the home, declared the assembly illegal and ordered the group to move 75 feet up the street.
Wilson refused to go and, under San Marino’s anti-protest ordinance, was arrested and taken to San Marino police headquarters.
In September 2012, as Wells Fargo was trying to evict Wilson from her home, Sloan chaired a fundraising ball for the Huntington Library, Art Collections and Botanical Gardens, an elite San Marino institution housed in the former estate of one of America’s best-known robber barons, railroad titan and real estate speculator Henry Huntington. A local newspaper published a photo of Sloan in his tuxedo, smiling for the camera. It reported that the menu by celebrity chef Wolfgang Puck included “filet of beef topped with shrimp scampi, sauteed spinach, pommes puree and baby heirloom tomatoes,” and a dessert of chocolate soufflé “with spun sugar, whipped cream and berries and panna cotta with tangerine sorbet.”
The event drew 380 supporters and raised $300,00—almost twice the value of Ana Wilson’s house.
WILSON’S CASE IS ONLY ONE of many customer abuse controversies that must undoubtedly have been known to Sloan as a member of Wells Fargo’s executive inner circle. Long before the phony accounts scandal erupted, bank reform activists had raised the alarm about the San Francisco-based bank’s racially discriminatory lending practices and aggressive foreclosures.
Wells Fargo has been repeatedly sued by consumer watchdog groups around the country, as well as by Baltimore and other cities, for allegedly violating laws against racist mortgage lending. Activists have testified before Congress, state legislatures and City Councils demanding that they investigate the bank’s practices. Like Wilson and her supporters, they’ve occasionally picketed at the homes of the bank’s top executives, and at its offices and shareholder meetings. Wells Fargo has been so concerned about these demonstrations that it has taken to playing cat and mouse by moving its annual shareholder meeting to a new location every year in a bid to evade protestors.
In 2006, before the subprime bubble started to burst, Wells Fargo originated or co-issued $74.2 billion worth of subprime loans, making it one of the top subprime lenders in the country.
In 2006, before the subprime bubble started to burst, Wells Fargo originated or co-issued $74.2 billion worth of subprime loans, making it one of the top subprime lenders in the country. By June, 2010, Wells Fargo had $17.5 billion worth of foreclosed homes on its books, making it one of the nation’s three top banks in foreclosure activity. Despite getting a $37 billion taxpayer bail out, Wells Fargo resisted kicking and screaming before reluctantly agreeing to participate in the federal government’s Home Affordable Modification Program. Even so, it helped few of its borrowers who were eligible for loan modifications designed to keep families in their homes.
Wells Fargo has also been forced to make huge settlement agreements with government agencies for engaging in a variety of predatory practices. In 2010, the Federal Reserve Board levied an $85 million fine on Wells Fargo for steering borrowers inappropriately into subprime loans and falsifying income information on loan applications. This was the largest civil consumer enforcement fine ever imposed by the Fed.
In 2012, in a settlement with the U.S. Department of Justice, Wells Fargo agreed to pay at least $175 million to redress blatant discrimination against African American and Hispanic borrowers. In cities across the country, brokers working with Wells Fargo steered minority borrowers into costlier subprime mortgages with higher fees when white borrowers with similar credit risk profiles received regular loans. Furthermore, while its mortgage lending to white borrowers increased, the bank’s lending dropped dramatically for African American and Hispanic borrowers. Wells Fargo has been sued many times for charging abusive mortgage default fees, submitting false and misleading court documents, processing unlawful foreclosures, mortgage appraisal and origination fraud, charging military veterans with hidden and illegal fees, robo-signing of mortgage documents, and other illegal acts.
In April, in another settlement with the Justice Department, Wells Fargo agreed to pay $1.2 billion and admitted responsibility for engaging in mortgage fraud. Between 2001 and 2008, the bank falsely claimed that many home mortgage loans were eligible for Federal Housing Authority (FHA) insurance, forcing the federal government to pay FHA insurance claims when some of those loans defaulted.
Last month, a few weeks after the fake accounts settlement was announced, the Office of the Comptroller of the Currency (OCC) assessed a $20 million civil money penalty against Wells Fargo for violating the Servicemembers Civil Relief Act. According to the OCC, between 2006 and 2016, the bank illegally made loans over the law’s 6 percent interest rate limit, and sought to evict service members from their homes without disclosing to courts that they were on active duty.
Wells Fargo has also been deeply involved in the payday lending business that preys on cash-strapped families by providing short term loans with exorbitant fees and annual interest rates (typically around 400 percent) that trap people in a cycle of debt, particularly borrowers in poor and minority neighborhoods. Wells Fargo provided financing for nine payday companies that operate one-third (32 percent) of the entire industry, whose storefronts are concentrated in African American and Latino neighborhoods.
Sloan is only one of two new leaders taking over for Stumpf as Wells Fargo enters a new phase of damage control. Stumpf had been both the bank’s chairman and its CEO. Now, those two jobs will be divvied up between Sloan as CEO and Stephen Sanger, a former CEO of General Mills, as chairman of the Wells Fargo board. The bank’s purpose with these and other moves may be to signal a clean slate.
But Sloan is the ultimate insider, not only at Wells Fargo, but as part of the nation’s corporate ruling class, which also exercises influence through its overlapping ties with business, foundation, and charitable organizations. Sloan not only serves on the Board of Overseers of the Huntington Library, he’s also a member of the University of Michigan’s Ross School of Business Advisory Board and a trustee of Ohio Wesleyan University, the California Institute of Technology, and (ironically, in light of Wilson’s condition) City of Hope, a well-known hospital dedicated to researching and treating cancer.
A major political donor, Sloan has made more than $235,000 in political contributions in the past five years, most of its to Republican candidates and committees.
Since the Occupy Wall Street movement emerged in 2011, Wells Fargo has donated over $10 million in campaign contributions to presidential and congressional candidates and paid $21.3 million to lobbyists, according to the Center for Responsive Politics.
Sloan and the bank he now runs will need all the political clout they can muster to repair the serious damage done to Wells Fargo’s reputation and stockholder confidence. California’s state treasurer, John Chiang, suspended the state’s ties with Wells Fargo, including the lucrative business of underwriting California municipal bonds, citing the bank’s “venal abuse of its customers.” Illinois and Ohio quickly followed suit. Ohio’s Republican Governor, John Kasich, has barred Wells Fargo for one year from “participating in future state debt offerings and financial services contracts initiated by state agencies” under his authority.
San Francisco city treasurer Jose Cisernos kicked Wells Fargo out of its Bank On program, which helps low-income people or those with credit problems open checking and savings accounts. Chicago has banned Wells Fargo from participating in bidding for bond underwriting and other types of business. Local Progress (a network of municipal officials), the Center for Popular Democracy (a federation of local community organizing groups), and the Committee for Better Banks (a coalition of unions and consumer groups) are pushing other cities to follow suit and stop doing business with Wells Fargo until it cleans up its act. Even the Better Business Bureau pulled its accreditation from Wells Fargo, citing the more than 4,000 complaints it has received about the bank over the last three years.
One silver lining of the scandal is that it has strengthened support for the Consumer Financial Protection Bureau
One silver lining of the scandal is that it has strengthened support for the Consumer Financial Protection Bureau, the federal agency that helped uncover the bank’s abuses. The brainchild of Massachusetts senator and anti-Wall Street Democrat Elizabeth Warren, the CFPB was created as part of the 2010 Dodd-Frank financial reform bill over heavy banking industry opposition. Since then, banking lobbyists and their GOP allies on Capitol Hill have sought to undermine the agency by reducing its budget and authority. But the recent Well Fargo settlement may make it more difficult for bank lobbyists and Republicans in Congress to attack the CFPB, according to a recent article in American Banker. Hillary Clinton recently touted the CFPB’s “forceful response” to the Wells Fargo scandal, adding that it was “a stark reminder of why we need a strong consumer watchdog to safeguard against unfair and deceptive practices,” a sentiment echoed by Wall Street watchdog groups like Americans for Financial Reform.
Unfortunately, the CFPB could do little for Ana Wilson, so she found a different way to make her voice heard. In addition to her family’s protest on the front lawn of Sloan’s mansion in 2012, she and her supporters also set up an encampment outside Wilsons’ home. Family members said they would refuse to leave if the bank tried to arrest Wilson. The publicity generated by these protests—including TV and newspaper stories, and support from a popular morning pop radio disc jockey—brought Wells Fargo to the negotiating table.
The bank ultimately offered to sell Wilson’s house to a nonprofit group, HomeStrong USA, that promised to rent it back and give the family an option to repurchase it after the Wilsons had reestablished their credit. Tired from fighting the bank and fighting her stage four breast cancer, Wilson reluctantly agreed to the arrangement. A few weeks later, in December 2012, Wilson died at the age of 50. HomeStrong has kept up its end of the bargain. The group made major improvements to the house. Wilson’s husband James, son Anthony, and mom Becky still live there and pay an affordable rent.
Meanwhile, as he takes over as Well Fargo’s CEO, Sloan may have to sell his San Marino mansion and move to the Bay Area to be closer to the bank’s San Francisco headquarters. Now that he is in the CEO, Sloan can be certain that activists will find out where he lives and visit his new home if he doesn’t change Wells Fargo’s corporate culture and deal with its abuse of employees and consumers alike.
By PETER DREIER
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Philadelphia Hopes to Become Next Major City to Pass Fair Workweek Legislation
Philadelphia Hopes to Become Next Major City to Pass Fair Workweek Legislation
It is part of a larger, nationwide effort that has already been introduced in San Francisco, Seattle and New York. Those cities passed similar legislation after increasing their minimum wage....
It is part of a larger, nationwide effort that has already been introduced in San Francisco, Seattle and New York. Those cities passed similar legislation after increasing their minimum wage. Adding fair workweek standards was the logical next step, according to Rachel Deutsch, senior staff attorney for worker justice at the Center for Popular Democracy. “Some companies are stuck in this philosophy that labor is the most malleable cost,” she said. “But there has been a ton of data that shows there are hidden costs to this business model that treat workers as disposable.”
Read the full article here.
Corporate power on the agenda at Jackson Hole
Protesters from the Fed Up group will once again be on hand this year as they campaign for central bankers to focus more on inequality and depressed wages.
Protesters from the Fed Up group will once again be on hand this year as they campaign for central bankers to focus more on inequality and depressed wages.
Former Fed Staffer, Activists Detail Plan to Overhaul Central Bank
Former Fed Staffer, Activists Detail Plan to Overhaul Central Bank
A former top Federal Reserve staffer joined with activists on Monday to lay out the mechanics of a plan to overhaul the structure of the U.S. central bank.
Dartmouth College’s Andrew Levin...
A former top Federal Reserve staffer joined with activists on Monday to lay out the mechanics of a plan to overhaul the structure of the U.S. central bank.
Dartmouth College’s Andrew Levin, who was a top adviser to former Fed Chairman Ben Bernanke, Jordan Haedtler of the left-leaning Center for Popular Democracy’s Fed Up campaign and the Economic Policy Institute’s Valerie Wilson say in a paper that their proposals amount to an important modernization of the Fed.
“The Fed’s structure is simply outdated, and that makes it harder for its decisions to serve the public,” Ms. Wilson said in a press call. “We are well aware we can’t create a dramatic shake-up” of the Fed, she said, explaining what she and her colleagues are calling for is “pragmatic and nonpartisan.”
The linchpin of the overhaul is bringing the 12 quasi-private regional Fed banks fully into government. The paper’s authors also repeated calls for bankers to be removed from regional Fed bank boards of directors, while proposing nonrenewable terms for top central bank officials and greater government oversight over Fed actions.
The paper Monday fleshed out the specifics of how the overhaul would happen, building on ideas first made public in April. “We had a ‘why,’ and now we have a ‘how,’” Mr. Levin told reporters.
Mr. Levin and Fed Up have seen successes in their campaign to overhaul the central bank. Earlier this year, congressional Democrats and the campaign of Democratic presidential nominee Hillary Clinton endorsed their push to remove bankers from the boards overseeing the 12 regional Fed banks. Fed Up’s effort to promote diversity in a central bank that is still dominated largely by white males, not withstanding the current leadership of Chairwoman Janet Yellen, also has gained traction among Democrats.
The regional Fed banks are unique among major central banks for being owned by local banks. Some fear this structure gives financial institutions undue sway over policy decisions. Fed bank presidents have countered this isn’t the case.
Regional Fed officials have acknowledged that more diversity within the central bank system would be welcome, but they have been reluctant to tinker with the current structure. The paper also proposes auditing the Fed’s monetary-policy-making functions, and that has been something officials have fought hard against, believing it will lead to bad economic outcomes.
The authors say regional Fed banks can easily be made public by canceling the shares of the member banks and refunding the capital these banks were required to keep with the Fed.
The money to do this can be created by the Fed, and the paper says the fact that the central bank no longer would have to pay dividends to the banks would help it return more of its profit to the government. Over the next decade, that could mean the Fed might return as much as $3 billion more in excess profit, helping reducing the government’s budget deficit.
A number of regional Fed bank leaders have pushed back at being made fully public. In May, New York Fed President William Dudley said “the current arrangements are actually working quite well, both in terms of preserving the Federal Reserve’s independence with respect to the conduct of monetary policy and actually leading to pretty, you know, successful outcomes.”
The paper’s authors said making the Fed fully public also would allow it to remove bankers and other financial-sector members from the boards that oversee each regional Fed bank. The authors said directors should be nominated by either a member of Congress or a state governor, subject to approval by the Fed boards.
None of these directors should be from the financial sector, to prevent the conflict of interest created by a member of a regulated financial institution overseeing the operations of their own regulator.
This, too, has drawn pushback from some on the Fed. Philadelphia Fed leader Patrick Harker said in July that “the banker from a small town in Pennsylvania provides incredibly important insight,” and he wants people like that on his board.
New bank leaders should be selected by an open process in which candidates are named publicly, with a formal mechanism for public input. All Fed officials also should serve single staggered seven-year terms, which the paper says would help insulate central bankers from political interference. The selection process of regional Fed bank leaders has long been a secretive affair. Meanwhile, the leaders of the Dallas, Minneapolis and Philadelphia Fed banks, who all took their posts since 2015, have had connections to Goldman Sachs, which has drawn criticism from the Fed Up campaign. Mr. Dudley at the New York Fed was once that firm’s chief economist.
The authors also would like to subject Fed monetary policy decisions to Government Accountability Office audits. To ensure this oversight doesn’t interfere with Fed decision-making, the paper calls for the audits to be done annually and not at the request of a member of Congress, and the GAO shouldn’t be able to comment on any given interest-rate decision.
The paper calls for the Fed to release a quarterly monetary policy report that describes officials’ views on policy, the economy’s performance relative to the Fed’s official price and job mandates, forecasts and a description of risks, and a description of any models driving policy-making.
Any changes to the Fed are ultimately up to elected officials. In February, Ms. Yellen told legislators “the structure could be something different and it’s up to Congress to decide that—I certainly respect that.”
By Michael S. Derby
Source
A guaranteed “Jobs For All” Program is Gaining Traction Among 2020 Democratic Hopefuls
A guaranteed “Jobs For All” Program is Gaining Traction Among 2020 Democratic Hopefuls
A longtime organizer, Barkan — who has Lou Gehrig’s disease — gained national recognition after his viral confrontation of Sen. Jeff Flake, R-Ariz., over his support for the Republican tax plan...
A longtime organizer, Barkan — who has Lou Gehrig’s disease — gained national recognition after his viral confrontation of Sen. Jeff Flake, R-Ariz., over his support for the Republican tax plan and the cuts to Medicare that it would impose. When he was diagnosed with ALS in late 2016, Barkan was working with the Center for Popular Democracy on a campaign to reform the Federal Reserve and American monetary policymaking with it. Following Trump’s election, he has continued to fight for that and against a range of Republican policies.
Read the full article here.
Wage Theft Across the Board
New York Times - April 21, 2014, by the Editorial Board - When labor advocates and law enforcement officials talk about wage...
New York Times - April 21, 2014, by the Editorial Board - When labor advocates and law enforcement officials talk about wage theft, they are usually referring to situations in which low-wage service-sector employees are forced to work off the clock, paid subminimum wages, cheated out of overtime pay or denied their tips. It is a huge and underpoliced problem. It is also, it turns out, not confined to low-wage workers.
In the days ahead, a settlement is expected in the antitrust lawsuit pitting 64,613 software engineers against Google, Apple, Intel and Adobe. The engineers say they lost up to $3 billion in wages from 2005-9, when the companies colluded in a scheme not to solicit one another’s employees. The collusion, according to the engineers, kept their pay lower than it would have been had the companies actually competed for talent.
The suit, brought after the Justice Department investigated the anti-recruiting scheme in 2010, has many riveting aspects, including emails and other documents that tarnish the reputation of Silicon Valley as competitive and of technology executives as a new breed of “don’t-be-evil” bosses, to cite Google’s informal motto.
The case essentially alleges white-collar wage theft. The engineers were not victimized by the usual violations of labor law, but by improper hiring practices against their interests. The result, however, was the same: Money that would have flowed to workers in the form of wages went instead into corporate coffers and from there to executives and shareholders.
When wage theft against low-wage workers is combined with that against highly paid workers, a bad problem becomes much worse. Data compiled by the Economic Policy Institute show that in 2012, the Department of Labor helped 308,000 workers recover $280 million in back pay for wage-theft violations — nearly double the amount stolen that year in robberies on the street, at banks, gas stations and convenience stores.
Moreover, the recovered wages are surely only a fraction of the wage theft nationwide because the Labor Department has only about 1,100 wage-and-hour investigators to monitor seven million employers and several states have ended or curtailed wage enforcement efforts.
New York, however, has been a notable exception. Last month, investigations by Attorney General Eric Schneiderman yielded settlements with nearly two dozen Domino’s Pizza restaurants in New York and one McDonald’s franchise that recovered nearly $1 million in stolen wages for 1,450 fast-food employees.
Those sums, vitally important redress for the low-wage victims, are small in comparison to the billions of dollars sought by the software engineers, or the hundreds of millions that would likely result from a settlement of the engineers’ case.
Still, as important as the recoveries is the evidence that wage theft afflicts both low- and high-wage jobs. To fight the theft from low-wage workers requires more Labor Department resources, as President Obama called for in his recent budget, and immigration reform, which would help to both stanch widespread wage theft from undocumented immigrants and improve low-wage working conditions.
To fight white-collar wage theft requires a re-energized Justice Department, to pursue tough cases and settlements against industry collusion, discrimination and other illegal practices that allow employers to deny employees their rightful pay.
Source
Can Community Organizers Build Progressive Power?
Last Tuesday, Alton Sterling was shot and killed while pinned on the ground by Baton Rouge police. The next day, Philando Castile was shot and killed by a cop in Falcon Heights, Minnesota, as he...
Last Tuesday, Alton Sterling was shot and killed while pinned on the ground by Baton Rouge police. The next day, Philando Castile was shot and killed by a cop in Falcon Heights, Minnesota, as he reached for his ID. On Thursday, protests swept across the country calling for an end to police killings of black and brown men. At one of those peaceful protests, in Dallas, a sniper opened fire from a vantage point above the march, trying to kill white police officers. Five officers died.
It was against this backdrop of deep social turmoil that dozens of community organizing groups from across the country came together in Pittsburgh for the People’s Convention.
Over the weekend, more than 1,500 community organizers and leaders—many of them Black and Latino—convened to discuss ways to create a more cohesive, powerful progressive grassroots network. It was the first step by the Center for Popular Democracy, a progressive organization that is trying to fill the vacuum left in the wake of ACORN’s demise in 2010.
On top of the recent events in Louisiana, Minnesota, and Texas, the convention also came at a critical political moment—on the Republican side, Donald Trump’s campaign is increasingly stoking racial animosity; on the Democratic side, Bernie Sanders has worked to push his party’s platform leftward.
“We wanted to make it both a statement in the electoral moment and really a statement that transcends the electoral moment,” Brian Kettenring, co-director of the Center for Popular Democracy, told the Prospect at the convention. “We’re trying to stand in this particular moment but also not be captive to the narrow partisan politics of our country.”
The convention started off Friday with a march of more than 1,000 activists through the streets of downtown Pittsburgh, including stops outside the University of Pittsburgh Medical Center to demand fair wages for workers; the Pittsburgh Federal Reserve to call for equitable economic policies for working families; and Pennsylvania Senator Pat Toomey’s office to protest his anti-immigration stances. Some onlookers joined the chanting—“What do we want? Justice. If we don’t get it? Shut it down,”—and raised their fists in solidarity. Others were visibly angry at the marchers’ message of justice for undocumented immigrants and victims of police brutality.
The following day, activists heard speeches from heavyweights of the progressive movement like Minnesota Congressman Keith Ellison and the Reverend William Barber III, leader of North Carolina’s Moral Mondays movement, who both spoke powerfully about the recent killings and the need for a unified response.
“The country needs healing, but you can’t heal a dirty wound,” Ellison pronounced. “A dirty wound needs disinfectant.”
He pointed to the “amazingly poised” Diamond Reynolds, the fiancée of Philando Castile, who streamed the immediate aftermath of his shooting on Facebook, as a model for the movement. “We need to push back with the same presence of mind of Diamond Reynolds,” he said.
With the killings of Sterling and Castile fresh on everyone’s mind, the specter of police violence loomed large at the convention. But the People’s Convention also wove together the threads of today’s social justice movements—not just Black Lives Matter, but also those campaigning for immigration reform, the Fight for $15, LGBTQ rights, and environmental justice, in a way that made clear the intersectionality of modern progressive organizing.
“We’re all dealing with the various layers of oppression,” said Jose Lopez, organizing director for Make the Road New York. “Whether it’s workplace inequality, housing inequality, or the recent decision from the Supreme Court, which to a degree sent a message to our families that we’re going to create opportunity for a limited number of children but we’re going to throw away the key to the gate to this country when we begin to talk about their parents.”
“[This convention] created the space and now we have to make sure we continue to stay in contact—using CPD as the vehicle—so that we can build out a network of power that can transform everything from immigration reform to worker rights to housing rights to the attack of black and brown people in this country by police,” Lopez said.
Groups attending the convention included New York Communities for Change, which helped launch the Fight for $15 back in 2012 and is now turning its focus toward addressing affordable housing needs in the city; Minnesota Neighborhoods Organizing for Change, which, in response to the police killing of Jamar Clark helped organize a protest occupation outside a North Minneapolis police precinct that lasted 16 days; the Texas Workers Defense Project, a worker advocacy group that has improved labor standards in the Texas construction industry; and Make the Road state chapters that have led local fights against deportations. Some of these groups have collaborated before, while others have been somewhat isolated from other community organizing groups.
Community organizations lost much of their national clout in the wake of ACORN’s demise, which was brought about in 2009 by a conservative smear campaign. CPD’s goal now—and that of the organizations represented at the conference—is to rebuild such groups’ institutional power and make it a critical part of the broader progressive movement.
In recent years, that movement has had some signal successes, which conference workshops showcased: how SEIU successfully organized for a $15 minimum wage in Seattle; how black community groups in St. Louis helped create lasting momentum for policing reform in the wake of Ferguson; how the New York Working Families Party established a powerful electoral presence; how organizers in Florida worked for climate justice in communities vulnerable to climate change.
“We are beginning to launch a real national organizing framework—that’s something that really hadn’t been seen since ACORN went under,” said Jonathan Westin, executive director of New York Communities for Change. “I think this is the beginning of an intentional path forward to try to create real structural power for community institutions and neighborhoods that already exists in places like the labor movement.”
Creating such structural power, organizers admit, will be challenging. There’s a shortage of funding for community organizations, which has kept them closely tethered to more well-funded labor unions and foundations—and, in many ways, also tethered to their funders’ agendas. The central challenge is how to establish a sustainable and independent source of funding, as unions have done with member dues, in order for community power to become a singular force on its own.
Beyond that, a critical question for community organizers is how to capitalize on both the current social and political moment.
“The genie is out the bottle with progressive politics,” Kettenring said. He believes that a strong force of community organizations can help direct the progressive movement’s current political capital in a way that avoids pitfalls of the past. “One of the historic strategic failures of the progressive movement has been its failure on race. So when you look at this convention and look at how diverse it is and how many of the organizations are rooted communities of color, you see the potentiality of how the community organizing sector can help root a more progressive, but also diverse politics.”
By Justin Miller
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