L Brands, owner of Victoria's Secret and Bath & Body Works, ending on-call scheduling
Dive Brief:
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L Brands Inc. is the latest retail company to end “on-call scheduling” in the face of a ...
L Brands Inc. is the latest retail company to end “on-call scheduling” in the face of a warning letter from New York Attorney General Eric Schneiderman that the practice likely violates state law.
The company said its Bath & Body Works stores and Victoria’s Secret stores are phasing out the practice nationwide.
Rise Up Georgia, a partner of the Fair Workweek Initiative at the Center for Popular Democracy, has been organizing L Brands workers and asking the company to end the practice, especially at Bath & Body Works stores, and says the latest move doesn’t go far enough.
Dive Insight:As the practice of on-call scheduling has drawn more scrutiny, lawmakers and regulators are calling for an end to the practice and taking steps, as Schneiderman's office has, to rein it in. Several jurisdictions, including a few states, already have laws on the books that could be used to temper or end the practice.
On-call scheduling uses algorithms to determine when workers are most needed or not, and many retailers have taken to sending workers home or having them at the ready without pay. That wreaks havoc on workers’ lives, hampering their ability to attend school, care for families, or hold down other jobs.
An improving job market is also helping make the practice less tenable as workers are more able to find jobs that are less disruptive to them.
Retailers should be prepared to see more such concerns, warnings, and even legislation as just-in time scheduling gets more scrutiny, Gail Gottehrer, a labor & employment litigator at Axinn Veltrop & Harkrider in New York who works on behalf of employers, told Retail Dive. The practice was a major concern when the San Francisco Board of Supervisors last year unanimously passed its Worker Bill of Rights law.
But some worker advocates say that L Brands move doesn’t go far enough.
"L Brand employees still have to put their lives on hold," Erin Hurley, an organizer for Rise Up Georgia and a former Bath & Body Works employee, said in a statement. "The company might have ended one type of on-call shifts, but it is still allowing for harmful shift practices: since July, they have been relying on shift extensions at Victoria’s Secret, which are on-call shifts by another name. While we celebrate the step forward, we call on L Brands to take a definitive step toward a fair workweek by giving workers shifts with definite start and end times, and enough hours to support their families.”
Schneiderman, meanwhile, praised the move while also making it clear that his office will continue to monitor the practice.
Recommended ReadingWall Street Journal: Bath & Body Works to End On-Call Scheduling
Source: RetailDive
The Fight for Paid Sick Leave Moves South
The Fight for Paid Sick Leave Moves South
It’s not surprising that the same sort of coalition of elected officials advancing the fight against SB4 have turned to this issue,” said Sarah Johnson, the director of Local Progress. “Workers...
It’s not surprising that the same sort of coalition of elected officials advancing the fight against SB4 have turned to this issue,” said Sarah Johnson, the director of Local Progress. “Workers and immigrants are important to the foundation of cities. The work being done around SB4 has created a strong coalition that has advanced from defense to offense.
Read the full article here.
NEW YORK CITY MUST SUPPORT ITS IMMIGRANT POPULATION TO ENSURE A SUCCESSFUL WORKFORCE
NEW YORK CITY MUST SUPPORT ITS IMMIGRANT POPULATION TO ENSURE A SUCCESSFUL WORKFORCE
These days, Marta has trouble finding work. Often, when she goes to apply for a job in food service or domestic work, the first thing she’s asked is, “Do you know English?” Answering with honesty...
These days, Marta has trouble finding work. Often, when she goes to apply for a job in food service or domestic work, the first thing she’s asked is, “Do you know English?” Answering with honesty, Marta always replies that she knows only a little.
More often than not, she’s turned away because the employer wants someone with English fluency. “These days, the truth is, it’s very hard to get a job,” Marta says.
New York City is home to the most diverse immigrant population of any major city in the world. Immigrants make up almost 40 percent of the population and nearly half of the city’s workforce.
But the city is faced with a paradox: While immigrants are employed at higher rates than native-born New Yorkers, they are disproportionately clustered in lower-wage jobs, have lower incomes on average than their native-born counterparts, and often experience higher rates of poverty. Many, like Marta, have low levels of English proficiency which can make it difficult to find good-paying work.
Since New York City Mayor Bill de Blasio took office a little over two years ago, the city has begun to restructure its workforce development system, creating an important opportunity to address some of the inequities faced by immigrant New Yorkers.
The city’s new framework for its workforce development system, called Career Pathways, promises to dedicate an unprecedented level of investment in job training and education for the city’s most vulnerable workers, to ensure that the city’s investments in workforce development are aligned across city agencies, and to work with employers and other stakeholders to improve the quality of the city’s lowest-paid jobs.
However, the plan did not sufficiently take into account the particular workforce challenges faced by New York’s immigrant population. Immigrants comprise the vast majority of workers in the fastest growing occupations in the city, ranging from home health aides and construction workers to registered nurses and software programmers. As such, immigrant workers are at the core of the city’s economic vitality, and their success must be central to the city’s overhaul of its workforce system.
Immigrant workers and jobseekers experience a number of unique barriers that limit advancement in the workforce. For example, a significant number of immigrants do not speak English well and have lower levels of formal education, on average.
At the same time there are thousands of immigrants that hold college or other education credentials that aren’t recognized in the United States, and are therefore stuck working at jobs that do not take full advantage of their skills and talents. And in the low-wage workforce, which is comprised heavily of immigrant workers, exploitation of workers is rampant. This is especially true for undocumented workers and those working in the informal economy.
The success of the Career Pathways plan depends on its ability to address the major barriers that immigrant New Yorkers face. A report co-authored by the Center for Popular Democracy and Center for an Urban Future identifies these barriers and outlines a coordinated approach for tackling the obstacles that prevent immigrant workers from reaching their full potential.
Specifically, the city and private workforce funders should invest in English classes, adult education, and training and certification programs for workers with varied levels of educational background and English proficiency. This would allow them to earn the skills they need to be competitive in the labor force and keep them from getting trapped in low-wage jobs.
Second, the city must ensure that immigrant workers are aware of these services by making sure that they are available in the neighborhoods where immigrants live or work. One great way to do this is to partner with nonprofit organizations that are based in immigrant communities, and to ensure that available funding is reaching workforce programs in immigrant communities.
Finally, a workforce development strategy that works for immigrants should improve the quality of the low-wage jobs that so many immigrants fill. This includes enforcing and improving job protection laws, which often go unenforced, and securing a higher minimum wage and access to paid sick leave. Employers themselves are a big part of this conversation, and the city should use its influence to help them improve the quality of their lowest-paid positions.
Without a coordinated approach to ensure that workforce development services are reaching immigrants, the city’s plan risks overlooking an enormous population of workers and job-seekers. We now have an opportunity to ensure that immigrants are included as a key part of this plan.
By Kate Hamaji and Christian González-Rivera
Source
Wall Street Journal: Citigroup Pact Has Detailed Plan for $2.5 Billion in Relief to Consumers
Wall Street Journal - July 14, 2014, by Alan Zibel - Citigroup’s $7 billion settlement with the Justice Department over the sale of flawed mortgage securities includes an agreement by the bank to...
Wall Street Journal - July 14, 2014, by Alan Zibel - Citigroup’s $7 billion settlement with the Justice Department over the sale of flawed mortgage securities includes an agreement by the bank to provide $820 million worth of loan forgiveness and other assistance, plus nearly $300 million in refinancing. The money is also earmarked to help with down payments, donations to community groups and financing for rental housing.
These requirements, outlined in a 15-page appendix to the agreement, provide more specificity for consumer assistance than a $25 billion 2012 state/federal settlement with Citigroup and four other banks over mortgage-servicing problems. They also are more detailed than a November 2013 settlement with J.P. Morgan Chase & Co. over similar flawed mortgage securities sold to investors.
At a press conference in Washington on Monday, Associate Attorney General Tony West said the department aimed to improve on previous settlements by establishing an “an innovative consumer relief menu—one that not only includes the principal reductions and loan modifications we’ve built into previous resolutions, but also new, consumer-friendly measures.”
The Citigroup settlement, unlike previous pacts, directs the bank to provide half of its loan assistance to particularly hard-hit parts of the country. It also mandates that borrowers whose loan balances are cut won’t remain “underwater” —or owe more on their homes than their properties are worth.
The J.P. Morgan settlement addresses similar issues, but in a less targeted way. It gave the bank a bonus for providing aid to hard-hit areas, but set no specific requirement. In addition, the J.P. Morgan settlement encourages loan write-downs but does not specify how much of a borrower’s debt must be forgiven. The Citigroup settlement contains $180 million in financing for affordable rental housing—a provision not included in other settlements.
“This settlement is far more nuanced than previous settlements with respect to consumer relief,” said Andrew Jakabovics, senior director for policy development and research Enterprise Community Partners, a large affordable-housing nonprofit group. The pact, he said, “reflects many of the best practices we’ve seen develop with respect to creating sustainable loan modifications.”
A Justice Department official said the consumer-assistance portion of the Citigroup settlement reflects refinements to the government’s thinking after previous settlements. In addition, the official said the smaller size of Citigroup’s mortgage-lending portfolio caused the government to consider additional avenues for relief because the bank had fewer loans to modify.
There has been tension between the Obama administration and liberal activist groups over efforts to resolve cases related to banks’ mortgage-crisis conduct.
Consumer groups have been unhappy with previous settlements of mortgage-related cases. For example, the 2012 mortgage-servicing settlement allowed banks to receive credit for short sales, in which a bank agrees to allow the sale of a property with a mortgage worth more than the home’s value, and for granting “deeds in lieu of foreclosure,” where a homeowner voluntary surrenders the home.
Some activists are still skeptical of the government’s settlements with the financial industry. Kevin Whelan, national campaign director for the Home Defenders League, an activist group representing homeowners, said there’s been no noticeable impact from last fall’s J.P. Morgan settlement.
“We haven’t seen any evidence that they’ve done anything at all,” Mr. Whelan said.
No statistics on the J.P. Morgan settlement have been released. A J.P. Morgan spokeswoman declined comment.
Joseph Smith, a former North Carolina banking regulator, is serving as the independent monitor overseeing the J.P. Morgan settlement and is expected to release a report on its progress in the coming weeks.
Thomas Perrelli, a former Justice Department official who helped broker the 2012 mortgage settlement, will serve as the monitor of the Citigroup agreement. Mr. Perrelli is now at the law firm Jenner & Block in Washington.
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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
Source
New Poll: Public Does Not Support Interest Rate Increase
Poll: http://bit.ly/1L4xbLB
Poll Analysis: http://bit.ly/1Q3Pu2S
Today, one week before Federal Reserve officials make a crucial decision on interest rates, the Center for Popular Democracy released a new Public Policy Polling (PPP) poll showing that the American public does not support an interest rate increase.
The poll, conducted by Public Policy Polling, shows that large majorities of the voting public believe that the economy is still too weak and that the Fed should focus on helping to create more jobs and higher wages. The poll also asked voters their opinions regarding Federal Reserve governance and transparency. In recent weeks, several Fed officials have indicated that they think the economy is ready for an interest rate hike, despite continued labor market slack, low wage growth, and disappointing jobs figures. Among the poll’s key findings:
62 percent support keeping interest rates low, while only 30 support raising them
By a 55-38 margin, voters think the Fed should prioritize creating more jobs and higher wages over ensuring that inflation does not get any higher
71 percent think the public does not have enough input into Fed’s process
While all respondents cited high unemployment and low wages as problems for the economy, Hispanics and African Americans were more likely than whites to rate these as major problems
The full poll results are available here, and an analysis is available here.
“Before the Fed slows down the economy, they should consider the perspective of working Americans,” said Connie Razza, Director of Strategic Research at the Center for Popular Democracy. “This poll shows that strong majorities do not feel the economy is ready for higher interest rates, and that ongoing unemployment and stagnant wages are a major concern for the American public. Going forward, the public is demanding greater input in Fed decisions and changes in Fed governance, and that the Fed takes wage and job growth more seriously when making its decisions.”
“The labor market remains far from fully recovered, as evidenced most clearly by the anemic wage-growth seen since the recovery began in 2009. And clear potential headwinds in coming months – the slowdown of the Chinese economy and the possible additional fiscal drag if sequester cuts are not reversed – argue strongly that the Fed should not pullback on monetary policy support for the recovery,” said Josh Bivens, Director Research and Policy at the Economic Policy Institute.
Just two weeks ago, members of the Fed Up coalition, led by workers, economists and advocates, held a conference in Jackson Hole, Wyo. adjacent to the Federal Reserve’s own symposium. The coalition delivered more than 119,000 petition signatures calling on the Fed to keep interest rates low to allow for more jobs and higher wages. Over the past weeks, numerous influential voice – Gene Sperling, Lawrence Summers, Joseph Stiglitz, the NY Times Editorial Board, the chief economist of the World Bank, among others – have spoken up against the Fed’s intentionally slowing down the economy.
These polling results shows that the American public agrees.
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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.
‘School Choice’ Mantra Masks the Harm of Siphoning Funds from Public Education
Ask an education “reform” proponent about any issue facing public education and the answer is always the same: “school choice.” Whether they’re championing charter schools, vouchers or Education...
Ask an education “reform” proponent about any issue facing public education and the answer is always the same: “school choice.” Whether they’re championing charter schools, vouchers or Education Savings Accounts (ESAs), advocates prefer to frame the debate around the right of parents to send their child to a better-performing school. This is merely a smokescreen to divert attention away from what school choice is really about: the transfer of public money to the private sector without accountability or transparency.
Many school choice campaigns are bankrolled by a faction of incredibly wealthy conservative donors and political groups, including the Koch Brothers and the American Legislative Exchange Council (better known as ALEC). Their agenda is clear: dismantle public education.
But it’s a safe bet you won’t hear their names during National School Choice Week (Jan 25-30). What you will hear is a lot of people parroting messages about “freedom,” “innovation,” “options,” even “civil rights” – buzzwords that underpin the campaigns to expand charter schools, vouchers and ESAs across the country. But the jargon masks the devastating impact these policies have had on public education, particularly on those students who are supposed to benefit the most.
Unaccountable Charter Schools: The Truth Hurts
Many people support the idea behind charter schools, but how many are aware of the mounting troubles the charter industry has experienced lately? Probably not enough. Proponents work very, very hard to maintain a facade of success and transparency in the face of evidence that many of these schools operate without any oversight, while wasting taxpayer money and fostering inequity and racial segregation.
Take the North Carolina State Board of Education, which just this month rejected the Department of Public Instruction’s annual report on charter schools as “too negative.” Dominated by school privatization stalwarts, the board is determined to prevent any meaningful oversight of the state’s charters and demanded revisions to the report before it could be submitted to the legislature.
North Carolina educator Stuart Egan took the board to task in an open letter to Lt. Governor and board member Dan Forrest: “Overall, charter schools seem to lack diversity and operate under a different set of rules according to the report you are trying to squelch. The fact is that many of the charter schools you have enabled are perpetuating segregation and are not accomplishing what you advertised they would do,” Egan wrote.
Given the magnitude of waste and fraud in the sector, it’s unsurprising why many charter operators are hiding from accountability and regulation. And according to a new study, the expansion of unregulated charter schools, particularly in urban communities, is beginning to resemble the effort a decade ago to pump up bad mortgages that eventually blew up the economy.
“Supporters of charter schools are using their popularity in Black, urban communities to push for states to remove their charter cap restrictions and to allow multiple authorizers,” Preston Green III of the University of Connecticut and co-author of “Are We Heading Toward a Charter School ‘Bubble’?: Lessons from the Subprime Mortgage Crisis” told EduShyster. “At the same time, private investors are lobbying states to change their rules to encourage charter school growth. The combination of multiple authorizers and a lack of oversight is creating an abundance of poor-performing schools in low-income communities.”
Vouchers: Who Is Really Benefitting?
According to the 2015 PDK/Gallup poll, a whopping 70 percent of Americans oppose school vouchers. They see it for what it is: a privatization scheme that subsidizes tuition for students in private schools. And perhaps they are aware that there is no conclusive evidence that vouchers improve student achievement. The public is also not fooled by the often-repeated falsehood that vouchers are primarily benefitting disadvantaged students.
In Scott Walker’s Wisconsin and Mike Pence’s Indiana, where vouchers have expanded dramatically, promises that the programs would serve low-income students in failing schools didn’t last. “That tale quickly and methodically changed,” said Teresa Meredith, president of the Indiana State Teachers Association. By 2015, only 2 percent of participants [in the voucher program] had attended an ‘F’ public school.
“The most expansive voucher program in America has become an entitlement program which, in large part, now benefits middle class families who always intended to send their children to private (mostly religious) schools and taxpayers are footing the growing bill,” Meredith said.
Education Savings Accounts (or Vouchers on Steroids)
In 2015, Nevada lawmakers were hoping to blaze a new trail for school choice with a new gambit, education savings accounts (ESA), which allow parents to claim more than $5,000 in state funds each year and use it for any qualified education expense. This includes religious-based private schools, but also a variety of other services, all with little or no oversight over student outcomes. In addition, states impose no quality controls on the textbooks, curriculum, tutoring, or supplemental materials that parents can purchase with ESA funds.
Education savings accounts exist in five states, but Nevada became the first to pass a bill that offered them to every public school student regardless of family income. Very few private schools in the state, however, have tuition low enough to be covered by the $5,100 or $5,700 provided annually by ESAs. Wealthier parents can supplement their own income to pay for the tuition, but for lower-income families private school will remain largely out-of-reach.
Earlier this month, a state judge slapped an injunction on the program. In his ruling, District Judge James Wilson said the law diverted public funds to pay for private school tuition and was therefore unconstitutional. The decision will be appealed because advocates have vested a lot in the scheme. ESAs are unquestionably the new school choice battleground and are being pushed in a growing number of states with proponents deploying the usual tropes about “freedom” and “flexibility” to mask their real impact: erosion of public school funding, fewer education resources, wider achievement gaps and increased segregation.
Real Innovation That Works
The good news is that a growing number of communities are finding solutions to struggling schools and achievement gaps that benefit all students, not just some. Educators and parents are working together to expand the community schools model, which is currently present in nearly 5,000 schools nationwide. When public schools extend services and programs beyond the school day, creating strong learning cultures and safe and supportive environments for both students and educators—in effect becoming community “hubs” – student outcomes improve. In 2015, Minnesota educators were instrumental in persuading the legislature to pass a bill creating a grant program for “Full-Service” Community Schools and other states may soon follow suit. To learn more about community schools, read “Investing in What Works” by the Southern Education Foundation and the Annenberg Institute for School Reform.
Source: NEA Today
Amazon’s $15 an Hour Minimum Wage and the Federal Reserve Board
Amazon’s $15 an Hour Minimum Wage and the Federal Reserve Board
This is where Fed Up played an incredible role. They were a crucial voice on the other side, constantly reminding the Fed of its legal mandate to promote full employment. Fed Up had important...
This is where Fed Up played an incredible role. They were a crucial voice on the other side, constantly reminding the Fed of its legal mandate to promote full employment. Fed Up had important allies in this effort, most importantly former Fed chair Janet Yellen, but it is likely that Yellen and her allies on the FOMC would have been forced to raise rates sooner and faster if not for pressure from Fed Up.
Read the full article here.
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
By The People: Promoting Democratic Participation Through Comprehensive Voter Registration
America suffers from disturbingly low voter registration and turnout rates. Almost 50 million eligible people were not even registered to vote in the 2012 election, and another 12 million had...
America suffers from disturbingly low voter registration and turnout rates. Almost 50 million eligible people were not even registered to vote in the 2012 election, and another 12 million had problems with their registration that kept them from voting. What’s more, many of these millions were low-income, youth, and people of color, all of whom are less likely to be registered. In order to strengthen our democracy, the United States must take dramatic and innovative steps to remedy our anemic voter turnout and registration.
“By the People: Promoting Democratic Participation through Comprehensive Voter Registration,” identifies Automatic Voter Registration (AVR) as the critical transformative policy that can result in the registration of millions of new voters. By shifting the responsibility of voter registration from the individual to the government, AVR ensures a more robust democracy. Automatic Voter Registration should be part of a suite of reforms including pre-registration of 16- and 17- year olds, portable registration, and other policies that make election administration more efficient.
Download the full report here
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