Campaign News

There’s no question that race and gender matter in determining people’s economic fortunes. African Americans’ unemployment rate is typically twice as high as that of whites. The racial wealth gap has widened since the financial crisis, when African Americans and Hispanics—who had a disproportionate share of their wealth tied up in their homes—disproportionately suffered from subprime loans and foreclosures. The Federal Reserve’s Survey of Consumer Finances finds that the median wealth of a white family in 2013, the last year studied, was $134,008. For Hispanics, it was just $13,900. For African-Americans, $11,184. And as everyone knows, or should, women still make 79 cents for every dollar men make.

These deficiencies are more likely to be ignored when our most important economic policymakers don’t reflect the faces of all Americans. Yesterday, 127 Democratic members of Congress wrote to Federal Reserve chair Janet Yellen about the lack of diversity at the central bank. “The leadership across the Federal Reserve System remains overwhelmingly and disproportionately white and male,” the letter notes. Led by Senators Bernie Sanders and Elizabeth Warren, this high-level challenge also castigates the Fed for being dominated by former and current executives of financial institutions and large corporations, rather than people with backgrounds in academia, labor, or consumer organizations.

The voices of those left behind most egregiously in the economic recovery are simply not present in Fed deliberations.

Momentum to fix the Fed’s diversity problem grew on Thursday when Hillary Clinton endorsed the viewpoints expressed in the letter. Her spokesperson Jesse Ferguson told The Washington Post, “Secretary Clinton believes that the Fed needs to be more representative of America as a whole and that commonsense reforms—like getting bankers off the boards of regional Federal Reserve banks—are long overdue.”

The Fed’s lack of diversity might actually violate the law. Under the Federal Reserve Reform Act of 1977, regional Federal Reserve bank directors are required to “represent the public, without discrimination on the basis of race, creed, color, sex, or national origin, and with due but not exclusive consideration to the interests of agriculture, commerce, industry, services, labor, and consumers.” The original Federal Reserve Act only mandated representation from agriculture, commerce, and industry.

It’s unclear what enforcement of that 1977 requirement would look like. But clearly the Fed isn’t living up to it. The members of Congress rely on a February report from the Center for Popular Democracy, organizers of the “Fed Up” coalition, which has pressured the central bank to adopt pro-worker policies. According to their figures, 83 percent of Federal Reserve board members are white, and 72 percent are male. Among the twelve regional Fed bank presidents, only Neel Kashkari of the Minneapolis Fed is non-white, and only Esther George (Kansas City) and Loretta Mester (Cleveland) are female. And among voting members of the Federal Open Market Committee (FOMC), which makes monetary policy decisions, it’s even worse: All ten currently serving members are white.

The lack of occupational diversity is also pretty stark. The Center for Popular Democracy studied the regional feds’ boards of directors, finding that 39 percent represent financial institutions. The Fed’s role as a key supervisor of major banks makes this highly suspect—especially considering there is no mandate for financial interests to be represented on the Fed board.

Another 29 percent of the Fed regional directors represent commerce and industry. Only 11 percent come from community, labor, consumer, or academic organizations. Even representation from the service sector, which has an overly non-white workforce and has expanded in recent years, has shrunk as a percentage of Fed bank-board members relative to 2010, the last time the boards’ makeup was studied.

It’s unusual for members of Congress to take such a public stand on the Federal Reserve, given their mindfulness of central bank independence. But they are recognizing that the lack of diversity has an important effect on economic policy. A more diverse Fed might pay more attention to how far communities of color are from full employment when deciding whether or not to raise interest rates, which they are now deliberating. A more diverse Fed might not be as consumed with the concerns of finance and industry, and their desire to keep inflation and wages low. It might consider how banks have traditionally preyed on communities of color, and target its supervision activities to reflect that.

The voices of those left behind most egregiously in the recovery are simply not present in Fed deliberations. The members of Congress cited a recent blog post by former Minneapolis Fed president Narayana Kocherlakota, who said that “there is one key source of economic difference in American life that is likely underemphasized in FOMC deliberations: race.” Kocherlakota searched transcripts of FOMC meetings from 2010 (the most recent ones released). That entire year, African American unemployment stood at 15.5 percent or above. But, writes Kocherlakota, “Based on that search, my conclusion is that there was no reference in the meetings to labor market conditions among African Americans.”

Traditionally, public pressure on the central bank has come from the right, from the likes of Ron Paul’s “End the Fed” movement. Progressives were largely absent from the conversation, despite the Fed’s central economic role. No more: Thursday’s letter to Yellen is the biggest success yet for the Fed Up campaign, launched two years ago to amplify the voices of communities that didn’t benefit from the recovery. The campaign has brought together labor and community groups to demand that the Fed take its mandate to maximize employment seriously—taking into account all communities, not just affluent ones. And now Fed Up’s views have become dominant in the Democratic Party.

In addition to the hefty names of Sanders and Warren, co-signers include 116 House Democrats, more than half of the caucus, as well as the ranking members of the Financial Services Committee (Maxine Waters) and the Monetary Policy Subcommittee (Gwen Moore), the committees with oversight of the Fed. And Clinton’s endorsement of Fed Up’s sentiment puts most of the ideological spectrum of the party on the side of reform.

But what does reform look like? The Center for Popular Democracy’s February report recommends that each regional board contain at least one member from a labor group, a community organization, academia, and a community bank or credit union. A separate reform proposal from former Yellen advisor Andrew Levin includes a number of ideas, including banning anyone affiliated with a financial institution from serving as a Fed director.

These ideas can be congressionally mandated. That will take time, of course, but the movement has begun to get Democrats off the sidelines to pressure the Fed. When Yellen testified before the House and Senate in February, giving her semi-annual Monetary Policy Report, she received questions about the lack of diversity from 15 different members of Congress. Yellen expressed concern that, among other things, no African American has ever led a regional Federal Reserve bank in U.S. history.

The fact that political pressure can make a difference was again signified by the quick response of a Fed spokesman to Thursday’s letter. The Fed statement said the central bank has “focused considerable attention in recent years on recruiting directors with diverse backgrounds and experience.” Those aspirations have not yet translated into results, however, even after the Fed established an internal diversity office in 2011.

It’s hard for the traditionally cloistered Fed to ignore concerns when they come from high-level Democrats. And just having ordinary workers in the public debate already diversifies the Fed, in a sense. No longer can they simply be responsive to Wall Street without further discussion.

BY DAVID DAYEN

Source

02.29.2016

Washington, D.C.—As the number of charter schools continues to rise, few states are paying adequate attention to how to hold these schools accountable to parents, communities, and taxpayers. Now, new poll results released today by In the Public Interest and the Center for Popular Democracy (CPD) show that Americans embrace proposals to reform the way charter schools are authorized and managed.

The poll shows overwhelming national support for initiatives to strengthen charter school accountability and transparency, improve teacher training and qualifications, prevent fraud, serve high-need students, and ensure that neighborhood public schools are not adversely affected.

“A severe lack of public oversight and real accountability has created what are essentially two separate school districts in many places, each competing for students and funding,” said Donald Cohen, Executive Director of In the Public Interest. “This is increasing inequality in public education, and these results confirm that parents and communities want to fix that.”

The poll’s key findings include:

Overwhelming majorities, as high as 92%, back proposals to strengthen transparency and accountability, improve teacher training and qualifications, implement anti-fraud measures, ensure high-need students are served, and make sure neighborhood public schools are not adversely affected.

92% of voters support requiring companies and organizations that manage charter schools to open board meetings to parents and the public.

90% of voters support requiring companies and organizations that manage charter schools to release to parents and the public how they spend taxpayer money.

“School choice” ranks last in a list of the biggest concerns voters have for K-12 education, with only 8% listing it as a concern.

Far more popular than “school choice” or unaccountable charter schools is the concept of community schools, which serve as community hubs, ensuring that every student and their family gets the opportunity to succeed no matter what zip code they live in.

A statewide poll of Colorado voters showed that 69% rate the quality of education at public schools in their neighborhood excellent or good—an even higher percentage than those that feel that way nationally. Colorado voters also overwhelmingly support proposals to reform the way charter schools are authorized and managed.

The national poll of 1,000 registered voters was conducted by GBA Strategies January 5-11, 2016 on behalf of In the Public Interest and CPD. A memo detailing the poll can be found here. The statewide poll of 500 registered voters in Colorado was conducted January 10-13, 2016. A memo detailing the Colorado poll can be found here.

Kyle Serrette, Director of Education at CPD, said, “State lawmakers have created charter laws without meaningful oversight provisions. The result? Over $100 million in taxpayer dollars have been lost to fraud, waste, or mismanagement by charter officials and over 100 thousand children currently attend charter schools that are failing to meet the needs of children. It’s time for lawmakers to add stronger oversight provisions before more money is lost and more children are enrolled in failing charter schools.”

For more information on the poll results, please contact Jeremy Mohler at jmohler@inthepublicinterest.org or 202-429-5091, or Asya Pikovsky at apikovsky@populardemocracy.org or 207-522-2442.

In the Public Interest is a research and policy center committed to promoting the values, vision, and agenda for the common good and democratic control of public goods and services.

The Center for Popular Democracy (CPD) 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

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Contacts:

Jeremy Mohler, jmohler@inthepublicinterest.org, 202-429-5091

Asya Pikovsky, apikovsky@populardemocracy.org, 207-522-2442

Labor Day has started the sprint to the November election. And with more than 40 percent of U.S. workers struggling on less than $15 an hour, our economy’s tilt toward low-paying jobs has become a top economic issue this year.  

Now, as GOP leaders fret that Donald Trump may drag down Republican incumbents, turning more U.S. Senate races into toss-ups, the Republican majority’s stonewalling of any action to raise the federal minimum wage could cost the party control of Congress.

New polling shows that close to 70 percent of voters in key swing states want an increase in the federal minimum wage—and that 60 percent or more support a $15 minimum wage in six of the seven states polled.

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Even more, the polling shows that candidates’ positions on raising pay could play a pivotal role in this year’s electoral battles for control of the U.S. Senate. The results show that the incumbent Republican U.S. senators locked in close races could lose critical support—and even their seats—over opposition to raising wages for working people.

In Pennsylvania, Wisconsin and New Hampshire, Democratic challengers Katie McGinty, Russ Feingold and Governor Maggie Hassan strengthened their leads over incumbent Republican Senators Pat Toomey, Ron Johnson and Kelly Ayotte when voters were made aware of the senators’ opposition to raising the minimum wage.  

And in Arizona, Missouri and North Carolina, Democratic challengers Representative Ann Kirkpatrick, Jason Kander and Deborah Ross pulled ahead of Senators John McCain, Roy Blunt and Richard Burr, flipping those contests on their heads, when voters learned of the senators’ track records opposing raises.  

For example, in Arizona—where John McCain has just emerged from his toughest re-election primary ever—a 43-43 tie turns into a 44-38 lead for Kirkpatrick once voters hear about McCain’s opposition to raising pay.

The polling comes as the National Employment Law Project Action Fund, the Center for Popular Democracy Action, the Working Families Organization and other grassroots groups in seven states begin to mobilize voters.

The coalition plans to engage in canvassing, hold candidate forums and wage debate protests, among other actions, to educate and energize voters around candidates’ positions on the raising the minimum wage.

While Donald Trump, who has been all over the map on the minimum wage, has announced he now supports an increase to $10, most Republicans in Congress remain opposed.

Leading Republican pollster Frank Luntz’s firm LuntzGlobal has warned minimum wage opponents, “If you’re fighting against the minimum wage increase, you’re fighting an uphill battle, because most Americans, even most Republicans, are OK with raising the minimum wage.”

Farm workers pick vegetables on a farm in Rancho Santa Fe, California, on August 31. Paul Sonn writes that Republican U.S. senators locked in close races could lose their seats over opposition to raising wages.

While Congress has refused to act, over the past three and a half years, more than 50 states, cities and counties, as well as individual companies, have stepped forward to approve minimum wage increases, delivering raises to 17 million workers.  

And 10 million of those workers are in states or cities that have approved phased-in $15 minimum wages, raising pay for more than one in three workers in California and New York and beginning to reverse decades of growing pay inequality.

Historically, raising the minimum wage enjoyed the same bipartisan backing in Congress that it does with voters. But over the past 20 years, increasing polarization in Washington and the growing role of money in politics have led many Republicans to abandon their support.

As a result, the federal minimum wage today remains frozen at just $7.25 an hour. And taxpayers are being forced to pick up the tab, as low-wage workers in the seven states just polled must rely on $150 billion per year in public assistance to make up for their inadequate paychecks.

Candidates’ positions on the minimum wage have made a difference in close U.S. senate races before. Ten years ago, in Missouri and Montana, Democrats Claire McCaskill and Jon Tester successfully used their support for a higher minimum wage to highlight the difference between them and their opponents, Republican Senators Jim Talent and Conrad Burns, who both opposed raising the wage.  

McCaskill and Tester rode the issue to an Election Day victory, helping to break a logjam in Congress and delivering the first federal minimum wage increase in 10 years in 2007.

With the public demanding action to boost pay, the Republican majority and individual candidates this fall face a clear choice: stop standing in the way of a long overdue federal minimum wage increase—or risk their political future.

By Paul K. Sonn

Source

Most on Wall Street welcomed the news that Powell is the likely nominee. Investment bank Deutsche Bank put out a note last week to clients saying Powell would be the best choice if Trump did not want to keep Yellen on. But some liberal groups, including Fed Up, were disappointed and see the selection of Powell as an attempt to make the Fed more favorable to big banks. "Jerome Powell's most important qualification is that he served with Janet Yellen. His confirmation should depend on his willingness to follow in Yellen's footsteps on both monetary and regulatory policy," said Shawn Sebastian, co-director of Fed Up, a campaign from the Center for Popular Democracy.

Read the full article here.