CPD IN THE NEWS

Last year’s behind-the-scenes selection of three men with ties to Goldman Sachs to serve atop the Federal Reserve did not go over well with outspoken civic groups and many Democrats, including Hillary Clinton, who have all called for a more transparent and inclusive central bank. In response to the critics, the Fed has rolled out a series of announcements, online forums and face-to-face meetings with Americans to portray a more open process of selecting its 12 district presidents that is also more sensitive to racial and gender diversity.

The Minneapolis Fed, like its counterparts in Philadelphia and Dallas last year, named a president in Neel Kashkari with a past at Goldman, the Wall Street bank. But it also broke ranks from others when it released video testimonials from directors shedding light on the year-long search process, and even published a “summary of attributes” sought in the candidate. The Atlanta Fed said last month it seeks a “diverse set of candidates” to replace outgoing chief Dennis Lockhart, and this month its board chair hosted a pubic webcast to explain the historically shrouded search process, raising hopes it would name the first black or Latino Fed president in the central bank’s 103-year history.

“In the Federal Reserve system we are taking this very seriously, but it’s not just because we want to go and say we’re diverse,” Loretta Mester, the Cleveland Fed President, told a gathering of low-wage workers and progressive economists organized by Fed Up, a labor-affiliated coalition of civic groups pushing for reforms. “It really is about … getting different view points that are very helpful to us in setting policy and thinking about the economy and understanding the trends,” she said at the Cleveland Fed on Friday. Mester met the group a day after her bank launched an online application form for the public to recommend people “diverse in backgrounds and perspectives” for board positions and advisory roles across her Midwest district. Asked to what extent outside pressure prompted the move, a spokeswoman said it was “just the latest in our ongoing efforts to broaden our outreach.”

The 12 Fed presidents have five rotating votes on U.S. interest rate policy. Unlike the five current governors at the Fed Board in Washington, who are selected by the White House and approved by the Senate, the presidents are chosen by their district directors, half of whom are themselves picked by private local banks that technically own the Fed banks. The dizzying structure is meant to ensure views from across the country are heard. But critics say it leaves the Fed beholden to bankers who are not representative of the public, and they point out that 11 of 12 district presidents are white while 10 of them are men. Among employees at the Fed Board in Washington, including service workers, 43 percent were non-white and 43 percent female last year. However at the executive level it was 18 percent and 37 percent, respectively, according to the central bank.

Clinton, the presidential candidate, has come out in favor of dropping bankers from district boards and making the Fed “more representative of America as a whole,” according to her party’s platform. That followed a May letter from 127 lawmakers to Fed Chair Janet Yellen urging more diversity.

After years of resisting more overt political efforts to curb its independence, the Fed under Yellen appears willing to take small steps in the name of transparency and inclusively. In an unusual entry in minutes of their meeting last month, Fed officials discussed a staff analysis of “differential patterns of unemployment across racial and ethnic groups.” U.S. unemployment among blacks is twice that of whites.

“While we applaud this progress, these very basic steps were available to them for the last hundred years and have only been rolled out very recently,” Shawn Sebastian, a Fed Up field director, said of the series of efforts by Fed banks.

In its latest critique, Fed Up called it “disappointing” that Nicole Taylor, a black woman and dean of community engagement and diversity at Stanford University whose term as director at the San Francisco Fed is soon to expire, would be succeeded on that district’s board by Sanford Michelman, a white man who is co-founder of law firm Michelman & Robinson LLP. John Williams, president of the San Francisco Fed, told reporters on Wednesday that while he has no control over the selection of directors, this board revamp “just redoubles my efforts and my team’s efforts to make sure that we are getting the voices and experiences from across the spectrum.” He added: “It’s definitely a step back in terms of what I’d like to see on our board. We’re working actively to build representation of women and minorities.”

By Jonathan Spicer

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The Boston Globe - December 21, 2014, by Dante Ramos - Most of the time, it’s a cop-out to blame technology for the human misbehavior that it enables. It isn’t PowerPoint’s fault that your co-workers add too many slides to their presentations. It isn’t Facebook’s fault that “friends” whom you barely know make odd comments on your photos. It isn’t Auto-Tune’s fault that Paris Hilton thinks she’s a singer.

But when the stakes are much higher, even software engineers should do some soul-searching. Late last month, just as shoppers around the country were girding for Black Friday, the San Francisco Board of Supervisors approved a “retail workers bill of rights” designed to give workers at retail chains more predictable schedules and discourage last-minute scheduling changes. It was a direct response to a powerful new employment trend: Increasingly, major retail and restaurant chains fine-tune their staffing — and hold down labor costs — via sophisticated software that looks at a store’s past performance, weather patterns, and real-time sales data.

The software plays an integral role in so-called just-in-time scheduling systems, which help ensure that a store won’t have eight cashiers working when there’s only enough business for four. For workers, though, these systems have serious downsides: irregular shifts, significant schedule changes on short notice, and huge variations in hours from week to week.

Earlier this year, The New York Times profiled part-time Starbucks barista Jannette Navarro, a San Diego single mom who couldn’t arrange child care or take classes because her hours fluctuated so wildly. Workers at chains from Walmart to Jamba Juice have gone public with their frustrations. “These hours don’t match the basic realities of people’s lives,” said Carrie Gleason, director of the Fair Workweek Initiative at the Center for Popular Democracy. The burden for workers with families is particularly heavy, she added. “Kids need routine, but when you work in retail routine doesn’t happen.”

The market leader in this workforce-management industry is Chelmsford-based Kronos Inc.; other players include SAP, ADP, and Oracle. What these firms have to decide is whether their products can be a force for greater equity in the workplace — or will remain one more way, in an uncertain economy, to shift more of the risk onto low-wage employees with little leverage.

The world’s richest man says we need to shorten the workweek. Who really wants to disagree?

Strikingly, none of the researchers or labor advocates whom I contacted blamed Kronos or its competitors for schedules that, ultimately, reflect the employer’s values. Still, all the evidence suggests that relying on faceless algorithms makes it easier for employers to casually jerk workers around.

If you worked in retail 20 years ago, your manager would post a handwritten schedule on the back of the bathroom door every week or two. She might have expected you to work every other Friday night, because spreading unpopular weekend shifts around helps morale. If you worked Tuesday and Thursday last week, she might give you the same shifts this week, because reinventing the schedule from scratch would be a hassle. She made judgments about which inconveniences you might grumblingly accept — and which ones were too burdensome to demand.

A robo-scheduler doesn’t recognize such objections unless it’s programmed to. “The algorithm did it,” a manager might rationalize — especially when headquarters is keeping a close eye on staffing at every store.

It also can’t be a coincidence that, as scheduling software proliferated over the last decade, so did the widespread use of on-call shifts, which require part-time employees to check in an hour or two beforehand to see if they’re needed. For workers who need to arrange child care, or work a second part-time job, being called in with a couple of hours’ notice is a disaster.

The workforce-management industry is a little cagey about how its products affect workers. “Reduce labor costs by efficiently scheduling, monitoring, and managing your workforce,” promises an Oracle marketing website. “Provide outstanding customer service as you control labor costs,” says the pitch for a Kronos product . But in a recent interview, Kronos’s vice president for business development, Charles DeWitt, argued that minimizing labor costs is “an afterthought in the calculation.” As he tells it, it’s hard enough just to match the mix of skills and certifications that a retailer needs at a given time (fluency in Spanish, the capacity to perform certain management duties) with the availability of workers, whose time constraints vary greatly.

In our conversation, DeWitt sounded genuinely interested in addressing some of the problems worker advocates have raised. Kronos is developing metrics for how often the hours an employee works differ from what’s on the original schedule, how well staffing respects workers’ preferences, and how widely a given employee’s hours vary from week to week. This is encouraging, but also unsettling: Shouldn’t such considerations have been part of the equation all along?

Eventually, labor laws have to adapt as well. Earlier this year, US Representative George Miller of California introduced the Schedules that Work Act, which would compensate retail, food service, and janitorial workers for last-minute schedule changes. But nobody thinks the federal legislation will pass anytime soon. If history is any guide, liberal states like California and Massachusetts will enact some controls, while other states will blow the issue off entirely.

Worker advocates need to look for additional pressure points — and software makers ought to own up to their own role in creating the current system. If technology firms and the retailers who hire them are looking at the right data, over a period of time that extends beyond the current quarter, they’ll be able to verify what labor activists have long believed: that more stability for workers reduces turnover and improves customer loyalty.

Maybe it’s too simplistic to hope for a simple software tool that allows employers to upgrade their schedules from 1 (“sadistic”) to 10 (“workers’ paradise”). If nothing else, Kronos and its competitors can help simply by confronting retail chains up front with the sacrifices they’re expecting from their workers.

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The Nation - April 30, 2013 - You can’t talk about poverty without talking about the practices of the big banks, including their continuing refusal to stem the foreclosure crisis through mortgage principal reductions.

Consider this: Latinos lost 66 percent of their household wealth after the housing bubble burst, and African-American households lost 53 percent. Nearly 12 million families—disproportionately people of color—have either lost their homes or are currently in foreclosure, and another 16 million are underwater, owing more on their mortgages than their homes are worth.

Communities are decimated by boarded up houses and vacant lots, declining property values and the consequent loss of state and local revenues, and fewer opportunities to weather and recover from financial hardship. A new study from the Urban Institute indicates that white families now average six times the wealth of African-American and Latino families.

So when US Bank executives fled Minneapolis two weeks ago to hold their annual shareholders meeting in what they believed would be friendlier confines in Boise, it was important that activists from Minnesota and Oregon traveled to join Idahoans in an effort to hold the bank accountable. Then last week, Wells Fargo bankers traveled from San Francisco to Salt Lake City for their shareholders meeting, and activists again weren’t deterred—they came from California, Colorado and New York to stand with local groups and protest the bank’s practices.

“Wells Fargo moved the shareholders meeting to Salt Lake because last year there were 3,000 people in the streets in San Francisco,” said Maurice Weeks, campaign coordinator for the Alliance of Californians for Community Empowerment (ACCE), which had fifteen members make the eleven-hour trip to Utah. “We wanted them to know that they can’t hide from us.”

ACCE members attended the shareholders meeting as legal proxies. They were joined by members of the Neighborhood Economic Development Advocacy Project (NEDAP) from New York, the Colorado Student Power Alliance and local groups from Salt Lake City that were focused on Wells Fargo’s investments in private prisons and the impact on communities of color.

Several ACCE members in attendance were facing immediate foreclosures and welcomed the opportunity to tell Wells Fargo CEO John Stumpf—who was paid $22.87 million last year, more than any other banker—that they hadn’t been given a fair shake.

“We’re talking about folks who could pay their mortgages and stay in their houses with a modification, and Wells refuses,” said Weeks. “We’ve had situations where a HUD counselor tells our members that they qualify and Wells still denies a modification.”

More broadly, ACCE was there to demand that Wells commit to pursuing principal reductions—reducing the amount owed on a mortgage so that it reflects the fair market value of the property—wherever they are legally able to do so. A recent report from ACCE, the Center for Popular Democracy and the Home Defenders League suggests that foreclosing on the more than 11,600 California homes currently in Wells’s foreclosure pipeline—which are concentrated in poor and non-white communities—would cost the state approximately $3.3 billion due to the decreased value of the foreclosed properties, decreased value of homes in the surrounding communities and lost tax revenues. In contrast, a comprehensive program of principal reduction would stabilize households, increase tax revenues and boost the economic vitality of distressed communities. (Modifications also happen to be better for the investors who hold the mortgage, but unfortunately banks that service the mortgages—like Wells Fargo—can often make more money by foreclosing.)

A second key demand by ACCE members was that Wells Fargo report its data on principal reductions, short sales and foreclosures by race, income and zip code. Last year, the bank reached a $175 million settlement with the Department of Justice for allegedly charging African-American and Latino borrowers higher rates and fees and steering them into subprime loans when they should have qualified for regular loans.

“Our members want to make sure Wells isn’t still preying on communities of color,” said Weeks.

NEDAC presented a resolution for an independent investigation of Wells Fargo’s business practices in order to ensure that they don’t violate any fair lending or fair mortgage laws. Although the resolution was voted down, Weeks said it received more discussion than any other resolution presented to the shareholders.

“ACCE members—but also people we didn’t know—were all voicing concerns about Wells Fargo’s mortgage practices,” said Weeks.

According to Weeks, when Stumpf tried to move onto “business as usual,” Makayla Major, an ACCE member from East Oakland, stood up and shouted, “John Stumpf, you’re a liar and a crook. You are stealing too many homes in my neighborhood!” Weeks said that the room was lined with “forty or fifty” security guards and that “six or seven” immediately moved in to “make her be quiet.”

Then ACCE member Manuela Alvarez—who has been trying unsuccessfully to modify her subprime loan since her husband was injured on the job—said, “You are trying to steal my home, like you’ve stolen the homes of tens of thousands of other hard-working families. It’s time for you to be held accountable!”

She, too, was quickly surrounded by security.

ACCE member Melvin Willis then began reading a “Citizens Arrest Warrant” for Stumpf for “the following crimes: illegally foreclosing on millions of homeowners nationwide; intentionally targeting communities of color with predatory, high-cost loans; and gouging students with predatory student loans—usury.”

“He was immediately swarmed and at that point we were all escorted out of the room and the hotel,” said Weeks. “But John Stumpf and the shareholders definitely heard our message, and we made it clear that they can’t ignore these issues.”

Wells Fargo made $19 billion in profits last year and record profits last quarter. None of this would have been possible without the bank bailout and continued borrowing of taxpayer money at zero percent interest from the Federal Reserve (which Wells Fargo and the other big banks then turn around and loan to state and local governments at much higher rates).

ACCE and its allies showed up in Salt Lake City to take a stand against a wealth-stripping machine. There will be more actions ahead against Bank of America (May 9), Sallie Mae (May 30) and Walmart (June 7). Sign up to stay informed here.

“The message from the banks is that the foreclosure crisis is over, and a lot of the general public is hearing that,” said Weeks. “But we see on the ground that that’s far from true, and that Wells Fargo continues to profit at the expense of our communities. That’s why we’re keeping up the pressure of this campaign. We’re going to fight for our communities as hard as we possibly can.”

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“But the real threat to the Fed’s independence isn’t coming from Trump—it’s coming from Wall Street. The Fed’s structural flaws have led to regulatory capture, which compromises its ability to set monetary and regulatory policy in a manner that isn’t tilted to favor those at the very top of the economic ladder. Trump may have broken a norm by commenting on monetary policy, but the Fed’s status quo is unaccountable, opaque decision-making shaped by deep conflicts of interest with the very financial institutions the Fed is ostensibly supposed to supervise.

Read the full article here.