The Dyett Hunger Strikers’ Fight For Green Technology and a Better Bronzeville
After weeks of a hunger strike by 12 residents fighting for the predominately African-American Bronzeville’s Walter...
All this in an effort to make Chicago Public School (CPS) officials heed their plea: to end the privatization of education and to make Walter Dyett High school into a Green Technology community high school.
The hunger strikers are saying what needs to be said: that Black and brown children must be valued, their families must be valued, and their schools must nourish their inherit value.
The demands of the hunger strikers are easy to understand. They don’t merely want a re-opened school, as was finally agreed to by Mayor Rahm Emanuel and CPS last week after 18 days of hunger strike. They want a Green Technology community high school with parent engagement in decision-making from the beginning. Their plan for the new school was vetted by multiple education experts at the University of Chicago. The comprehensive plan presented by the community and the hunger strikers to CPS was “excellent and should be chosen,” said Jeannie Oakes, president of American Educational Research Association, AERA.
Why Walter Dyett High School was set up for closure by the CPS to begin with is difficult to understand. The school received awards in 2008 and 2011. First, for the largest increase of students going to college out of all Chicago’s public schools, and then the ESPN “Rise Up” award for small schools making great improvements, but in need of some help. The school won a $4 million athletic facilities renovation.
So what happened? In a part of town activists say is a target for gentrification, the school was closed before students even got a chance to enjoy the new facilities. The strikers called it “racism” and “systemic disinvestment.” “Our schools weren’t failing,” they said. “They were failed.” And Walter Dyett High School was set to become yet another victim in the closing of over 50 neighborhood Chicago public schools in favor of privately owned and managed charter schools, with poor records of achievement, no accountability and inadequate oversight. But due to the sacrifice of the hunger strikers risking their health, that plan was overturned last week.
However, the Bronzeville hunger strikers know what a growing chorus of national education experts recognize: while just keeping schools open is not enough, sustainable “community schools” can help transform neighborhoods. As it is now, Bronzeville is a food and job desert, but Green Technology addresses both problems. There are already 5000 community schools in the US that through civic partnerships address the majority of challenges in a neighborhood by providing wrap-around healthcare, social and psychological services, in addition to the standard educational offerings. Community schools focus on restorative justice practices and a curriculum based in the community and evaluated by teachers, so students can learn more. Community schools are making marked gains in student outcomes both academically and socially.
Take Cincinnati. The city turned around their public schools’ statistics when they bet on the effectiveness of community schools over charter schools. The results are staggering. In 2003, before introducing the model, only 51 percent of all students graduated. In 2014, when 34 out 55 schools were community schools, 82 percent of all students were graduating. Community schools combat racial inequality, as well: in Cincinnati, the black/white achievement gap dropped 10 percent in those same 11 years. Similar results are seen in New York, Baltimore, Kentucky, Ohio, Minnesota, and other places where community schools have been prioritized.
These are the kind of schools that Bronzeville deserves.
It is under this history of political disinvestment that Bronzeville community leaders arrived to last month’s protests: community members risking their health to fight for their children’s access to something as basic as a good public school. While school officials took the right first step by moving to keep Dyett open, they must heed the deeper call of the people of Bronzeville and invest in a community school that will better the future of the children in Chicago.
Source: In These Times
Report: Emanuel's $13 Minimum Wage Plan Would 'Shortchange' Women, Minority Workers
Progress Illinois - October 29, 2014, by Ellyn Fortino - Chicago Mayor Rahm Emanuel's proposal to lift the city's...
Progress Illinois - October 29, 2014, by Ellyn Fortino - Chicago Mayor Rahm Emanuel's proposal to lift the city's hourly minimum wage to $13 would leave out approximately 65,000 low-wage workers who are mostly women and people of color.
That's according to a new Center for Popular Democracy report, which compared the potential impacts of the mayor's $13 minimum wage plan with a competing $15 minimum wage ordinance introduced in late May by a group of aldermen, including members of the council's Progressive Reform Caucus.
The proposed $13 ordinance specifically "shortchanges" domestic and tipped workers, the majority of whom are women of color, according to the report.
The Raise Chicago coalition, which supports the $15 plan, released the report's findings at a City Hall press conference Wednesday morning. More low-wage Chicago workers would be covered by the $15 plan, which would also almost double the economic impact for the city compared to the $13 measure, the report found.
"With the opportunity to nearly double the economic growth of people across the city, our Raise Chicago ordinance would help propel people towards financial stability, help this city and state with tax revenues, and its effects would ripple through every community in Chicago," said Action Now Executive Director Katelyn Johnson, a Raise Chicago leader. "The mayor's proposal does not do enough to address the needs of Chicagoans and, in fact, will keep people living paycheck to paycheck."
In July, Emanuel, along with 25 other aldermen, introduced an ordinance to bump the city's hourly minimum wage from the current $8.25 to $13 by 2018.
The measure models the recommendations of the mayor-appointed Minimum Wage Working Group, which was tasked with researching and gathering public comment about increasing the city's minimum wage. The mayor formed the commission the same month the ordinance seeking to hike Chicago's base wage to $15 an hour by 2018 was introduced.
Under the mayor-backed ordinance, the city's minimum wage for non-tipped employees would increase by $1.25 in each of the next three years and $1 in 2018 to hit the $13 level. The city's minimum wage would be adjusted each year after 2018 to keep pace with inflation. The tipped minimum wage, which is currently $4.95 at the state level, would be lifted by $1 to $5.95 over two years and indexed to inflation after that.
The $15 plan, on the other hand, would require large employers in Chicago making at least $50 million annually to raise their employees' wages to $12.50 an hour within 90 days. Those companies would then have to raise workers' hourly wages to the $15 level within one year of the measure taking effect.
Businesses with less than $50 million in annual revenue would have a different minimum wage phase-in period. Small and mid-sized businesses would have to increase their base hourly wage to $12 within 15 months. After that, the smaller employers would have to increase their minimum wage by $1 each year until they hit the $15 level by 2018.
Johnson said the mayoral working group's measure "burdens small businesses," because it provides "no separate phase-in period for large corporations and small businesses."
The city's minimum wage under the $15 proposal would be adjusted each year after 2018 to keep pace with inflation. If that plan were adopted, the base hourly wage for tipped workers would be 70 percent of the overall minimum wage.
Tipped workers under the $15 ordinance would earn a $10.50 hourly wage once the phase-in process is completed. That wage would be 63 percent greater than what the $13 plan proposes.
Domestic workers, meanwhile, are covered by the Raise Chicago minimum wage ordinance, but they're excluded from the $13 proposal.
"This exclusion would have a disparate impact on women of color, who make up the majority of domestic workers in Chicago," the report reads.
Ovadhwah "O.J." McGee, a Chicago home care aid and SEIU* Healthcare Illinois member, said workers who provide supports to seniors and those with disabilities, for example, deserve a living wage. McGee, a single father who is also a certified nursing assistant, said he earns less than $13 an hour and struggles to make ends meet. He said "$15 would make such a great difference for me."
"The mayor's proposal will leave domestic workers behind. They wouldn't even get the $13 an hour, and that's an injustice," McGee said, adding that the $13 ordinance also "shortchanges tipped workers, providing them with only a $1.50 wage increase."
"That's a shame," he stressed. "The reality is by leaving domestic and tipped workers behind, the mayor is leaving workers of color behind. The majority of these jobs are ... held by African Americans and Latino workers."
Nearly 40 percent of the city's more than 1.3 million workers living in Chicago make less than $15 an hour, according to the report, which also estimated the total number of workers who would see their wages lifted, either directly or indirectly, by the two proposals.
"Under the $15 proposal, we project that 444,000 workers earning up to $17.30 will receive wage increases related to raising the wage floor," the report states. "Under the $13 proposal, only those workers currently earning up to $15.60, or about 379,000 workers, would receive higher wages."
The $13 measure would leave out 65,000 low-wage workers, including 42,000 Chicago residents, according to the report. Of the 65,000 low-wage workers who would be excluded from the $13 plan, approximately 13,000 are African American and 20,000 are Latino.
Additionally, the mayor's $13 measure "fails to secure the truly robust economic recovery that the $15 Raise Chicago ordinance would achieve," the report reads.
After full implementation, the $15 proposal would generate $2.9 billion in new gross wages; $1.04 billion in new economic activity and 6,920 new jobs; more than $80 million in new sales tax revenues; and $125 million in new income tax revenues, the report found.
On the flip side, the $13 plan would lead to $1.25 billion in new gross wages; $522 million in new economic activity; and $40 million in new sales tax revenues.
"Our research found that the benefits of a $15 minimum wage far outweigh those of the mayor's proposed $13," Connie Razza, director of strategic research at the Center for Popular Democracy, said in a statement. "At a time when income inequality is at historic levels and American communities are still reeling from the financial crisis, two dollars more may well be the threshold between survival and stability."
"For Chicago, it means over half a billion more dollars in economic activity that would benefit small businesses and communities, millions more in tax revenue for the city, and would significantly raise the wage floor," she added.
During the March 18 primary election, Chicago voters overwhelmingly supported a non-binding ballot referendum to increase the city's minimum wage to $15 an hour for employees of companies with annual revenues over $50 million. The referendum appeared on the ballot in 103 city precincts, garnering support from about 87 percent of voters.
"The time to raise the minimum wage to $15 an hour is now, and no half measurers will be accepted," Johnson stressed.
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Jackson Hole Journal: Rate Rise Friends, Foes Encircle Fed Event
Also getting under way at the lodge is a protest conference organized by the Center for Popular Democracy, a liberal...
Also getting under way at the lodge is a protest conference organized by the Center for Popular Democracy, a liberal group that has been cajoling the Fed to hold off on raising interest rates. Their headline speaker will be Joseph Stiglitz, a Nobel Prize-winning economist and once a mentor to Fed Chair Janet Yellen, who is not attending the Fed event.
Policy makers such as Fed Vice Chairman Stanley Fischer won’t be able to avoid seeing their activists, roaming around the lodge in green t-shirts, reading “Whose recovery?” and “Let our wages grow.”
The group, which this year includes representatives from the Black Lives Matter movement, have reserved conference space directly below the room where the Kansas City Fed’s sessions take place.
Left out is the American Principles Project, a conservative organization that has heavily criticized the Fed’s monetary policy as excessively accommodative. They believe interest rates should have been lifted long ago.
The group tried to reserve space at the Jackson Lake Lodge but were refused, according to Steve Lonegan, their director of monetary affairs. So they’ll get their alternative conference started this evening in Teton Village, a more than 30-mile (48-kilometer) drive away. Scheduled speakers include Representative Scott Garrett, a New Jersey Republican who has sponsored legislation to make the Fed more accountable to Congress.
Better Access
Standing at an information table covered with gold-coin chocolates on Wednesday in Jackson Hole Airport, Lonegan complained that his group was refused space at the lodge while the other protesters enjoyed much closer access to the Fed attendees, including the media.
Kansas City Fed Spokesman Bill Medley said the bank had “no say over who else books space here.”
Elizabeth Biebl, a spokeswoman for lodge operator Vail Resorts Hospitality and Real Estate, said in an e-mail there are space limitations and the Center for Popular Democracy was accommodated at the Jackson Lake Lodge because it requested smaller numbers than American Principles Project.
“Groups interested in booking with us are not subject to the approval of other groups who already have bookings,” she wrote.
Source: Bloomberg
Let cities better help their retirees
In less than 20 years, one in every five Americans will be over the age of 65 and we will live longer than any...
In less than 20 years, one in every five Americans will be over the age of 65 and we will live longer than any generation before us. For those without adequate savings for retirement, those added years will be a time of uncertainty and dependency rather than leisure.
Connecticut is the latest state seeking to stave off this looming crisis in elder poverty, passing legislation to provide access to a state-sponsored retirement plan for the 600,000 Connecticut residents who do not have a plan through their employers. The bill will automatically enroll workers in businesses with five or more workers in a retirement plan overseen by a new quasi-public authority. Connecticut joins California, Illinois, and more than a dozen other states pushing for state-sponsored plans to encourage workers to save for retirement.
The accelerated pace of activity follows decades of wage stagnation that have left the average American worker with just half of what workers saved in the 1970s. Half of those nearing retirement have no retirement savings at all and those that do have savings have only enough to provide a median income of around $400 per month.
At the same time, employers have largely abandoned defined benefit pension plans that once guaranteed a minimum level of security based on salary and length of service, opting instead for plans that put the onus on workers to build up their own retirement accounts. Today, more than half of American workers have no private pension coverage at all.
Those who retire without a pension or sufficient savings will depend largely on Social Security for their retirement income, a system that will grow increasingly burdened as baby boomers retire, leaving fewer workers to cover the costs of each retiree.
This daunting reality has spurred states like Connecticut to act.
Innovation at the state level, however, is currently hindered by the federal Employment Retirement Security Act (ERISA), which generally preempts state action on private sector pensions. State legislatures have had to build language into bills making any plan contingent on an exemption from federal ERISA requirements. This burden creates uncertainty for both workers and state administrators, preventing many states from even exploring the possibility of a plan.
In response, the Department of Labor (DOL) is currently developing a safe harbor rule that would clarify how states can bypass ERISA requirements. The rule would let states develop the retirement security model that best suits their residents, while also learning from the successes and missteps of other state plans.
While the proposed DOL rule is a great first step, it does not go far enough in its present form. The rule is limited to states, but cities such as New York are also considering similar plans. They should be afforded the same opportunity to ensure a secure retirement for their residents.
In developing its rule, the DOL should aim to reach the largest possible number of workers, including those whose state legislatures are unable or unwilling to address retirement security. Including cities also allows for more tailored programs when demographics and industries vary widely across a state.
Preventing an elder poverty crisis will require creative solutions at all levels of government. The DOL should ensure that federal regulations foster that creativity, rather than stifle it.
By ANDREW FRIEDMAN
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Report says transit times extra long for commuters of color
Star Tribune - 05-12-2015 - Twin Cities transit users of color spend almost 160 additional hours a year commuting when...
Star Tribune - 05-12-2015 - Twin Cities transit users of color spend almost 160 additional hours a year commuting when compared to whites who drive to work solo. That's according to a report out Tuesday from four advocacy groups opposing cuts to public transportation funding.
The report "It's About Time: The Transit Time Penalty and Its Racial Implications" cited infrequent service, indirect routes, delays, overcrowded vehicles, and insufficient shelter at bus stops as factors that contribute to a transit time penalty that adds time and stress to each commute. For Blacks and Asians who used public transit, that totaled an extra 3.5 weeks a year and for Latinos it was 4 hours a year of additional time required to travel between two points by public transportation, compared with going by car.
"That means that for a month a year more than white drivers, transit commuters of color are unavailable for working, helping children with homework, helping parents get to the doctor, running errands, volunteering in their communities or participating in their churches," said the report compiled by Neighborhoods Organizing for Change, TakeAction Minnesota, ISAIAH and the Center for Popular Democracy.
The groups released their findings during a news conference at the State Office Building in St. Paul.
As the legislative session come down to the wire and a transportation budget still up in the air, the advocacy groups are urging law makers to approve a bill that would not cut service but allow Metro Transit to move forward with its Service Improvement Plan. That plan calls for an expansion of service that would institute Arterial Bus Rapid Transit, which would speed up service on local urban routes by as much as 30 percent among other things, the report said.
A proposal passed by the Minnesota House would force Metro Transit to reduce regular bus service by at least 17 percent. The fate of that proposal will be decided in the overall transportation spending bill hashed out by the House, Senate and Gov. Mark Dayton
"These improvements can only happen with enough funding. If transit funding is cut, the time penalty is certain to worsen," the report said. "Funding cuts proposed by House Republicans will result in lost service—longer waits, more delays, longer travel times, and more crowded buses and trains."
About 5 percent of whites and Minnesotans of Asian descent commute by public transit, 8 percent of Latinos, 10 percent of Blacks, and 29 percent of American Indians commute to work on public transit.
Source: Star Tribune
Report: Twin Cities minorities have longer commutes
Fox 9 - 05-12-2015 - A new report says minorities in the Twin Cities have longer commute times than white people, and...
The 12-page report is called, "It's About Time: the Transit Time Penalty and its Racial Implications," and was released Tuesday by Neighborhoods Organizing for Change, TakeAction Minnesota, ISAIAH and the Center for Popular Democracy.
According to the report, black people using transit in Twin Cities spend 146 hours or about 3 and a half weeks more of their time commuting than white drivers taking their cars.
“If you are Latino it's closer to five weeks -- every year when you are on a bus when you could be with your family, when you could be at work, other things than literally being on a bus on public transportation,” Neighborhoods Organizing for Change spokesman Anthony Newby said. The report cites 173 hours for their "transit time penalty."
Part experiment, part social awareness, several lawmakers took the transit challenge themselves. One found it took him two hours to get to the Capitol from Golden Valley.
"My experience shows first hand that the transit time penalty is real,” Rep. Mike Freidberg (DFL-Golden Valley) said.
The groups involved with the report aren't bashing Metro Transit, but rather, they emphasized the agency has a good plan for more arterial transit routes. They just say it needs more funding.
Source: Fox 9
I'm Still Recovering From Hurricane Maria — & Here's What I Want You To Know
I'm Still Recovering From Hurricane Maria — & Here's What I Want You To Know
For activists like Xiomara Caro of the Center for Popular Democracy, it's all emblematic of a larger trend: that the...
For activists like Xiomara Caro of the Center for Popular Democracy, it's all emblematic of a larger trend: that the struggles of Puerto Rico are its own, borne under the indifferent gaze of the United States.
Read the full article here.
Kamala Harris Fails to Explain Why She Didn’t Prosecute Steven Mnuchin’s Bank
Kamala Harris Fails to Explain Why She Didn’t Prosecute Steven Mnuchin’s Bank
FORMER CALIFORNIA ATTORNEY General Kamala Harris on Wednesday vaguely acknowledged The Intercept’s report about her...
FORMER CALIFORNIA ATTORNEY General Kamala Harris on Wednesday vaguely acknowledged The Intercept’s report about her declining to prosecute Steven Mnuchin’s OneWest Bank for foreclosure violations in 2013, but offered no explanation.
“It’s a decision my office made,” she said, in response to questions from The Hill shortly after being sworn in as California’s newest U.S. senator.
“We went and we followed the facts and the evidence, and it’s a decision my office made,” Harris said. “We pursued it just like any other case. We go and we take a case wherever the facts lead us.”
Mnuchin is Donald Trump’s nominee to run the Treasury Department, and served as CEO of OneWest from 2009 to 2015. In an internal memo published on Tuesday by The Intercept, prosecutors at the California attorney general’s office said they had found over a thousand violations of foreclosure laws by his bank during that time, and predicted that further investigation would uncover many thousands more.
But the investigation into what the memo called “widespread misconduct” was closed after Harris’s office declined to file a civil enforcement action against the bank.
Harris’s statement on Tuesday doesn’t explain how involved she was with the decision to not prosecute, or why the decision was made. She also would not say whether the revelations would disqualify Mnuchin for the position of treasury secretary. “The hearings will reveal if it’s disqualifying or not, but certainly he has a history that should be critically examined, as do all of the nominees,” Harris told The Hill. She added that she would review the background and history of all Trump cabinet nominees.
Senate Democrats have vowed to put up a fight over Mnuchin — even creating a website inviting homeowners to list their complaints against OneWest. And yet not one senator has commented publicly on the leaked memo, which received media coverage in Politico, Bloomberg, the New York Post, CBS News, Vanity Fair, CNN, CNBC, and other outlets.
The Intercept has reached out to half a dozen Senate Democratic offices, including those of Minority Leader Chuck Schumer and leading Mnuchin critics Bernie Sanders and Elizabeth Warren, receiving no response.
Sen. Tammy Baldwin, D-Wisc., retweeted the story, as did the Twitter account of the Democratic National Committee. But another DNC tweet just hours later hinted at the bind Democrats are in when it comes to using the information against Mnuchin. That tweet praised Harris’s swearing-in. Her decision not to prosecute may make her new colleagues wary of pursuing it.
Progressive groups have not been so reluctant. Three groups — the Rootstrikers project at Demand Progress, the Center for Popular Democracy’s Fed Up Campaign, and the California Reinvestment Coalition – have called for a delay of Mnuchin’s confirmation hearing until he publicly discloses all settlements and lawsuits OneWest has faced from its foreclosure-related activities, responds fully to all questions submitted by members of the Senate Finance Committee, and publicly discloses his role in obstructing the California attorney general investigation, or any others.
The California Reinvestment Coalition followed that up on Thursday by asking OneWest to release the obstructed evidence, which involved loan files held by a third party then known as Lender Processing Services (it’s now called Black Knight Financial Services). “That’s something the Senate Finance Committee should ask him for, prior to scheduling their hearing with him,” said Paulina Gonzalez, executive director of the California Reinvestment Coalition.
Mnuchin has already declined to answer a detailed list of questions from Finance Committee member Sherrod Brown, which Brown sent before the release of the leaked memo.
After The Intercept story was published, Mnuchin spokesperson Barney Keller called it “meritless,” and highlighted OneWest’s completion of a foreclosure review with the Office of the Comptroller of the Currency (which involved completely separate issues from the California inquiry) and what he claimed was OneWest’s issuance of over 100,000 loan modifications to borrowers.
“Memos like this belong in the garbage, not the news,” Keller said.
Meanwhile, the Alliance of Californians for Community Empowerment, an organizing group that made headlines in 2010 by protesting on Mnuchin’s front lawn over OneWest’s foreclosure practices, expressed disbelief that he could now become treasury secretary. “My family lived first hand the fraud and unethical behavior under his leadership when I was told to default before they could help me, and (was) instead pushed into foreclosure,” said Peggy Mears, a OneWest victim.
ACCE plans to ask incoming California Attorney General Xavier Becerra to take up the prosecution of OneWest based on the newly released evidence. And the group vowed to fight the Mnuchin nomination. “No one who oversaw the defrauding of thousands of homeowners should be allowed to serve watch over our country’s money,” Mears said.
By David Dayen
Source
The right kind of reform
PERHAPS it was inevitable in the aftermath of the worst financial crisis in almost a century, but America is boiling...
PERHAPS it was inevitable in the aftermath of the worst financial crisis in almost a century, but America is boiling over with schemes to remake the Federal Reserve. Some Republicans want the central bank’s monetary-policy decisions to be “audited” by the Government Accountability Office, an arm of Congress. Others wish to use a formula to put monetary policy on autopilot and to haul the chairman in front of Congress every time the Fed steps in. The most extreme sceptics peddle conspiracy theories about how the Fed “debases” the dollar. They propose abolishing the central bank entirely.
Any of these schemes would be disastrous—either because they would jeopardise the central bank’s independence, or because they would cast monetary policy adrift.
Fortunately, the likely presidential candidates have no desire to “end the Fed”. Donald Trump says he might replace Janet Yellen, the Fed’s chairman, with a Republican when her term ends. That would be unwise, but hardly revolutionary. Hillary Clinton wants to change the rules about who sits on the boards of the 12 powerful regional banks in the Fed system.
She is right. The Fed is not broken, but it is anachronistic. The system of regional Feds gives commercial banks influence over their regulators and dishes out public money to their private shareholders. The next president and Congress should give it a thorough overhaul.
The Federal Reserve system, created in 1913, owes a lot to the efforts of Carter Glass, who gave his name to the more famous Glass-Steagall Act, which separated investment banking from the duller retail kind. Thanks to his efforts, the country has not one monetary authority but a network of regional banks overseen by a board of governors in Washington, DC.
Glass’s aim when founding the Fed was to avoid giving too much economic power to Washington bureaucrats. The regional banks would be like the states, while the board of governors would be like Congress. To placate bankers who wanted the government to stay out of their business, banks would themselves capitalise each regional Fed and appoint two-thirds of its directors. The directors would, in turn, elect a president who, on a rotating basis, would assume one of five voting seats on the FOMC, the committee that sets interest rates for the whole country. Such sops were necessary in part because, until 1980, membership of the Fed system was voluntary.
The sops are still being dished out today. The system provides sweetheart deals to banks, most of which earn a risk-free 6% annual dividend on their compulsory investments in the regional Feds. This is more than three times what the government currently pays for capital on the ten-year debt market. Although the dividend was recently cut for the 70 largest banks, roughly 1,900 smaller banks in the Fed system, which also own part of the regional Feds’ stock, continue to benefit. Banks holding shares issued before 1942 receive their dividends tax-free.
The most important job of a regional Fed is to oversee the banks in its district. As a result, Glass’s system comes perilously close to letting bankers serve as their own regulators—not so much a revolving door between Wall Street and government, as a shared executive suite. The bankers who sit on the boards of regional Feds are not directly responsible for regulation and they no longer vote for a regional Fed’s president, but banks appoint outside directors who do. And bankers can take part in a vote to dismiss a regional-Fed president.
This is all the more worrying since political gridlock has given the regional Feds growing representation on the FOMC. The system is designed so that the Washington board of governors, which is appointed by the president and confirmed by the Senate, has a majority. But the White House has filled vacancies slowly, in part because of an unco-operative Senate—which in 2010, for instance, decided that Peter Diamond, a Nobel-prize-winning economist, was unqualified for the job. Hence, for most of Barack Obama’s presidency, regional Feds have matched governors in voting power. This matters because banks tend to profit from higher interest rates. Regional-Fed presidents tend to be the most hawkish members of the FOMC, as their dissenting opinions suggest (see chart).
Amend the Fed
The next president can put this right by taking Mrs Clinton’s proposal—and then going further. The private sector should be kicked out of the Fed entirely, the reserve banks capitalised with public money and the central bank’s profit kept for taxpayers. The Fed would not want for expertise without bankers on its regional boards: it already hires plenty of ex-bankers and can always consult the firms it regulates.
Some fear that any reform attempts would provide an opening for all those other barmy ideas. That is not an idle worry. But private-sector involvement in the Fed arms the critics and conspiracy theorists. It reinforces the corrosive notion that self-serving elites write economic policy. In the long run, reform would protect the Fed from undesirable meddling.
From the print edition: Leaders
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'Look at Me:' Women Confront Flake on Kavanaugh Support
'Look at Me:' Women Confront Flake on Kavanaugh Support
Moments after pivotal Sen. Jeff Flake announced he would vote to confirm Supreme Court nominee Brett Kavanaugh, the ...
Moments after pivotal Sen. Jeff Flake announced he would vote to confirm Supreme Court nominee Brett Kavanaugh, the Arizona Republican was confronted with the consequences.
Read the full article here.
2 months ago
2 months ago