CPD IN THE NEWS

Hundreds of protesters from more than a dozen states demonstrated at a Capitol Hill church Wednesday to oppose the Trump administration's proposed $7 billion cut to federal housing programs.

Holding signs that said "No cuts to our funding" and "Stop selling our neighborhoods to Wall Street," the protesters chanted and yelled "No cut" as they streamed inside the Lutheran Church of the Reformation.

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Atlanta Black Star - March 4, 2015, by Nick Chiles - The actions of the Federal Reserve have typically been undertaken to benefit banks and the financial services sector collectively known as Wall Street, but a new report by the Center for Popular Democracy reveals that the Fed’s traditional policies substantially contribute to the dire economic conditions of African-Americans across the country.

While there have been many reports showing how badly African-Americans suffered from the Great Recession and how middle and low-income Americans have not benefitted from the so-called economic recovery, which was really just a recovery for Wall Street, this report is one of the first to link the fortunes of specific groups like African-Americans to the actions of the Federal Reserve.

The Federal Reserve, the nation’s central bank, remains a shadowy presence to most rank-and-file Americans, who would hardly think of the Federal Reserve when assigning blame for their financial struggles.

The intentions of the Center for Popular Democracy, with assistance from the Economic Policy Institute, are clear just by reading the name of its report—”Wall Street, Main Street, and Martin Luther King Jr. Boulevard: Why African Americans Must Not Be Left Out of the Federal Reserve’s Full-Employment Mandate.”

In the explanation for the report’s rather trite title, the primary author, Connie M. Razza of the Center for Popular Democracy, said Martin Luther King Jr. Boulevard refers to African-American communities because “hundreds of U.S. cities have streets named for Martin Luther King Jr., often located in persistently lower-income Black neighborhoods.”

The report’s premise is that the Fed’s goal of keeping the national employment rate at about 5.2 percent—which the Fed considers “full employment” because it allows for movement in the job market—is actually devastating to the African-American community. The reason: When the national unemployment rate stays in the vicinity of 5.2 percent, the African-American unemployment rate is typically about 11 percent.

But because the Fed is dominated by the interests of Wall Street, the impact of its policies on Main Street or on African-Americans is not ever truly considered.

“Although the Great Recession officially ended nearly six years ago, the American economy is still far from healthy,” the report states. “Wall Street has had a robust recovery. Large corporations are making record profits. But the labor market remains weak.”

As Razza points out, the policy decisions of the Federal Reserve directly affect Main Street and MLK Blvd. The Fed’s primary job is keeping inflation stable, regulating the financial system, and ensuring full employment. But corporate and finance executives generally want to limit wage growth so that they maximize their future profits.

“But most people in America earn their living from wages, not capital income, and it is in their interest to see full employment whereby wages grow faster than prices in order to lift working and middle-class families’ living standards,” Razza writes.

Typically the Feds resolve this dilemma in favor of Wall Street, by intentionally limiting wage growth and keeping unemployment excessively high.

“The Fed’s policy choices over the past 35 years have led to increased inequality, stagnant or falling wages and an American Dream that is inaccessible to tens of millions of families—particularly Black families,” the report says.

As detailed in the report, the last eight years have been catastrophic for the nation’s African-American community in virtually every financial indicator studied by economists:

* In January 2015, the national African-American unemployment rate was 10.3 percent, more than twice the current white unemployment rate and higher than the 10.0 percent U.S. unemployment rate reached in October 2010, at the height of the recession.

* The contraction in public-sector jobs—which are disproportionately held by Black people and women—has meant that the African-American workforce has been disproportionately impacted by the recession. In 2011, the number of African-Americans who were unemployed and had most recently been employed in state or local government was higher than their share in the decline of state and local government job loss, suggesting that they were disproportionately laid off and faced more barriers to finding work after losing their public-sector jobs, according to the report. The loss of public-sector jobs also has potential implications for wage inequality since African-Americans and women who are employed in public service have historically suffered significantly less wage inequality than their peers in the private sector.

* Wages have been stagnant or falling for the vast majority of workers since 2000, the report states. While at the median, wages for white workers have risen only 2.5 percent in 14 years, African-American workers have seen a wage cut of 3.1 percent over the same period. In fact, in two-thirds of the states for which data are available, the median real wages of African-American workers declined between 2000 and 2014. The fastest declines were in Michigan (down 15.8 percent), Ohio (down 13.7 percent) and South Carolina (down 11.6 percent).

* Between 1989 and 2001—a period of comparatively robust job growth and a tight labor market during the late 1990s—the wealth gap between whites and African-Americans narrowed. In 2001, Black households had roughly 16 percent the wealth of white households, compared with 6 percent in 1989. By 2013, median African-American household wealth was only 8 percent that of whites.

The report states that the wealth disparity began growing during the housing boom, precisely because of the racist practices of American banks. Between 2004 and 2007, at the height of the boom, white household wealth increased 23 percent, while African-American household wealth actually declined by 24 percent.

“The convergence of wage stagnation and banks’ preying on African-American communities with risky mortgage products (which banks backed with overvaluations of collateral property), led to African-American borrowers being more likely to receive subprime loans than white borrowers,” the report says. “These loans were frequently made as second mortgages, drawing down equity that homeowners had built up. Discriminatory subprime lending practices drained wealth from African-American homeowners before the recession and certainly made Black wealth significantly more vulnerable during the housing crisis.”

One of the most telling statistics in the report is the detailing of the jobs that the economy has regained during the recovery. If the public needed a clear indication of why so many people are still struggling though Wall Street is back, here it is:

While lower-wage industries accounted for 22 percent of job losses during the recession, they account for 44 percent of employment growth over the past four years. That means lower-wage industries today employ 1.85 million more workers than at the start of the recession.

Mid-wage industries accounted for 37 percent of job losses, but 26 percent of recent employment growth. There are now 958,000 fewer jobs in mid-wage industries than at the start of the recession.

Higher-wage industries accounted for 41 percent of job losses, but 30 percent of recent employment growth. There are now 976,000 fewer jobs in higher-wage industries than at the start of the recession.

And here’s another startling fact showing how much America’s economy has been tilted in favor of corporate America and against workers for a generation. Between 1948 and 1973, the hourly compensation of a typical worker in America grew in tandem with productivity. But since 1973, productivity grew 74.4 percent while the hourly compensation of a typical worker grew just 9.2 percent.

“This divergence between pay and productivity growth has meant that workers are not fully benefiting from productivity improvements,” the report says. “The economy—specifically, employers—can afford much higher pay, but is not providing it.”

So what should the Fed do to help Main Street and MLK Blvd. begin to enjoy the economic “recovery?” The report suggests a change in the structure of the Federal Reserve System so that fewer representatives from the financial industry and corporate America are appointed to the Fed’s governing board and more regular people are added. This would make the Fed more sensitive to the needs of Main Street and MLK Blvd., so that “the voices of consumers and working families can be heard.”

The Center for Popular Democracy suggests that the Fed keep interest rates low “so that the numbers of job openings and job seekers are balanced and everybody who wants to can find a good job.”

In addition, it wants the Feds to provide low- and zero-interest loans so that cities and states can invest in public works projects like renewable energy generation, public transit and affordable housing that will create good new jobs.

The Fed should study the harmful effects of inequality, according to the Center, and examine how policies like raising the minimum wage and guaranteeing a fair work week can strengthen the economy and expand the middle class.

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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.

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

New York Daily News - February 25, 2013 - Nisha Agarwal - President Obama and Congress have not addressed the federal Secure Communities program, which has created a deportation pipeline that tears apart thousands of immigrant families.

In recent weeks, the federal fight for immigration reform kicked off in earnest, with Congress and the White House issuing their legislative principles, and the White House “leaking” specific proposals for a bill. Reform offers the bright possibility of legalization for 11 million, including more than 700,000 New Yorkers who live and work in, contribute to and sustain our richly diverse city and state. But the dark side of reform — its painful compromise — may be an increase in federal immigration enforcement efforts.

The Senate and the President’s proposals demand further fortification of the borders and better tracking of visa-holding immigrants. They also do not address the federal Secure Communities program, which has failed utterly in its objective to identify violent and dangerous criminals and, instead, creates a detention and deportation pipeline that has torn apart thousands of immigrant families.

New York City is poised to alter the terms of the national debate, however, by pushing back against Secure Communities and highlighting the destructive impact of the program for New York’s immigrant communities and the city itself. Recently, City Council Speaker Christine Quinn and Councilwoman Melissa Mark-Viverito introduced two bills that will limit the extent to which the Department of Corrections and the NYPD collaborate with federal Immigration Customs and Enforcement officials through the Secure Communities program.

These bills, which are due to pass this week, build upon a law enacted in 2011 that would prevent the Department of Corrections from turning over to federal immigration authorities certain individuals being held at Riker’s Island who posed no public safety threat. Before this law went into effect, thousands of immigrant New Yorkers were held at Riker’s Island every year in order to be turned over to ICE for eventual deportation. A large segment of those held posed no threat to public safety, including those who were long-term, legal permanent residents, juveniles, people seeking asylum and protection under the Violence Against Women Act, victims of human trafficking and many individuals who may have been arrested for minor infractions such as selling merchandise on the street or hopping a turnstile. What is more, the city was under no legal obligation to hold these individuals for federal authorities, but it continued to do so, spending nearly $20 million a year in city funds to subsidize a senseless and harmful federal deportation process.The new law ended this practice, better focusing the city’s limited resources, targeting enforcement and ensuring that immigrant families were not afraid to step forward as victims and witnesses to crime or to interact with their local government.

With the enactment of Secure Communities in New York in May 2012, ICE has been able to “flag” immigrants moving through the criminal justice system far faster and earlier in the process than had previously been possible because it allows for the sharing of fingerprint data almost instantaneously between the Federal Bureau of Investigation and ICE. A bad system of indiscriminate immigration enforcement was made much worse under Secure Communities.

Now, New York City is once again faced with the challenge of having to subsidize and support a broken and deeply flawed federal immigration enforcement system. Immigrant New Yorkers are coming into our courts and through our police precincts at risk of being siphoned into deportation proceedings, even if they have committed no crime, are themselves victims of crime or domestic violence or have committed only minor status-related crimes such as driving without a license. Perversely, many immigrant defendants now arrive at arraignments already having been identified by ICE and therefore find it in their best interest to be sent to Riker’s Island rather than released on bail because they are at risk of being turned over to immigration authorities upon release.

The new bills introduced in the City Council will put a stop to these perverse outcomes, ensuring that individuals who have no criminal record, immigrants who have committed only low-level or some status-based offenses, and immigrant youth, among others, are not ensnared by the deportation dragnet when they pose no threat to the public.

This legislation was developed in partnership with Mayor Bloomberg and the NYPD, as well as in collaboration with the immigrant community and others impacted by the harmful and inappropriate conflation of the criminal justice process with civil immigration enforcement. It is New York City speaking with one voice, reaffirming our collective values: the importance of trust between government and the people it serves; the commitment to diversity, openness and inclusion; and the enduring, stubborn passion to be a city that attracts and supports a world of talent and human potential. The proposed legislation is also New York’s call to the rest of the country, as national attention focuses on the possibility of comprehensive immigration reform.

The era of exclusion and impunity is over. We must choose a path forward that protects our families, sustains our communities and promotes the hard work and opportunity that boosts our economy.

Nisha Agarwal is deputy director of the Center for Popular Democracy (www.populardemocracy.org) and a lecturer at Columbia Law School.

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