CPD IN THE NEWS

Federal Reserve Bank of Richmond President Jeffrey Lacker plans to retire Oct. 1, marking the exit of one of the U.S. central bank’s most steadfast inflation fighters at a time when the Fed is weighing how quickly to raise interest rates.

The Richmond Fed said Tuesday that a committee had been formed to find a successor for Lacker, who has led the regional Fed bank since 2004, and has engaged professional services firm Heidrick & Struggles to conduct the search. The head of the Richmond Fed will be a voting member of the policy-setting Federal Open Market Committee in 2018.

Lacker, 61, was a voice of restraint in the use of monetary policy and the central bank’s balance sheet as the Fed deployed extraordinary powers to combat the financial crisis, the worst recession since the Great Depression as well as a sluggish recovery.

“He was consistent in terms of wanting a narrow Fed that stuck to the business of ensuring price stability because that would be the Fed’s best contribution to society,” said Vincent Reinhart, chief economist at Standish Mellon Asset Management Co. LLC in Boston. “Jeff Lacker kept the faith.”

Lacker dissented frequently in favor of tighter policy when he was a voter on the FOMC, including at every meeting in 2012. During the financial crisis he warned about channeling credit to specific sectors of the economy, inflation risks and government rescues of troubled banks.

Core Doctrines

One of Lacker’s core doctrines was that an expansion of Fed credit to other sectors of the economy would create expectations of further support and thus further destabilize markets in the future as investors tested the perceived safety net.

“The striking feature of central bank lending during the recent turmoil is the extent to which it has extended well beyond the boundaries that previously were understood to constrain such lending,” Lacker said in a speech in November 2008.

Lacker wasn’t alone in those views. Former Fed Chairman Paul Volcker said the bailouts had taken the central bank to “the very edge of its lawful and implied powers, transcending in the process certain long-embedded central banking principles and practices.”

Arguing for constraint when the entire financial system was at risk seemed overly cautious to some of his colleagues. Former Chairman Ben S. Bernanke noted that Lacker opposed a crisis-era innovation called the Term Securities Lending Facility, where the Fed loaned out its Treasury portfolio to primary dealers in exchange for mortgage-backed securities as collateral.

“Jeff Lacker spoke against the TSLF,” Bernanke wrote in his book, “The Courage to Act.”

Lacker will depart three years ahead of his mandatory retirement age of 65. He hasn’t lined up another job, according to Richmond Fed spokeswoman Laura Fortunato. “He does want to get back to writing and research,” she said.

The search for his successor, which gets under way as the Atlanta Fed is undertaking its own campaign to replace its president Dennis Lockhart, who retires Feb. 28, will be conducted nationally to “identify a broad, diverse and highly qualified candidate pool for this leadership role,” the Richmond Fed said in a statement on its website.

The Fed is under pressure to increase diversity among its leaders after criticism that it is dominated by white men. Janet Yellen, the first woman to chair the central bank, has said she’d like to see more diversity, though the Richmond Fed’s own board of directors will make the ultimate selection.

Jordan Haedtler, campaign manager for the Fed Up coalition, which has called for a more diverse leadership that includes more minorities and women, said the group will push for “a publicly inclusive and transparent process with the consideration of diverse candidates who will consider labor market conditions for all workers in weighing their decisions.”

Haedtler said Lacker was “always gracious” and toured low-income communities in Charlotte, North Carolina, with one of their member groups.

Given the Richmond Fed’s tradition of standing firm on price stability, “my guess is that the Richmond Fed will find a hawk,” said Mark Vitner, a senior economist at Wells Fargo Securities LLC in Charlotte. “Part of this reflects the sentiment of businesses, residents and bankers located in this part of the country, who tend to take a more cautious view on what monetary policy can and cannot do,” he said.

Atlanta’s Vacancy

Lacker admitted in speeches that his forecasts for the recovery were at times too optimistic. His warnings about inflation were defused as shocks hit the economy. When the Fed decided to go forward with a second round of quantitative easing in November 2010, Lacker raised concerns that it could make it hard to restrain inflation.

“This poses unacceptable risks to price stability and to our credibility,” he said, according to the meeting transcript. “I fear today’s decision and the expectations it encourages will come back to haunt us.”

The Fed’s preferred inflation measure, the personal consumption expenditures price index, did rise above its 2 percent target in 2011 and for part of 2012. It then fell below 2 percent in May that year and has never risen above that level since, partly due to a tumble in oil prices that began in 2014.

By Craig Torres

Source

YOUTH ‘LOBBY DAY’ LOOKS TO DISCIPLINE GUIDELINES: More than 100 young activists are expected to gather in front of the Education Department today and call on Education Secretary Betsy DeVos to maintain Obama-era guidelines aimed at addressing racial bias in school discipline policies. DeVos is chairing a White House school safety commission that’s considering whether to rescind the guidelines over concerns that they burden school districts and potentially keep violent students in the classroom. The activists are also expected to visit the offices of Senate Minority Leader Chuck Schumer, Sen. Kirsten Gillibrand (D-N.Y.), Rep. Nydia Velazquez (D-N.Y.) and Sen. Chris Murphy (D-Conn.), urging them to sign a pledge and “prohibit federal funding for any school policing or criminalization of schools and invest in restorative justice, and mental health supports and resources for schools, students, and families,” according to a release. The “youth-led lobby day” is being organized by left-leaning groups including the Center for Popular Democracy, Make the Road New York and the Urban Youth Collaborative.

Read the full article here.

SILive - September 18, 2014, by Anna Sanders - Mayor Bill de Blasio on Wednesday announced the launch of a new initiative to push for eligible immigrants to become U.S. citizens in the nation's three largest cities. 

"Cities for Citizenship" aims to increase naturalization programs and other efforts to help immigrants in New York City, Chicago and Los Angeles.

"This win-win effort will help us create more inclusive cities that lift up everyone," de Blasio said in a statement announcing the initiative. "From increased economic activity to larger voting and tax bases, the advantages of citizenship will not only expand opportunity to our immigrant families, but to all New Yorkers and residents nationwide."

The de Blasio administration said increasing immigrant access to citizenship will help fight poverty and estimated that naturalizing 684,000 legal permanent residents will add up to $4.1 billion to the city's economy over a decade.

In a report released Wednesday, the Center for Popular Democracy estimated that there are about 750,000 legal permanent residents eligible for naturalization.

Citigroup, a corporate partner of the initiative, will contribute $1.15 million for the new initiative.  

New York City will use funds for NYCitizenship, a coordinated effort to connect low- and moderate-income New Yorkers to free legal assistance during the naturalization process. NYCitizenship works with city agencies to connect those in the city eligible to become U.S. citizens with assistance, such as legal advice, help on applications and financial counseling.

The NYCitizenship program has already helped more than 1,800 New Yorkers complete naturalization applications since 2012, according to the Center for Popular Democracy report.  

In addition to the initiative, the city's Office of Immigrant Affairs will also commission a study on the economic impact of citizenship programs nationwide.

Source

Times Union – August 7, 2013, by Jimmy Vielkind - Immigrant advocacy groups say it remains difficult to get access to government services in languages other than English — nearly two years after Gov. Andrew Cuomo decreed that written and oral interpretation would be available the state’s six most-spoken foreign languages.

Cuomo signed an executive order that took effect last October mandating state officials to offer language assistance for speakers of Spanish, French, Italian, French Creole, Russian and Chinese. But the order’s scope was necessarily limited to state agencies, even though state-funded services like food stamps, driver’s licenses and unemployment benefits are administered by New York City or other counties.

The groups — including Make the Road New York, the Center for Popular Democracy and the Center for the Elimination of Minority Health Disparities at the University at Albany — visited government offices and surveyed people with limited English proficiency to develop a measure of compliance. In a report released earlier this week, they found that less than half the people who needed language assistance were able to receive it.

According to Nisha Agarwal, deputy director of the Center for Popular Democracy, the survey found 63 percent of citizens using state-operated facilities that are explicitly covered by the order were not successful in their quest to gain language assistance.

“The governor’s team has been very engaged on implementation, and we’re sympathetic to the challenges of getting an entire state apparatus to change,” said Agarwal. “That said, the results are by no means satisfactory, and we were quite disappointed that the state took the position that county-run agencies for state services were not within the ambit of the order. We feel it’s a pretty big gap.”

The Cuomo administration responded by saying that all covered state agencies are in compliance with this executive order

“This report paints an inaccurate picture of reality by relying on visits to county-run agencies that by law fall outside the executive order,” said Cuomo spokesman Richard Azzopardi. “Everyone should have the same access to their government, and we encourage counties to follow the state’s lead.”

Source