News Highlights: Top Financial Services News of the Day
Activists in Jackson Hole Pressure Fed on Inflation, Endorse Yellen The Fed Up campaign is holding events to show...
Activists in Jackson Hole Pressure Fed on Inflation, Endorse Yellen
The Fed Up campaign is holding events to show support for raising the Fed's 2% inflation target as well as allowing Janet Yellen to serve a second term as the central bank's chairwoman.
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De Blasio Administration Rejects Two Council Voter Registration Bills
Gotham Gazette - October 23, 2014, by Kristen Meriwether -In 2000 the City Council passed Local Law 29 which aimed to...
Gotham Gazette - October 23, 2014, by Kristen Meriwether -In 2000 the City Council passed Local Law 29 which aimed to increase voter registration by requiring 19 city agencies to offer voter registration forms to its customers. It's fourteen years after the law's passage and compliance has been abysmal.
A report compiled by Center for Popular Democracy released this week shows during their walk-ins to 14 of those city agencies, 95 percent of people were never asked if they wanted to register to vote. Of those who self-identified as citizens, the report indicated 84 percent were not given a voter registration form.
On Thursday the City Council held an oversight hearing to discuss the poor compliance and introduce two bills aimed to increase voter registration at the city agency level. Intro 493, sponsored by Committee on Government Operations chair Ben Kallos, would require 15 additional agencies to be covered under the agency-based voter registration law. Intro 356, sponsored by Council Member Jumaane Williams, would assign a code to each agency that would be printed on the voter registration forms and allow the City to track how many forms are being utilized from each agency.
Both bills are being rejected by the de Blasio administration.
"We are committed to getting agency-based voter registration right," Mindy Tarlow, director of the Mayor's Office of Operations, said during her testimony. "But to get it done, we are going to need time and space to manage the agencies and correct long-standing behavior."
Tarlow pointed to Directive 1, issued by Mayor Bill de Blasio on July 11, 2014. In the directive—his first as mayor—he ordered each agency covered under Local Law 29 to prepare a plan showing how they would implement the requirements of the Charter and submit it within 60 days.
The directive also requires each agency submit a semi-annual report on how the plan is being implemented which will include the number of voter registration forms distributed, the number of registration forms completed, and the number of forms transmitted to the Board of Elections.
Tarlow said she agrees with the assessment that there is a problem, but she argued that with the administration already addressing the problem, it was too early for further legislation.
"It is hard. We are trying to bring a number of agencies along," Tarlow said, adding that before moving on new legislation, "we want a chance to feel like we have made some inroads."
Tarlow did not provide an exact timeline as to when the Council would see the results from Directive 1, but did promise to share preliminary reports with the Council some time at the end of November. Kallos jokingly said he looked forward to to reading it in between bites of his Thanksgiving dinner.
"We need the flexibility to watch this over time," Henry Berger, special counsel to the mayor, said during the hearing.
Intro 356The administration's rejection of the second bill, Intro 356, is based less on Directive 1 and more on privacy concerns. Tarlow argued that by putting a code which would identify what agency a voter was getting services from may deter voters from registering at agencies.
"This is to protect the privacy of the individuals who receive services from government that they don't wish to be disclosed," Tarlow said in her testimony.
The council members now face the prospect of attempting to negotiate the bills with the administration.
On Thursday, Council Member Williams went through a lengthy back-and-forth with members of the administration as well as representatives of the Board of Elections (who testified in a later panel) to dispute objections. Williams argued there was already a code (the number 9) on all voter registration forms coming from City agencies and a separate code for those coming from CUNY.
Both Williams and Kallos asked if it was a matter of that information being released to the public or simply being documented. Tarlow said it wasn't a matter of determining who the person was, but what services they were seeking or receiving. She said the administration believes the fear of that information getting out would deter people from signing up to register to vote.
Williams pointed out information such as social security numbers, fax numbers, and driver's license numbers are all exempt from public reporting, but records are still kept. He argued this code could be exempt as well.
Michael Ryan, executive director of the New York City Board of Elections (BOE), said during his testimony the BOE did not believe this code could be exempt based on current law, but he admitted they did not have a chance to dive in deeply on the issue because they were preparing for the upcoming election.
"I don't know that I have been persuaded," Williams said.
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Advocates for Greater Fed Diversity Bring Case to Capitol Hill
Advocates for Greater Fed Diversity Bring Case to Capitol Hill
Members of Congress involved in overseeing the country’s financial regulators agree that changes to the Federal Reserve...
Members of Congress involved in overseeing the country’s financial regulators agree that changes to the Federal Reserve’s governance model are overdue. But a Wednesday panel hearing revealed that lawmakers differ on what elements of the status quo need to be preserved.
Republicans on the House Financial Services Subcommittee on Monetary Policy and Trade argued that the Fed’s existing structure, which was enshrined in the 103-year-old Federal Reserve Act, is adequately representative when it comes to racial or gender makeup.
Wednesday’s hearing was the first chance Republican lawmakers had to discuss Fed reform proposals since both parties’ election platforms were adopted at their respective nominating conventions in July, when Democrats called for more diversity.
What the Fed needs instead, according to subcommittee chairman Bill Huizenga (R-Mich), is a new rules-based approach to monetary policymaking that’s outlined in the Financial CHOICE Act, the centerpiece of House GOP’s deregulatory agenda.
Those changes should not extend to major changes at the Fed that would, in effect, eliminate the representation of the banking industry on regional boards or take extraordinary measures to ensure greater diversity, as Democrats suggested in their 2016 election platform, Huizenga said.
He characterized Democratic proposals to overhaul the Fed’s governance structure as a “hostile takeover” of the central bank that’s only being undertaken to ensure high levels of inflation. “Democrats have constantly resisted reforms that would modernize the Federal Reserve, bringing much needed transparency to what most Americans consider an impossibly opaque institution,” Huizenga said.
He then referred to a bill he sponsors that would give Congress oversight responsibilities regarding monetary policy. “The Democrats on the other side of the aisle would like to double down on what Dodd-Frank started, co-opting the Federal Reserve district banks by subjecting them to the same politics that has kicked economic opportunity to the sidelines in the name of reinflating asset prices,” Huizenga said.
He had backup from Kansas City Fed President Esther George and Richmond Fed President Jeffrey Lacker, both of whom testified at today’s hearing and said the central bank’s current governance structure facilitates adequate regional, commercial, ethnic and gender diversity.
“I remain convinced this is a question of accountability, and not of structure, of the Federal Reserve,” George told the panel, referencing the Fed’s overall efforts to be a representative body.
Lacker said he agreed with George, and added that there are “multiple dimensions” officials look at when selecting a regional Fed board.
Regional Fed boards are divided into three alphabetically organized classes. Member banks of each regional Fed select Class A directors to represent the banking industry and Class B directors to serve the public or other commercial interests. The Fed’s Board of Governors selects Class C directors, who are appointed to represent the public interest.
Democrats had their position supported by William Spriggs, chief economist at the AFL-CIO, along with activists in the “Fed Up” coalition who attended the hearing wearing green t-shirts as a form of silent protest about the current Fed structure.
Spriggs and representatives from Fed Up argued that the lack of adequate racial representation on regional boards has prevented the bank from addressing higher rates of unemployment in African-American and Latino communities through monetary policy.
“We believe that when our voices our excluded from the conversation, then our interests are excluded,” said Ruben Lucio, a field organizer for the Fed Up Coalition, which is led by the left-leaning Center for Popular Democracy. Members of the coalition met with George during the Fed’s retreat in Jackson Hole, Wyo., last month.
Lucio indicated that the Fed’s method for determining full employment — part of its dual mandate, along with price stability — might be due for a reevaluation.
“Whose unemployment are they looking at? Are they looking at overall unemployment? Are they talking about black and brown unemployment?” Lucio asked. “When you raise those interest rates because certain communities have recovered, and it’s fine because you’re scared about some threat of inflation, who are you impacting when those interest rates go up?”
Some lawmakers questioned the lopsided nature of the Fed’s regional districts. Reps. Denny Heck of Washington and Bill Foster of Illinois, both members of the business-friendly New Democrat Coalition, were joined by Rep. Mia Love (R-Utah) in floating the possibility of taking a new look at the geographic makeup of the regional boards.
Despite members having stated such clear positions on the issue of Fed governance, the likelihood of movement on any statutory changes to Fed governance is slim at this point. Rep. Gwen Moore of Wisconsin, the ranking Democrat on the subcommittee, said she’s interested in taking an “objective” look at what changes might be needed, but she didn’t say what laws or regulations are needed to implement the changes sought by Democrats.
Huizenga, who reiterated to reporters afterward that he thinks the Fed’s regional directors should be selected as a “meritocracy,” struck a similar tone. “I don’t know that there’s any kind of consensus, as of yet, on that,” he said.
By Ryan Rainey
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The CEO of Starbucks won’t keep promises to his workers, but wants an end to “cynicism”
The CEO of Starbucks won’t keep promises to his workers, but wants an end to “cynicism”
Starbucks CEO Howard Schultz, who has somehow convinced himselfthere is public desire for him to be president, took a...
Starbucks CEO Howard Schultz, who has somehow convinced himselfthere is public desire for him to be president, took a moment at yesterday’s board meeting to deliver some pious criticism of America’s unusually rancorous political season.
“Dysfunction and polarization have worsened,” the coffee entrepreneur said. Deep in a bout of Bloombergitis, Schultz warned of the failure of the American dream: “Sadly, our reservoir is running dry, depleted by cynicism, despair, division, exclusion, fear and indifference.”
“What is the role and responsibility of all of us, as citizens?” Schultz asked.
His employees have one answer: They want him to keep Starbucks’ promise to set their schedules at least 10 days in advance, and stop making them work consecutive shifts closing a location and then returning to open it early the next morning. So-called “clopening” shifts can entail working until 11pm and then starting again at 4am.
The scheduling problems have been an issue since at least 2014, when a New York Times investigation exposed how scheduling practices can be as problematic for workers as low pay or abusive treatment. The problem is especially difficult for parents, who must find a way to care for their children without knowing their work responsibilities more than a few days in advance.
The problem seems especially galling because the company uses scheduling software to match employee availability with the predicted demand. Experts suggest that this software could be used to provide more predictability for workers. Starbucks has repeatedly said it will remedy these issues, but interviews with employees suggest they remain. The Center for Popular Democracy, a union-backed organization that runs advocacy campaigns for workers rights, published a survey of 200 workers (pdf) in September 2015 that found half received their schedules less than a week in advance and one in four worked the “clopening” shift.
Grant Medsker, who worked at a Starbucks in Seattle for about a year before quitting in January, told Quartz that managers often don’t follow dictates from headquarters. “Everyone runs their ship their own way, regardless of company policies,” he said.
Some franchise managers attribute the lack of follow-through on the company’s promise on schedules to pressure from higher-ups to keep labor costs down, which leads to chronic understaffing. Meanwhile, Starbucks earnings per share more than doubled between 2011 and 2015; in fiscal 2015 it had an operating income of $3.6 billion. Quartz reached out to Starbucks but has not received a response. In the past, the company has noted that many of its employees see a flexible schedule as a perk, rather than a hindrance. The company also provides its part-time employees with access to health insurance and educational benefits that it says are more generous than comparable companies. But given the company’s history of dubious social responsibility campaigns, it’s hard to see this failure to implement corporate policy as an accident. This is, after all, the executive who announced a personal boycott of political spending even as his company spent millions on lobbying.
“It’s not enough to talk about it, it’s not enough to say, ‘oh that’s really bad, I hope that changes,'” said Medsker, who volunteers with the labor-rights group Working Washington. “We have an obligation to change what is wrong with our society.”
“It’s not about the choice we make every four years,” Schultz said yesterday. “This is about the choices we make every day.”
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Center for Popular Democracy Names Jennifer Epps-Addison Network President
Center for Popular Democracy Names Jennifer Epps-Addison Network President
The Center for Popular Democracy Tuesday announced the appointment of Jennifer Epps-Addison as the new president of its...
The Center for Popular Democracy Tuesday announced the appointment of Jennifer Epps-Addison as the new president of its network of 43 state-based partner organizations. She will also serve as the social and economic justice organization’s Co-Executive Director.
Read the full article here.
Amazon Not Happy with Seattle’s New Compromise Head Tax
An open letter May 14 to the city of Seattle from about 55 elected leaders—some from cities on Amazon’s short list for...
An open letter May 14 to the city of Seattle from about 55 elected leaders—some from cities on Amazon’s short list for HQ2—rebuked Amazon for its tactics and its opposition to the tax proposal. “We urge you to remain steadfast in your commitment to this effort to reduce homelessness and the persistent inequities faced by all of our cities,” the leaders wrote to their Seattle colleagues.
Read the full article here.
Avoiding 'Regressive Mistake,' Fed Holds Off on Rate Hike — For Now
Update 3 PM EDT: In a decision that aligns with progressive demands, the Federal Reserve ...
Update 3 PM EDT:
In a decision that aligns with progressive demands, the Federal Reserve announced on Thursday that it would keep interest rates near zero in light of "recent global economic and financial developments" and in order to "support continued progress toward maximum employment and price stability."
Presidential candidate Bernie Sanders issued the following statement today after the Federal Reserve announced that it would hold off on raising interest rates:
“It is good news that the Federal Reserve did not raise interest rates today. At a time when real unemployment is over 10 percent, we need to do everything possible to create millions of good-paying jobs and raise the wages of the American people. It is now time for the Fed to act with the same sense of urgency to rebuild the disappearing middle class as it did to bail out Wall Street banks seven years ago.”
The New York Times reports that the Fed’s decision, "widely expected by investors, showed that officials still lacked confidence in the strength of the domestic economy even as the central bank has entered its eighth year of overwhelming efforts to stimulate growth."
Progressives cheered the news, with Josh Bivens of the Economic Policy Institute saying, "Today’s decision by the Federal Reserve to keep short-term rates unchanged is welcome. [...] We hope they continue their pragmatic, data-based approach and allow unemployment to keep moving lower, and only tighten after there is a significant and durable increase in inflation."
He continued: "Tightening before the economy has reached genuine full-employment is not just a mistake, it’s a regressive mistake that would hurt the most vulnerable workers—low-wage earners and workers from communities of color—the most."
However, Reuters reports that "the central bank maintained its bias toward a rate hike sometime this year, while lowering its long-term outlook for the economy."
Which means that pro-worker organizations, which have largely opposed a rate increase that they say would slow the economy and stifle wage growth, will have to keep up the fight.
"We applaud Chair Yellen and the Federal Reserve for resisting the pressure being put on them to intentionally slow down the economy," said Ady Barkan, campaign director for the Fed Up coalition, which rallied outside the Federal Reserve on Thursday.
"Weak wage growth proves that the labor market is still very far from full employment," Barkan continued. "And with inflation still below the Fed’s already low target, there is simply no reason to raise interest rates anytime soon. Across America, working families know that the economy still has not recovered. We hope that the Fed continues to look at the data and refrain from any rate hikes until we reach genuine full employment for all, particularly for the Black and Latino communities who are being left behind in this so-called recovery."
Earlier...
Progressives are cautioning the U.S. Federal Reserve against slowing the economy by raising interest rates "prematurely"—a decision the Fed will announce Thursday.
The U.S. central bank will issue its highly anticipated short-term interest rate decision following a two-day policy meeting, with a 2 pm news conference led by Fed Chair Janet Yellen.
As CBS Moneywatch notes, "[t]he decision affects everything from the returns people get on their bank deposits to how much consumers and employers pay for credit cards, mortgages, small business loans, and student debt." That's because a higher rate makes it more expensive for individuals and businesses to borrow, with rising bank lending rates shrinking the nation's money supply and pushing up rates for mortgages, credit cards, and other loans.
Just before the announcement, the advocates, economists, and workers of the Fed Up coalition will be joined by Rep. John Conyers (D-Mich.) at a rally outside the Fed, calling on the central bank to keep interest rates low to allow for more jobs and higher wages.
"The point of raising rates is to rein in an overheating economy that is threatening to push inflation outside the Fed’s comfort zone," explained Josh Bivens of the Economic Policy Institute in the Wall Street Journal on Wednesday. "But inflation has been running below the Fed’s target for years—and its recent moves have been down, not up."
Furthermore, wrote economist Joseph Stiglitz at the Guardian earlier this month: "If the Fed focuses excessively on inflation, it worsens inequality, which in turn worsens overall economic performance. Wages falter during recessions; if the Fed then raises interest rates every time there is a sign of wage growth, workers’ share will be ratcheted down—never recovering what was lost in the downturn."
Progressive activists opposed to an interest rate hike overwhelmed the Fed's public comment system on Monday in a last-minute effort to sway the central bank. Raising the rate, they said, would be catastrophic for working families, particularly in communities of color that are still struggling. The Fed Up campaign, which includes groups like the Center for Popular Democracy, Economic Policy Institute, and CREDO Action, say the central bank "privileges the voices and needs of corporate elites rather than those of America's working families."
"A higher interest rate means that fewer jobs will be created, and that the wages of workers at the bottom will remain too low to live on," wrote Rod Adams, a member of Neighborhoods Organizing for Change in Minneapolis, in an op-ed published Wednesdayat Common Dreams. "That’s because when the Fed raises rates, they are deliberately trying to slow down the economy. They’re saying that there are too many jobs and wages are too high. They’re saying that the economy is exactly where it should be, that people like me are exactly where we should be."
However, at this point, "many observers believe the Fed will not raise rates this week," analyst Richard Eskow wrote on Wednesday.
"The Fed is really the central bank of the world. If the Fed raise rates a little bit, it will have an impact all over the world, particularly in emerging markets," billionaire private equity professional David Rubenstein told CNBC's "Squawk Box" on Thursday.
"I think the Fed is sensitive to that," Rubenstein said, "and I think therefore the Fed is likely to wait for another month or two to get additional data and probably telegraph a little bit better than it has now that it's about ready to do it at a particular time."
Meanwhile, global markets are fluctuating wildly in anticipation of Yellen's announcement and subsequent news conference.
But as Eskow noted, Thursday's real surprise "is that there’s any question at all what [the Fed] will do. That suggests that our economic debate is not yet grounded in economic reality, at least as most Americans experience it."
While the Guardian is providing live updates on the Fed's decision, others are making comment under hashtags that reflect the unbalanced economic recovery:
Source: CommonDreams
At the RNC, Don’t Just Watch Trump. Watch Who Follows Him.
At the RNC, Don’t Just Watch Trump. Watch Who Follows Him.
In the coming days, our nation’s media will focus enormous attention on the formal anointment of Donald Trump as the...
In the coming days, our nation’s media will focus enormous attention on the formal anointment of Donald Trump as the GOP’s candidate for president at the Republican National Convention. Endless ink will be spilled on Mr. Trump’s entrance, his appearances, and his words. But, as the Republican Party prepares itself to nominate the most anti-immigrant and racist presidential candidate in at least a generation, Americans should not just be watching Mr. Trump—we must pay attention to those who follow him.
It’s no secret that Mr. Trump has defined himself politically, from the very launch of his campaign, by scapegoating immigrants as “criminals” and “rapists,” and doubling down on his bigotry with proposals to, among other things, deport eleven million undocumented immigrants and ban all Muslim immigrants. Mr. Trump’s dominant strategy has been to animate the nativist portion of the Republican primary electorate—a strategy that proved quite successful in the primaries, and that Mr. Trump will continue (albeit in modified fashion) in the general election.
None of this is new. And Republicans will likely lose the White House because Trump has so alienated Latinos, communities of color, and other groups, including women.
But as Latinos and immigrants, we can’t just watch Trump. Our fight is not just about defeating Trump: it’s also about defeating “Trumpism,” the anti-immigrant and hateful policies and rhetoric he embraces.
That’s why have to, and we will, watch who follows him in contested Congressional races around the country. These “down-ballot” elections will determine the prospects for critical federal legislation in 2017 and beyond on issues including: reforming our out-of-date immigration system and ensuring that millions of immigrant families can remain together, ending police brutality, and raising the federal minimum wage.
What we will if we watch the candidates in these congressional races over the next few days is as simple and scary: the lion’s share of one of America’s two principal parties, including hundreds of sitting Congressional representatives, will embrace Trump’s hateful campaign strategy and applaud him as he formally becomes their standard bearer.
Their embrace will take two forms.
First will be incumbents and candidates who wholeheartedly endorse Trump. Hundreds of Republican elected officials have said openly that they will support him, and they will double down through November. Their ranks will grow during and after the convention. These Trump acolytes are people like Rep. Lee Zeldin of New York, who has endorsed and then repeatedly stumped for Mr. Trump. At the RNC, voters should pay careful attention to figures like Mr. Zeldin. Despite representing a moderate district where people of color represent roughly 20 percent of the voting-age population, Rep. Zeldin has acknowledged the racism in Trump’s words, but refused to withdraw his support.
Second will be legislators who are uncomfortable with the Trump brand, but quietly copy his playbook. Many Republicans are concerned that Trump’s divisive rhetoric may hurt the Republican brand and their poll numbers—so they stop short of full-throated endorsement, and in some cases are skipping the convention—but will mirror his demagoguery. Senator Pat Toomey of Pennsylvania offers a perfect example. Locked in a re-election fight with Democrat Katie McGinty, Toomey has not endorsed Trump for fear of its political downside. Instead, he has echoed Trump’s nativist appeals, leading efforts in the Senate to punish localities that have sought to improve community-police relations and public safety for all residents by distancing local law enforcement from immigration enforcement. To justify this politically-motivated policy fight, Sen. Toomey has suggested that immigrants are criminals and murderers—despite research consistently showing that immigrants commit fewer crimes than native-born residents.
This behavior from legislators like Zeldin and Toomey will not be lost on Latinos, voters of color, and other voters who stand for inclusion and diversity.
Latino and immigrant voters across this country are angry and we are energized. This is why residents protested outside Rep. Zeldin and Sen. Toomey’s offices this past weekend. And it is why, over the coming months, community organizations across the country, working with national groups like the Center for Community Change Action and Center for Popular Democracy Action, will be talking to millions of voters in our communities to make sure that they know the importance of voting all the way down the ballot.
No number of photo ops at local cultural events will erase the damage that legislators like these are doing to themselves, and to the Republican Party writ large, by embracing the politics of Trump.
As the GOP prepares for its convention, let there be no mistake: our communities are watching. And, to those who have embraced the politics of Trump, we say: we see you. And, in November, we will hold you accountable for vilifying us.
By ADANJESUS MARIN AND WALTER BARRIENTOS
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Turning Wisconsin schools into police states won't help kids learn
Turning Wisconsin schools into police states won't help kids learn
According to a new report put together by LIT and the Center for Popular Democracy, “Despite white students’...
According to a new report put together by LIT and the Center for Popular Democracy, “Despite white students’ overwhelmingly similar behavior patterns, and despite black students accounting for only 55% of the student population in Milwaukee in the 2013–2014 school year, data shows that black students accounted for 84.6% of the referrals to law enforcement.
Read the full article here.
Warren says Toys 'R' Us investors should augment worker fund
The toyseller's former private-equity owners said they were forming the fund on Tuesday after months of pressure from...
The toyseller's former private-equity owners said they were forming the fund on Tuesday after months of pressure from former employees and their representatives, along with some public pension funds and lawmakers including Warren, a former Harvard Law School bankruptcy expert who is considering a run for president in 2020. The groups, linked to the Center for Popular Democracy, estimate that workers are owed $75 million in severance pay, and they've also pressed Toys "R" Us creditors including Solus to pitch in.
Read the full article here.
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