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Today Is No Different from Any Other Day: Your Efforts Matter.

By Kristin Lawton on 01/20/2017 @ 08:00 AM

Tags: News, Recommended Reading

You work hard every day to ensure that everyone in your community has a fair shot at getting ahead. But some days, it can feel like no matter how hard you try, progress is just too far out of reach.

For moments when you feel that way, we want to remind you that you can and do make a difference in the lives of low-income families, families of color and the millions of others who, if not for you, would be excluded from opportunities to get by and get ahead.

Not sure how you can make a difference? Here are three simple actions you can take today to help financially vulnerable communities achieve progress and prosperity.

  1. Join one of our advocacy campaigns. Taking 60 seconds to sign up will connect you with opportunities to protect and promote policies that ensure that all U.S. families have the skills, knowledge, access and protections they need to realize their financial dreams. Our four campaigns focus on the four areas in which we can achieve the greatest impact: protecting social safety net programs like AFI and VITA, flipping the tax code right-side up, strengthening protections for consumers and expanding affordable homeownership opportunities.
  2. Share your story to inspire others. Each of us are called to this work for different reasons. Take time today to reflect on what gives you hope and write down your personal story. Share your story on social media and in our Story Bank to inspire others.
  3. Chip in to advance our shared vision. Add your name to the list of people who are putting opportunity within reach by contributing whatever you can—even $20 can go a long way toward promoting prosperity. Unable to donate but looking for ways to help in your local community today? Print off a list of needs from a nearby food bank or shelter and spend the day with your family or friends collecting those items from neighbors or at a dollar store. Then, take a trip together to bring your collection to the community organization that needs your support.

Today is no different from any other day: your efforts matter. If you’re not convinced, we hope you’ll take one of the actions above or think about how you might support one of the thousands of organizations that do great work every day to promote prosperity and expand opportunity. By working together, there’s nothing we can’t accomplish.

FROM THE ARCHIVE: Reflections on the Historical Roots of the Racial Wealth Gap

By Alicia Atkinson on 05/26/2016 @ 04:00 PM

Tags: Recommended Reading, Federal Policy

This post first appeared in February 2015.

“Two-hundred fifty years of slavery. Ninety years of Jim Crow. Sixty years of separate but equal. Thirty-five years of racist housing policy. Until we reckon with our compounding moral debts, America will never be whole.” – Ta-Nehisi Coates, June 2014

Probably like many people who work in the beltway, my family has no idea what I do for a living. My mom still calls me when she hears the word “policy” on NPR in the morning in an attempt to assure herself that my job really does exist. Despite public policy’s omnipresence in our lives--from workplace safety to transportation to banking regulations--people, like my mom, often don’t know the impact that policy has on our daily lives.

Unless an issue has captured America’s attention, policy tends to be relatively behind-the-scenes. CFED’s policy team focuses on various, and sometimes invisible policy levers, that builds assets, such as savings or higher education or purchasing a house. We do this partly by looking at the tax system or the workforce development system to see how we can leverage different mechanisms that can help people to save and invest in key asset-building purchases in order to become financially stable.

While we tend to focus on the present, we are heavily invested in reversing some of the detrimental policies of the past that actively worked against certain people, specifically people of color, to build assets and wealth. The repercussions of these historical policies can still be seen today with communities of color having lower homeownership rates, lower access to tax-deferred retirement accounts, higher student debt, lower inheritances and lower-overall wealth. The result: a new report from the Urban Institute shows that white families have around 12 times the wealth of African- American families and 10 times the wealth of Hispanic families.

What were some of these historical policies that contribute to this unacceptable wealth-gap today? In Ta-Nehisi Coates June 2014 article, “The Case for Reparations,” he chronicles some of these historical events that actively disenfranchised black households, leaving them out of key income and wealth building opportunities. These span from times in slavery to present day and include:

  • Wage-theft: As slaves, African- Americans missed out on years of income and wealth building. Their labor was free and many white Americans accumulated massive amounts of wealth off this free labor. For example, “in 1860 there were more millionaires per capita in the Mississippi Valley than anywhere else in the country.” Even after African-Americans were “freed” legally from slavery, they were forced to work on the same land and continued to undergo substantial wage-theft.
  • Housing: For 30 years, households of color were cut out of the legitimate home-mortgage market, partly due to the Federal Housing Authorities active redlining of certain communities, and forced to work with contract sellers. Contract sellers demanded a hefty downpayment and high monthly payments, but gave households no equity until the entire house was paid off. If residents missed one payment, they were evicted and did not see any money returned to them. Today, households of color, particularly black households, continue to face barriers to homeownership. Recent research showed that an application from a black mortgage applicant was 2.4 times more likely to be denied compared to an application from a white applicant.
  • Property Values: For black households that were able to find a way to purchase a home in a racist housing system, many were often forced into certain communities and if they were able to purchase in mostly-white community than they experienced white flight, which dramatically decreased their property values. What was one of the repercussions of this? Research showed that black families making $100,000 typically live in neighborhoods inhabited by white families making $30,000.
  • Education: The G.I. bill that was a key source of assistance to many veterans, completely failed black veterans. Researchers have stated that the racism in the VA offices pretty much made this bill obsolete to black veterans returning from war.
  • Retirement: Historically and presently, households of color have hit barriers to accessing key retirement benefits. In 1935, 65% of African Americans nationally were ineligible for social security. Many households of color are still missing out on retirement opportunities, and research has shown that they are less likely to have access to tax-deferred retirement accounts, the main source of retirement income now-a-days.
  • Health Care: The recent passing of the ACA expanded health care coverage for millions of individuals. However, many southern, and former confederate states, have refused to expand Medicaid, creating a hole in coverage for many impoverished individuals.

Each minority group in the United States has undergone their share of wealth depleting policies or lack of policy, such as internment for the Japanese, massive land theft from Native Americans or the large rates of wage theft for immigrants who struggle to find formal employment, that has contributed to having lower-wealth and less financial security overall.

Despite broad and deep notions that we all have succeeded without assistance, history demonstrates that policy has assisted some while actively prohibiting others from building wealth and assets. While policy can seem like a foreign or often invisible thing to many, the implications and impact of it are real and have a lasting effect. Policy is not just about influencing lives now but also for righting the wrongs of history. The racial wealth gap is one of those wrongs that policy actively contributed to in the past, and in the present, and policymakers, practitioners and advocates should be focused on reversing policy’s detrimental impact.

As we near the end of Black History month and ask how policy can improve economic opportunity, we must not forget about the past and the influence it had on the state of households now, especially households of color. It’s time we start acknowledging the long-term outcomes of these detrimental policies and put closing the racial wealth gap at the top of our policy agendas.

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Practical Work-Life Balance Tips for Economic Justice Professionals

By Tonia Kallon on 05/17/2016 @ 04:00 PM

Tags: Recommended Reading

Employee wellness. Self-care. Work-life balance. We’ve all heard the latest buzz words when it comes to managing our personal lifestyles, professional aspirations and everything in between. But how do you thrive in a 24/7 digital world that is always on? There are many forces at work — the endless news and information cycle, a multi-generational workforce and technology, among many other things, have changed the way of business as we know it. Conventional wisdom says that we should eat right, exercise and get enough sleep. On the other hand, integrating all that into work, family and financial obligations — not to mention living — is harder. How does one incorporate wellness and achieve work-life balance?

First, the facts. According to a 2014 Gallup poll, only 50% of U.S. workers employed full-time actually work 40 hours or less in a workweek. While some of this can be attributed to personal drive and ambition of employees, another part is tied to the fast pace of society and the rising demands placed on businesses trying to keep up. Whether you are an employee looking to achieve balance or employer looking to support your staff in this endeavor, below are a few elements to consider:

  • Make work more flexible: In a world of shifting priorities, every task can appear to be mission-critical, and it can be difficult to keep up. Flexibility at work, such as telework or alternate scheduling, have been hailed as a good way to maintain work-life balance. (Even if you aren’t able to work from home very often, you can take smaller actions to incorporate some “flexibility” into your day, such as by taking stretching and walking breaks!)
  • Maximize available resources: If you have health insurance, chances are you have access to a variety of tools to foster healthy living. If your company offers an Employee Assistance Program (EAP), that is another valuable resource to support health and financial wellness in and out of work. Even if these particular programs aren’t accessible at your workplace, tapping into your and your colleagues’ wealth of knowledge can spawn all types of ideas. Perhaps a colleague is an art or fitness enthusiast and could lead a weekly or monthly workshop. Have a lot of catered meetings? That’s an opportunity to bring healthy eating options into the workplace.
  • Focus on results achieved: Hours worked tell a portion of a worker's story. The actual work product tells more. There is much discussion around employees feeling pressure to maintain a standard of excellence — in other words, always being “on.” This can make anyone feel overwhelmed. However, an emphasis on quality over quantity makes the day feel more manageable. Deadlines will always exist but a clearer focus on the overall results, combined with time and project management techniques, should make your task list feel realistic and most importantly, attainable!

I don't have the exact formula to solve the work-life balance equation. Oh, how life would be different if I did! It is personal and different for everyone, and ultimately, the keys to a successful, healthy work-life balance lie with both employees and employers. Employees must be able to define what that ultimate balance is, and employers must foster an environment that supports that. Onward towards wellness!

4 Keys to Getting People to Care about Your Cause

By Craig Sandler on 03/30/2016 @ 06:00 PM

Tags: Recommended Reading, Assets & Opportunity Initiative

Did you know that today’s typical social media user consumes 285 pieces of content every single day? (One of those 285 posts and updates might be how you got to this blog!) There’s a lot of noise in any communication channel, and it’s difficult to cut through the clutter of information overload and truly inspire an audience to action. So how can organizations get people to pay attention, connect with an issue and lend their energy and talent to a cause?

We do it by framing our message in a strategic way that engages our audience’s values. And of course, there are resources to show you how! In September, the Assets & Opportunity Network hosted a webinar with Janet Byrd of Neighborhood Partnerships, the State Network Leader from Oregon, to discuss the importance of “values-based messaging,” which puts the major ideals and principles underlying an issue front-and-center. Values-based messaging is a method for ensuring that your audience knows exactly why they should care about an issue or a policy proposal. It presents a frame that is instantly engaging, by appealing to the big ideas we intuitively understand — rather than the wonky policy details.

Message Box, a tool recommended by Public Works, is one way to develop compelling values-based messages for your audience. Message Box is a visual representation of a communications plan meant to keep your organization focused on the big picture, highlighting the values that will most resonate with your audience on an emotional level.

Message Box is built on research on message framing by George Lakoff, who proposed that there are three main levels of analysis when discussing matters of social change:

  1. Big ideas/values (e.g. personal responsibility, reward for hard work)
  2. Issues (e.g. poverty, wealth inequality)
  3. Policies (e.g. Children’s Savings Accounts, public benefits programs)

As policy advocates, it is easy for us to get stuck thinking on level three. We think in terms of policy details and debates, and so it’s natural for the messages we craft to reflect that. But the Message Box posits that audiences will be much more receptive to our proposals if instead we craft them around level one.

By appealing to more fundamental values, we let people know why they should care and what’s at stake. People are constantly bombarded with information about the problems of the world, and the way to break through their “compassion fatigue” is to frame your messages so that the fundamental principles are kept at the forefront. Audiences are more immediately responsive to broad terms with understandable stakes like “opportunity” and “future generations” than they are to gritty policy details and statistics.

To keep our frame based around values, the message box visually breaks down your message into four key components: vision, values, problem and solution.

The message box should be filled out one field at a time. Public Works recommends that you proceed in this order: “Vision,” “Values,” “Problem” and then “Solution.” This allows you to keep the ideas you’ve brainstormed for the “Vision” and “Values” sections in mind while crafting the “Problem” and “Solution” sections. What’s crucial is that you frame the problem in a way that naturally sets up your proposed solution. You should show that the values you’ve laid out are at stake and that the problem stands in the way of realizing your vision. Finally, the “Solution” should be presented in a way that keeps you focused on the principles and outcomes you hope to achieve. This makes it clear to the audience why their participation in the solution will uphold their values and advance their vision.

During the webinar, Neighborhood Partnerships shared an example of a Message Box developed around Children’s Savings Accounts (CSAs) in Oregon.

The “Vision” section communicates what Neighborhood Partnerships sees is possible: an Oregon where all kids are unobstructed in pursuing their dreams. The “Values” section keeps the focus on the big ideas that are at stake — terms like “choice” and “prosperity” that immediately resonate on an emotional level and show why this proposal matters. The “Problem” section lays out the issue of financial insecurity in a way that sets up Neighborhood Partnerships’ proposed solution of increasing educational attainment. Janet used data derived from CFED’s Assets & Opportunity Scorecard to illustrate the “Problem” section. And finally, the “Solution” section sets forth the proposal for CSAs in a way that keeps the principles and outcomes of the solution front and center.

Taken together, the message outlined in this Message Box communicates a “theory of change” to the audience that shows why their involvement matters and what it will achieve. This is the heart of values-based messaging.

Along with the importance of keeping the framing of your message big enough — not bogged down by policy details, jargon and statistics— Public Works lays out a number of other benefits to using a Message Box to help frame your message. These include:

  • Distilling your key arguments
  • Helping you describe the problem in a way that supports YOUR proposed solution
  • Keeping you away from frames that could damage your argument

If you’ve been seeking a new way to develop an effective messaging plan to get your audience inspired, you should give the Message Box a try. You can download a blank copy here.

Want access to more tools and resources like this one? Join the Assets & Opportunity Network today to connect with thousands of advocates and leaders across the country who are working to expand economic opportunity.

Bridging the Great Racial Divide with Data and Bright Ideas

By Andrea Levere on 03/16/2016 @ 01:00 PM

Tags: Assets & Opportunity Initiative, Racial Wealth Divide, Data and Research, Recommended Reading

One of the most welcome reactions from readers of What It’s Worth: Strengthening the Financial Future of Families, Communities and the Nation has been the universal appeal of its purpose and content. Educators speak powerfully about the ways that poverty and financial insecurity enter the schoolhouse door and compromise the effectiveness and impact of even the best instruction. Workforce developers recognize how much depends on getting a job, but also that getting a job is just the first step on the road to financial health. Public health officials have been some of the most enthusiastic readers, understanding how much our physical health is the result of economic conditions, and how far our health care practices must go to integrate these insights.

Some of the most engaged voices in this conversation are those working on issues of financial security and economic opportunity in communities of color. They bring multiple perspectives that both enrich our understanding of how to achieve financial well-being — and raise the stakes of failing to make major policy and practice changes that bridge the growing and unconscionable racial wealth divide in this country.

Several weeks ago, CFED also put the financial lives of households of color under the microscope when we released the 2016 Assets & Opportunity Scorecard, which analyses 130 policy and outcome measures of household financial security. This year’s Scorecard disaggregates data for 18 outcome measures by race in order to deepen our understanding and ability to address long-term racial disparities. But by pairing What It’s Worth’s essays with the data from the 2016 Assets & Opportunity Scorecard, we can both measure the size of the challenge facing communities of color and think creatively about new solutions.

Let’s start with housing. Rick Lazio, in his article “Stable Housing, Stable Families” affirms the potential of housing stability as means to financial well-being: “Healthy, decent, affordable housing is a key determinant of financial security, especially for those living close to the financial waterline.” The Scorecard offers vivid detail on the homeownership gap by race, with 71% of white households owning a home compared to 53% of Latino/Hispanic families and just 41% of African-American households. This pattern continues with renters, as the Scorecard documents that while 45% of white renters of cost-burdened (e.g., paying more than 30% of income on rent), this rises to 56% for Latino/Hispanics and 57% for African-American households.

If homeownership remains the greatest source of wealth for the majority of U.S. households, our communities of color are being left out and left to navigate rental markets so lacking in affordable housing that the majority of households of color lack any affordable housing options. The Scorecard highlights that multiple policy solutions that are necessary to address this situation, from support for homeownership counseling, down payment assistance and direct lending programs to protection from discrimination for low-income renters.

Multiple articles in What It’s Worth raise up other drivers of the racial wealth divide. Dedrick Muhammed, in his article “African American Economic Inequality,” affirms the enduring impact of increasing the minimum wage and addressing chronic unemployment while also insisting that without massive asset development the divide cannot be meaningfully reduced. In “Latinos in the Financial Shadows,” Jose Quinonez describes consumers whose lack of basic credit scores makes them invisible to the private markets, despite Latinos having the highest labor force participation rates in the nation. Elsie Meeks writes in “The Lakota Funds Story” how tribes can expand their goals from business development to individual wealth creation by working with community financial institutions that are designed to serve their cultural and financial needs.

What problem are they all aiming to solve? The Scorecard presents the grim news that median household net worth by race resembles a roller coaster ride down: while white households report median net worth of $110,637, this falls to $95,061 for Asian households (a number which hides more than it reveals through aggregation across a diverse population), plummets to $8,985 for Latinos, and fall even more to $7,113 for African Americans. The causes are as complex as our economic lives, and involve all the factors explored by the What It’s Worth authors — employment, education, homeownership, entrepreneurship, income and savings.

We are not naïve about what is necessary to make meaningful progress in reducing the “great racial divide.” We face centuries-long structural racism, a nation exercising its best and worst instincts in response to a decade of demographic and economic change, and a lack of political leadership to move forward with the most modest of policies to bridge this gap.

But we do have data and intelligence about the nature of the problem and innovative solutions and platforms to share this information with advocates, practitioners and policymakers. We watch how the power of social media is changing corporate behavior on these issues more significantly than more conventional shareholder protests. And we can join our collective efforts — as do the authors in What It’s Worth — to address the issues of racial and economic inequality together. I welcome your engagement in this movement!

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The One Question You Have to Ask to Avoid Supporting the Status Quo

Posted on 02/02/2016 @ 11:00 AM

Tags: Assets & Opportunity Initiative, Financial Capability, Recommended Reading, Economic Inclusion

The piece is excerpted from a chapter entitled “So What? Keeping Our Eyes on the Prize” in the book, What It’s Worth: Strengthening the Financial Future of Families, Communities and the Nation, published in 2015 by the Federal Reserve Bank of San Francisco. This post originally appeared in the New York PhilanthroPost here.

The concept of two Americas is becoming increasingly prevalent. Americans are feeling more financially vulnerable than ever. As asset and income inequality continues to grow, the schism in our society is no longer a risk but an increasing reality. Philanthropists have never been more focused on results, but I wonder whether we are letting our focus with data distract us from the big picture — ensuring that the paths to opportunity and upward mobility still exist.

Whether they focus on income inequality, educational attainment, health outcomes, social development or the various points where these issues intersect, policymakers and thought leaders recognize the challenge we face. The seeds of change were sown decades ago as middle class wages stagnated and the cost of goods increased more than incomes. Research conducted by the Economic Policy Institute, which has documented hourly wages for nearly three decades, shows that since 1979, the vast majority of American workers has seen their hourly wages stagnate or decline. But you don’t need complex economic analysis to know that when expenses exceed income, especially over long periods of time, financial stability erodes.

There is a role for philanthropy in funding interventions that treat the consequences of erosion. When families’ margin for financial error shrinks to the vanishing point, the task becomes all the more urgent to build their financial capability. But if we make treating the symptoms the goal — in other words, if we lose sight of the “So what?” — philanthropists risk becoming tacit supporters of the status quo.

I doubt any philanthropist would dream of saying, “Our task is to help you better manage your scarcity.” But that is exactly what you are saying, if you base grantmaking solely on program performance measures and outcomes. You are accepting that scarcity as a given, and defining “the problem” as the inability of some to manage within the confines presented before them.

Of course, it is futile to imagine that philanthropy alone can undo structural changes brought on by social and economic trends decades in the making. But every philanthropist who is seriously interested in having an impact should look beyond the data and make an effort to understand how to permanently contribute to opportunity and advancement. The role of implementing effective programming, whatever the particular tactical approach, is the job of trusted grantees. The job of staying focused on the “So what?” is, in a perfect world, everyone’s responsibility. But it is particularly the duty of philanthropists.

We all care about improving the financial well-being of American families. If we want to help people lead healthier lives, gain and keep good jobs, and obtain affordable and stable housing, then we also need to recognize the critical role that financial stability has in achieving these outcomes. Without supporting strategies that address the financial well-being and empowerment of the people in our communities, it is unlikely that we will ever fully succeed in improving peoples’ lives over the long-term.

As many of the contributing authors to this book have noted, financial insecurity is deeply embedded in a variety of social problems. Left unaddressed, the eroding financial security of American households will negatively impact our economy as a whole and threaten our country’s future. As philanthropists, we can work across traditional silos and use our investments to inspire families to believe in their own self-efficacy, invest in building social capital that will help them weather financial challenges, and support research and testing that deepens our understanding of how households adapt to socioeconomic challenges and opportunities.

Moreover, we should also be willing to use our philanthropic capital to challenge the status quo by investing in social movements that will bring greater awareness and understanding — both about the impact of financial vulnerability on our society and economy, and about the reasons why our success as a nation depends on reversing this downward economic cycle.

Because financial health is so inextricably intertwined with every other aspect of a person’s life, the Citi Foundation is deeply committed to approaching the issue from a holistic perspective. We work hard to break down our own internal funding and wisdom-sharing silos, and we believe in working in partnership with other institutions across sectors, including colleges and universities, municipalities, community development, public health and other agencies. Our vision is to enable these entities to build capacity, pool resources, develop a shared financial capability agenda, and ultimately, reach millions of low-income people. We are open to experimentation to move beyond what feels comfortable or safe, and we engage in an open dialogue with our partners to learn from mistakes as well as successes.

We also believe in sharing those lessons more broadly — to build a body of knowledge and catalyze collaboration with our fellow philanthropists. Adopting a shared narrative among practitioners, policymakers, and funders is important to achieve large-scale impact and create the systems change required to put more American families on the path to long-term financial success.

At the heart of our work is a constant effort to remember that philanthropy by its nature is more of an art than a science, and that it simply is not a business like any other where success can be empirically quantified. There is the old joke among doctors: “Oh, never mind the patient. The patient died on the table, but the operation was a brilliant success.” For philanthropists, the equivalent is that the economic divide may not be shrinking, but at least the program data look good.

Some will argue that without a single-minded devotion to data and outcomes, it is too easy to “hide behind the mission,” to say “well, we can’t prove it exactly, but we know we are doing good in the world.” I would urge my fellow philanthropists to remember that the risk runs in the opposite direction as well. If you can avoid metrics by hiding behind the mission, you avoid the mission by hiding behind the metrics. You can easily become the boastful doctor focused on the brilliant operation, instead of its impact on the lifeless patient.

Brandee McHale is President of Citi Foundation and Chair of the CFED Board of Directors. Follow her on Twitter: @BrandeeMcHale

Gift Ideas for the Economic Justice Advocate on Your List

By Merrit Gillard on 12/22/2015 @ 12:00 PM

Tags: Just For Fun, Recommended Reading

There are just a couple of days left to finish up all of your final holiday shopping! So what do you get the economic justice advocate in your life? CFEDers have some book ideas that are sure to put a smile on the face of any loved ones whose idea of a good time is curling up by the fire and reading about the deep inequalities in the American economy.

What It's Worth: Strengthening the Financial Future of Families, Communities and the Nation, produced by CFED and the San Francisco Federal Reserve

This compilation of 40-plus essays from the leading experts in the field of financial well-being features a host of ideas to transform the financial lives of low-income Americans. As an added bonus, in case you’re already over your holiday-shopping budget, you can order a free copy!

Between the World and Me, by TaNehisi Coates

In this beautiful and painful letter to his son, Coates explores the devastating impact of historical and structural racism on our families, communities and country.

The Unwinding: An Inner History of the New America, by George Packer

It’s one thing to read an economic treatise on the wealth gap; it’s another to read about it through the lives of real people. This is what Packer does so well in The Unwinding. He shows what deindustrialization and the technological revolution have done to real families.

Shortchanged: Why Women Have Less Wealth and What Can Be Done About It, by Mariko Lin Chang

A comprehensive primer on the drivers of the wealth differential between men and women, this book is a great resource on women of color and racial economic inequality.

Beacon Press

Where Do We Go From Here: Chaos or Community?, by Dr. Martin Luther King, Jr.

In this classic text, Dr. King lays out the socioeconomic foundation of racial inequality and sketches out a vision for America’s future, free from poverty and economic injustice.

Black Power: The Politics of Liberation, by Stokely Carmichael and Charles V. Hamilton

Another foundational text from the 1960s, this book attempted to define what “Black Power” means, and in doing so, developed an early definition of institutional racism.

When Work Disappears: The World of the New Urban Poor, by William Julius Wilson

Eighteen years after When Work Disappears was originally published, the premise of the book still resonates: communities without strong job opportunities and resilient employment sectors will likely fail, and the fallout impacts numerous social and economic measures, from health to family bonds to crime. These are fundamental challenges, and despite nearly two decades of reflection, we still have not fully grasped them.

Evicted: Poverty and Profit in the American City, by Matthew Desmond

This selection won’t arrive in time for Christmas, since it doesn’t come out until March, but it’s worth reserving a copy. An important addition to the work on the how economic disruption disrupts everything else, Evicted focuses on Milwaukee’s north side and far south side, looking at evictions from walkups and, yes, a mobile home park.

How the Other Half Banks, by Mehrsa Baradaran

New out this year, How the Other Half Banks explores the reasons that many low-income people aren’t using mainstream financial products and services—and offers a potential solution of using post offices to meet the banking needs of low-income households.

Assets and the Poor, by Michael Sherraden and Neil Gilbert

Assets and the Poor remains a foundational book for the asset-building field, providing a solid history and context for why there is a wealth gap—particularly among African Americans—and creating a call-to-action for asset-building programs.

Penguin Random House

Leaders Eat Last: Why Some Teams Pull Together and Others Don’t, by Simon Sinek

This book doesn’t focus on economic justice, but it’s a must-read for leaders in the field who want to learn how to foster successful teams and organizations that advance their mission.

The Pale King, by David Foster Wallace

For fiction lovers, this hilarious novel set in an IRS Regional Examination Center in 1980s Peoria, Illinois explores the political genius of making the tax code boring—so that elites can extract concessions publicly and legally without the public even noticing.

A is for Activist, by Innosanto Nagara

The advocate in your life might not be old enough to read yet, but this beautifully illustrated alphabet board book—complete with a cat to find on every page—is sure to be a hit among parents and children alike.

Many thanks to Jocelyn Harmon, Dedrick Asante-Muhammad, Melissa Grober-Morrow, Kate Griffin, Ezra Levin and Doug Ryan for their thoughtful suggestions!


Have a favorite book that didn’t make our list? Tell us about it in the comments!

Joining People and Place: Remarks by Nancy Andrews on the Occasion of the Launch of "What it’s Worth"

By Nancy Andrews, Guest Contributor on 12/11/2015 @ 10:13 AM

Tags: Recommended Reading

It is a great disappointment to me that I cannot be at this event in person. I was SO looking forward to following Eric and lending my voice of congratulations to Andrea Levere and David Erickson on this most excellent accomplishment—the publication of What it's Worth, the latest in the What Works series of books. Stepping back for a moment—can you imagine any other field of social activism that has created for itself a series of three (soon to be four) books, celebrating its thinkers, its practitioners, its successes, but also intentionally challenging itself to do more?

In the original Investing in What Works book, David and I wanted to get across a few key messages. The biggest, overarching message of that book is that the-age old debate between people- and place-based strategies is over. And both sides won.

It is no longer good enough for American social policy, our social investments, our way of working and our vision to be split down the middle by an artificial argument about which side—people or place—works best. We need all of us—each and every one of us in this room or watching on line—to recognize the value that we all bring to the cause of justice, equality and opportunity.

I cannot think of a better complement to the original What Works book than what my good friend Andrea has created for us today with the creation of What It's Worth. Because between us, between What Works and What It's Worth, there is a visual and tangible representation of the joining of people- and place-based work. Those of us who have dedicated our lives to building better places need to learn from those of you who have dedicated your lives to building financial inclusion. Neither of us alone is good enough. But together we have a fighting chance to make a difference in people’s lives, in communities and in building better, healthier futures for children and families. That is why I wanted so much to be here as a champion for Andrea and David, and to be with you today.

But this the hardest thing, isn’t it, this joining of people and place? It’s taken a lifetime to get good at building affordable housing; its taken decades to understand with clarity the importance of investing in young kids or what works for schools. It’s taken decades to build a solid path for financial inclusion. Many of us here today have dedicated our entire careers to getting good at just one aspect of this work. And we’re not done yet, not by a long stretch.

So, today, Andrea, David and I say to you: the work that each of us has done for years, the work we get up each morning and pour our hearts into–our work is remarkable, it accomplishes small miracles every single day. But we must do more. We are here to ask you to do more. We are here with congratulations, but not with rest. We are here to urge you to make the miraculous ordinary, to make the extraordinary routine.

So, Andrea and David, my deepest congratulations to you both for your extraordinary accomplishment in completing this book. Thank you for helping us understand what works and how to make it work better. But thank you most of all for reminding us that we have much much further to go. And I will be with you every step of the way as we move away from from the past and build the future of what works.

Nancy Andrews is President and Chief Executive Officer of the Low Income Investment Fund (LIIF), a Community Development Financial Institution.

To learn more about What It's Worth and to order your own FREE copy of the book, visit strongfinancialfuture.org.

How Can We Cure What Ails American Family Finances?

By Andrea Levere on 12/10/2015 @ 05:00 PM

Tags: Recommended Reading, News

This article originally appeared on the Huffington Post.

There's nothing simple about being a consumer of financial services these days. We're bombarded daily by tempting credit offers while living in a reality where a single unpaid bill can torpedo one's credit score. Bank closings and mergers have left many lower-income neighborhoods without a mainstream financial institution, and high-cost predatory lenders have stepped in to fill the gap. In the U.S. today there are 20,000 storefront lenders. That's about 6,000 more than the number of McDonald's restaurants.

All of this is happening during a time when skyrocketing student loan debt and the demise of employer-based retirement plans have made people even more dependent on this complex financial system. No wonder 57% of Americans are considered "financially unhealthy" and one in five people making more than $75,000 say they could not come up with $2,000 in an emergency.

Navigating this financial minefield is hard enough for those of us with a good paycheck and savings in the bank. But for those further down the economic ladder, it is nearly impossible.

The perilous state of American family finances cannot be solved by a few new policies alone. Instead, the situation demands action from all the players in the system, including the business community, education leaders, non-profits and government agencies.

With that in mind, the country's leading experts on financial well-being from a range of sectors have come together to create a roadmap for change. The result is What It's Worth: Strengthening the Financial Future of Families, Communities and the Nation, a book produced by my organization (CFED) and the San Francisco Federal Reserve. The 40-plus essays in the book, including a forward by Janet Yellen, showcase a host of remarkable innovations that are transforming financial lives in communities across the country. And they also raise a challenge: for these programs to have significant impact on our financial lives, they need to be replicated on a national scale.

Many of the most successful approaches help improve "financial capability" by integrating services such as financial coaching into existing programs that already target vulnerable populations. For instance, Skyline College's on-campus SparkPoint Center provides services such as free tax preparation and financial coaching to the California community college's low-income students. The services help keep students in school and on a path toward graduation. In 2013-14, 87% of students who used one of the center's services remained enrolled during that academic year compared with just under 55% college- wide.

Innovative approaches at companies like Staples Inc. demonstrate how businesses can help workers better manage their financial lives. The company uses video games to educate employees about the need to save and to sign up for the company's 401(k). And it offers the Treasury Department's myRA account for part-time workers and those too young to be eligible for the 401(k).

Louisville, Kentucky, is often hailed as a model for municipalities looking to embed financial capability programs into their social services. It offers programs ranging from Bank On Louisville, which helps unbanked residents access affordable financial products, to the "Credit as an Asset" financial education curriculum, which is designed to help people understand how to monitor and improve their credit scores.

Providing one-on-one financial coaching, as opposed to a quick class or workshop that is easily forgotten, is a particularly effective tool that can be integrated into everything from job training to re-entry programs. When Destiny Riviera saw a coach at The Financial Clinic in New York City, she wanted to pay down her $16,500 in debt including credit cards and student loans and eventually buy a car to make her work commute easier. Destiny's coach helped her set a realistic budget, identify opportunities to save and establish a realistic repayment plan for her student loan. By the end of her first year of coaching, Destiny already had paid off a quarter of her debt, increased her credit score by 30 points and saved $3,000, all while sticking to her budget.

When financial coaching is combined with safe, affordable and high-quality financial products and services, the results can be powerful. For instance, opt-out retirement plans, in which an employee must actively say no to an automatic paycheck deduction, are a simple but critical way to ensure all employees start saving for the future. And products such as the FDIC's Model Safe Accounts help bring underserved consumers into the financial mainstream with safeguards such as the elimination of overdrafts.

There is no shortage of innovative and effective approaches to help people achieve financial well-being. As a nation, we must make investing in the delivery of these products and services as much a priority in the 21st century as we did more than a century ago when we created our public education system. Only then can we have a country educated in all the subjects necessary to achieve economic security and opportunity.

To get your FREE copy of What It's Worth, visit strongfinancialfuture.org.

What Is Financial Abuse & How Can We Help Victims?

By Kim Pentico, Guest Contributor on 10/28/2015 @ 05:00 PM

Tags: Economic Inclusion, Recommended Reading

Editor's Note: October is National Domestic Violence Awareness Month. Today, Kim Pentico of the National Network to End Domestic Violence explains how financial abuse can keep victims from leaving abusive relationships.

“Why don’t they just leave?”

This question is frequently asked of victims of domestic violence. One of the primary reasons victims remain trapped with an abusive partner is because they don’t have the financial resources to break free and stay free. It’s estimated that financial abuse occurs in 99% of domestic violence cases, and surveys of survivors reflect that concerns over their ability to provide financially for themselves and their children were one of the main reasons for staying with or returning to an abusive partner. As with all forms of abuse, financial abuse occurs across all socioeconomic, educational and racial and ethnic groups.

Financial abuse is a common tactic used by abusers to gain power and control in a relationship. Whether subtle or overt, there are common methods that abusers use to gain and maintain financial control over their partners. These can include:

  • Forbidding the victim from working
  • Sabotaging work or employment opportunities by stalking or harassing the victim at the workplace or causing the victim to lose their job by physically abusing the victim prior to important meetings or interviews
  • Controlling how household income is spent
  • Not allowing the victim access to accounts
  • Withholding money or giving “an allowance”
  • Not including the victim in financial decisions
  • Forbidding the victim from attending job training or advancement opportunities
  • Forcing the victim to commit financial related crimes, such as writing bad checks or filing fraudulent tax returns
  • Running up large amounts of debt on joint accounts
  • Refusing to work or contribute to the family income
  • Withholding funds from the victim or children to obtain basic needs such as food and medicine
  • Hiding assets
  • Stealing the victim’s identity, property or inheritance
  • Forcing the victim to work in a family business without pay
  • Refusing to pay bills and ruining the victim’s credit score
  • Forcing the victim to turn over public benefits and then threatening to turn the victim in for “cheating” or misusing benefits
  • Filing false insurance claims
  • Refusing to pay or evading child support or manipulating the divorce process by drawing it out, hiding or not disclosing assets.

The short- and long-term effects of financial abuse can be devastating. In the short term, access to assets is imperative to staying safe. Without assets, survivors are often unable to obtain safe and affordable housing or provide for themselves or their children. With realistic fears of homelessness, it is little wonder that survivors often return to abusive partners.

For those who manage to overcome initial hurdles to escape the abusive person, they often face overwhelming odds in obtaining long-term security and safety. Ruined credit scores, sporadic employment histories and legal issues caused by the abuser make it extremely difficult to gain financial independence.

It can be difficult for couples to navigate the complexities of family finances, and almost all couples have arguments about money. In financially healthy relationships, however, partners talk about their wants and needs and make choices about finances together. When one person strategically uses finances as a way to control their partner, that is abusive. Financial empowerment is imperative to survivors’ independence, well-being and success.

The Economic Justice project at the National Network to End Domestic Violence (NNEDV) works to strengthen victim advocates’ financial capabilities to better assist survivors of domestic violence and help them move from short-term safety to long-term security and an economically sustainable independent life. We employ a signature “train-the-trainer” approach to deliver financial literacy lessons to victim advocates across the United States.

The road to economic empowerment for survivors is not easy or quick, but with the help of advocates and allies, we can ensure that survivors have the support and resources they need to be financially independent.

Learn more at http://nnedv.org/ej

Kim Pentico is the Economic Justice Director at the National Network to End Domestic Violence. Kim has been working with and on behalf of survivors of sexual and domestic violence since 1990. She first spent over seven years working for a local domestic violence program in Kansas and another seven years at the Kansas Coalition Against Sexual and Domestic Violence. She has also worked for the STOP Technical Assistance Project in Washington, DC. Kim currently works as the Economic Justice Director, working to ensure and enhance survivor access to economic justice and long-term safety.

Want to read more from about efforts to expand financial security and opportunity? Sign up for the Inclusive Economy Weekly to get every post delivered straight to your inbox in a convenient weekly digest.

Reflections on the Historical Roots of the Racial Wealth Gap

By Alicia Atkinson on 02/27/2015 @ 04:30 PM

Tags: Recommended Reading, Federal Policy

“Two-hundred fifty years of slavery. Ninety years of Jim Crow. Sixty years of separate but equal. Thirty-five years of racist housing policy. Until we reckon with our compounding moral debts, America will never be whole.” – Ta-Nehisi Coates, June 2014

Probably like many people who work in the beltway, my family has no idea what I do for a living. My mom still calls me when she hears the word “policy” on NPR in the morning in an attempt to assure herself that my job really does exist. Despite public policy’s omnipresence in our lives--from workplace safety to transportation to banking regulations--people, like my mom, often don’t know the impact that policy has on our daily lives.

Unless an issue has captured America’s attention, policy tends to be relatively behind-the-scenes. CFED’s policy team focuses on various, and sometimes invisible policy levers, that builds assets, such as savings or higher education or purchasing a house. We do this partly by looking at the tax system or the workforce development system to see how we can leverage different mechanisms that can help people to save and invest in key asset-building purchases in order to become financially stable.

While we tend to focus on the present, we are heavily invested in reversing some of the detrimental policies of the past that actively worked against certain people, specifically people of color, to build assets and wealth. The repercussions of these historical policies can still be seen today with communities of color having lower homeownership rates, lower access to tax-deferred retirement accounts, higher student debt, lower inheritances and lower-overall wealth. The result: a new report from the Urban Institute shows that white families have around 12 times the wealth of African- American families and 10 times the wealth of Hispanic families.

What were some of these historical policies that contribute to this unacceptable wealth-gap today? In Ta-Nehisi Coates June 2014 article, “The Case for Reparations,” he chronicles some of these historical events that actively disenfranchised black households, leaving them out of key income and wealth building opportunities. These span from times in slavery to present day and include:

  • Wage-theft: As slaves, African- Americans missed out on years of income and wealth building. Their labor was free and many white Americans accumulated massive amounts of wealth off this free labor. For example, “in 1860 there were more millionaires per capita in the Mississippi Valley than anywhere else in the country.” Even after African-Americans were “freed” legally from slavery, they were forced to work on the same land and continued to undergo substantial wage-theft.
  • Housing: For 30 years, households of color were cut out of the legitimate home-mortgage market, partly due to the Federal Housing Authorities active redlining of certain communities, and forced to work with contract sellers. Contract sellers demanded a hefty downpayment and high monthly payments, but gave households no equity until the entire house was paid off. If residents missed one payment, they were evicted and did not see any money returned to them. Today, households of color, particularly black households, continue to face barriers to homeownership. Recent research showed that an application from a black mortgage applicant was 2.4 times more likely to be denied compared to an application from a white applicant.
  • Property Values: For black households that were able to find a way to purchase a home in a racist housing system, many were often forced into certain communities and if they were able to purchase in mostly-white community than they experienced white flight, which dramatically decreased their property values. What was one of the repercussions of this? Research showed that black families making $100,000 typically live in neighborhoods inhabited by white families making $30,000.
  • Education: The G.I. bill that was a key source of assistance to many veterans, completely failed black veterans. Researchers have stated that the racism in the VA offices pretty much made this bill obsolete to black veterans returning from war.
  • Retirement: Historically and presently, households of color have hit barriers to accessing key retirement benefits. In 1935, 65% of African Americans nationally were ineligible for social security. Many households of color are still missing out on retirement opportunities, and research has shown that they are less likely to have access to tax-deferred retirement accounts, the main source of retirement income now-a-days.
  • Health Care: The recent passing of the ACA expanded health care coverage for millions of individuals. However, many southern, and former confederate states, have refused to expand Medicaid, creating a hole in coverage for many impoverished individuals.

Each minority group in the United States has undergone their share of wealth depleting policies or lack of policy, such as internment for the Japanese, massive land theft from Native Americans or the large rates of wage theft for immigrants who struggle to find formal employment, that has contributed to having lower-wealth and less financial security overall.

Despite broad and deep notions that we all have succeeded without assistance, history demonstrates that policy has assisted some while actively prohibiting others from building wealth and assets. While policy can seem like a foreign or often invisible thing to many, the implications and impact of it are real and have a lasting effect. Policy is not just about influencing lives now but also for righting the wrongs of history. The racial wealth gap is one of those wrongs that policy actively contributed to in the past, and in the present, and policymakers, practitioners and advocates should be focused on reversing policy’s detrimental impact.

As we near the end of Black History month and ask how policy can improve economic opportunity, we must not forget about the past and the influence it had on the state of households now, especially households of color. It’s time we start acknowledging the long-term outcomes of these detrimental policies and put closing the racial wealth gap at the top of our policy agendas.

The Key to Regaining American Opportunity and Fiscal Freedom

By Sean Luechtefeld on 07/08/2014 @ 09:30 AM

Tags: Events, Recommended Reading

On Wednesday, June 25, CFED Founder and Board Chair Bob Friedman had the opportunity to moderate a panel discussion at San Francisco’s Commonwealth Club, titled “The Key to Regaining American Opportunity and Fiscal Freedom.” The discussion featured longtime CFED friends Eugene Steuerle, Former Deputy Assistant Secretary of the U.S. Department of the Treasury and author of Dead Men Ruling: How to Restore Fiscal Freedom and Rescue Our Future, and Frank Yeary, Former Vice Chancellor of the University of California at Berkeley and Co-founder and Chair of Level Money.

From left: Bob Friedman, Eugene Steuerle, Frank Yeary

In Dead Men Ruling, Gene argues that with both tax cuts and entitlement spending on autopilot and more than claiming all additional growth dividends, there is no ability to make investments in the younger generation (the first generation in our history unlikely to do better than their parents) and all other changing needs going forward unless both the Left and the Right free the future. Frank Yeary followed by underscoring that we are investing in aging baby boomers to the detriment of younger Americans, and describes his efforts to organize "an AARP for young people" based on a financial planning app, LevelMoney, designed to give millennials a measure of clarity and control over their finances.

Eugene Steuerle (left) and Frank Yeary

More information about the event can be found here. In the coming days, video from the event will be uploaded as well, so check back when you’ve got a few extra minutes; it’s worth the watch.

Steurele’s book, Dead Men Ruling, is available for purchase on Amazon.

Can The Company Buy Me A...?

By Neil Jacobson, Guest Contributor on 06/18/2014 @ 10:00 AM

Tags: Recommended Reading

As a Senior Vice President and IT Manager at Wells Fargo, I frequently received the question, 'Can the company buy me a...?' Managers and team members always seemed to want the latest and greatest gadget, software application or piece of hardware. My answer was always, "How will it make you more productive and how will it fit into our environment?" Most of the time, the requester had no answer to these questions, and so we didn't pursue the request any further. However, for those few people who were able to articulate the worth to the bank and the productivity benefits it would bring, I was eager to help get them what they needed, and most of the time we were successful.

Assistive technology has always been an amusing concept for me. My own disability, Cerebral Palsy, is quite significant. I cannot drink without a straw, but are drinking straws considered assistive technology? I also have very limited use of my hands, and use a word expansion application to help me type faster. Many people with disabilities I know use a speech recognition system to verbally navigate their computer and the Internet and create documents. These applications have been called assistive technology, but when people without disabilities use them they are just seen as mainstream conveniences and aids to productivity. Would anyone call Siri an assistive technology? What about speakerphones? Gadgets and applications seem to be classified as assistive technology only when they are used by people with disabilities—and only until the general public realizes how universal that gadget or app can be. When people ask me what assistive technology I like the best, I answer it is my Wells Fargo Visa Card. It's surprising how much easier it is for people to understand me after they see that card!

So is it assistive technology, or a mainstream technology product that has accessibility features? The technologies themselves have no such categories, and the differences only seem to arise in terms of who is using them in what context. Most, if not all, developers and companies I know want to build accessible technologies. Who wouldn't want their product to be usable by as many potential customers as possible? At Wells Fargo, I always ensured the bank had at least one team member actively engaged with the W3C Web Accessibility Initiative (WAI). Their web accessibility standards are quite good, which is why they’re being implemented in law and practice worldwide. The main issue was, and continues to be, how to educate thousands of developers on the standards and how to ensure an ever-changing system continuously conforms to the standards. I look forward to when changes can quickly, if not automatically, be tested and reconstructed to meet W3C WAI guidelines. I look forward to companies proudly displaying an icon depicting their alliance with accessibility guidelines.

If there’s a learning mission for getting developers up to speed, my point here is that technology users with disabilities have some learning to do as well, so that they can master their own technology choices, which are often very personal. Before working at Wells Fargo, I co-founded the Computer Technologies Program (CTP) with Scott Luebking. Scott had a spinal cord injury that caused quadriplegia. He had difficulties keyboarding. Although we had the most modern assistive technology available to us, Scott found that placing a pencil between his fingers enabled him to type the most efficiently. Many people I know who are non-verbal due to Cerebral Palsy have found that they communicate better with a simple letter board than a complex augmentative communication device. These examples are not meant to disparage the wonderful assistive technology that are available and continue to be developed. Indeed, many people with disabilities need these more complex assistive technologies and use them very effectively. These examples are intended to show the importance of empowering each person with a disability the opportunity to discover and acquire what works best for them, whether it’s from the world of AT, from a mainstream product, or a jury-rigged personal solution.

True inclusion may take more than empowerment. Perhaps we should begin to expect that people with disabilities have the personal expertise needed to navigate the technology solution space. One of my favorite sayings is 'give a person a fish and you feed them for a day; teach a person to fish and you feed them for life.' It is time to teach people with disabilities that we, like everyone else, can and must work, just like everyone else. Like everyone else, along with that obligation to work comes the responsibility of knowing how to be as productive as one can be. For many people with disabilities, that will include learning how to circumvent accessibility barriers. Having been in the workforce for 40 years, I find it odd listening to and observing how much energy is used trying to explain to employers which assistive technology may be useful for people with disabilities. We must teach people with disabilities to know what they need and how to get what they need. We need to ensure that when we say, ‘Can the company please buy me a...’ we do so with pride and determination, knowing exactly why we need it and how it will enable us to be more productive.

Responsibility is a Good Thing

By Neil Jacobson, Guest Contributor on 06/05/2014 @ 03:30 PM

Tags: Financial Capability, Recommended Reading

Imagine going into your 9-month old son's room to find him sitting atop his 5.5 feet tall dresser adjacent to his crib. Imagine you and your wife sitting in your wheelchairs staring up at this smiling boy knowing there's no way either of you are able to reach your son to get him down from there. What do you do? Well, after gasping for air, my wife, Denise, looked at me and said, “Well, if David was able to get up there by himself, he should be able to get down by himself.” Sure enough, with just a little coaxing from us, he went on his stomach and slid safely back into his crib. The look of success on David's face was precious!

A few years later, when David was 4, we had a friend of his over for lunch. The friend was the same age as David. We had a snack that day. As was normal in our house, David got the cookies from the cabinet and the milk from the fridge. David proceeded to pour the milk into glasses for all of us. His friend was wide-eyed. “Wow,” he said, “Your parents let you pour milk! That is so cool!” Little did the friend realize that with our disabilities, neither Denise or I could pour very well, and that David had been doing so since he was about 2. The look of pride and success on David's face when he heard his friend praise him was unforgettable.

As years go by, it seems that children have less and less responsibilities. This seems especially true for youth with disabilities. More often than not, they learn how to accept assistance, but rarely how they are needed and what their responsibilities may be.

I was fortunate to have the values of hard work and independence instilled in my life from an early age. As a child with cerebral palsy, my parents did all they could to foster my self-reliance. My mother woke me each morning and would insist I dress myself, even though it took two hours to do so. At night, I’d get two dinners. One dinner I had to feed myself; the other I was provided assistance to ensure I got enough to eat.

These approaches may sound extreme, and today I know that a key to independent living is knowing when and how to get help. But for my parents, work was, quite literally, a life and death matter. As Holocaust survivors, they had seen how those who could not work were considered worthless, and were the first to perish in ghettos and concentration camps. They showed me that determination and perseverance are the key to achievement and that I had a responsibility to do well.

For me, the payoffs have been enormous. Despite my obvious disability — I can’t sit upright, I have involuntary movements and my speech impairment is significant — for nearly 30 years I built a career at Wells Fargo, rising to senior vice president of information technology. Work gave me purpose. Work made me proud. Work allowed me to gain economic independence and build a secure financial future.

I believe that it is important for us to instill the values of determination and perseverance in our children and set the example that they too can gain economic independence whether or not they have disabilities. In my retirement, I am working on reforming Social Security policies to encourage youth with disabilities to enter the workforce and gain independence despite the challenges they may face. The current Supplemental Security Income (SSI) Program has many work disincentives that make it difficult for youth with disabilities to go to work and still receive services they need. The proposed program, CareerACCESS, will be created by changes in federal policy aimed at significantly increasing the employment rate of people with disabilities. The program expects young adults with disabilities ages 18 through 30 to work. CareerACCESS will provide required support and services recognizing that disability benefits are offsets to the high cost of disability rather than subsidies for the inability to work.

As we go about our ever-increasingly busy life, let's not shy away from giving our children the responsibilities they need and deserve. Responsibility is a good thing!

When Piketty Came to America

By Andrea Levere and Ezra Levin on 04/29/2014 @ 10:00 AM

Tags: Federal Policy, Recommended Reading

The following article initially appeared in Politico's In the Arena. Read it here.

The French economist found that concentrated wealth drives income inequality. That means the U.S. has its policy all wrong.

The top-selling book on Amazon.com right now, amazingly enough, happens to be a 696-page treatise on economic history written by a Frenchman. It’s the talk of the town in Washington and even a hot topic on cable news. The book, “Capital in the Twenty-First Century,” by economist Thomas Piketty, has been called “the most important economics book of the year — and maybe of the decade” by New York Times columnist Paul Krugman, its stunning findings chewed over by pundits on the left and right. But all the buzz has missed a fundamental implication from Piketty’s work: America’s public policies devote billions of dollars to an asset welfare system that helps some build wealth, while leaving most working families behind. Piketty’s book is a meticulously researched argument in favor of turning these upside-down policies right-side up.

Piketty offers a surprisingly simple explanation for the huge spike in income inequality in developed countries over the past few decades. He finds that the rate of return on capital — homeownership, business ownership, stock, bonds and everything that makes up a household’s net worth — has regularly outpaced the growth of income. Income tends to grow at 2 to 3 percent annually, while capital tends to grow at 4 to 5 percent each year. Because capital is concentrated among wealthier households, inequality has increased over decades to the levels we are now seeing.

This is a particular problem in countries where wealth is distributed very unequally. In the United States, the top 1 percent of the population owns more than 35 percent of the wealth — more than the entire bottom 90 percent combined. In fact, our nonprofit organization, the Corporation for Enterprise Development, has found that 44 percent of U.S. households have almost no savings. These “liquid asset poor” families are not only missing out on the returns from wealth — they’re one economic shock away from financial disaster.

It is no surprise that a French economist like Piketty proposes solutions that are political nonstarters in this country, such as a redistributive global tax on wealth. Like Piketty, many U.S. economists and policymakers focus their attention on the concentration of wealth at the top. But a more pragmatic starting place should be looking to see what we can do to help low- and moderate-income working families save, invest and build wealth from the bottom up.

The federal government alone spends more than $500 billion annually to encourage Americans to save, invest and build wealth. But the vast majority of this support goes to high-income households through tax spending on asset support — for instance to buy a house (mortgage interest and property tax deductions), invest in stocks (reduced rates on capital gains) and save for retirement (exclusion for 401(k) and IRA contributions). This is essentially welfare targeted at high-income households.

By contrast, welfare for low-income households tends to come as income support for everyday expenses, such as to pay for food (the Supplemental Nutrition Assistance Program), rent (Section 8 vouchers) and health insurance (Medicaid).

In other words, government spends to help low-income families just get by, and it spends to help high-income families get further ahead. Piketty found that concentrated wealth is the driving force behind income inequality, and federal policy is actively concentrating that wealth.

Some may argue that working families do not receive benefits for saving and investments because these families are unable to save or invest. But decades of research proves otherwise. The American Dream Demonstration, for instance, a nationwide research project on savings for working families, showed that even the lowest-income families will save toward their goals of college, home and business ownership if provided with the right opportunities and incentives. And a rigorous study of New York City’s $aveUSA program has found that low-income tax filers will save a significant portion of their refund to serve as a personal safety net.

There’s no shortage of ideas for new asset-based policies. Children’s Savings Account programs, which help children start building assets early in life, have launched throughout the country and congressional leaders have committed to supporting legislation to provide every child born in the country with a savings account.

Other asset-based proposals would expand and make refundable the Saver’s Credit — a rare retirement savings tax expenditure targeted to low- and moderate-income households. Policymakers are also working to remove asset limits from public benefit programs so families don’t have to choose between building wealth and receiving benefits that help them make ends meet. (In many states, a parent who saves as little as $1,000 or $2,000 in a savings account for themselves or for their kids risks getting kicked off of public benefits.)

These incentives and reforms won’t help if families lack access to saving vehicles. To tackle this issue, California and Illinois are exploring a policy called Automatic-IRA to guarantee that families without an employer-sponsored retirement plan can save for the future. And President Barack Obama recently announced the myRA, a U.S. Treasury-sponsored account aimed at removing barriers to retirement savings by creating a simple, safe and affordable retirement savings product for working families.

Our upside-down Tax Code and asset policies strongly encourage savings and investments by the wealthy and do little for most working families. Piketty’s work shows us that if we want to stem the growing tide of inequality, we need to fix those policies. But we don’t have to enact radical global tax schemes. All we need to do is turn the system we do have right-side up.

The Existence of Poverty Doesn’t Signal the Failure of Asset Building: A Response to Callahan

By Bob Friedman on 04/28/2014 @ 08:45 AM

Tags: From the Founder, Recommended Reading

In a recent blog post, David Callahan critiqued the asset-building field by asserting that it was hard to think of "a policy movement that failed so miserably in its overall goal, despite massive foundation funding, intellectual firepower and buzz."

To be sure, Callahan recognizes certain contributions of asset policy and innovation in the course of his article, although such recognitions are buried after his indictment of failure. In fact, he even goes so far as to acknowledge, somewhat in contradiction, that continued asset innovation could accompany greater ideological advocacy for government's role in shaping the economy. Yet this sort of scathing critique, especially of a thoughtful friend, demands answer. To this end, I offer three points.

First, there is no evidence that foundations' investment displaced, diminished or otherwise worked against other inclusive economic development and security strategies. While Ford and other foundations did invest in asset practice, policy and research—generously—so too did they continue longer-term and equally "massive" investments in a range of other strategies, including those David describes.

David deserves credit for his important work during this period on the issues of government's proper role in the economy (even as the economy was demonstrating its inability to function fairly and productively without better laws, regulation and structures), the specter of rising indebtedness led by under-regulated predatory lenders and insufficient public funding of postsecondary education. But the asset-building field supported and complemented these efforts, rather than diminished them, with the enlarged frame of financial security and empowerment, encompassing the Learn-Earn-Save-Invest-Protect spectrum.

Second, the inability of families to climb out of poverty in the last decade should not be laid exclusively at the feet of any particular movement concerned with the economic well-being of low-income families. If the assets movement is to be judged by the measured economic outcomes of the last thirty years in terms of income, wealth, inequality, poverty, wages, protections, un- and underemployment, opportunity and mobility, then all our strategies and efforts should fairly be judged as failing—even failing “abysmally” as David put it.

But, it is not likely that any of our efforts were consequential in producing those outcomes, at least when compared with the impacts of globalization, technology, declining wages, shrinking unions, deregulation, disinvestment and, most importantly, the Great Recession which put our entire economy on the brink of collapse in 2008 and disproportionately devastated low- and moderate-income communities. A fair review of the emergence of the asset-building field (and its contribution to an evolving economic justice movement) during this period would recognize the palpable (and measured) difference made in tens of thousands of people's lives by the availability of IDAs and CSAs and the savings, education, entrepreneurship, homeownership and economic advancement they opened. These have resulted in the spread and measurement of 67 asset-building state policies, the rise of the Cities for Financial Empowerment Coalition, and the emergence of significant federal legislative and administrative policies.

We have not yet afforded every American a reasonable chance to save and build assets, but the path to large-scale, inclusive and progressive savings and asset-building incentives and structures is clear. While asset building has its "technocratic policy" aspects, it calls attention to the gulf, racial and generational, of wealth inequality and its historical and structural causes and supports, including a tax system that squanders half a trillion dollars a year in tax breaks for the wealthiest among us and misses the asset-poor but entrepreneurially rich majority.

Third, while I agree with David that we need to be making larger, values-based arguments about the shape of the marketplace and the larger role of government regulation and investment in the economy, this argument must extend beyond income policy, financial regulation and investment to wealth policy. Going forward, there is an important asset-based storyline that focuses on the under-appreciated entrepreneurial, educational and vocational, homeownership dreams of the asset-poor majority, and the way policy (tax policy in particular) currently rewards the rich, misses the middle and penalizes the poor. An economic growth strategy based on engaging the savings, entrepreneurial, educational, homeownership and retirement security dreams of all, built on the large scale, universal, progressive, automatic, tax-based systems of child and adult accounts is being rolled out in San Francisco, Cleveland, Colorado, Utah, Maine and so many other states and cities.

These asset strategies can and should be a part of the larger spectrum of economic policies Callahan describes. In particular, the annual half-trillion upside-down tax expenditures on productive asset building need to be rethought and redeployed to invest in all people, especially the asset-poor majority, and curbed for the top 20%. Broadly inclusive and progressive Children’s Savings Accounts are likely to be the harbinger of such policies, but clearly not the last. This is not a narrow, technocratic argument, but in line with the new thinking led by Thomas Piketty and others, that we need to deal with capital distribution and accumulation directly.

If we have not yet achieved the large scale transformative asset policy we sought, it is perhaps not because the assets field has failed, but because we have only begun on what is better conceived as a 50-year marathon than a 20-year dash.

EDITOR'S NOTE: This post has been edited slightly because the original version erroneously identified David Callahan as a staff member at Demos. He has not, and his original post has since been removed from the Demos site because it is not reflective of the organization's view of asset building.

CFED, Partners Featured as Experts in Community Development Investment Review

By Sean Luechtefeld on 04/03/2014 @ 03:30 PM

Tags: Housing and Homeownership, Recommended Reading

Did you see that the latest issue of Community Investment Development Review, which hit shelves last week, features two of CFED's experts in affordable housing as an asset-building strategy? President Andrea Levere's introduction to the issue framed the relationship between energy-efficient housing and asset building for low- and moderate-income (LMI) families, while Director of Affordable Homeownership Initiatives Doug Ryan co-authored a piece with Next Step CEO Stacey Epperson about manufactured housing as a viable homeownership option for LMI families. You can read Andrea's article here and Stacey & Doug's article here.

Community Development Investment Review, the journal of the Federal Reserve Bank of San Francisco's Center for Community Development Investments, aims to "bridge the gap between theory and practice and to enlist as many viewpoints as possible" while covering community development investment topics. This vital publication for the asset-building and financial empowerment fields is critical in bringing the issues you care about to new audiences, so we hope you will circulate the latest issue among your networks.

Have feedback for Andrea or Doug? Leave your comments below!

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Innovations in Microbusiness: New Strategies to Help Financially Vulnerable Microbusiness Owners Succeed

By Katherine Lucas McKay on 03/06/2014 @ 08:30 AM

Tags: Entrepreneurship, Recommended Reading

Image courtesy of BigStock

If you’re a microbusiness training provider, microlender, microbusiness funder or small business policymaker, CFED has a new report for you. "Innovations in Microbusiness: Enhancing the Financial Security of Low-Income Entrepreneurs" details what we learned from a year working with some of the microbusiness field's most innovative organizations. The report documents what they're doing to help financially vulnerable microbusiness owners achieve financial security and explores strategies for these new approaches could grow to scale. Our partners included Accion Texas, the California Association for Micro Enterprise Opportunity (CAMEO), ECDC Enterprise Development Group (EDG) and the Washington, DC, Women's Business Center (DC WBC). Each of their featured initiatives addresses challenges that financially vulnerable microbusiness owners face in starting businesses, managing their finances, achieving growth and addressing financial setbacks.

  • Accion Texas worked with the BETA Project, a collaborative effort of CFED and ideas42, to design and test behavioral interventions aimed at helping their microloan borrowers repay their loans successfully and on time.
  • CAMEO coordinated a group of small-scale microlenders to affordably share access to automated microloan underwriting software.
  • EDG implemented a comprehensive suite of tax assistance services for its self-employed clients, from training and education about tax responsibilities and tax planning, to free preparation, to IRS conflict resolution assistance.
  • DC WBC, a training and TA organization, helped its clients access zero-interest microloans through Kiva Zip, an online crowdfunding platform.

The report identifies four strategies that other microbusiness-serving organizations can use to successfully and sustainably replicate our partners’ innovative work:

  • Develop products that leverage new technology to more affordably and efficiently help lower-income entrepreneurs thrive and grow.
  • Create partnerships with others to achieve economies of scale.
  • Leverage platforms such as Kiva Zip and Accion Texas’s Microloan Management System (MMS) to standardize processes and serve more clients with the resources you have.

The report concludes with recommendations for policymakers and funders to use product, partnership and platform strategies to grow our partners’ innovative programs to scale throughout the industry. For example, we recommend that funders support efforts to spread awareness of behavioral economics principles within the microbusiness field. While behavioral interventions are a hot topic in the asset-building world, and there is a high level of interest in the microbusiness sector, relatively few organizations serving financially vulnerable entrepreneurs have yet applied behavioral insights to their own work. We also recommend that policymakers clarify the roles that Small Business Administration and CDFI Fund grantees can play in helping clients use crowdfunding to access capital. To read the rest of our recommendations and learn more about our partners’ work, check out the full paper here.

The Racial Wealth Gap is Growing

By Jeremie Greer on 02/19/2014 @ 11:00 AM

Tags: Federal Policy, Racial Wealth Divide, Recommended Reading

In a month when we celebrate the bravery and sacrifices made every day by extraordinary people to advance racial equality in the United States, we are also reminded that despite incredible progress we have not come far enough. The financial security of communities of color is still incredibly fragile, and in many communities across the country, families are barely getting by—if they are getting by at all. In a speech marking the 50th Anniversary of the March on Washington, President Obama articulated this struggle—far better than I ever could—by describing the measure of progress as defined by those who gathered in Washington, DC, 50 years ago. During this speech President Obama said:

“The test was not, and never has been, whether the doors of opportunity are cracked a bit wider for a few. It was whether our economic system provides a fair shot for the many - for the black custodian and the white steelworker, the immigrant dishwasher and the Native American veteran. To win that battle, to answer that call - this remains our great unfinished business.”

In addressing the question of whether communities of color are accumulating wealth, building assets or achieving financial security for their families, unfortunately the answer—as articulated by President Obama—is that as a country we have “unfinished business."

On January 30, CFED released its annual Assets & Opportunity Scorecard, which profiles state data on household financial security and 67 policy solutions, and highlighted the many families who are living in a persistent state of financial insecurity. One major and troubling finding was that two out of every three (61%) households of color are liquid asset poor, which means they have less than three months’ worth of savings (conservatively measures as $5,887 for a family of four). Further, and as reported in a recent post by Lebaron Sims, African-Americans are twice as likely to be liquid asset poor as white households. This lack of savings corresponds with overall lower wealth and assets. CFED found that households of color have approximately one-tenth the median net worth (assets minus debt) of white households ($12,377 and $110,637, respectively).

This week, CFED’s Government Affairs team has released a new fact file, titled “The Racial Wealth Gap is Growing,” which highlights the disturbing trend of wealth inequality regarding households of color in the United States and some of the reasons it exists and persists in the United States. Here are some of the alarming facts:

  • The racial wealth gap far exceeds the racial income gap. As mainstream rhetoric tends to focus on income inequality, CFED’s new Scorecard data brings into light the reality that inequality is more extreme and pervasive when looking at different households’ net worth.
  • The racial wealth gap is growing. According to research by the Urban Institute, the wealth gap has doubled in the past few decades. In 1983, the average wealth of white families was $230,000 higher than the average wealth of African-American and Hispanic families; in 2010, it has increased to over $500,000.
  • Homeownership rates for households of color are 26 percentage points below the rate for white households. Research by the Institute on Assets and Social Policy (IASP) has determined that the homeownership gap is a result of a broad legacy of systematic racial segregation, discrimination and unequal opportunity. Additionally, new research from Zillow, Inc., in collaboration with the National Urban League, found that there were significant differences across race and ethnic groups with the success of mortgage applications.

These facts and trends are explored in more depth in the Fact File.

All in all, we know that in order to finish the “business” of expanding opportunity, whether it is through investments in homeownership, college education or small businesses, disparities between white households and households of color must be erased. In his State of the Union Address, President Obama offered hope that this vision can be realized when he said, “Opportunity is who we are. And the defining project of our generation must be to restore that promise”.

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“We All We Got”: Race in the 2014 Scorecard

By Lebaron Sims on 02/11/2014 @ 03:00 PM

Tags: Assets & Opportunity Initiative, Recommended Reading

As has been well-documented, the recession hammered the nation’s minority and White households alike. The recovery, however, hasn’t been nearly as color-blind. The 2014 Assets and Opportunity Scorecard provides a clear snapshot of the relative financial stability of America’s working households. While the Scorecard focuses on disparities between White households and all households of color, this post unpacks the data to focus specifically on the outcomes of African-Americans. Across the board, the consistent pre- and post-recession trend remains: African-American households continue to trail White households in each of the Scorecard’s financial security outcomes, both nationally and at the state level.

Liquid Asset Poverty Rate

  • One of the most basic metrics of financial security is whether households have a safety net, or enough of a savings cushion to sustain them in the event of a medical emergency or loss of income. Unfortunately, a majority of the nation’s African-American households do not: over two-thirds (67.2%) are liquid asset poor, a figure that remains above the pre-recession level of 65.3%. Though the gap between White and African-American households has narrowed somewhat since the recession, AA households remain nearly twice as likely to be liquid asset poor than White households.

Unemployment Rate

  • Though the unemployment rate continued to fall across the board through 2012, unemployment for African-Americans remained above even the worst recession-era rate for White workers. In 2012, the annual unemployment rate for African-Americans was 13.6%, over two times greater than the rate for White workers (6.4%). Of the states where data was available, the disparity was slimmest in Ohio, where African-American workers were still 1.8 times more likely to be unemployed than their White counterparts.

Homeownership Rate

  • Homeownership rates fell among both White and Black households in 2012, continuing the trend since the burst of the housing bubble in middle of the previous decade. African-American homeowners, however, were hit considerably harder by the crisis: African-American households have seen homeownership rates decline by 8.4% since 2006, compared to a 3.4% decline among White households. Among the states, the homeownership gap is most pronounced in New York, where White households are 2.3 times more likely to own their home than African-American households. In five states – NY, MA, RI, WI and CT – the White homeownership rate remains more than double that of African-American households.

Household Net Worth

  • Though homeownership is no longer the paragon of economic stability it once was, the home remains the primary asset for most households, and the collapse of the housing market and subsequent recession continue to show their lingering effects through sustained declines in household net worth. A history of discriminatory zoning and lending practices has contributed to the large gap in homeownership and net worth between White and African-American households, and, though this gap narrowed slightly in 2011, it remained enormous. White households held, on average, 15.6 times the wealth of African-American households in 2011.

High School Graduation Rate

  • The graduation rate for African-American high schoolers lags behind that of White students in every state. In only one state – Texas – do African-American students graduate high school at a rate of 80% or more; White students eclipse the 80% marker in 36 states and the District of Columbia. Furthermore, in 23 states and the District of Columbia, the graduation rate for African-American students falls below the lowest rate for White students – Oregon’s 71% rate.

Uninsured Rate

  • The uninsured rate among African-Americans continued its steady decline in 2012, as the full implementation of the Affordable Care Act’s (ACA) mandated insurance marketplaces loomed large over the healthcare industry. Overall uninsured rates declined in 37 states and the District of Columbia from 2011, with state rate increases primarily driven by rising uninsured rates among White residents. That said, nationally, residents of color are still nearly twice as likely to be uninsured than are White residents. The full implementation of the ACA in 2014 should serve to narrow the uninsured gap even further, as underserved African-American households gain access to affordable health services that has thus far eluded them.

Though the environment appears bleak for many African-American households, there are avenues for opportunity. States can lead the way by adopting policies that enable families to build wealth, like lifting asset limits and adopting an earned income tax credit. States can also combat the intergenerational transfer of wealth that has helped to calcify the racial wealth gap by targeting wealth-building policies – often within the tax code – toward underserved communities and populations, thereby helping to tilt the scales back to a more equitable position. For more policy recommendations, and the outcome data for all households of color, visit the 2014 Assets and Opportunity Scorecard website.

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