Articles – Page 9

Ending Banking Deserts in Texas

“Banking development districts” and “savings lotteries” could help more Texans open and use bank accounts.

In the parts of Dallas known as South Dallas and West Dallas, west of the Trinity River, many neighborhoods could rightly be called “banking deserts.”

“You see a handful of bank branches, a Chase drive-through or an ATM kiosk in a strip mall,” says Texas State Rep. Eric Johnson, whose district includes these areas. “You don’;t see any – or very few – of the smaller community banks or credit unions.”

But what these neighborhoods do have in abundance, says Johnson, are what he calls “lower-tier” financial services providers: payday lenders, title lenders, pawn shops, and check cashers.

Dallas is, in fact, among the most “unbanked” cities in America, and Texas is among the most “unbanked” states. According to the Federal Deposit Insurance Corporation (FDIC), more than one-third of Dallas-area households – about 36 percent – either have no bank account at all or rely mostly on check cashers and other non-bank providers for financial services. These households are what the FDIC calls “unbanked” and “underbanked.” Statewide, nearly 4 in 10 Texas households – or about 38 percent – fall into one of these categories, compared to about 27 percent nationwide.

But Texas might now be on the path to reversing these trends. In May, Johnson successfully led the passage of legislation that could put Texas at the forefront of improving access to mainstream financial services. Better access to banks, Johnson hopes, would also mean better access to mainstream financial products such as home mortgages, small business loans and lower-cost consumer credit – all of which are in short supply in many parts of Dallas and Texas.

Continued at the Washington Monthly…

It’s hard to be a moderate politicians. It’s also expensive

Moderate candidates pay a heavy “centrist premium” to win and keep their seats.

Via the Washington Post

It’s tough to make it as a moderate in Congress these days.

Across the country, competitive purple districts have been gerrymandered into oblivion, replaced by seats that are safely red or blue. Activists at both extremes show no mercy toward elected officials who venture to advocate compromise. Even former House majority leader Eric Cantor — hardly moderate — fell victim to a 2014 primary challenge from a tea-party-backed opponent after his immigration stance ran afoul of the GOP’s far right wing. But perhaps most prohibitive: Being a moderate costs far more than being extreme. And the increasing expense means most moderates can’t compete.

Consider the case of Democratic members of the House, where long-standing, self-defined coalitions — New Democrats and Blue Dogs on the one hand and the Progressive Caucus on the other — separate moderates and liberals with reasonable clarity. (Members must apply to join, attend regular meetings and remain in good standing.) In the past three election cycles, self-described moderate lawmakers spent roughly twice as much as their liberal counterparts to win or defend their seats.

In 2014, for example, direct spending by members of the moderate New Democrat and Blue Dog coalitions averaged $2.01 million per campaign, according to an analysis of data derived from OpenSecrets.org, the site of the Center for Responsive Politics. In contrast, members of the liberal Progressive Caucus each spent an average of $1.07 million on their races.

This disparity is even more extreme — greater than 3 to 1 — when all campaign spending is included. Counting spending by opponents and outside groups, the average campaign in a New Democrat or Blue Dog district cost $5.2 million in 2014, compared with an average of $1.57 million in Progressive Caucus districts.

And as ideological partisanship increases, this centrist premium is growing. For every dollar that the average Progressive Caucus member directly spent to defend his or her seat in 2014, the average moderate lawmaker spent $1.93. By comparison, moderates shelled out $1.54 for every campaign dollar spent by liberals by 2012 and $1.65 in 2010.

Continue reading at the Washington Post.

Financial Volatility Is the New Normal for American Households

New research finds most Americans are unprepared to weather a financial crisis.

Standard financial planning advice presumes that financial emergencies – the loss of a job, an illness or accident, or an unexpected car or household repair – are relatively infrequent for most households. But new research shows that many American households live in a constant state of financial uncertainty, experiencing major monthly swings in their income and expenses.

A recent report from the JPMorgan Chase Institute, which analyzed a sample taken from 2.5 million accounts, finds that volatility is the norm, even at higher incomes. According to the study, as many as 89 percent of Americans see their incomes fluctuate by more than 5 percent from month to month, while 60 percent see changes in spending greater than 30 percent from month to month. Moreover, these figures are roughly the same across all income levels.

Continued at the Washington Monthly…

It’s hard to be a moderate politician. It’s also expensive.

It’s tough to make it as a moderate in Congress these days.

Continued at the Washington Post…

How to End Gerrymandering

Every state should have an independent redistricting commission, says Tennessee Congressman Jim Cooper.

Many observers say Illinois’ 4^th Congressional District resembles a pair of ragged earmuffs. Intended to capture Chicago’s Latino population, the district carves out two roughly symmetrical disks in the heart of the city, connected by a narrow stretch of I-294.

The district is often cited as a blatant example of “gerrymandering” – but it’s legal. A federal court rejected a challenge to the district map in 2011. And districts that look like Illinois’ 4^th Congressional District are increasingly common. With the help of proprietary programs such as Maptitude and access to household-level data, states can now draw districts to their liking with uncanny precision.

As one result, the number of competitive Congressional districts, according to the Cook Political Report, dropped from 164 in 1998 to just 90 in 2013.

“It’s gotten so bad that you could say politicians elect their voters, not the other way around,” says Rep. Jim Cooper (D-TN).

Continued at the Washington Monthly…

The Death of “Reinventing Government”

New research says “dismantlers” now have the upper hand.

In 1993, President Bill Clinton and Vice President Al Gore launched modern history’s longest-running project to fix the federal government.

Posing with two forklifts loaded with federal documents, Gore vowed to streamline an “old-fashioned, outdated government” with a ruthless focus on efficiency. By the project’s end in 2000, “reinventing government” had eliminated 640,000 pages of internal regulations, cut 426,200 federal jobs and saved $136 billion. Public trust in government rose from 25 percent in 1993 to 42 percent in 2000, the highest it had been in decades.

Today, however, trust in government has sunk back to historic lows. And as the 2016 elections approach, “government reform” is a likely plank in many candidates’ platforms.

But if it’s time for reinventing government again – the 1990s’ focus on “inefficiency” might be too pallid a prescription for government’s current woes. Americans no longer believe inefficiency and waste are the government’s biggest problems, according to a recent study by Brookings Institution scholar Paul Light. Instead, more Americans now disagree with government’s fundamental priorities. It’s not so much how government is doing its job, but what it’s doing in the first place – a problem no amount of streamlining can fix.

Continued at the Washington Monthly…

French Fries and Free Trade Agreements

Booming U.S. potato exports are an example of how free trade agreements can open markets for U.S. products – and fuel cultural trends abroad.

South Korean consumers have fallen hard for potatoes.

In 2013, a group of teenagers in South Korea made international news when they were booted from a McDonald’s after buying $250 in French fries. The teens had hoped to host a “potato party” – a fad then sweeping South Korea and Japan.

Now the latest Korean food craze is “honey butter” potato chips. Introduced in August 2014 by the Haetae Confectionery & Food Co., the salty-sweet snacks are a national obsession, endorsed by celebrities and K-Pop stars, and sometimes in such scant supply that chip scalpers have created their own market. Vice recently reported that two bags of the coveted chips sold on eBay for $103.50.

Among the chief beneficiaries of the current Korean passion for potatoes are U.S. potato growers and processors, who’ve seen their exports explode in recent years. According to the U.S. Potato Board, U.S. potato exports hit a record high of $1.76 billion in 2014, shipping out 1,643,618 metric tons of potatoes. South Korea is now among the top global destinations for U.S. potatoes, after Japan, Canada and Mexico. The Potato Board reported that exports to Korea grew by 87,000 metric tons – or 13 percent – from 2013 to 2014 alone.

Many variables account for why some food trends take off and others don’t. But U.S. exporters credit one factor in particular for boosting the wide availability of potatoes in the Korean market: free trade.

Continued at the Washington Monthly…

The Challenge of Latino Retirement Security

Only 6 percent of Latino workers in California have employer-sponsored retirement savings.

America’s fastest-growing demographic group might also be the least ready for retirement.

New research by the National Council of La Raza finds that in California – home to more than a third of the nation’s Latino population – just 29 percent of Latinos have access to an employer-sponsored retirement plan and only 21 percent of those who have access participate. Taken together, this means only 6 percent of the state’s Latino workers have employer-sponsored retirement savings at all.

Continued at the Washington Monthly…

“The Little Agency That Could” – OPIC’s Outsized Role in Global Development

This often-overlooked agency leads U.S. development efforts overseas – while making a profit for taxpayers.

In 2011, the Dominican Republic launched its first-ever wind farm, with the eventual capacity to offset more than 62,500 tons of carbon emissions a year.

In sub-Saharan Africa, “micro-irrigation” kits allow small farmers to grow onions, tomatoes and other cash crops throughout the dry season, boosting production and incomes.

And in rural India, 300,000 people a day have access to clean drinking water from 500 new water-treatment facilities built in villages throughout Punjab.

These initiatives are among the thousands of projects financed over the years by the federal Overseas Private Investment Corporation (OPIC). Though often overlooked, this agency has long been at the forefront of U.S. efforts to boost the economies and living standards of developing countries while also supporting U.S. foreign policy aims.

Continued at the Washington Monthly…

Why America Needs an Arctic Ambassador

New legislation would help America protect important interests in the Arctic.

New government data finds that the amount of Arctic sea ice this year is at its lowest level ever – another possible indicator of climate change and rising sea levels around the world.

The accelerating melt also poses another risk: a potential global battle – that America may be ill-equipped to win – for the vast natural resources once buried under the now-disappearing Arctic ice.

Continued at the Washington Monthly…