America’s Racial Wealth Gap Is Fixable

The Huffington Post
by: Preeti Vissa

America’s yawning racial wealth gap gets mentioned only rarely in political and policy discussions — perhaps the only thing rarer is for a political leader to suggest that this problem can actually be fixed. But a recent study from Brandeis University’s Institute on Assets and Social Policy suggests that it is indeed fixable — if we forget most of what we think we know.

First, some numbers: According to U.S. Census data, for every dollar of wealth a U.S. white family has, the median Asian family has about 63 cents, the median Latino family has seven cents, and the median black family has less than a nickel.

Many believe this gap comes from personal attributes and choices like laziness or choosing not to save. As one commenter on a conservative website put it recently, “This [racial wealth gap] may be no more than the result of different tendencies in different cultures with respect to saving money.”

It’s comforting to believe that America’s staggering wealth gap exists only because “those” people are lazy and irresponsible. Reality is more complicated.

The fascinating study from Thomas Shapiro and colleagues — which got some coverage but deserves far more attention — followed 1,700 families from 1984 to 2009. They looked at how much wealth these families managed to accumulate and what factors contributed to differences between racial groups, and the results were startling.

Unfortunately, the researchers didn’t have data for enough Asian and Latino households to produce reliable comparisons, but they were able to compare white and African-American families. In 1984, the white families were worth about $85,000 more than the black families. Over time, both groups gained wealth, but 25 years later the gap between white and black families had soared to over $236,000.

What perpetuated and expanded this gap was a web of what the researchers termed “opportunities and barriers in workplaces, schools and communities that reinforce deeply entrenched racial dynamics in how wealth is accumulated.” Those opportunities are shaped by policy, meaning we can fix them.

Those barriers and opportunities revolved around things like homeownership, income, unemployment and inheritance. The biggest factor by far was years of homeownership, which accounted for more than a quarter of the racial wealth gap in these families.

And homeownership, sadly, has a huge racial component. Decades of what Shapiro and colleagues term “racial segregation by government design” (and not just in the Jim Crow south, but often enforced by federal agencies like the FHA) lowered demand for homes in black neighborhoods, reducing the equity black homeowners could accrue. Because whites are five times more likely to inherit money than blacks, or otherwise help family members with downpayments, whites on average bought homes and started building equity eight years earlier than African-Americans, generally with lower lending costs.

Shockingly, factors that should help everyone helped whites far more than blacks. Take education, for example: “Similar college degrees,” the researchers write, “produce more wealth for whites.” A number of factors contribute to this, including the fact that African-Americans are more likely to graduate college burdened by debt.

This is discouraging, but much of it can be addressed by smart policies. We can enforce lending standards and fair housing policies to lessen the effects of segregation and predatory lending. We can help low-income families and families of color attend college and graduate without massive debt. We can use the minimum wage and equal pay provisions to reduce the income gap, and strengthen employer-based retirement plans.

But the first step is to recognize that the racial wealth gap didn’t just happen. Policies created it, and policies can fix it.

Follow Preeti Vissa on Twitter: www.twitter.com/Greenlining

America's Top Housing Official Must Aid Struggling Homeowners

The Huffington Post
by:Preeti Vissa

If one man can be described as absolutely key to solving the ongoing foreclosure crisis — and thus not only helping millions of struggling homeowners but also stabilizing the neighborhoods where they live — it is Edward DeMarco, head of the Federal Housing Finance Agency. The rest of the country is inching forward on tangible progress, but DeMarco could do more than anyone.

The need is as urgent now as it ever was.

Continue reading “America's Top Housing Official Must Aid Struggling Homeowners”

An Ebenezer Scrooge Christmas?

huffingtonpost.com

By Preeti Vissa

This time of year conjures up traditional images of family gatherings, cozy fireplaces, shared meals and happy exchanges of presents — images of home, security and friendship. But millions of Americans who have had their homes foreclosed or who are in imminent danger of foreclosure have no such sense of security, and in many cases no real home. Far too little is being done to help them.

It seems like Ebenezer Scrooge is running Christmas this year. But it doesn’t have to be this way.

Continue reading “An Ebenezer Scrooge Christmas?”

An Important Step to Clean Air and More Equitable Communities in Los Angeles

Union of Concerned Scientists Blog
By Joel Espino and Jimmy O’Dea

Next month, LA Metro, the second largest transit fleet in the United States, will decide what types of buses to purchase through 2030. The decision will impact Los Angeles’ efforts to clean the air, fight climate change, and expand economic opportunity. We applaud the proposal put forward by Metro staff last week to transition the entire fleet to zero-emission vehicles.

LA Metro can be a leader

Today, Metro’s 2,200 buses operate entirely on natural gas. While natural gas was a better option than diesel when Metro began switching fuels more than 20 years ago, it no longer deserves the “clean” branding seen on Metro’s buses. Advances in technology have made electric buses an even cleaner and viable option. It’s time for Metro to continue its leadership in fighting pollution and transition to the cleanest technology available today: electric buses powered by renewable energy.

Earlier this year, a coalition of bus riders, labor groups, and public health groups launched a campaign urging Metro to be a leader and transition to an all-electric bus fleet powered by renewable energy. A central part of this campaign is that communities most affected by poverty and pollution should be first to reap the benefits of bus electrification, such as improved air quality and more high-quality, skilled jobs. Mayor Garcetti recently urged Metro to make this transition by 2030 and just yesterday, the Los Angeles Times expressed its support for Metro’s path to zero-emission buses.

Despite years of work and improvement, Los Angeles’ air still ranks among the worst in the country. Heavy-duty vehicles like buses are a major source of air pollution.  Today, residents of communities like Wilmington or Bell Gardens, who live near highly trafficked roads and freight corridors, suffer the consequences of air pollution like increased risks of lung and heart disease and premature death.

Last fall we found that electric buses result in far lower air pollution and global warming emissions than natural gas buses. Electric buses have zero tailpipe emissions, cut global warming pollution, and create new jobs. They are better for bus riders, bus drivers, and communities with heavy traffic and severe air pollution.

Our analysis found the potential for good jobs in manufacturing of electric buses, construction of charging infrastructure, and maintenance. With the right training and hiring practices, this industry could bring an economic boost to communities most in need.

Electric buses are the cleanest

There are two types of electric buses Metro could purchase; both have significant benefits. Battery electric buses have 70 percent lower global warming emissions than natural gas buses. Fuel cell electric buses have 50 percent lower global warming emissions than natural gas buses. That includes the emissions from producing electricity and hydrogen. Both types also cut smog-forming emissions in half compared to today’s natural gas buses. As we generate more of our electricity with clean sources like solar and wind, electric buses will be even cleaner.

Electric buses also have lower life cycle emissions than the newest “low-NOx” natural gas buses fueled with biomethane from waste sites such as landfills. Capturing fugitive methane emissions from sources of waste is an important strategy in reducing California’s global warming emissions and can help displace natural gas use in vehicles, yet the limited amount of biomethane available from sources of waste could meet just 3 percent of California’s natural gas demand.  This resource should be used prudently across California’s economy.

The technology is here and ready

Electric buses fueled with hydrogen have had ranges over 200 miles for many years and battery electric buses recently passed this mark. With fewer moving parts and durable electric motors, maintenance costs are lower for electric buses. Electric buses can also accelerate and climb hills as well or better than diesel or natural gas buses.

Metro’s bus investment would boost the regional economy, including at least eight electric bus and truck manufacturers in the LA region, and spur job training in underserved communities, creating a workforce capable of accelerating electrification in other areas of transportation.

Metro can’t switch to electric buses overnight, but as it retires natural gas buses it should replace each with a clean, quiet electric bus. Nearly 20 transit agencies across the state have stepped up to the plate and begun incorporating electric buses into their fleets, many with significant, if not full, commitments to zero-emission buses. California and its poorest and most polluted communities depend on it.

An Important Step to Clean Air and More Equitable Communities in Los Angeles

The Union of Concerned Scientists Blog 
By Jimmy O’Dea and Joel Espino

Tomorrow, LA Metro, the second largest transit fleet in the United States, will decide what types of buses to purchase through 2030. The decision will impact Los Angeles’ efforts to clean the air, fight climate change, and expand economic opportunity. We applaud the proposal put forward by Metro staff last week to transition the entire fleet to zero-emission vehicles.

LA Metro can be a leader

Today, Metro’s 2,200 buses operate entirely on natural gas. While natural gas was a better option than diesel when Metro began switching fuels more than 20 years ago, it no longer deserves the “clean” branding seen on Metro’s buses. Advances in technology have made electric buses an even cleaner and viable option. It’s time for Metro to continue its leadership in fighting pollution and transition to the cleanest technology available today: electric buses powered by renewable energy.

Earlier this year, a coalition of bus riders, labor groups, and public health groups launched a campaign urging Metro to be a leader and transition to an all-electric bus fleet powered by renewable energy. A central part of this campaign is that communities most affected by poverty and pollution should be first to reap the benefits of bus electrification, such as improved air quality and more high-quality, skilled jobs. Mayor Garcetti recently urged Metro to make this transition by 2030 and just yesterday, the Los Angeles Times expressed its support for Metro’s path to zero-emission buses.

Despite years of work and improvement, Los Angeles’ air still ranks among the worst in the country. Heavy-duty vehicles like buses are a major source of air pollution. Today, residents of communities like Wilmington or Bell Gardens, who live near highly trafficked roads and freight corridors, suffer the consequences of air pollution like increased risks of lung and heart disease and premature death.

Last fall we found that electric buses result in far lower air pollution and global warming emissions than natural gas buses. Electric buses have zero tailpipe emissions, cut global warming pollution, and create new jobs. They are better for bus riders, bus drivers, and communities with heavy traffic and severe air pollution.

Our analysis found the potential for good jobs in manufacturing of electric buses, construction of charging infrastructure, and maintenance. With the right training and hiring practices, this industry could bring an economic boost to communities most in need.

Electric buses are the cleanest

There are two types of electric buses Metro could purchase; both have significant benefits. Battery electric buses have 70 percent lower global warming emissions than natural gas buses. Fuel cell electric buses have 50 percent lower global warming emissions than natural gas buses. That includes the emissions from producing electricity and hydrogen. Both types also cut smog-forming emissions in half compared to today’s natural gas buses. As we generate more of our electricity with clean sources like solar and wind, electric buses will be even cleaner.

Electric buses also have lower life cycle emissions than the newest “low-NOx” natural gas buses fueled with biomethane from waste sites such as landfills. Capturing fugitive methane emissions from sources of waste is an important strategy in reducing California’s global warming emissions and can help displace natural gas use in vehicles, yet the limited amount of biomethane available from sources of waste could meet just 3 percent of California’s natural gas demand. This resource should be used prudently across California’s economy.

The technology is here and ready

Electric buses fueled with hydrogen have had ranges over 200 miles for many years and battery electric buses recently passed this mark. With fewer moving parts and durable electric motors, maintenance costs are lower for electric buses. Electric buses can also accelerate and climb hills as well or better than diesel or natural gas buses.

Metro’s bus investment would boost the regional economy, including at least eight electric bus and truck manufacturers in the LA region, and spur job training in underserved communities, creating a workforce capable of accelerating electrification in other areas of transportation.

Metro can’t switch to electric buses overnight, but as it retires natural gas buses it should replace each with a clean, quiet electric bus. Nearly 20 transit agencies across the state have stepped up to the plate and begun incorporating electric buses into their fleets, many with significant, if not full, commitments to zero-emission buses. California and its poorest and most polluted communities depend on it.

And the Oscar for Irony Goes to …

SF Gate
By Preeti Vissa and Regina Davis

The Best Documentary Oscar for “Inside Job,” aside from being a deserved award for a well-made film, is also a reminder of how wildly off-track the debate about economic recovery has gone. Watch the film (out on DVD March 8 ) and marvel at how much structural reform is needed, and at the irony of how much the Republican House majority is doing to thwart what reforms have already been enacted.
Continue reading “And the Oscar for Irony Goes to …”

Another View: Oil Industry Doesn’t Speak for Low-Income Californians

Californians aren’t buying the notion that the oil industry cares about low-income communities most impacted by pollution and poverty. (Collaboration needed, not harsh fuel limits”; Viewpoints, Oct. 4). Their deceitful campaign to weaken Senate Bill 350, the state’s newest, historic clean energy law, is more than enough evidence that the only thing the oil industry cares about is its bottom line.

The Western States Petroleum Association waged an unprecedented, no-expenses-spared effort to remove the provision in SB 350 to cut petroleum use. When all the lobbying reports are in, I suspect we will see record spending this year by those threatened by a clean energy future.

The petroleum association’s leader claims, “The voice of the people was heard.” Yet a recent Latino Decisions poll found 81 percent of Latinos in California strongly supported the exact goal the oil industry killed. There is nothing arbitrary about wanting to reduce our dependence on petroleum.

Fortunately, many lawmakers were not swayed by the oil industry’s familiar scare tactics and persevered to ensure that the law signed by Gov. Jerry Brown on Wednesday moves our state forward toward meaningful action on clean energy and climate change. While the petroleum association and its oil company members were successful in removing the petroleum-reduction component of SB 350, the final bill is a huge achievement for California and a model for other states and nations.

If you want to see how climate leadership is uplifting the most disadvantaged Californians, look no further than The Greenlining Institute’s new report profiling the neighborhood-level climate investments made possible by our state’s signature climate change law, Assembly Bill 32.

Through AB 32, California has generated close to $3 billion for projects that cut carbon pollution, and each year at least 25 percent of funds go to the most polluted parts of the state. These climate investments are making a difference. Take Roy Rivera of Sacramento, who is disabled and lives on a fixed income. He will save more than $800 this year from new solar panels he received at no cost. Or the Mendoza family of Stockton, who exchanged an inefficient 1984 Ford Ranger and got rebates to help them afford a Prius plug-in hybrid.

If the Western States Petroleum Association had its way, we would cease these investments in disadvantaged communities across the state. That would be reckless.

The next time the oil industry seeks “collaboration,” it should stop lecturing us and start listening to Californians, who support cutting poverty and pollution by any means necessary.

Are Banks Abandoning Fresno Home Buyers?

The Fresno Bee
By Vedika Ahuja and Tate Hill

If you or someone you know bought a home in Fresno recently, chances are the lender wasn’t a bank. That raises a number of concerns.

Recently, The Greenlining Institute and the National Community Reinvestment Coalition analyzed federal data on California home mortgage lending for 2015, examining statewide figures and looking specifically at lending patterns in Fresno, Oakland and Long Beach. Each city had a different story.

In Fresno, the story might be titled, “The Rise of the Non-Banks.” Surprisingly, nine of Fresno’s top 10 home purchase lenders weren’t banks – a much larger presence of non-banks than in the statewide figures, and a huge difference from 2013 when five of the top 10 lenders in Fresno were banks.

Why does this matter? Traditional financial institutions like banks and credit unions don’t just make loans. They take deposits and offer savings and checking accounts, ATM services, etc. The non-bank lenders writing most of the home purchase and refinance loans in Fresno don’t offer those services.

Just as important, banks holding Fresno residents’ deposits have an obligation to the community under the Community Reinvestment Act, an important law which requires banks to meet the credit and borrowing needs of the communities they serve.

The CRA has brought billions of dollars in investment to underserved communities that financial institutions had largely neglected, including rural communities here in the Valley.

One question our findings raise is, “Where are the banks?” Wells Fargo, California’s top lender, was also Fresno’s leading home purchase lender in 2015. But no other bank – not even giants like Bank of America and JP Morgan Chase – made the top 10.

What’s going on? Many banks, including Bank of America, Bank of the West, and MUFG Union Bank hold substantial deposit shares in the area. However, we see banks pulling out of the home-lending business in Fresno, and also closing branches here. Since 2008, California has lost five percent of its bank branches while Fresno County has lost 15 percent.

That is why we are working with numerous organizations on the San Joaquin Valley Economic Justice Campaign, an effort to hold banks accountable to meeting the credit needs of low-income communities and people of color in the area.

We urge banks to increase affordable home lending to underserved populations and support housing counselors and other local organizations that build the financial health and wealth of Valley communities.

We should also consider how non-banks impact the Fresno community. These non-banks aren’t covered by the Community Reinvestment Act and don’t technically have an obligation to meet the needs of the community. Many of these non-banks are more effective at reaching communities of color than banks, with three such lenders making over half of their Fresno home purchase loans to Latinos.

This could be a good thing, but could also pose a risk, depending on the terms and rates of those loans. From the little research available, non-banks appear to charge slightly higher rates than deposit banks for similarly situated borrowers.

We did not compare rates and terms of loans given by Fresno’s non-bank and bank lenders, but this question definitely needs further research, and will become increasingly important. Immigrant communities, especially those who speak and read only limited English, could be exploited if we’re not careful.

Homeownership remains one of the most crucial ways to build intergenerational wealth. Cities, community leaders, and nonprofit organizations must work together to ensure that communities of color and low-income people throughout the Valley are not left behind as the financial industry evolves.

Vedika Ahuja is Economic Equity Senior Manager at The Greenlining Institute. Tate Hill is Senior Manager of Administration at Access Plus Capital in Fresno and a Greenlining Institute board member.

 

Are Benefit Incentives Not to Work a Cause or a Result?

The Wall Street Journal
by: Orson Aguilar

It must be nice to live in such a sheltered world that you can imagine, as Richard Vedder does, that Americans aren’t working because they’re so lazy they would rather collect food stamps or freeload through college on Pell Grants than get a job. Has Prof. Vedder ever tried feeding himself on $125 a month?

Continue reading “Are Benefit Incentives Not to Work a Cause or a Result?”