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Archives for March 2017

by Catherine Read

The Financial Diaries: How American Families Cope in a World of Uncertainty

The Financial DiariesThe most fundamental way to reduce the volatility that Americans face is through improvements in job quality . . . the Great Job Shift has resulted not only in lower wages but also unpredictable scheduling, inadequate hours, and less job security. Alongside those challenges are diminishing opportunities for training and advancement, and an erosion of benefits such as paid leave and employer provided health care and retirement coverage.

Jonathan Morduch and Rachel Schneider presented the findings contained in their book The Financial Diaries: How American Families Cope in a World of Uncertainty at the Aspen Institute’s Summit on Inequality & Opportunity held in Washington, DC, on March 16, 2017.

Researchers followed 235 low and middle-income families for one year and delved into their daily decision making about how they managed their household finances. They were from various regions of the country and represented a variety of family structures, but at least one member of every household (and often more) were working.

This is an excellent companion book to Lisa Servon’s The UnBanking of America which also addresses how working people are using every means at their disposal to make ends meet – often without the help of traditional financial institutions. In both books, the strength of the research is in the qualitative approach to understanding the real world context of decision-making. These are people’s stories – real people caught between a rock and a hard place. Data is limited in what it can show us – patterns and practices – but it’s not telling us WHY.

What Morduch and Schneider found is that people are struggling with variable income that has spikes and dips that don’t mesh with their financial obligations. Even families whose annual income is sufficient to cover their basic living expenses have months where they dip below the poverty line. Throughout this book the importance of the Earned Income Tax Credit (EITC) kept coming up as the saving grace for families to pay down debt or get back on their feet in February and March of each year.

Living hand to mouth does not leave room for unexpected healthcare costs and car repair. Those were the two things that most often imploded a fragile budget because they are necessities. A car to get to a job was a must have for the majority of people in this research group. Which only points to the EPIC FAILURE of this country to invest in better transportation options. And health care costs for those who are uninsured are still forcing people into bankruptcy over unpaid bills.

This book covers so much territory in 178 pages. What keeps hard working people down are a confluence of factors – not just one or a few. Some of these we can lay at the feet of businesses who have shifted a certain level of risk from their own bottom lines and placed it on workers – with “just in time” staffing, variable hours and schedules, and no paid benefits. Companies now worship at the altar of profit margins and quarterly returns for shareholders – not investing in their employees as Henry Ford once did so that he created a class of consumers who could purchase what they produced. Other factors include some bad public policy.

Most government savings policies – especially tax deductions for retirement savings and housing – were directed toward high-wage employees, not janitors and cafeteria workers. In 2013, the United States spent almost $400 billion in federal tax subsidies for homeownership and retirement savings. That was 30 percent of all federal tax expenditures. About 70 percent of the savings from the mortgage interest and property tax deductions went to the top 20 percent of earners. Almost none went to the bottom 40 percent.

The reality of what people are doing to get by should give us all pause. Not enough people in our communities are thriving and the amount of energy required just to survive is not some great American Dream. It is a constant and stressful nightmare that is being handed down from one generation to the next in our post WWII economy. Wage stagnation began in the early 1970s and the picture for the future is bleak unless significant changes are made in the creation of better jobs with basic benefits, public policy that spreads out benefits to all income groups, and the willingness of financial institutions to change how they assess people’s credit worthiness and their investment in services to better support low-income working class people.

This book points out time and again that there is a difference between “insolvency” and “illiquidity.” Yet despite existing, and very sophisticated technology, and access to reams of personal financial data, financial institutions appear to have few incentives to better meet the needs of millions of working people who are struggling to match up their income to their expenditures on a weekly and monthly basis. This economic uncertainty and instability has been labeled in sociological terms as “precarity” defined as “a precarious existence, lacking in predictability, job security, material or psychological welfare. The social class defined by this condition has been termed the precariat.”

This precariat are millions of working people in this country – friends, neighbors, colleagues, co-workers and family members. We can’t begin to solve problems we don’t fully understand. This book goes a long way in describing the lives of people all around us in a way they would not likely share with us. That is a very powerful thing in seeing these issues not as ideological debates about masses of nameless faceless people we don’t know, but as humanizing issues of public policy down to the devastating financial impact of a broken down car on a neighbor’s ability to survive in very real terms.

I highly recommend this book. I think it will benefit every person who reads it.

Filed Under: Blogging, Good Books, Political Tagged With: Aspen Institute, Banking, EITC, Financial Institutions, Healthcare, Jonathan Morduch, Precarity, Rachel Schneider, tax reform, Working Class, Working Families

by Catherine Read

OAR Fairfax Breaking the Cycle of Crime – Inside Scoop

(March 20, 2017) Catherine Read talks with Derwin Overton of OAR Fairfax. OAR was founded in 1971 as a national organization which later became more localized with smaller non-profits embedded into communities across the country to better serve those who are released from incarceration. Opportunities, Alternatives and Resources is the core value of this organization which started out as Offender Aid and Restoration.

Derwin Overton OAR FairfaxDerwin Overton has been with OAR for fourteen years, with 10 of those years as Executive Director. OAR Fairfax serves Fairfax, Prince William and Loudoun Counties with some of their funding coming from the national organization, some from Fairfax County and the rest a cobbled together mix of grants and individual donors. They have the support of the Fairfax County Sheriff’s Office which runs the Fairfax County jail and works to facilitate the work they do with inmates prior to their release. OAR also works with the local judiciary on alternative sentencing for first offenders, using community service hours as a more appropriate form of restorative justice.

Classes are taught inside the jail on basic skills like financial management, interpersonal skills, parenting, resume writing and job interviews. Upon release, program participants are provided with basic needs like a set of clothes, toiletries, tokens for transportation and snacks. In the third segment, volunteer services coordinator Peggy Krusell talks about what brought her to the program as a volunteer and why she is so passionate in her mission to help these returning citizens to write a better chapter in their life story.

John Chapman Inside ScoopJohn Chapman joins Catherine in the second segment to talk about his experience with OAR prior to his release from jail and how he was inspired by his own difficulty in finding a job to create a jobs training program. John founded the non-profit Johnny Apple Seed Association, Inc. to train those formerly incarcerated to be electricians, plumbers and HVAC technicians. He acquired and converted an old party bus into a mobile training center. With the financial support and backing of the Home Depot in South Riding, that first training effort took off. There is now a training center in Seven Corners and John is looking to scale and expand these training efforts to other locations around Virginia. They have had great early success in their training efforts and are providing local communities with the skilled and licensed tradesman that are in short supply.

OAR continues to build awareness of the services they provide both inside local detention centers and to the formerly incarcerated individuals upon their release. There is a constant search for funding, volunteers, instructors, donated supplies and training programs to serve this population like Johnny Apple Seed.

OAR is hosting an event on June 7, 2017 at Bull Run Winery to raise money and awareness for the services they provide here in Northern Virginia. The public is invited and encouraged to attend to find out more about how this organization is helping those who have been incarcerated to successfully return to their families and communities.

Filed Under: Blogging, Entrepreneurship, Inside Scoop, TV Shows, Virginia Tagged With: Derwin Overton, Fairfax County, Felons, Formerly Incarcerated, Jobs Training, John Chapman, Johnny Apple Seed, OAR, OAR Fairfax

by Catherine Read

Paid Family and Medical Leave for American Workers with Vicki Shabo – Inside Scoop

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(March 6, 2017) Catherine Read talks with Vicki Shabo, Vice President, National Partnership for Women & Families, about Paid Leave. The United States is one of the few developed countries in the world that does not ensure that working people have paid time away from their jobs when they have a routine illness or need preventive health care, and that does not have basic guarantees for family and medical leave, for working people who need to care for a new child, a seriously ill loved one or deal with their own more serious health issues.

It was only 24 years ago, in 1993, that Congress passed the Family and Medical Leave Act (FMLA) that provides 12 weeks of unpaid leave for the birth or adoption of a child or caring for immediate relatives with serious medical problems. Employees can also take time off for medical conditions of their own that make them unable to work.  Even under FMLA, many full-time employees are not covered if they work for a small business with less that 50 employees. To qualify for the leave, employees must work for at least a year for at least 1,250 total hours as of 2015. While some larger corporations provide paid leave at their own discretion, that only covers a small percentage of the U.S. workforce.

In today’s economy, only 14 percent of workers in the United States have access to paid family leave through their employers, and fewer than 40 percent have access to personal medical leave through employer-provided short-term disability insurance. A major initiative for the National Partnership for Women & Families is the fight for Paid Family and Medical Leave.

There is a coalition of over 300 organizations across the United States working toward better workplace policies. More information about the work of the coalition can be found at http://supportpaidleave.org

Four states now have, or will soon have, paid family leave laws in place – and DC is set to join them soon. Nearly 40 jurisdictions guarantee paid sick days, and nearly two dozen jurisdictions have strengthened protection for pregnant workers.

Sen. Kirsten Gillibrand (D-N.Y.) and Rep. Rosa DeLauro (D-Conn.) have introduced the Family And Medical Insurance Leave (FAMILY) Act that would create a shared fund to make paid leave affordable to all employers.

There are numerous ways to get involved in pushing for paid leave policies at the city and county level, through state legislation, and at the federal level by supporting the FAMILY Act. You can contact Senator Tim Kaine and Senator Mark Warner to tell them to sign on to Senator Gillibrand’s bill, as well as contacting your Congressional Representative to sign on to Rep. Rosa DeLauro’s bill in the House. Every call and email helps.Paid Leave Checklist

A good paid leave policy will include a broad range of workers. The National Partnership for Women & Families has developed a checklist for what a real paid leave policy should look like. While good public policy on this issue is critical for the health and well being of families, workers can advocate to their employers to take steps to provide inclusive paid leave voluntarily through better and more inclusive company policies.

You can follow the hashtags #FAMILYAct and #PaidLeave on Twitter and you can use WeTweet.org to tweet directly at your elected officials, including the President. The National Partnership for Women & Families tweets under @NPWF and there are other members of their coalition you can follow including @MomsRising, @PaidLeaveUS and @FmlyValuesWork. These organizations are active in issuing action alerts and organizing constituents to contact their elected representatives. Get involved and help push this initiative forward.

Filed Under: Blogging, Inside Scoop, Political, Women Tagged With: Catherine Read, FAMILYAct, FMLA, Maternity Leave, National Partnership, paid leave, Paid Sick Days, Parental Leave, Vicki Shabo, Women & Families

Catherine S. Read
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