Ritz for Forbes: Win or Lose, Executive Actions Like Student Debt Cancellation Should Face Judicial Review

By Ben RItz

The Supreme Court will hear oral arguments this week on the constitutionality of President Biden’s attempt to cancel up to $20,000 in student loans per borrower via executive action last year. Many proponents of the move, including the Biden administration itself, have argued that not only is the move itself legal but that it is wrong for the courts to even entertain the pending challenges to its legitimacy. Whether one thinks the plan itself is lawful or not, everyone should be grateful that the courts are so far rejecting this argument and taking a serious look at the merits of the plan itself because failure to do so could have catastrophic long-term implications.

The Biden administration says that it has the authority to grant mass debt cancellation under the HEROES Act: a law passed in 2003 that gives the Secretary of Education authority to adjust the terms of any loan it holds during national emergencies. The law was introduced to make it easier to discharge debt for victims of terrorism and veterans who were injured or killed fighting the War on Terror, but the Biden administration argues that the law’s text gives them broad discretion to provide relief for anyone who lived through the COVID-19 pandemic.

Several lawsuits claimed this broad interpretation was an abuse of the HEROES Act authority that went well beyond Congress’s intent in passing the law. The answer to this legal question has serious implications for our constitutional system, which entrusts Congress with the power of the purse. If allowed to proceed, Biden’s debt cancellation move would cost taxpayers over $400 billion. That would be one of the biggest expenditures of public funds without explicit Congressional appropriation.

Read more in Forbes.

Adrienne Elrod of Dept. of Commerce’s CHIPS Program Office Joins PPI’s Mosaic Project to Discuss Implementation of Historic CHIPS and Science Act

Last week, Director of External and Government Affairs for the CHIPS Program Office Adrienne Elrod and Head of Government Affairs at ASML Maryam Cope joined the Women Changing Policy Luncheon Series, hosted by the Progressive Policy Institute’s (PPI) Mosaic Project and moderated by Jordan Shapiro, Director of the Innovation Frontier Project at PPI.

Ms. Elrod discussed what the long-lasting impact of the historic Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act will mean for communities across the country, and what the Administration is doing to ensure a smooth and effective implementation of the law’s many provisions. Ms. Cope explained what the law will mean for companies like ASML and how it will bring the United States to the forefront of global competition in the semiconductor industry. The CHIPS and Science Act was signed into law by President Biden in August, 2022.

“Number one, first and foremost, we passed this legislation and we’re implementing the CHIPS and Science Act all around national security and economic security…Right now we basically make no leading edge chips in the United States, and we have got to change that trajectory,” said Adrienne Elrod, Director of External and Government Affairs for the CHIPS Program Office.

“I think governments around the world are recognizing that there is a need to have this resiliency, looking at the U.S. CHIPS and Science Act, and [asking], what’s our target? What’s our part of this equation? And how can we contribute our expertise and our comparative expertise to this global system? So I think that it’s really a balance between domestic resiliency and globalization that we have to continue to look at,” said Maryam Cope.

“Mosaic was honored to have set the stage for such an important and timely conversation. It’s not everyday you get to hear from two of the country’s leading women working to advance the future of semiconductor manufacturing and paving the way for countless women in tech,” said Jasmine Stoughton, Director of PPI’s Mosaic Project.

 

Left to right: Jordan Shapiro, Director of the Innovation Frontier Project, Progressive Policy Institute; Maryam Cope, Head of Government Affairs, ASML; Adrienne Elrod, Director of External Affairs for the CHIPS Program Office at the Department of Commerce.

 

The Mosaic Project is an initiative of the Progressive Policy Institute that aims to put more women at the forefront of policymaking. The same handful of well-known men have dominated key policy conversations for decades, resulting in legislative outcomes that fail to reflect the richness of our society. It is the project’s mission to empower expert women with the tools and connections needed to engage with the media and lawmakers on today’s toughest policy challenges.

The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org.

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Media Contact: Tommy Kaelin – tkaelin@ppionline.org

Skill-Based Hiring, If Done Right, is a Win-Win

In the 21st century, education has become America’s most significant marker for class privilege. People with bachelor’s and advanced degrees have mostly prospered, while employment prospects, wages, and advancement opportunities for those with less education have fallen. While there are many reasons for this persisting disparity, a big one is that jobseekers keep hitting “the paper ceiling.”

The paper ceiling is the invisible barrier that comes at every turn for workers without a bachelor’s degree. Early in the 2000s, many employers began adding degree requirements to job descriptions, whether they needed them or not — using the degree as a proxy for job preparedness. As a result, workers without a bachelor’s degree were screened out of opportunities.

Research from Opportunity@Work, which leveraged public datasets, the Occupational Information Network (O*NET) and the Current Population Survey (CPS), found there is an overlooked talent pool of skilled workers in our economy — uncovering more information about workers without degrees, their occupations, and skill sets. This data showed that Americans skilled through alternative routes other than a bachelor’s degree represent 50% of the U.S. workforce. Many of them possess skills that should qualify them for jobs with salaries at least 50% higher than their current job. In other words, our current hiring practices systematically underutilize the skills of millions of U.S. workers, deepening the economic divide between those with and without college degrees.

Luckily, the trend toward degree inflation is starting to reverse. Business, government, and community  leaders are moving towards skills-based hiring practices. In one recent survey, 81% of employers said they are looking at skills rather than degrees as they struggle to fill open positions with U.S. unemployment at a record low.

Policymakers in both parties are also starting to act. In Colorado, Utah, and Maryland, elected leaders have passed laws or signed executive orders that eliminate or substantially reduce degree requirements for public sector hiring, with Maryland already having seen a 41% increase in new hires without degrees. More recently, Pennsylvania followed suit, with Governor Josh Shapiro signing an executive order declaring thousands of state jobs would no longer require a four-year college degree on his first full day in office.

At the federal level, President Biden endorsed the “skills, not degrees” movement in last year’s State of the Union address. The administration’s Office of Personnel Management has released new guidance for agencies to help them implement a skills-based hiring approach to filling jobs. Unfortunately, Congress has yet to pass The Chance to Compete Act, which seeks to improve and update the hiring process for federal employers, focusing on potential candidates ability to succeed in the job rather than where or if they received their college degree.

The federal and state momentum is encouraging, but there are still kinks that need to be worked out.  First, there needs to be a greater commitment from employers across the private and public sector to scale up skills-based hiring. What’s more, organizational leaders who commit to skills-based hiring are not always the ones in charge of executing it. Many HR professionals and hiring managers may not understand how to assess job applicants’ skills in the absence of formal credentials.

This can be especially confusing when job descriptions ask for a bachelor’s degree or an equivalent skill or practical experience — forcing hiring managers to compare people’s qualifications without knowing how to analyze them properly. This is why Opportunity@Work’s Paper Ceiling campaign is so important.  Rather than asking for degree equivalency, it encourages employers to drop degree requirements altogether, making it easier for the jobseeker as well as the employer to navigate the hiring process.

While this would make the process easier, it still will be a challenge to truly assess an applicant’s skills in absence of historically relied upon credentials. It is why job descriptions are also critically important. As employers reduce their reliance on degree-based hiring, they must think more carefully about what capabilities they are truly looking for and describe them more explicitly. This not only helps the applicant better convey their relevant skills, it helps the employer match the skills to the internal need more effectively, while also encouraging skill providers to consider how they can update their curriculum to respond to in-demand opportunities.

As with any new initiative, it will take time to get this right. As employers newer to the space begin to get involved and adopt skills-based hiring, they should consider starting off with a trial, implementing the practice with one or two in-demand positions. This will allow employers to test best practice and understand what works – ensuring their skills-based hiring procedures are having the intended impact.

In addition to shifts in employer practice, the move toward skills-based hiring will require overhauling our nation’s workforce development system. This means a greater emphasis on industry-responsive education, training, and experience, like career and technical education and work-based learning, across K-12 and postsecondary education. Policies that promote competency-based education, offer prior-learning assessments, and expand career pathways will also be increasingly important so individuals can have more stackable, skills-based learning opportunities while also understanding changing labor market demands. Additionally, innovation around learning and employment records, which provide digital infrastructure to hold information about a person’s academic and industry achievements will be important to design and scale so individuals have a more accessible way to demonstrate their accumulation of skills, knowledge and experiences.

Dropping degree requirements and moving toward skills-based hiring practices has the potential to even the playing field for degree and non-degree workers — helping to close equity gaps that persist across employment opportunities and wages, while also creating a more diverse talent pool for employers to pull from.

Employers and policymakers alike should lead by example, by removing degree requirements from job descriptions that don’t need them. The private and public sector must also better work together to promote industry-responsive education and training opportunities that ensure people are learning the skills needed for in-demand careers while also supporting assessments and new tools that ensure individual’s skills are effectively translated, demonstrated, and understood in the job market.

Reforming hiring practices to consider jobseekers’ actual skills and competencies, not just formal credentials, will narrow economic inequality and boost U.S. productivity. Previously overlooked workers will be able to pursue attractive career pathways even without a four-year degree and employers will be better able to fill jobs that need filling. It is a win-win.

Jacoby for New York Post: How Ukrainians are learning to live with the war sirens

By Tamar Jacoby, Director of the New Ukraine Project

 

President Biden’s visit to Kyiv this past week was met with jubilation across Ukraine. Ukrainian friends messaged me with glowing thanks. A bartender who knows I’m American offered me a drink on the house. The president’s trip underscored what Biden has often said – that America will stand by Ukraine “as long as it takes.”

Nothing made this point more viscerally for Ukrainians than the way Biden and Ukrainian President Volodymyr Zelensky ignored the air-raid siren screaming in the background as they walked across the square in front of golden-domed St. Michael’s Cathedral on Monday. For Ukrainians, air raid sirens are a weekly if not daily scourge, and everyone knows what it’s like to decide, should I heed this one or not?

Read more In New York Post.

Mosaic Moment: Tis the Season… to Talk About Taxes!

It’s that time of year again… It’s tax season, and on this episode of the Mosaic Moment PPI’s Senior Policy Analyst, Nick Buffie, sits down with Mosaic alum and Associate Director of Policy at Prosperity Now, Joanna Ain to talk all things taxes. They talk about the importance of the Volunteer Income Tax Assistance program (VITA), why funding the IRS is an equity imperative, and the current state of the Child Tax Credit and the Earned Income Tax Credit.
Follow Joanna Ain on Twitter
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Learn more about the Progressive Policy Institute here.

Butler for Newsweek: Democrats Depend on Black Voters But Do Nothing for Us. Here’s How to Fix That

By Markose Butler, Director of Community Outreach and Training

It’s no secret that Democrats have long controlled major coastal cities of the United States. Politicians running as Republicans have not won city-wide election in any of the 10 largest cities since Michael Bloomberg’s first election as New York City mayor, and in many cities, it’s literally been decades. Yet despite the remarkable loyalty showed to Democrats by Black voters, they have completely abandoned these voters on the most important issues to their daily lives.

The truth is, the Black community hasn’t benefited from improvements in urban economies or quality of life, and we remain disproportionately represented as the victims of crime. It’s long past time for Democrats to take concrete actions that actually move the needle and provide for the needs of Black Americans.

In recent decades, the nation’s urban centers have emerged as engines for job creation. From 2004 to 2015, job growth was concentrated in the 94 largest cities in the U.S. and especially in just four cities: New York, Chicago, San Francisco, and Seattle. While this does show that cities run by Democrats can produce economic growth, this concentration has also contributed to large scale migration to a handful of large cities that has resulted in a massive housing crisis in large metros nationwide.

Read more in Newsweek

Administration Proposes Welcome Reforms to SSI’s ISM Rule

It didn’t generate many headlines, but last week, the Biden administration released a common-sense proposal to simplify one of our country’s most convoluted, overregulated safety net programs. Specifically, the administration proposed removing food purchases from the In-Kind Support and Maintenance (ISM) calculations in the Supplemental Security Income (SSI) program. This change would greatly simplify SSI, cutting down on the administrative burdens faced by beneficiaries at little cost to taxpayers.

SSI is meant to provide an income floor for elderly or disabled Americans with low Social Security benefits. Because Social Security is tied to past earnings, people who earned low wages throughout their careers receive meager benefits. This is where SSI steps in: For everyone who is accepted to the program, total income from SSI, Social Security, and other sources is guaranteed to be at least $914 per month. The program is extremely well-targeted to the very poorest individuals: As of 2013, the poverty rate among SSI beneficiaries was 63%, which was more than four times the national average at the time. SSI extends a lifeline to these extremely needy people. In January 2023 alone, SSI provided benefits to nearly 7.6 million disabled or elderly Americans, with the average beneficiary receiving $677 (as a monthly payment).

However, after accounting for what are known as “income disregards,” SSI benefits are reduced by one dollar for every $2 of on-the-job earnings and for every $1 coming from other income sources. Under the program’s ISM test, most food and housing assistance provided to SSI beneficiaries must be counted as other income. For example, if a friend or family member buys dinner or groceries for an SSI recipient, the recipient will have their benefits reduced by the dollar value of the food. The total ISM benefit reduction is capped at one-third of recipients’ monthly SSI payments.

Notably, the ISM test does not apply to other types of purchases (such as medical care or transportation), nor does it apply to food or housing provided by charities or the government. No other safety net program applies a similar test, given the complications associated with tracking food and housing expenses. Unsurprisingly, the ISM test comes with heavy administrative burdens: The Social Security Administration’s instructions on how to assess ISM are approximately 250 single-spaced pages, and many of the most complicated questions during the SSI application process are about food and housing.

In the end, the in-kind benefits test creates more havoc than it is worth: Only about 8 or 9% of SSI recipients have their benefits reduced in any given year, yet problems associated with carrying out the ISM test are one of the leading causes of miscalculated payments. Overall, the ISM test saves taxpayers less than 0.01% of GDP — in other words, it results in a $1 tax cut for every $13,000 of taxpayer income. These meager savings do not justify imposing such administrative nightmares on SSI beneficiaries. By removing food purchases, the Biden administration proposal would effectively limit the ISM test to housing assistance, thereby cutting down on the paperwork and bureaucracy that rob SSI participants of precious time and benefits.

SSI is badly in need of further reform and simplification, but this is clearly a promising first step. And it should be a first step not just towards simplifying SSI, but towards simplifying the safety net more broadly. As PPI has previously noted, the safety net is filled with overlapping, complicated programs that impose excessive administrative burdens on the poor. This reason is one of many that PPI has previously called for a comprehensive regulatory improvement commission aimed at removing unnecessary regulations rather than just letting them pile one on top of the other. As the Biden proposal demonstrates, “simplification” is not necessarily a euphemism for “cuts,” and a simpler safety net can also be a more compassionate one.

Jacoby to Lead PPI New Ukraine Project from Kyiv

Russia’s illegal invasion and brutal occupation of Ukraine will soon enter its second year. The Progressive Policy Institute is marking the occasion by launching a New Ukraine Project to report on the war, its impact on everyday life in Ukraine, and its wider implications for peace and international security.

Directing the project from Kyiv is Tamar Jacoby, a prominent journalist, author, and thought leader widely respected for her work on immigration, the struggles of working class Americans, and public school reform. In addition to her dispatches from the front lines of the conflict, her work will focus on the social, economic, and political reconstruction of Ukraine, as it seeks to take its place in Europe’s free and democratic community.

“Every American has a stake in Ukraine’s war of independence, which in many ways resembles our own break from a different empire,” said PPI President Will Marshall. “We are fortunate to have in Tamar Jacoby an astute witness to the history that is being made on the ground today in eastern Europe.”

See this dispatch from Jacoby just published in The Washington Monthly on what Ukrainians want to know about America’s support for their cause.

“The war in Ukraine isn’t just another regional conflict,” Tamar Jacoby said. “Everything we hold dear as Americans — our fundamental liberal values — hangs in the balance. Can the international order prevent brutal imperialist aggression? How should the West respond to an emerging nation willing to risk everything to embrace democratic ideals? What are and aren’t we willing to do to protect human rights and human dignity? And then, beyond ideals, there’s the actual threat: If we don’t stop Russia in Ukraine, where will the story end — who will Putin blackmail next, with oil or gas or grain or weapons of mass destruction? It’s a privilege to be on the ground witnessing what’s happening and telling the story for American readers.”

“Having Tamar interpret the daily successes and struggles of Ukrainians during this Putin invasion will help Americans appreciate that our commitment to Ukraine needs to go beyond the battlefields and well after the Russians retreat: helping Ukraine create a sustainable democracy is the victory the people of Ukraine deserve and the defeat that will define Putin failures,” said Lindsay Mark Lewis, Executive Director of the Progressive Policy Institute.

This is the third major international project for PPI, with PPI Brussels established in 2018, and the Project on Center-Left Renewal based in the U.K., established in January of 2023.

Tamar Jacoby is currently based in Kyiv, Ukraine. She is the president of Opportunity America, a Washington-based nonprofit working to promote economic mobility, and a former journalist and author. She was a senior writer and justice editor at Newsweek and, before that, the deputy editor of The New York Times op-ed page. Her articles have appeared in The New York Times, The Wall Street Journal, The Washington Post, The Weekly Standard and Foreign Affairs, among other publications. She is the author of “Someone Else’s House: America’s Unfinished Struggle for Integration” and “Displaced: The Ukrainian Refugee Experience.” Her edited volumes include “Reinventing the Melting Pot: The New Immigrants and What It Means To Be American” and “This Way Up: New Thinking About Poverty and Economic Mobility.”

The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org.

Follow PPI on Twitter: @ppi

Find an expert at PPI.

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Media Contact: Aaron White; awhite@ppionline.org

PPI’s Trade Fact of the Week: Currency trading is the largest market ever

FACT: Currency trading is the largest market ever.

THE NUMBERS: Annual currency trading –

2022                     $2,739 trillion
2020                    $2,402 trillion
2013                      $1,956 trillion
2010                     $1,460 trillion
2001                       $452 trillion
1992                        $265 trillion
1970                            $6 trillion

WHAT THEY MEAN:

Two human things are measured in quadrillions. One is energy — about 640 quadrillion annually burnt “BTUs” heat the world’s homes, propel its ships and planes, run its server banks, and water its gardens. The other is money. The Bank of International Settlements’ most recent Triennial Survey (out last December) says that governments, businesses, banks, tourists, and computerized trading programs exchanged $7.5 trillion in currency daily, or $2.739 quadrillion over the year. With all the zeroes, this is “$2,739,000,000,000,000.” Some particulars:

Scale and rate of growth: Annual currency turnover was a modest $6 trillion exchanged mostly for purposes of tourism, debt repayments, and import/export trade (as had been standard practice since the invention of money in the Lydia kingdom in present-day Turkey) just before the abandonment of the gold-based “Bretton Woods” system in 1971. The contemporary ‘floating exchange’ which replaced Bretton Woods, after an interval of some confusion, launched precisely fifty years ago, on March 1, 1973, and has since become the largest market of any sort in human history. Annual currency trading reached $500 trillion in the early 2000s; hit the $1 quadrillion mark in 2008, and reached $2 quadrillion — mainly for hedging and futures markets rather than more traditional purposes — in 2017 or 2018. Assuming no gigantic upheaval in global finance, current trends suggest $4 quadrillion by 2030.

Currencies: U.S. dollars figured in 88.6% of all world currency exchanges in 2022. This is a bit less than the 89.9% rate of 2001, but more than the 84.9% of 2010. The dollar’s use in currency exchange has been pretty stable over the past 20 years, as has that of the euro and yen. (Euro: 32% of transactions in 2001, 30% in 2022; yen: 15% and 17%). Speculation about the Chinese yuan’s rising role remains, well, speculative: Used in 0.5% of exchanges in 2007, the yuan now appears in 1.6% of transactions in 2022 — rising, but about equal to use of the Mexican peso and well below the Aussie dollar.

Trading sites: Having lost its role as reserve-currency issuer in the 1930s, the U.K. found a new one as the central forex trading site and holds it still. City of London banks and firms handle 38% of world currency trades, or about $1 quadrillion worth each year.  New York ranks second with 19%; Singapore, Hong Kong, Tokyo, and Switzerland follow at about 9%, 7%, 4%, and 3% respectively. BiS speculates that Brexit may have slightly reduced the British share of currency trade, with some shift to the United States and Singapore.

To put this in context, blithely ignoring differences between exchanges, value-added output, asset wealth, and so on: $2.7 quadrillion per year is (a) 6 times the estimated $450 trillion value of total world privately held wealth in the forms of real estate, stocks, money, physical possessions, and other assets; (b) 26 times the $104 trillion world GDP of 2022; (c) 100 times the $25 trillion in 2022 goods and services exports, and (c) 400 times the $7 trillion in actually existing physical coins and bills. As to whether this gigantic roar of hedging and futures-trading very significantly raises real-world growth rates or improves global economic efficiency: research appears insufficient.

 

 

FURTHER READING:

BIS’ 2022 Triennial Survey on the $2.7 quadrillion annual/$7.5 trillion daily foreign exchange market

In practical terms, over the last six years the currency markets have worked to raise the value of the dollar vis-à-vis other currencies. Some IMF staff thoughts on the implications

And a similar view from currency scholar Jeffrey Frankel

While Barry Eichengreen looks at the geography of currency trading, and the advantage digital technologies and fiber-optic cables may have given to the City of London

Some reference points: 

A comparative table: Forex vs. wealth, vs. stocks, vs. GDP, vs. trade, etc.* All figures are for 2022:

Annual currency trading:                                                 $2.739 quadrillion

Total privately held world wealth:                                      $464 trillion

Global public & private debt:                                              $235 trillion

World GDP:                                                                           $104 trillion

Total world stock market capitalization                               $93 trillion

Total world stock trading                                                       $61 trillion

Total world goods/services exports:                                    $28 trillion

U.S. GDP                                                                                  $25 trillion

NYSE market capitalization:                                                  $22 trillion

U.S. “M1”**                                                                              $20 trillion

All world tax revenue for governments                                $14 trillion

World currency reserves                                                        $13 trillion

All the money (physical coins & bills) in the world             ~$7 trillion

U.S. currency printed annually                                             $0.3 trillion

*  BIS for currency trading; Credit Suisse for world wealth; IMF for world GDP, world debt, and world currency reserves; Federal Reserve for currency in circulation and U.S. annual currency printing; World Bank for world stock trading and tax revenue, NYSE for market cap.
** M1 includes all U.S. currency, money held in bank accounts and CDs, etc. See here.

How much is “all the money in the world”?

Private wealth: Credit Suisse estimates world household wealth in the form of homes, stock portfolios, condos, bank accounts, land, and so on — at $464 trillion for 2022. This is a bit more than double the $221 trillion of 2012, in nominal terms. No estimates are available for government assets (navies, buildings, national parks, etc.), but “all the money in the world” by this definition might be near $1,000,000,000,000,000.

Government reserves: Governments’ “wealth” may be unknown, but in terms of actual ‘money’ they now hold about $12.8 trillion in reserves. As with currency trading (but not quite as much, and not quite so certainly) most of their holdings are, metaphorically, a big pile of dollars.  Dollars make up $6.44 trillion of the $10.77 trillion the IMF identifies by currency type — 60% of the total, slightly below 62% for 2012 and noticeably less than the 71% in 2000. Euros account for 20%, and the yen and sterling 5% each. The IMF’s financial reserve data.

Circulating money: The Federal Reserve reports that about $2.3 trillion in actual U.S. paper and metal coins is currently in wallets, bank vaults, cash registers, safes, mason jars, and so on.

Some players:

The U.K.’s Financial Conduct Authority regulates the City of London, the world’s largest currency-exchange center.

The U.S. Treasury Department’s semi-annual currency trading reports on currency values and potential manipulations.

And the Treasury Department monitors dollar exchange rates.

And some history:

Currency was the invention of an anonymous fellow early in the 7th century B.C., most likely in the Kingdom of Lydia in modern-day Turkey, home to semi-legendary King Croesus — and quickly copied by neighboring Greece and Persia. A look at the first coins, with a mini-bio of Croesus and some lumpy-looking early Lydian efforts (made of electrum, a mix of gold and silver) stamped with pictures of lions.

The “money-changers” of the Gospels were a consequence of these innovations six centuries later. For a small fee, they swapped Roman, Greek, and Persian coins carried by out-of-town pilgrims for half-shekel coins minted in Jerusalem and Tyre, with exchange rates depending on the quantities of precious metal contained in the coins, enabling pilgrims to pay the modest tax needed to finance Temple operations, and pay for food, shelter, and shopping during their stay. The account in Matthew.

And the U.S. Mint today.

 

 

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank Progressive Economy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007).  He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

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Will Direct e-File really reduce errors on tax filings?

Anybody who has ever filed taxes in the United States knows it is complicated, and that the level of complexity is getting worse. The Inflation Reduction Act (IRA) enacted last year directs the Internal Revenue Service (IRS) to study how to implement a direct e-File program. Under such a system, the IRS would pre-populate tax returns with any third-party information the agency has from employers and other entities, and information that the IRS believes is relevant from the prior years’ tax return.

The goal, according to Ariel Jurow Kleiman — an associate professor of law at Loyola Law School who will be one of the authors of the upcoming IRS report — is to “eliminate all tax compliance activities” related to filing taxes, because doing so “will be disproportionately more valuable to taxpayers than reforms that merely shave an hour or two off their total tax preparation time.”

Choi and Kleiman’s research is informative and well-researched. The authors are correct that tax reform should focus on simplification and ease of filing, eliminating as many compliance activities as possible, and dramatically reducing the risk of taxpayer error, which their study shows is most important to taxpayers.

The problem lies with some of their conclusions. Their argument that direct e-File and Free-File programs are answers to the problems noted above is not supported by facts.

In their paper, Choi and Kleinman cite exact withholding type systems in the United Kingdom and German as models for the U.S. But as tax codes around the world have become more complex, many countries that are currently using such systems are increasingly finding it necessary to re-engage taxpayers in order to ensure accuracy. A 2017 report by the UK’s All-Party Parliamentary Taxation Group on Pay-As-You-Earn (PAYE), found that as a result of a number of economic changes since the creation of PAYE, roughly one-third of British taxpayers were effectively filing their own taxes via a process known as Self-Assessment — negating much of the “will save the taxpayer time” rationale for direct e-file and free-file systems. The number of taxpayers who will need to file Self-Assessments is only expected to increase with the rise in two-earner households, self-employed workers, labor mobility, and targeted tax incentives that make the code more and more complex.

Furthermore, the report noted that error rates had been rising significantly in the United Kingdom, costing the government and taxpayers billions over the years. Asking the already overburdened IRS to take on e-File would siphon away resources from enforcement and create more opportunities for wealthy tax evaders like Donald Trump to reduce their tax liability.

Reducing the burden of tax compliance and error rates should be a top priority of any national government. However, gimmicks like direct e-file, the FAIR Tax, and various versions of the Flat Tax, are more gimmicks than good policy. All three are “quick fixes” intended to do away with the inconvenience of tax filing, while ignoring the need for a well-designed income tax. Policymakers should instead turn their attention to the hard work of reducing the growing number of tax expenditures that litter the code and simplifying important incentives such as the Earned Income Tax Credit.

Jacoby for Washington Monthly: After Biden’s Visit to Kyiv, Ukrainians Welcome U.S. Aid but Plead for More

By Tamar Jacoby, Director of the New Ukraine Project

When President Joe Biden touched down in Kyiv on February 20, it was more than another secret presidential trip like the visits Presidents George W. Bush and Barack Obama made to Afghanistan and Iraq. There was no stealthy meeting with American troops, no photo op on a base in an American theatre of operations. Biden’s goal was to demonstrate American support for a democratic ally fighting the most devastating war in Europe since 1945. Not even Franklin Roosevelt did this. He never visited London during the Blitz, choosing to meet Winston Churchill on safer ground in Washington, Casablanca, Tehran, and Yalta. That Biden’s visit came on the anniversary of Russia’s invasion of Ukraine made it all the more significant as a show of determination to halt Vladimir Putin’s push to crush a democratic neighbor. “I thought it was critical that there not be any doubt, none whatsoever, about U.S. support for Ukraine,” Mr. Biden said.

Andrey Dubenko is the co-owner of a small shopping mall on the river between Bucha and Irpin, two of the Kyiv suburbs that saw the worst fighting in the weeks after Russia’s invasion last February. The boundary between the two towns—one was occupied through the next month, the other remained in Ukrainian hands—became the front line. Air strikes, artillery fire, and hand-to-hand combat in the parking lot gutted Dubenko’s mall. Now the 54-year-old investor and developer, a man old enough to have served in the Soviet army in the 1980s, is rebuilding and optimistic. But he is also unflinchingly clear-eyed about who will determine what happens in Ukraine. “When will the war end?” he asks rhetorically. “That will be decided by Americans. The war will end when the U.S. wants it to end – when they stop sending weapons and ammunition.”

Read more in Washington Monthly.

Closing the Global Achievement Gap

This essay was published as part of Opportunity America’s report: Unlocking the Future – Toward a new reform agenda for K-12 education.
The full collection of essays can be found here.

 

Introduction

For decades, US education reformers have struggled to narrow stubborn achievement gaps among White, Black and Hispanic students. With China driving hard to overtake America as the world’s largest and most dynamic economy, our country’s leaders should show a greater sense of urgency in closing another kind of achievement gap: the underwhelming performance of US students compared to their peers abroad.

As President Joe Biden often observes, the United States is locked in a “strategic competition” with China for economic and technological leadership in the 21st century. The United States won’t win this contest by continuing to tolerate mediocre public schools for the middle class and low-performing schools for low-income Americans.

China sees itself as the rising power in the world and the United States as a decadent and spent historical force. Under its ultranationalistic president, Xi Jinping, China is keen to demonstrate to developing countries the supposed superiority of its state-directed model for economic growth over the “chaos” of Western capitalism. Beijing also draws invidious comparisons between the “social harmony” enforced in increasingly totalitarian fashion by the ruling Chinese Communist Party (CCP) and an America riven by internal political and racial strife.

In short, the rivalry between the United States and China isn’t simply commercial; it’s a contest of political beliefs and governing systems—liberal democracy versus Beijing’s new hybrid of markets and autocracy. At issue isn’t only which country will achieve the highest living standards and per capita wealth but also which will set global standards on trade, economic competition, climate change and human rights.

On the innovation front, the CCP has made no secret of its determination to mobilize state resources to help Chinese companies dominate the high-tech industries of the future—5G, supercomputing, AI, biotech, electric cars and batteries and more. China already leads the United States in electric car production, while US automakers are hobbled by a shortage of semiconductor chips, most of which are manufactured in Taiwan, China and South Korea.

Our national security also is at stake. China has been rapidly translating its economic clout into military power, with an eye toward a shotgun wedding with a democratic Taiwan; establishing hegemony over the surrounding seas; and pushing the United States out of East Asia.

To be sure, China’s rise isn’t inexorable. Hit hard by weakening global demand and a stern policy of “zero Covid” lockdowns at home, its economic growth rate recently has fallen by about half. Having been awarded an unprecedented third term by a compliant CCP in October, Xi continues to consolidate power in what looks like a return to a Mao-style dictatorship.

Xi has reined in China’s high-flying tech giants and is steadily extinguishing Hong Kong’s once-vibrant democracy. He has matched harsh repression at home with an aggressive “wolf warrior” diplomacy aimed at intimidating Taiwan and China’s neighbors and silencing international criticism of Beijing’s predatory trade practices, ethnic cleansing of Muslim Uyghurs and status as the world’s biggest carbon emitter.

These self-isolating policies have bred security fears across East Asia and triggered a strong political backlash in the United States and Europe. Nonetheless, it would be a mistake to assume that China can’t change course. Its stunning national development over the past four decades shows that the United States can no longer take for granted our century-old status as the world’s biggest and most advanced economy.

Americans are faced with a clear choice: we can resign ourselves to being surpassed eventually by a Chinese economic and military superpower, or we can raise our game.

The Global Achievement Gap

For America’s public schools, that means a new resolve to narrow the global achievement gap. International comparisons of student performance indicate that our students have fallen well behind their counterparts in China and the Asia-Pacific.

For example, the Organisation for Economic Co-operation and Development’s (OECD) Program for International Student Assessment (PISA) is a worldwide study that periodically compares the performance of 15-year-olds in 78 nations on mathematics, science and reading.

The latest PISA results show that in 2018, the United States ranked an underwhelming 25th in the world in average math, science and reading scores. Breaking the scores down, the US ranked 37th in math, 18th in science and 13th in reading. Chinese students were number one in each subject.

But perhaps the most dismal headline from the PISA tests is this: the performance of US teenagers in reading and math has been stagnant since 2000, despite federal efforts to raise academic standards and create financial incentives for school improvement.

Andreas Schleicher, director for education and skills at the OECD, is one of the chief architects of the test. Comparing scores, he found that about a fifth of American 15-year-olds hadn’t achieved the reading levels expected of 10-year-olds and consequently face “pretty grim prospects” in the labor market.

Also illuminating are the results of the Trends in International Mathematics and Science Study (TIMSS). These tests measure math and science achievement in fourth and fifth grade every four years.

According to the latest TIMSS results, US fourth graders ranked 15th among 64 participating education systems in math and eighth in science. Singapore and China were ranked first and second. US eighth graders ranked 11th of 46 in science and 11th in math.

Crucially, the TIMSS tests illuminate wide performance gaps between America’s top- and bottom-performing eighth graders. On math, for example, the US gap is larger than the gap in 31 of the 45 other participating systems.

Although many US students perform at high levels, these international tests show that, on average, US students significantly underperform their peers in China and other Asian countries on math, reading and science. The tests also highlight yawning performance gaps that reflect America’s deeply entrenched social and racial inequities.

These achievement gaps will not be closed overnight. So it’s all the more important that our political and education leaders start now by benchmarking US students’ academic progress against the high levels of proficiency in reading, math and science achieved by students in China and other Asian competitors.

A Call for National Leadership

It’s a formidable challenge—and President Biden ought to take it up. In fact, it’s hard to think of an American institution more ripe for “building back better” than our public schools. They are both formative to American citizenship at a time when democratic norms are under political attack at home and essential to our capacity to innovate and grow at a time when America’s long run of economic primacy faces a determined challenge from China.

Although public education in the United States always has been a primarily local responsibility, there is a Cold War precedent for invoking national interests and security to rally public support for a dramatic upgrade of school quality. In the late 1950s, the Soviet Union launched Sputnik, the world’s first satellite. This shocked a complacent America, prompting Congress to pass the landmark National Defense Education Act in 1958.

The law explicitly made improving public schools a national security imperative, galvanizing federal investments in science, technology and math education. In fact, it marked the beginning of Washington’s large-scale involvement in elementary and secondary schools, preceding the equity-oriented federal interventions of the 1960s.

Today, our political leaders should again forge a broad public consensus for harnessing public education as a national strategy for promoting science, frontier technologies and high-tech entrepreneurship. Equally as important, we need dramatic improvements in school quality to ensure that our students acquire skills comparable to those of our toughest competitors.

Hackneyed calls for new “moonshots” and Marshall Plans to solve this problem or that litter US political discourse. Nonetheless, only presidents have the standing to set urgent national goals. In the spirit of JFK’s race to the moon, Biden should challenge state and local school authorities to make our schools second to none in the world—and for all our students. In this way, the president could tap into both Americans’ patriotism and their love of competition.

Reaching for world-class standards of performance doesn’t mean making America’s schools more like China’s. The highly regimented way students learn in authoritarian countries with a collectivist ethos will not work in a liberal country like ours that values individual liberty and initiative.

China places a heavy emphasis on rote memorization and rigorous drilling for tests. The American path to educational excellence will be different, putting greater emphasis on creativity, inquiry-based approaches, diverse curricula and personalized learning. Nonetheless, US students will have to do a better job of mastering the fundamentals of reading, math and science, and here the international tests like PISA and TIMMS can help us mark progress toward closing the gap.

Complicating this challenge are the steep learning losses American students experienced when schools shut down during the Covid pandemic. The latest report from the National Assessment of Education Progress shows sharp declines in math and reading proficiency among students of all backgrounds in most states.

Only 36 percent of US fourth graders and 26 percent of eighth graders scored proficient or above on math tests. For reading proficiency, the scores were 33 percent for fourth graders and 31 percent for eighth graders.

These domestic test results, of course, augur ill for how America’s kids are likely to score in the next round of international assessments. US public school leaders need to go all out to make up for pandemic learning losses, which also will help prepare US students to chip away at the international achievement gap on math, reading and science.

Invest in National Change, Not the Status Quo

Another good reason to act now is that schools are awash with money. Since March 2020, Congress has passed a slew of pandemic relief bills that have included $200 billion for K–12 education. President Biden’s March 2021 American Rescue Plan alone includes $125 billion, the largest-ever federal investment in public schools. In July 2021, Congress passed President Biden’s CHIPS and Science Act, which included $13 billion to bolster STEM in K–12, postsecondary schools and job-training programs.

Public schools can use this extraordinary federal bounty in a wide variety of ways. These include helping tackle pandemic learning losses with extended school years, after-school programs, summer school and tutoring. Schools can also spend federal dollars to upgrade facilities for healthy learning environments, equip students with wraparound social supports and stabilize and diversify the school workforce.

These are all important goals. But simply pouring money into our legacy education system, which wasn’t yielding the results we need pre-pandemic, is hardly the way to construct the more nimble, resilient and responsive public schools Americans have a right to expect post-pandemic.

The Covid shutdowns thrust America’s parents deep into the world of their children’s schools and the adults who run them. For many, the experience has been anything but confidence-inspiring. In addition to being fed up with school closures and steep learning losses, many parents are frustrated because they think school officials don’t listen to them. Popular pressure for change in how schools operate is building, and a crucial question is whether it will merely inflame our country’s tribal divides or give fresh impetus to modernizing an outdated public education system.

In the first scenario, public schools become the new front in America’s culture wars. In 2021, Republican Glenn Youngkin won an upset victory in Virginia’s gubernatorial contest by exploiting parents’ anger over a wide array of school-related grievances, from broadly shared concerns about shutdowns and unresponsive district bureaucracies to such right-wing bugaboos as mask and vaccine mandates and critical race theory.

This mix of fact and myth became the template for Republican candidates in the 2022 midterm elections. Although education was eclipsed by voters’ concerns over inflation, abortion and threats to democracy, it’s worth noting that one of the midterm’s biggest winners was Florida Gov. Ron DeSantis, an ardent GOP proponent of “parent power.”

In the second scenario, public consternation over how the pandemic has magnified all the pathologies of our legacy K–12 system—stubborn class and racial inequities, bureaucratic rigidity and inertia, antiquated labor relations and standardized, one-size-fits-all instruction yielding mediocre results—feeds cross-partisan demands for systemic change.

Americans who believe in equal educational opportunity and inclusive prosperity should be rooting for the second scenario. There’s a huge opportunity here for President Biden to speak to the public’s post-pandemic hunger for sweeping changes in their K–12 schools.

As the Progressive Policy Institute (PPI) has documented, a new, 21st-century model for public education is incubating in such pioneering cities as New Orleans, Denver, Indianapolis, San Antonio, Newark and Washington, DC. The emerging model is built on parental choice of public schools, a shift in decision-making power from central bureaucracies to school leaders, diverse curricula, personalized learning and rigorously enforced performance contracts.

These and other hubs of innovation are producing new kinds of schools that go by a variety of names: innovation schools, renaissance schools, partnership schools and contract schools. Where these reinvention efforts have reached critical mass, gains in student attainment have been dramatically positive. As the PPI has documented, over the past 15 years, urban school districts that embrace the 21st-century model—offering families a choice of public schools, shifting decisions from central bureaucrats to autonomous public charter schools and holding these schools strictly accountable for performance—have produced the fastest academic gains among disadvantaged urban students.

In sifting through the PISA results, PPI analysts David Osborne and Tressa Pankovits report that OECD has detected positive effects for school autonomy, a key feature of the 21st-century model: “OECD found that the greater the number of schools with the responsibility to define and elaborate their curricula and assessments, the better the performance of a country’s school system, even after accounting for national income.”

In addition to more parental choice and school autonomy, a modernized K–12 system should be charged with creating more seamless transitions from school to work, especially for the 60 percent of young Americans who do not get college degrees. They deserve better than a binary choice between high-cost college degrees they may not need and low-quality public training programs. And whether college-bound or not, US students should learn about how job markets work and have opportunities for apprenticeships and other work-learning opportunities with local employers before they graduate from high school.

President Biden should use his bully pulpit to make closing the international achievement gap a national priority. He could take as his model the 1989 Education Summit in Charlottesville, Virginia. Cohosted by President George H. W. Bush and Bill Clinton, then governor of Arkansas and chair of the National Governors Association, the summit convened 49 governors to focus exclusively on raising education standards.

Such a display of bipartisanship may seem inconceivable amid today’s red-blue culture wars. But Biden was elected in part to rise above today’s virulently negative partisanship, and Republican governors presumably are as eager as their Democratic counterparts to see America prevail in the intensifying contest with China for economic preeminence.

The Charlottesville summit was inspired by the landmark 1983 report A Nation at Risk, which warned that the lackluster performance of US schools and students was imperiling America’s economic security. Biden could use a successor summit to challenge governors to use unspent federal education dollars to align state standards and tests with those in countries that dominate the international proficiency rankings.

Governors have their own discretionary Covid recovery funds (the Governor’s Emergency Education Relief Fund), which should be dedicated to closing an international achievement gap exacerbated by the pandemic learning losses and our slow reopening of schools. They could also tap into a large pool of unspent money in the states’ Higher Education Emergency Relief Fund to invest in dual enrollment programs that allow high school students to enter college early and earn credits. Biden could also promise federal money to extend such gap-closing efforts past the 2024 deadline for spending American Rescue Plan funds.

Reinventing America’s public schools will require challenging stale dogmas on both ends of the political spectrum: the right’s insistence that the supposedly sacrosanct principle of “local control” trumps our national interest in a modern education system that supports US global competitiveness and the left’s defense of yesterday’s bureaucratic and highly centralized K–12 school model as the one true way to deliver public education for all times.

The United States is trying to prepare its young to compete in the knowledge economy with a factory-style school system designed for the industrial era of more than a century ago.

Amid populist attacks and rising public frustration with that system, it’s time to acknowledge that new school models aren’t a threat to the public education ideal, but the way to save it.

Butler for The Hill: Woke isn’t enough: What Democrats must do to win back Black voters

By Markose Butler, Director of Community Outreach and Training

In the years since Barack Obama left office, there have been two seemingly contradictory developments in Democratic Party politics. On one track is the Democratic Party’s leftward lurch into broader social justice advocacy in which anti-racism, dismantling white supremacy and other cultural issues commonly summed up by its detractors as “wokeness.” On the other is the recent drop in support for Democrats among African Americans, and especially Black men.

It’s clear that the Democratic Party has become an anti-racism party. Spend any time in progressive spaces and you’ll see that notions of equity and racial/social justice have permeated through the party.

It’s a great development for the party that was once the home of segregationist politicians. The problem is that this hasn’t worked well in bringing Black voters back to the party.

Read more in The Hill.

 

A Crash Course on Section 230: What it is and why it matters

Part of the Communications Decency Act of 1996, Section 230 has become a widely debated and frequently misunderstood staple in the conversation about the regulation of tech companies. With calls for reform coming from both sides of the political aisle, on its face it seems as though there is a certain level of consensus around this issue when it comes to the moderation of online content. However, diving just below the surface reveals that could not be more untrue. With Democrats and Republicans coming at the issue from entirely opposite sides and the impacts of Section 230 being commonly misrepresented, it’s critical that any efforts at reform take a measured approach which considers the true positive impact this law has had on the dramatic expansion of the internet.

What does Section 230 say?

No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.

No provider or user of an interactive computer service shall be held liable on account of — any action voluntarily taken in good faith to restrict access to or availability of material that the provider or user considers to be obscene, lewd, lascivious, filthy, excessively violent, harassing, or otherwise objectionable, whether or not such material is constitutionally protected.

What does this mean for the internet today? 

Section 230 applies to “interactive computer services,” which refer to any online platform or service which hosts third-party content. This means social media sites, but also product reviews on e-commerce sites, independent seller listings which utilize websites like Etsy or eBay, or any other case of an online service hosting the content of third-party individuals. The internet as we know it today is largely built around the model of this third-party content, with many online platforms and services relying on their users to provide information, services and products, and many small businesses relying on the infrastructure of other websites to reach audiences they couldn’t on their own.

To break it down from the beginning, Section 230 says that the website is not the publisher of third-party content, shifting responsibility away from the platform and onto the individual, who is liable for their own speech. If you were to post something defamatory on anything from a social media account to a WordPress blog, it would be you that is responsible for your comment, rather than the company you used to post it.

Section 230 is also the mechanism that allows online platforms to moderate content on their sites, allowing them to remove any content that they find objectionable, without being treated as the publisher. This may be because the website serves an intended purpose, such is the case with Reddit communities where posts unrelated to the forum are taken down, or because the platform does not want to host speech that they find dangerous or harmful to their users, such as misinformation or hate speech.

Who wants to change Section 230? 

Efforts to change Section 230 have come from several different directions. Proposals from congressional Democrats have included efforts to make platforms liable for health misinformation, or in cases where online activity has led to real world violence. The Biden Administration has also called for its repeal. While potentially well-intentioned, platform liability for this type of content will make it functionally impossible for websites to host third-party content, while shifting responsibility away from the root of the problem — those who are spreading misinformation and violent rhetoric. If a company is responsible for the speech of all their users, they will need to review and approve every piece of content posted to ensure they do not get sued. In the current model, the amount that is posted online everyday makes it so that despite moderation efforts and algorithmic flagging, companies don’t know exactly what is posted on their sites immediately and at all times. This would require a sort of cable model for the internet, where only pre-approved content is shown online, putting a stop to the flow of information we enjoy today and taking away the ability for individuals to have a voice in the public discourse.

On the other side of the aisle, Congressional Republicans have taken their own stab at Section 230, with the motivating factor being the alleged “censorship” of conservative voices online. Similar sentiments have been echoed by those ranging from the Trump Administration to Supreme Court Justice Clarence Thomas. In the states, Republican governors in both Texas and Florida have signed laws banning content moderation that is targeted at certain viewpoints. Critics of these proposals cite the likelihood that it will force online users to be inundated with harmful but legal content, such as misinformation, conspiracies, hate speech and Nazi propaganda, harassment, etc.

The combination of these two efforts is paradoxical. In a world where no moderation is allowed, and companies are responsible for the speech of all their users — as would be the case if Section 230 was repealed entirely — websites are forced to host the same speech, which will open them up to countless lawsuits.

Why is this important?

Section 230 has made it so that third-party content online has essentially propelled the creation of a new economy, with entrepreneurs able to sell products, post video or written content, and promote their work to an established audience at little or no cost. Consumers are used to information and entertainment at their fingertips, much of which is also provided to them at little or no cost. In an important sense, the powerful job production associated with the tech boom, would not have been possible without Section 230.

While there is always room for improvement, online platforms need to moderate content in order to maintain their purpose. And while this is often spoken about in the context of larger tech entities, it will have the same devastating impact on Google and Amazon as it would to any small, independent interactive website. It’s not in the best interest of Instagram for their users to be bombarded with violent posts, but it’s also important that the independent food blogger posting recipes is able to remove harmful content from the comment section. Exposing these entities to liability for the actions of any one individual would be a fundamental change to the internet as we know it, significantly cutting down our access to information and making it more difficult for individuals to have a voice online. If Congress or the courts decide to alter this system through which the internet has been able to grow, they must be aware of the consequences to independent businesses, individuals, and the future of online speech.

Joint Episode: The Neoliberal Podcast Discusses Inclusionary Zoning ft. Lauren Bealore of Prosperity Now

Lauren Bealore of Prosperity Now joins Jeremiah Johnson of The Neoliberal Podcast to talk about inclusionary zoning. They Discuss the history of inequity in housing markets, whether or not inclusionary zoning can mend those problems, and what good policies might look like.

 

Learn more about the Progressive Policy Institute here.

 

Follow PPI on Twitter here.

New Report from PPI’s Metro Federalism Caucus and Prosperity Now Calls for Inclusive Entrepreneurship to Unlock Access to the American Dream

Today, the Progressive Policy Institute’s Metro Federalism Caucus and Prosperity Now released a new report outlining steps federal and local policymakers — and other stakeholders in the small business ecosystem — can take to best target resources to business owners of color. The report also spotlights three organizations across America that have used pandemic relief funds from the federal government to support entrepreneurs of color in their communities. The report is titled “Inclusive Entrepreneurship Is Key to Unlocking Equal Opportunity,” and is authored by Myrto Karaflos of Prosperity Now.

This report examines the creative initiatives supporting inclusive entrepreneurship from Baltimore BASE (Business Assistance and Support for Equity) Network in Baltimore, Maryland; the Pierce County Business Accelerator in Tacoma, Washington; and West Side Grows Together in Wilmington, Delaware. All three organizations have used Coronavirus State and Local Fiscal Recovery Funds from the American Rescue Plan Act (ARPA) to support entrepreneurs of color, who were hit hardest by the pandemic.

“Given this timely opportunity of federal funding dedicated to recovery and growth post-pandemic, the time to act is now. With more targeted support from policymakers, financial institutions, and local leaders, entrepreneurs of color can have a chance to thrive, which will not only benefit themselves but also the economy and society as a whole,” writes Myrto Karaflos, Policy Manager of Prosperity Now, in the report.

“Local and Federal partnerships are essential to our local economies. Innovative support for small businesses, entrepreneurs, and communities of color is vital as we recover,” said Congresswoman Marilyn Strickland (WA-10), Former Mayor of Tacoma, WA and Co-Chair of PPI’s Metro Federalism Caucus. “The report highlights how federal funding can help communities in crisis, and that local leaders know where to strategically and equitably invest in sectors that need it most.”

“As a former Mayor, I know firsthand how critical federal resources are to our communities during — and long after — a crisis. The COVID-19 pandemic took a toll on small businesses in cities and towns across America, and continued support for entrepreneurs will be necessary to keep the lights on and the ‘open’ sign up on the front door,” said Sly James, Former Mayor of Kansas City, MO and Co-Chair of PPI’s Metro Federalism Caucus. “This report from the Progressive Policy Institute and Prosperity Now shows how important the American Rescue Plan Act funds are, and the organizations featured are a shining example of the work that should be done from coast to coast.”

Read and download the paper here:

Myrto Karaflos serves as Policy Manager at Prosperity Now. In this role, she works to identify and advance policies that help entrepreneurs of color launch and grow their small businesses. Myrto previously provided policy research and analysis for several racial economic justice issues, including tax and savings policy, and also supported the implementation of technical assistance projects. Before coming to Prosperity Now, Myrto worked at Galloway & Associates, a small law firm, where she undertook research projects and provided financial and administrative support. She holds a Bachelor of Arts in International Studies from American University. Myrto is a cohort member of PPI’s Mosaic Project.

The Progressive Policy Institute, in partnership with the Kauffman Foundation, has launched the Metro Federalism Caucus to advocate for a more direct and empowering relationship between national and local government leaders. The Caucus consists of former local officials who now serve in Congress, as well as accomplished mayors and former mayors from around the country, whose governing experience and insights can help U.S. policymakers reimagine the division of labor among national, state, and local governments. Its mission is to open a direct channel of communication that does not run through state governments, aimed at forging a stronger partnership between Washington and metro leaders. Organized and supported by PPI and Co-Chaired by Representative Marilyn Strickland (WA-10) and former Mayor of Kansas City Sly James, the Caucus will champion a new approach to federalism that channels resources and decision making directly to metro leaders. PPI calls this decentralizing dynamic “Metro Federalism.”

The Progressive Policy Institute (PPI) is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on twitter.

Since 1979, Prosperity Now (formerly CFED) has been a persistent voice championing economic opportunity, innovating outside of and beyond existing systems to build power for all communities. We advance racial and ethnic economic justice by investing in bold new ideas, and we work deeply at both the grassroots and national level to impact the entire ecosystem. By setting goals for our economy and following through with targeted approaches based on need, we are equipped to drive forward and cement big structural solutions. Join Prosperity Now in creating a new, transformed economy that works for all of us. Visit us at www.prosperitynow.org.

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Media Contact: Aaron White; awhite@ppionline.org