Charter Schools Gone Wild: Study Finds Widespread Fraud, Mismanagement and Waste
Bill Moyers - May 5, 2014, by Joshua Holland - Charter school operators want to have it both ways. When they’re...
Bill Moyers - May 5, 2014, by Joshua Holland - Charter school operators want to have it both ways. When they’re answering critics of school privatization, they say charter schools are public — they use public funds and provide students with a tuition-free education. But when it comes to transparency, they insist they have the same rights to privacy as any other private enterprise.
But a report released Monday by Integrity in Education and the Center for Popular Democracy — two groups that oppose school privatization – presents evidence that inadequate oversight of the charter school industry hurts both kids and taxpayers.
Sabrina Joy Stevens, executive director of Integrity in Education, told BillMoyers.com, “Our report shows that over $100 million has been lost to fraud and abuse in the charter industry, because there is virtually no proactive oversight system in place to thwart unscrupulous or incompetent charter operators before they cheat the public.” The actual amount of fraud and abuse the report uncovered totaled $136 million, and that was just in the 15 states they studied.
Diane Ravitch on school privatization.
According to the study, fraud and mismanagement of charter schools fall into six categories:
Charter operators using public funds illegally — outright embezzlement
Using tax dollars to illegally support other, non-educational businesses
Mismanagement that put children in potential danger
Charters illegally taking public dollars for services they didn’t provide
Charter operators inflating their enrollment numbers to boost revenues
General mismanagement of public funds
The report looks at problems in each of the 15 states it covers, with dozens of case studies. In some instances, charter operators used tax dollars to prop up side businesses like restaurants and health food stores — even a failing apartment complex.
The report’s authors note that, “where there is little oversight, and lots of public dollars available, there are incentives for ethically challenged charter operators to charge for services that were never provided.” They cite the example of the Cato School of Reason Charter School in California, which, despite its libertarian name, collected millions of tax dollars by registering students who actually attended private schools in the area.
Perhaps the most troubling examples of mismanagement were those the report says actually put kids in danger:
Many of the cases involved charter schools neglecting to ensure a safe environment for their students. For example, Ohio’s State Superintendent of Public Instruction, Dr. Richard A. Ross, was forced to shut down two charter schools, The Talented Tenth Leadership Academy for Boys Charter School and The Talented Tenth Leadership Academy for Girls Charter School, because, according to Ross, “They did not ensure the safety of the students, they did not adequately feed the students, they did not accurately track the students and they were not educating the students well. It is unacceptable and intolerable that a sponsor and school would do such a poor job. It is an educational travesty.”
Integrity in Education and the Center for Popular Democracy aren’t the first to warn of problems plaguing an under-regulated industry fueled by billions of tax dollars. A 2010 report to Congress by the Department of Education’s Inspector General’s office warned of the agency’s “concern about vulnerabilities in the oversight of charter schools” in light of “a steady increase in the number of charter school complaints.” It blamed regulators’ failure “to provide adequate oversight needed to ensure that Federal funds [were] properly used and accounted for.”
Read the full report for the watchdogs’ recommendations for how policymakers could strengthen oversight and bring real transparency to the charter school industry.
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Housing advocates: FHFA won’t reduce principal, offers discounted NPLs
Two liberal advocacy groups have published a provocative study accusing the Department of Housing & Urban...
Two liberal advocacy groups have published a provocative study accusing the Department of Housing & Urban Development and the Federal Housing Finance Agencyof helping Wall Street at the expense of low-income communities by selling non-performing loans to investors.
The Center for Popular Democracy and the ACCE Institute’s report “Do Hedge Funds Make Good Neighbors?: How Fannie Mae, Freddie Mac and HUD are Selling Off Our Neighborhoods to Wall Street” is lengthy and accusatory.
The study looks at how HUD has since 2012 auctioned off, at a discount, some 120,000 Non-Performing Loans that they want to get off their books.
They also take into account similar actions by the FHFA through Fannie Mae and Freddie Mac, which have sold over 10,000 mortgages already this year.
The study, which can be read here, notes that nearly all of the roughly 130,000 mortgages have been sold to Wall Street hedge funds and private equities firms, leading to what they call the rise of a new phenomenon in this country – Wall Street as major landlord and neighbor in communities across the country.
“An initial examination into four of the largest purchasers of HUD and FHFA loans has unearthed an array of disturbing business practices, ranging from those that clearly run counter to the goals of homeownership preservation and neighborhood stability to those that break laws, deceive homeowners, and harm taxpayers more generally,” the study claims.
The authors argue that HUD and FHFA should sell these troubled mortgages to entities working to preserve homeownership and create affordable housing, not to Wall Street speculators with a history of defrauding taxpayers and harming homeowners, tenants and neighborhoods.
“Nearly eight years after the start of the global financial crisis, hedge funds and private equity firms have found yet another way to make big profits: distressed housing assets. Often, the very same corporate actors that precipitated the housing crash in the first place are buying and selling off delinquent mortgages and vacant houses that are a product of the crash,” the study says. “Together, these Wall Street entities have raised over $20 billion to buy the notes for as many as 200,000 homes in the United States. The newly consolidated single-family rental market is a lucrative business. A 2014 study estimated that the four largest holders of these assets have seen as much as a 23% rate of return on the properties they purchased in the last three years.”
However, HUD has been making changes to how it deals with distressed assets and NPL sales.
Just two months ago, HUD announced significant changes to its Distressed Asset Stabilization Program. HUD also announced additional improvements to the Neighborhood Stabilization Outcome sales portion of DASP which are aimed at increasing non-profit participation.
Updates include giving non-profits a first look at vacant properties, allowing purchasers to re-sell notes to non-profits, and offering a non-profit only pool.
Previously, loan servicers could foreclose 6 months after they received the loan and were encouraged, though not required to assess a borrower’s qualifications for loss mitigation programs. Purchasers of the geographically targeted neighborhood stabilization pools have always been required to ensure that at least 50% of the loans in a pool achieve outcomes that help areas hardest hit by foreclosure avoid the neighborhood decline associated with numerous vacant properties.
“These changes reflect our desire to make improvements that encourage investors to work with delinquent borrowers to find the right solutions for dealing with the potential loss of their home and encourage greater non-profit participation in our sales,” said Genger Charles, Acting General Deputy Assistant Secretary, Office of Housing, when it was announced. “The improvements not only strengthen the program but help to ensure it continues to serve its intended purposes of supporting the MMI Fund and offering borrowers a second chance at avoiding foreclosure.”
The groups are calling on HUD and FHFA to “establish much higher standards and criteria for the kind of companies that are eligible to purchase delinquent mortgages” and to “prioritize companies that have a clearly defined program to offer permanent modifications with principal reduction and to create affordable housing with vacant properties.” ?
They also want FHFA to “immediately begin to offer principal reduction in their own modification process.”
“Two distinct paths forward are available: the abuses of the biggest purchasers to date of the HUD and FHFA non-performing loans; or, the approach of community development financial institutions with both the ability and the commitment to create affordable housing to better local communities. The status quo benefits the very actors that hastened the financial crisis and actively created the conditions that sucked over half the wealth from millions of American families. These companies profit from new predatory practices and speculative business models that once again take advantage of ordinary people,” the study concludes.
Source: HousingWire
When To Raise Rates? Boston Fed Chief Pokes Fellow Liberals
When To Raise Rates? Boston Fed Chief Pokes Fellow Liberals
Eric S. Rosengren, president of the Federal Reserve Bank of Boston, has been famous as an inflation dove – until now....
Eric S. Rosengren, president of the Federal Reserve Bank of Boston, has been famous as an inflation dove – until now.
Being a dove means he almost always favors smaller and fewer interest rate increases by the Fed, in the hope that more money from the spigot will lead to more jobs and wage increases for workers. Rosengren and Janet Yellen, the Fed chair, have led the dove charge in recent years.
But on Wednesday, Rosengren dissented when the central bank postponed a rate hike at least until December. That surprised his fellow dovish liberals because, to oversimplify, lower rates tend to help workers, while higher rates, making money harder for borrowers to get, can protect accumulated wealth by warding off inflation.
The pro-hike dissent was his first in almost 10 years as a Fed governor; he has certainly opposed rate hikes and urged faster cuts, sometimes with formal dissents.
The move ignited debate not along the usual lines of doves and hawks – those who favor rate hikes to control inflation even before it appears – but between doves and doves, in much the same way that, for example, foreign trade deals divide liberal Democrats.
All of this might seem like an esoteric spat to Joe Grabasandwich, as my old politics professor used to say. But it lies at the heart of how the central bank can prod the economy to help more people, sooner. And it matters especially in Connecticut, where growth is slow even in good times, making rate hikes hurt worse than elsewhere.
On Friday, Rosengren explained his dissent in a public statement in which he said the economy is stronger than many people think.
"By 2019, I expect the unemployment rate to have declined below 4.5 percent," Rosengren said in the statement. "While I have a long track record of advocating for policy that supports robust labor market conditions, that is below the rate that I believe is sustainable in the long run."
What Rosengren is saying is that a 4.5 percent unemployment rate is so low that it would heat up the economy to the point of inflation above 2 percent, and that's the big no-no the Fed is trying to prevent – a clear charge to anyone who remembers the nightmare of the 1970s.
Taking the medicine of a one-quarter of 1 percent rate increase now, immediately, will, in his view, allow for relatively low rates over the long haul. That's part of the so-called soft landing from an expansion that is so hard to achieve.
Not so fast, left-leaning economists say. Or rather, not so slow. In the big picture, economist Jared Bernstein said, workers only see wage increases when the unemployment rate is at or near full employment – as we saw in the Sept. 15 Census report. The report showed a robust 5.2 percent 2015 jump in the income of households at the middle of the scale.
Did Eric Rosengren, of all people, turn his back on this?
"I've always considered him sympathetic to my view, which is that the last thing you'd want to do is tap the brakes and slow down job growth at a time when the economy is finally starting to...help people who have been left behind," said Bernstein, a senior fellow at the Center on Budget and Policy Priorities and author of a new book, "The Reconnection Agenda: Reuniting Growth and Prosperity."
Bernstein, a former chief economist for Vice President Joe Biden, doesn't believe Rosengren is suddenly looking out for capital at the expense of labor. Rather, the issue comes down to the murky relationship between inflation and unemployment.
The financial media widely reported Rosengren's 4.5 percent jobless figure Friday. But in itself, it's not news, considering the rate is now 4.9 percent. The real news, Bernstein said, is that Rosengren thinks he can tell when too hot is too hot, without data.
Rosengren, in a visit to New Britain in April, explained that the "natural" or "full" rate of employment, the level that delivers the maximum benefits to the economy without accelerating inflation, will be reached when the jobless rate is 4.7 percent.
The trouble with that view, Bernstein said, is that "it is widely understood by people who look very closely at this question that we cannot reliably estimate that rate within 2 points one way or another."
There are too many variables in play, such as productivity and distribution of income, so, why risk punishing workers by applying certainty to a mystery?
Rosengren explained, in his statement Friday: "My goal is to achieve a long and durable recovery – a sustainable expansion...I believe a significant overshoot of the full employment level could shorten, rather than lengthen, the duration of this recovery."
As I noted when Rosengren visited in April, his view of the economy, literally, from his downtown Boston office, is full of cranes in the torrid market of a red-hot city. Is that coloring his fear of inflation? Maybe.
No one thinks another quarter-point increase in the Fed's overnight borrowing rate, after last December's uptick, will make a big difference by itself. But the signal the Fed sends can and does move markets and the economy.
"If we want this recovery to reach down and help people it has yet to reach, that's inconsistent with even a small rate increase," Bernstein said. "Where's the inflation?"
"It's gradually coming up," Rosengren told a Quincy, Mass. audience on Sept. 9.
That's the $15 trillion debate as the U.S. economy either is, or is not, nearing its speed limit.
By Dan Haar
Source
U.S. job growth surges in July
The U.S. economy added 209,000 jobs in July, according to government data released Friday morning, surpassing...
The U.S. economy added 209,000 jobs in July, according to government data released Friday morning, surpassing economists' expectations and suggesting the economy continues to thrive after an extended streak of job gains in recent years.
The unemployment rate ticked down to 4.3 percent, compared with 4.4 percent in June, and wages rose by 2.5 percent from the year before to $26.36 in July.
Read the full article here.
Breaking Down the Walls: Brooklyn #BHeard on Immigration, A Community Town Hall
Breaking Down the Walls: Brooklyn #BHeard on Immigration, A Community Town Hall
On October 22nd at 7PM, ...
On October 22nd at 7PM, BRIC TV hosted Breaking Down the Walls: Brooklyn#BHeard on Immigration, a live-broadcast, town hall-style discussion that aimed to examine the state of immigration and the policies (or lack there-of) that affect New Yorkers.
The face of immigrant Brooklyn is diverse and each story is complex, but a common thread among so many immigrants is the wish for security, tolerance, and a legal path to continue contributing and living here. From the child who only knows NYC as her home, to the first generation parent responsible for supporting his family in his home country abroad, to the aging worker with limited prospects for retirement—immigration is a human rights issue which can no longer be avoided.
In the upcoming Presidential elections, hope and fate are once again in the hands of those running for the nation’s highest office. What happens on a national and global level will affect immigrants here in the Big Apple. The reverse is also true, and that’s why we need to discuss what we’re doing here in one of the nation's most diverse cities…what work lies ahead…and how Brooklyn can #BHeard on Immigration.
PANELISTS:
Carlos Menchaca (City Council Member, Chair of the Committee on Immigration)Linda Sarsour (Arab American Association)Adrian Carasquillo (National Political Reporter Buzzfeed News)Alina Das (NYU Law Professor, Director of NYU Immigrant Rights Clinic)Shena Elrington (Director of Immigrant Rights & Racial Justice, the Center of Popular Democracy)Ravi Ragbir (Director of The New Sanctuary Coalition of NYC)
MODERATOR:
Brian Vines (BRIC TV)
Everyone wants the opportunity to #BHeard. Come to BRIC House on 10/22 at 7pm for our latest town-hall style discussion. The topic this time: immigration.
BRIC TV
Source: Storify
A Terminally Ill Progressive Activist Confronted Jeff Flake About The Tax Bill On A Flight
A Terminally Ill Progressive Activist Confronted Jeff Flake About The Tax Bill On A Flight
A leading progressive activist with Lou Gehrig’s disease appealed to Sen. Jeff Flake (R-Ariz.) to reconsider his...
A leading progressive activist with Lou Gehrig’s disease appealed to Sen. Jeff Flake (R-Ariz.) to reconsider his support for the Republican tax bill during a flight to Phoenix on Thursday.
“I need you to make your vote match your principles, senator. And for the rest of your life, you will be proud if you vote this bill down,” said Ady Barkan, founding director of the Fed Up campaign, a group backed by the Center for Popular Democracy that pushes the Federal Reserve to set monetary policy that favors workers.
Read the full article here.
Groups demand recovery money for Puerto Rico
The Center for Popular Democracy and Make the Road CT plan to deliver postcards at the Bridgeport office of U.S. Rep....
The Center for Popular Democracy and Make the Road CT plan to deliver postcards at the Bridgeport office of U.S. Rep. Jim Himes, D-4, demanding Congress "have a heart" and send an aid package to Puerto Rico with no additional oversight or austerity measures.
"The efforts also preview a larger mobilization on the 6-month anniversary of Hurricane Maria, when hundreds of activists from across the country will travel to Washington, D.C. to demand a comprehensive aid package for Puerto Rico that does not impose more austerity, oversight or privatization," said Julio López Varona, a spokesman for the group.
Read the full article here.
Nueva York es la primera ciudad de EE.UU. que financia abogados para inmigrantes
NTN24 – July 21, 2013 - Una investigación determinó que las personas que se encuentran bajo detención por orden de un...
NTN24 – July 21, 2013 - Una investigación determinó que las personas que se encuentran bajo detención por orden de un juez de inmigración en EE.UU. no cuentan con un abogado de oficio.
Por esta razón, se creó en Nueva York un programa que le brinda el acompañamiento legal a los inmigrantes que no cuentan con los recursos necesarios para recibir asesoría legal. La iniciativa es apoyada por Robert Katzmann, Juez federal de la Corte de Apelaciones.
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Part-Time Workers Struggle With Full-Time Juggling Act
NPR - March 6, 2015, by Yuki Noguchi - The cold weather did not hamper hiring last month. Employers...
NPR - March 6, 2015, by Yuki Noguchi - The cold weather did not hamper hiring last month. Employers added nearly 300,000 jobs to payrolls, and the unemployment rate fell to 5.5 percent.
Despite another strong report, there is little evidence that all the hiring is putting upward pressures on wages.
And there are more than 6.5 million people working part time who would like to have more hours.
Randa Jama pushes airline passengers on wheelchairs to their gates at the Minneapolis-St. Paul International Airport. This had been a full-time job when she took it last fall, but then a couple of months later, that changed.
"They told me that you're working only Saturday and Sunday from now," she says.
That cut her hours to 12 a week. Sometimes, her supervisors ask her at the last minute to stay late or do an extra shift. Since she cut back on babysitters, she can't accommodate.
"I let them go because they can't just wait for me to get full time. Now that I want to work full time, no I can't because obviously I changed everything," Jama says.
Higher wages are just one issue workers like Jama care about. They say getting enough hours — and a predictable schedule — are equally important in order to enable them to find additional work or deal with the other obligations in their lives.
"Nowadays you have to say you have open availability and that you're free to work whenever," says Aditi Sen, a researcher for the Center for Popular Democracy, a worker advocacy group.
But pledging open availability limits a worker's ability to plan or get other work.
So far, the law has little to say when it comes to scheduling.
Some states, including Minnesota, Connecticut, Maryland and Massachusetts, are considering legislation that would require several weeks advance notice of schedule changes and institute minimum time off between shifts.
Shannon Henderson says she needs more control over her constantly shifting work schedule. The single mom of two says she asks for more than the 33 hours a week she typically gets working at the Wal-Mart in Sacramento, Calif. But that's also stressful.
"In order to get hours, you have to have open availability," she says. "For instance, last week I worked all late shifts, which was 2 to 11. And then this week I had all early shifts, which was 6:30 to 2."
Wal-Mart last month promised to raise its base wage and give workers more control over their schedules.
Henderson worries the store won't give her more control without cutting back on her hours. She looks for more steady work when she can.
"I do look. But the thing is, with the scheduling being all over the place, it makes it hard for me to actually set time to go look," she says.
Neil Trautwein, vice president of health care policy at the National Retail Federation, says, "Unquestionably those are some difficult hours."
Trautwein says retailers are balancing the consumer demand for 24/7 service, with employees' scheduling concerns. Wal-Mart, he says, is responding to workers' demands.
"That's the way the market self-adjusts and self-regulates," he says.
Jason Diaz, a server at a restaurant in New Haven, Conn., says in order to work 40 hours a week, he's constantly looking for extra gigs.
"Finding the place is the first problem," he says. "And then finding out how to manage that, and travel cost expenses and still being to my next job on time is pretty difficult."
He spends his remaining time trying to find a full-time job and taking care of his son.
"Just in the last two weeks, I got an email from my boss saying, 'Hey, you have to work on Tuesday, so figure out what you're going to do with your son,' " he says.
So Diaz canceled his son's drum lesson and found babysitting, only to discover his boss had made a mistake and he didn't have to work, after all.
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The Federal Reserve Leaves Key Interest Rate Unchanged Amid Slower Job Growth
The Federal Reserve Leaves Key Interest Rate Unchanged Amid Slower Job Growth
The Federal Reserve announced on Wednesday that it will keep its benchmark interest rate at current levels in response...
The Federal Reserve announced on Wednesday that it will keep its benchmark interest rate at current levels in response to lackluster job creation in recent months and other discouraging economic data.
The decision will shield American consumers from higher borrowing costs, but it also reflects the fragility and unpredictability of the current economic recovery, some seven years after the Great Recession officially ended.
The central bank’s Federal Open Market Committee is keeping the influential target federal funds rate — the Fed-set interest rate banks charge one another for overnight lending — at a range of 0.25 to 0.5 percent. Since the rate is a benchmark for lending throughout the economy, leaving it unchanged will likely prevent higher interest rates on mortgages, car loans and other household debts.
The Fed has a dual mandate to craft monetary policy that both maximizes employment and keeps inflation in check. The FOMC lowers the federal funds rate to accelerate job growth by reducing borrowing costs. It raises the rate to limit price inflation by slowing the pace of job growth.
The FOMC’s decision not to do the latter in June was widely expected. Fed officials signaled earlier this month that disappointing job creation had undermined the case for a rate hike. The economy created just 38,000 jobs in May, and new data show that the preceding two months produced fewer jobs than previously believed, according to the Bureau of Labor Statistics.
The central bank is also responding to tepid inflation. The price of consumer goods, excluding food and energy, rose 1.6 percent in the 12 months ending in April, according to the price index favored by the Fed — well below the Fed’s 2-percent target. And a University of Michigan survey revealed on Friday that U.S. households’ expectations of long-term inflation are lower than they have been at any point since the survey began collecting data in 1979.
In a press conference following the announcement, Federal Reserve Chairwoman Janet Yellen acknowledged the role that those developments played in the central bank’s decision, noting that “recent economic indicators have been mixed.”
Yellen also said that the prospect of a “Brexit,” or British exit from the European Union, was “one of the factors” that led the central bank to hold off on an interest rate hike. The United Kingdom will vote on the country’s membership in the EU on June 23.
If the U.K. chooses to leave the EU, which functions as a single market, it could ultimately have adverse effects on the U.S. economic outlook, Yellen suggested. A higher percentage of British voters supported Brexit than opposed it in a poll released on Monday.
The Fed last raised the federal funds rate by one-quarter of a percentage point in December, the first increase since the financial crisis. The rate had been at or near zero — 0 to 0.25 percent — since December 2008.
With the December interest rate increase, the Fed seemed to express confidence that the economic recovery had entered a new phase, indicating it was time to pivot to the work of preventing inflation. Yellen predicted that the move would be the first in a series of small interest rate hikes that would gradually raise rates to levels that are more historically normal.
Since then, however, disappointing economic data have repeatedly delayed the pace of those increases. Slower global demand reduced the availability of credit, and wage growth remained sluggish, prompting the Fed not to raise the federal funds rate in March.
Fed officials suggested in May that economic conditions would finally permit them to raise the rate again in June. But the May job creation data, released on June 3, rapidly dashed those plans.
The central bank’s next opportunity to announce a rate hike will be July 27, after a meeting of the FOMC.
Wednesday’s announcement will come as welcome news to many progressive economists and activists who have long argued that the job market has much more room to grow before inflation becomes a serious problem.
While the official unemployment rate is 4.7 percent, much of its recent decline is due to people dropping out of the workforce altogether. The labor force participation rate, which measures the percentage of people actively seeking work in addition to those who are working, is significantly lower than it was in 2000.
In fact, when you exclude workers 55 or older who may have retired voluntarily, labor force participation is lower now than it was at its worst point during the past two business cycles, according to an analysis by the Economic Policy Institute.
A job market where people continue to give up on finding work is part of the reason wage growth has failed to meet expectations, since employers still have little reason to compete for workers, progressive economists argue. Average hourly pay rose 2.5 percent in the 12-month period ending in May, not enough for a significant boost in most Americans’ paychecks.
The Fed Up campaign, a coalition of progressive groups that advocates for Fed policy that is favorable to workers and communities of color, cites figures like those when pleading with the Fed to hold off on raising rates. Fed Up has called on the Fed not to raise the benchmark interest rate until “the economic recovery reaches all communities,” said Jordan Haedtler, Fed Up campaign manager.
Progressives were overjoyed when presumptive Democratic presidential nominee Hillary Clinton expressed her sympathy with these concerns last month. The campaign said in a statement that as president, Clinton would appoint Fed officials who take seriously the central bank’s mandate to maximize employment, in addition to its duty to tamp down inflation.
Clinton stands to benefit politically from Wednesday’s announcement, since voters typically judge the candidate of the incumbent party for the economy’s performance. A rate increase would have squeezed economic demand, risking even slower job growth in the months ahead of the general election.
Donald Trump, the presumptive Republican presidential nominee, has expressed a wide variety of views about the Fed. He most recently suggested that he supports low interest rates, but that he plans to replace Yellen as Fed chair.
Yellen said Wednesday that the central bank will act based on economic data in the coming months, even if its actions are perceived as affecting the general election in November. “We are very focused on assessing the economic outlook and making changes that are appropriate without taking politics into account,” she said.
This piece has been updated with Yellen’s comments.
By Daniel Marans
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18 hours ago
18 hours ago