Economy, Politics & The Financial System

Virtually every aspect of American life—from employment, to housing, to the generational transfer of assets and wealth, and poverty—is tied to our financial systems and institutional structures. On the heels of the Great Recession—which depleted the assets of many households—and as we head into the 2016 election, it’s time to examine and reassess the policies and systems in our workplaces, communities, educational institutions and financial systems that make it easy for families to get ahead and stay ahead.

Foreword
The financial crisis and the Great Recession demonstrated, in a dramatic and unmistakable manner, how extraordinarily vulnerable are the large share of American families with very few assets to fall back on. We have come far from the worst moments of the crisis, and the economy continues to improve. But the effects of the recession…
How the Road to Financial Security is Paved with Financial Capability
At CFED (the Corporation for Enterprise Development), we often joke that our parents don’t understand what it is we do for a living. “Expanding economic opportunity” — okay, sounds nice, but what does that mean? The truth is, it’s complicated. Poverty is complicated. Inequality is complicated. And if we have learned anything over the years, it’s that…
The Future of Building Wealth: Can Financial Capability Overcome Demographic Destiny?
Bravo to MacKenzie. When she was born, she chose married, white, well-educated parents who live in an affluent, mostly white neighborhood with great public schools. She chose parents who read to her, signed her up for violin and soccer lessons at an early age, and involved her in church and community activities. She also chose…
Financial Vulnerability is a Problem: An Economist’s View
Not every financially healthy family will be in the top percentiles of the income and wealth scales. There is and always will be a distribution of income in our own and similar economic systems, as well as a distribution of opportunity, educational access, and so on. But “financial health” implies that, conditional on reasonable effort,…
We Are in This Together: Bipartisan Solutions to Preserve the American Dream
Free economies rarely offer equal results or outcomes. Disparities of wealth are inevitable. However, they are only tolerable if the public has confidence that individual freedom can produce economic and social mobility, and that markets can be open to the enterprise of all corners. In the American economy, freedom can only be sustained if the…
Consumer Protection Drives Financial Health
In the wake of the financial crisis, consumer protection regulation has focused principally on preventing financial services organizations from doing affirmative harm. That’s an excellent start, but going forward, consumer protection can and should help the industry accomplish its best and highest function: making the lives of American families better and more stable through finance.…
Stable Housing, Stable Families: Thinking beyond Homeownership
We face a silent housing crisis in America, and it is becoming worse each year. Nearly 20 million lower-income families spend more than one-half of their monthly income on housing. Another 20 million low-income households also lack access to transit, good schools, and jobs, or are living in concentrated poverty. Most of these families are…
Starting at Home: Housing-based Approaches to Financial Stability
Housing plays a central role in the financial stability, or too often the instability, of America’s families and communities. Housing costs are typically the single largest expense in a family’s budget and, especially for low-income families, often a significant financial burden. The massive job losses and high levels of underemployment during the Great Recession exacerbated…
Empowering Entrepreneurs, Strengthening Communities
There’s a familiar proverb: “Give a man a fish and you feed him for a day; teach a man to fish and you feed him for a lifetime.” As a small business lender, I often add to this saying — help him buy the pond and he will feed his family and community. At LiftFund,…
Ending “Welfare As We Know It”: Redesigning Public Assistance through the Lens of Financial Health and Economic Mobility
In 1996, President Clinton declared the “end of welfare as we know it.” The occasion was the signing of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA), a response to the bipartisan call for welfare reform. This new law was intended to move people from “welfare to work” by restructuring federal public assistance and…
A Lifecycle Approach to Putting Higher Education within Reach
I think by far the most important bill in our whole code is that for the diffusion of knowledge among the people. No other sure foundation can be devised for the preservation of freedom and happiness. — Thomas Jefferson to George Wythe, 1786 A generation ago, the United States ranked first in the world in…
African American Economic Inequality: A Twenty-First Century Challenge
Depressed living standards for Negroes are not simply the consequences of neglect. Nor can they be explained by the myth of the Negro’s innate incapacities, or by the more sophisticated rationalization of his acquired infirmities. They are a structural part of the economic system in the United States. — Dr. Martin Luther King, Jr., 1968…
Women and Wealth: How to Build It
Wealth and assets are integral to the economic security of men and women of all ages, races, ethnicities, occupations, and income levels. Although women have made tremendous progress in achieving economic equality with men in all the largest racial and ethnic groups in the United States, they still lag behind men in many aspects of…
What It’s Worth: Building Bridges to Financial Health and Well-being
Although each author in this book states it somewhat differently, each points to the same conclusion: household financial health and well-being is the bridge to a better life, a better community, and a better economy. Our challenge is to make that idea intuitive to policymakers in all parts of society — education, health, housing, justice,…
SO WHAT? Keeping Our Eyes on the Prize
Let’s say that you are a philanthropist with a deep commitment to improving the lives of low-income people. You have a healthy budget and a talented staff, and after a strategic planning process worthy of the most rigorous management consultants, you make financial capability a cornerstone of your philanthropic approach. You identify the best thinkers…
Closing the Financial Capability Gap: A Call to Action for Private Markets
In recent years, the pace of market-driven innovation in financial services has been breathtaking. Products and services such as prepaid cards, mobile money, payment technologies, and credit score services are making saving, borrowing, and moving money easier than ever. Some of the entrepreneurs driving these innovations have recognized that serving the entire market — lower-income,…
Toward Productive Research Agendas in Financial Inclusion, Security, and Development
In this essay, we focus on key themes in research and knowledge building which have the potential to inform and improve research on financial inclusion, security, and development. In doing so, we use current examples in our own work on asset building, child accounts, and financial capability. This is the work we know best, and…
Building the Opportunity Economy
[The objective of government is] to elevate the condition of men — to lift artificial weights from all shoulders — to clear the paths of laudable pursuit for all — to afford all, an unfettered start, and a fair chance, in the race of life. Abraham Lincoln We start with the recognition of the capacity…

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Economy, Politics & The Financial System

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Economy, Politics & The Financial System