Asset Building News Week, August 18–22

article | August 22, 2014

The Asset Building News Week is a weekly Friday feature on The Ladder, the Asset Building Program blog, designed to help readers keep up with news and developments in the asset building field. This week's topics include inequality, food security, savings, and employment.


The events in Ferguson, Missouri have prompted numerous reflections on what the unrest reveals about inequality in the St. Louis area and across the country. Writing in The New York Times, Thomas Edsall contrasted the riots in Ferguson to the riots in the Watts section of Los Angeles in the mid-1960s. The comparison he makes is disheartening. While the Watts riots immediately preceded a time of "sustained gains in terms of income, jobs, education and the status of blacks relative to whites," the rioting in Ferguson "follows more than a decade of economic stagnation and worse for many black Americans, a trend that appears unlikely to be reversed in the foreseeable future." For a local D.C. perspective, Mike DeBonisfor the Washington Post compared the Ferguson riots to rioting in the Mount Pleasant neighborhood of D.C. in 1991.

For a visual representation of growing racial inequality and economic stagnation, Neil Irwin, Claire Cain Miller, and Margot Sanger-Katz published a chartbook on "America's Racial Divide" for The New York Times's "The Upshot." Among the important takeaways from the piece is that, even if two people have similar incomes, "the level of wealth they accumulate can vary widely." And the wealth gap between white and black families is widening: "white families were 4.3 times as wealthy as black and Hispanic families in 2007. By 2010, the multiple had widened to 6.1."

The Brookings Institution's Richard Reeves published a "Brookings Essay" on the big picture of equality, opportunity, and the American Dream in the country. He frames the story with the rags-to-riches myth of Horatio Alger and his modern-day legacy, the Horatio Alger Association of Distinguished Americans. Reeves concludes he article, "It is now time to pay [Alger] more than lip service. Equal opportunity must and will remain the quintessential American ideal. The challenge is to live up to it."

In terms of policy solutions for inequality, reforming the tax code wouldn't be the worst place to start. Alex Ulamin The American Prospect reminds us of "how a widely beloved tax deduction really just benefits the well-off and exacerbates inequality." Though there are many "beloved" tax deductions that benefit the wealthy, Ulam is referring specifically to the mortgage interest deduction. Also this week, the Urban-Brookings Tax Policy Center's Eugene Steuerle and Caleb Quakenbush published a short article for Tax Notes that catalogued the up-to-date costs of regressive tax expenditures like the mortgage interest deduction.

Food Security

Feeding America released its Hunger in America 2014 report that analyzes the extent to which Americans rely on charitable food distribution. According to the report, "the Feeding America network of food banks provides service to 46.5 million people in need across the United States, including 12 million children and 7 million seniors." NPR's Pam Fessler ran a story based on the findings, highlighting the need for military families to rely on organizations like the Maryland Food Bank in Baltimore.

Unfortunately, even low-income families that do not rely directly on food banks to get enough food still face higher rates of health risks related to food, though not just because of a lack of it. Researchers from the Drexel College of Nursing and Health Professions have found that "for the poor, food is not only scarce, it's often rotten and germ-ridden." This is because the quality of foods – and the storage systems in which it is kept – in many corner stores and small supermarkets that serve urban "food deserts" are problematic. Alfred Lubrano for The Philadelphia Inquirer reported on the findings.

In Ohio, the failure of officials to renew the state's SNAP waiver, which allowed many poor residents to receive food assistance without meeting a work requirement, has caused thousands of Ohioans to lose federal benefits. According to advocates, "the decision disproportionately hurt minority Ohioans," which has led to a civil rights complaint against Ohio officials filed with the Department of Agriculture. Jackie Borchardt reported for the Northeast Ohio Media Group.

Besides requiring citizens to work to receive food, other states have implemented other strategies to limit receipt of government assistance, with dubious success. Darlena Cunhaexplained for TIME "why drug testing welfare recipients is a waste of taxpayer money."


Mehrsa Baradaranprovided "A Short History of Postal Banking" for Slate this week. She writes, "Postal banking was America's most successful experiment in financial inclusion—a problem we face again today. As we contemplate whether it has a place in our future we must recall the vital role it played in our past." While postal banking is again receiving serious public discussion, its end was unceremonious: "The postal banking system died a quiet death without public discussion."

One reason for pursuing postal banking as a policy solution is to provide an entry into the banking system for more Americans. Doing so could increase savings in the long run and help alleviate problems like the one identified by Jim Puzzangherain the Los Angeles Times this week. He reported on the findings of a new study from, which found that "more than a third of American adults have no retirement savings, and 14% of those ages 65 and older also haven't put money away yet."

In the face of such discouraging statistics, some states are seeking to address the retirement security problem without federal help. Oregon is one of those states, and its Retirement Savings Task Force released a draft report and recommendations for "improving access, participation and level of individual contribution to retirement savings for a secure retirement future." A pdf of the report is here.


Gary Fields and John R. Emshwiller explained in The Wall Street Journal how a single arrest that may have occurred sometime in a worker's past, even if charges were dropped, "can ruin chances of a job." This issue is especially timely as we in the Asset Building Program pursue policies to advance a "Second-Chance Economy."

Chris Bowyer wrote about a different group of Americans who are struggling to get ahead through employment, but who are struggling for very different reasons. The job market for recent college graduates is tough and offers perhaps too many opportunities for underemployment and not enough that make use of graduates' skills. According to Bowyer, "the Federal Reserve Bank of New York reported that a whopping 44% of graduates were underemployed. And it's not just because of the recession: the number's been rising since 2001."

However, for a certain subset of workers with particular skills, the situation may be different. For those entering the "construction, manufacturing and professional services" industries, more opportunities are presenting themselves. Ylan Q. Muifor The Washington Post reports, "The recovery in America's job market is finally spreading to industries with good pay after years of being concentrated in fields with low wages."

Quick Hits

According to a press releasefrom the Illinois government, "Governor Pat Quinn [this week] signed legislation to prohibit ATM fees on EPPICards, reloadable debit cards which are methods of receiving child support payments."

In an op-ed in The Hill, Gary Kalman summarized recent actions to curb the practice of predatory payday lending around the country.

The Assets Learning Conference, a biennial gathering of the asset building field convened by CFED, occurs next month in Washington, D.C. Will you be there?