Our first plenary of the conference , titled “Advancing the Assets Agenda,” featured:
Josh Nasser, Vice President for Federal Affairs, Center for Responsible Lending
CFED’s President Andrea Levere made introductory remarks, asking us to reflect on the anniversary of 9/11 with a moment of silence. She mentioned that they chose Washington DC this year to show the full power of the movement we’ve created, and to help us dedicate ourselves to bringing the movement to scale. Today, there are 73,000 IDA accounts, and there’s new data on the impact that we can use to build the movement.
With today being legislative advocacy day at the conference, Merle Lawrence noted that this is the largest gathering of asset advocates ever, with over 1,100 people in attendance.
Merle said she had 5 simple messages for her 5 minutes:
1. It’s about taking action now.
2. Organizing our constituents is more important than ever in a time of economic crisis.
3. We need to continue to accelerate innovation in our field, and she foresees much happening at the municipal and neighborhood level.
4. This movement is fundamentally about equity across diverse communities.
5. Yes, you can lobby, and you must.
Their foundation understands that public policy work is hard, sometimes controversial, but they believe it must be done. With modest resources, they’ve found that public policy advocacy is one of the most important things they can do. It’s a highly leveraged investment. They were the first corporate funding of the American Dream Demonstration. They provide support for state coalition building. And the list goes on and on.
She concluded by saying that challenging times like we have today are a catalyst for change: we’ve tested the tools; we’re in it for the long term; we can make much more substantial change happen if we’re willing to remain dedicated to this work we’re doing today.
Andrea Levere returning to the podium to repeat the axiom that one of the true measures of leadership is who you hire, so she feels pretty good about herself for hiring Carol Wayman, who has really “gone for it” in her role as Senior Legislative Director. She has brought in an amazing diversity of partners.
Carol reminded us of the broad policy objectives laid out at the 2006 Assets Learning Conference in Phoenix.
1. Remove disincentives
2. Expand savings and asset building infrastructure
3. Provide savings incentives
4. Preserve the asset gains once they’re made
She noted that people can handle incremental change. It’s true of your personal life, and true of policy. In that spirit, the field has succeeded in its push for reform of asset limits on food stamps, succeeded with automatic enrollment into retirement plans, succeeded in action on split refunds. We’ve now got $8 million for VITA sites. We’ve preserved AFI and ORR funding for IDAs, and increased funding for microenterprise development. We’ve passed the Beginning Farmer and Rancher IDA program. We shouldn’t feel that this is a do-nothing congress when it comes to asset-building.
Josh Nasser of the Center for Responsible Lending then took the podium to note that the bad economy has highlighted the importance of everyone’s work around responsible lending, where his organization is focused. He’s encouraged by the recent action at the Federal Reserve to put in place new rules for mortgage lending, which would have prevented many of the problems we’re having today. He hopes the Senate will take up anti-predatory lending legislation, and he’s happy to see that the House Financial Services Committee is putting forward a credit card reform bill, aimed at curbing abusive practices.
Josh noted that this period we’re in now has demonstrated the need for stronger consumer protection practices, so that when the sub-prime market comes back, it operates in a much more responsible way.
Peter Orszag of the Congressional Budget Office kicked off his remarks by noting that his children refer to it as the “Congressional Boring Office,” but he’ll try to keep us from dozing off. He offered a Cliff Notes version of his remarks to start us off, which the blogger in me loves to hear. Just two major points, he said:
1. More Pscyhology 101, less Economics 101 when it comes to public policy on retirement and a host of other issues. In area after area, “norms” have a far bigger impact than the typical understanding of economics would suggest. (He didn’t mention Thaler and Sunstein’s “Nudge,” but I think he’s talking about the same basic concept.
2. Health care costs are crowding out so much else (bad news), but we have substantial opportunities to get some big gains in efficiency by replicating what works well in the states/regions that keep costs low while still providing top-quality care (good news).
On the first point, he said the most compelling example comes from retirement savings (participation rates in company 401k plans). When you look at the actual data, a large match rate doesn’t get you the same kick in participation as automatic enrollment (regardless of the size of the employer match). Policy makers haven’t paid sufficient attention to the power of these “defaults,” but that needs to change.
Regarding the other problem — an unsustainable fiscal course related to health care costs — Peter elaborated on his Cliff Notes version to note that we could potentially save $700 billion by not “overpaying” for care that fails to demonstrate better outcomes (based on medicare data).
The jaw-dropping anecdote for me was Peter’s point about the placebo effect,which is frequently discounted, but it’s often more important than intervention effects. He described a study in which researchers monitored hotel housekeeping staff after telling a group of them that they were engaged in physical exercise in the course of doing their job, while telling nothing to the rest of the housekeeping staff. Simply as a result of learning that their job is equivalent to physical exercise (no other intervention than that, thus making it a placebo effect), that group’s weight went down significantly. That’s pretty extraordinary.
Next we moved on to Ray Boshara of New America Foundation and Carol Wayman again to describe the 4 major legislative priorities of the asset-building field, which were also discussed in the earlier Lobbying 101 session (which I blogged about here).
Ray made a strong point that we shouldn’t talk about “assets” in most circumstances, even with policy professionals on Capitol Hill. We need to use language like “enduring aspirations” and the “raw material of the American Dream,” because then it feels more real than the asset development lingo that our field often uses.
The plenary ended with comments from Elsie Meeks of First Nations Oweesta Corporation. The terminology she likes to use is “wealth-building.” She said that when she talks to policy makers about how you really can build wealth for the poorest group of people in this country, native Americans, those policy makers pay attention. And although one might think that “native country” isn’t big enough to command much attention from members of congress, she feels that in general they’ve really been on board with it. The legislators want to know solutions. They want to be in on fixing real problems. So her final words of encouragement, directed primarily toward those heading off on Hill visits in the afternoon, are: “Don’t be afraid. Don’t apologize.”