King County Council Approves One of Toughest Living Wage Ordinances in the Country

SEATTLE — The King County Council yesterday approved a living wage ordinance, which, when signed by County Executive Dow Constantine, would be among the stronger county-level ordinances in the country.

The Alliance for a Just Society and Washington Community Action Network have supported the legislation, which includes language citing Alliance living wage research. The legislation sets a wage floor for King County employees and service contractors for contracts worth $100,000 or more.Continue reading “King County Council Approves One of Toughest Living Wage Ordinances in the Country”

If Germany Can be Tuition Free, Why Not Us?

There was some very exciting news coming out of Germany this week, when the country announced that it is scrapping tuition and fees for its universities. Organizing is widely credited with building the public will and political momentum for free college. In fact, Dorothee Stapelfeldt, of the Hamburg Parliament, told reporters this week, “Tuition fees are socially unjust.”

Free or low-cost higher education is typical in most of Europe.

In Germany, tuition is a mere fraction of what American students pay. But with Germany, which has been taking heat for pushing austerity measures that have unnecessarily constrained the economy, leading on this important issue it, brings hope that we can keep building the momentum in the U.S.

And it’s beginning. In Connecticut, Gov. Dannel Malloy has unveiled a plan that will help folks who are already burdened with student debt. His plan calls for state tax breaks for interest on student loans, but more importantly, it would create an authority in the state that would allow students to refinance their debt at market interest rates. Additionally, he’s working to create the Connecticut Financial Aid Pledge, which would offer assistance to help qualifying Connecticut students graduate without debt.

This is a step in the right direction, but the U.S. is still miles away from the free college tuition. Students, teachers unions, and communities have been working for nearly ten years in Germany to win free schooling. Here in the states it’s just recently risen to be part of the national conversation.

Nascent coalitions like the Higher Ed Not Debt that the Alliance works alongside, will continue to push for fully funded education, and to ensure that our young people don’t enter the workforce carrying student debt. We need other states to step up to the table to match and beat this proposal.

Because, as the Minister for Science and Culture in Lower Saxony said this week, “We got rid of tuition because we don’t want higher education which depends on the wealth of the parents.”

High Student Debt and Low Wages Don’t Mix

Students and graduates throughout the country continue to bear the burden of the high cost of education by taking out student loans. For those in states with high average student debt and lower median incomes, the weight of student loans combined with low incomes can mean a lifetime of debt.

The Alliance for a Just Society has released two new “A Mountain of Debt” reports, one last Thursday in Maine, and another today in Montana.  The state-specific reports highlight the difficulty of paying for school and paying off loans after graduation in states with predominantly lower wages. When comparing student debt to median household income, Maine has the 11th highest student debt-to-median income ratio in the country. Montanans fare even worse with the 6th highest ratio.

With half or fewer job openings paying a living wage for a single adult, average student loan debts after college graduation of over $27,000 in Montana and over $29,000 in Maine leave graduates without the means to pay off their loans in a timely matter – if they can afford to make payments at all.

As a single mother with significant student loan debt, Kimberly Hammill of Levant, Maine finds that her loans keep her from financial stability.

“Not only did I go to school to better myself and enter a rewarding career, but I also wanted to improve both my daughter’s and my quality of life. My student loans funded my education, but today they keep me in the same state of economic dependence I was experiencing before school. I still have to rely on social services to get by,” said Hammill.

Adam Bland of Presque Isle, Maine says his student loans keep him from saving for the future and living the life he wants today.

“My loan payments take up a little more than 20 percent of my monthly take home pay,” Bland said. “If I didn’t have to make these payments, I would be investing in a 401K, setting money aside for emergencies, and definitely doing a little bit of traveling, but the high interest payments mean I can’t.”

Jan Siemers of Helena, Montana doesn’t have student debt of her own, but she has seen her grown children struggle with their student debt.

“We want our children to be successful and are often told that a college education is the best path, but today I am witnessing firsthand how the resulting student debt is destroying economic opportunities for young people,” Siemers said.

Graduates like Clementine Lindley in Billings, Montana wonder whether student loans are worth it.

“My experience in college has meant so much to me, and has shaped who I am today,” she said. “Sadly though, I am not sure I would make the same decision if given the chance to go back and do it again. While the experiences were invaluable, the $90,000 price tag has been extremely difficult to handle.”

States need to reinvest in higher education, explore innovative solutions to address rising tuition and fees, allow students and graduates to refinance their loans, and increase wages so that graduates can actually afford to pay off their loans. Students and graduates in Maine and Montana deserve to have their hard work pay off, without seeing their dreams crushed by student debt.

Report: America’s Families Are Out of Balance

Media Advisory
Alliance for a Just Society
September 29, 2014
Contact: Kathy Mulady
kathy@allianceforajustsociety.org
(206) 992-8787

America’s Families Are Out of Balance

“The basic bargain of America is that no matter who you are, where you come from or what you look like, if you work hard & play by the rules, you can make it.”  – U.S. Department of LaborSecretary Tom Perez on the agency’s Labor Day 2014.

Millions of families in America work hard, play by the rules and are not making it.  The federal minimum wage is $7.25 an hour and hasn’t been increased in five years.

A sobering report, Families Out of Balance, released this week by the Alliance for a Just Society, shows that the living wage for a single worker in Idaho or Montana is $14.40 an hour. In New York City, it’s $22.50 an hour.

For families it’s even more:

TeeJay Henry ­– A young man in Idaho is trying to support his wife and baby daughter on $12 an hour he earns working fulltime as a heavy truck tire technician. He’s had two raises in two years. They share a house with roommates.  A family living wage in Idaho: about $25 an hour.

Carlota Ortega – She and her husband have two children and live in New York City. She earns $8.50 an hour at a bakery; he earns $10 an hour in construction. They don’t have enough to eat. Living wage in New York City for this family with two working parents: $25.14 per hour for each parent.

Nazmie Batista – A young couple in Connecticut with two children count their pennies. Her husband works full time, but to save childcare costs, she works part-time. They cut back on groceries. She doesn’t know how she will cover her student loan payment. Living wage in Connecticut for a family with two children: $24.92 an hour for each parent.

Calculations in the Families Out of Balance report are no-frills, with a small cushion of savings to cover the minor emergencies that can sink low-income families. Our budgets don’t include payments on student loan debt or medical debt that burdens many low–income families.

What our report does show is that 9 out of 10 low-income families prioritize paying their bills, even if it means skipping meals or turning off the heat in the winter.

Now it’s time for Congress and our state legislators to prioritize families. It’s time for businesses to pay real living wages, so working families can thrive – not just barely survive. Here are some recommendations to get started.

Please let me know if you would like to interview families included in the report, or the authors of the report, Ben Henry and Allyson Fredericksen.

You can find the full report at http://www.thejobgap.org

Using Our Stories to Win: Native Organizing Alliance Webinar

[av_video src=’https://www.youtube.com/watch?v=5NzUUiXjgn4′ format=’16-9′ width=’16’ height=’9′]

As Native people, no one knows our issues and struggles better than we do. Storytelling, an art form that is indigenous to us, can be used to shift power dynamics and substantiate ourselves as experts on the social justice issues that we fight for. In this hour-long webinar witness Native organizers discuss ways to capture the stories that enliven our communities, how to make a case for change, and how to use stories to build and leverage power in campaigns.  

Recorded September 8, 2014. Hosted by Danisha Christian.

Bank of America Settlement Could Fund Principal Reduction Programs

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Reset Seattle members listen as homeowners facing foreclosure ask Seattle City Council members to enact a principal reduction program to help them save their underwater homes from foreclosure. Photo: Reset Seattle

It has taken six years and dozens of lawsuits and settlements after the largest housing collapse since the Great Depression – and finally we may have a way to set up and implement local principal reduction programs in cities across the country.

September has brought us what is expected to be the last of the big settlements by the Justice Department against the big banks. The good news is that the settlements have grown progressively larger each time, with more and more specificity regarding how the banks must comply.

On the flip side, however, there are the murky oversight mechanisms that present challenges for municipalities and community groups looking for a handle.

In the latest settlement Bank of America is required to provide $2.5 billion in principal reduction where foreclosure is not pursued. Additionally, they’re required to pay $50 million to capitalize local programs administered by local governments, Community Development Financial Institutions or other community organizations.

This is ready-made for the proposal the Reset Seattle coalition is working to implement. Reset Seattle is an alliance of hundreds of individuals and more than 30 faith, community, and labor groups in Seattle dedicated to stopping the foreclosure crisis.

The Bank of America settlement money could create a revolving loan fund that is designed purchase underwater homes in zip codes that are particularly hard hit – such as those in southeast Seattle where 15 -20 percent of homes are underwater and homeowners haven’t felt the recovery the way parts of the city have.Screen shot 2014-09-22 at 12.02.24 PM

Seattle must seize this opportunity to demand Chase, Bank of America and Citibank meet their settlement obligations by funding principal reduction proposals, like the one proposed in Seattle. This seems like a perfect fit for everyone – the banks meet their obligations, the city doesn’t have to issue bonds to capitalize the program and underwater homeowners in the city get their principal reduced saving hundreds of dollars every month.

In her latest brief on principal reduction, Alliance Policy Associate Allyson Fredericksen writes that “many other cities are already taking action to give banks the incentive to renegotiate mortgages and work with homeowners to avoid foreclosure”

Some of those incentives, according to Fredericksen, include instituting fees to encourage mediation, to issuing fines for blight on foreclosed homes, to releasing reports on banks’ actions in the community. Such actions put the responsibility on banks to act without putting additional pressure on homeowners.

Seattle should learn from other cities, and lead the way in helping homeowners, without requiring those stretched and stressed homeowners to negotiate with banks on their own.

Unfortunately as we’ve seen time and again since the housing market collapsed, common sense rarely wins out and unnecessary suffering is inflicted to score an ideological point. Hopefully the stars have finally aligned

You can read the Bank of America settlement here.

You can read the details of the Community Relief section here.

 

Graduates Struggle Under a Mountain of Debt

College is supposed to be the pathway to a better job and a better life, but for students across the country college is also the pathway to a life of debt.

Since 2008, states across the country have decreased their investment in higher education, with every state except for Alaska and North Dakota providing less per student in 2014 than in 2008. These cuts have led colleges and universities to increase tuition to make up for the lost funding, shifting that burden onto students and their families.

“A Mountain of Debt,” released this week in Washington and Connecticut, show clearly that when students face increased tuition and low wages, many must turn to student loans to cover costs. In fact, nationwide 70 percent of students graduate with student loans. The average amount of debt at graduation is $29,000.

Students in states like Washington and Connecticut find themselves unable to get by without loans for college, and unable to easily pay them off after graduation.

“I was working 80 hours a week to pay for school and living expenses. My average day would include working multiple fast food jobs sporadically thrown between classes, working one job until 8:30 at night, working 10 p.m. until 4 a.m. loading trucks in a factory, then getting up for class at 8 a.m. and doing it all over again,” said Alex Katz, a student at the University of Connecticut.

Christina Hoadley, a student at Central Connecticut State University, works two jobs to help pay for college, but still is worried about the prospect of paying off her loans. “After grad school, I anticipate walking away with a loan amount to the tune of $40,000. I’ll have to begin paying on all that within 6 to 8 months after completing school. It’s a lot of stress knowing the huge weight of debt that lies ahead.”

In Washington, Roxana Pardo Garcia loves the work that she has found since graduation, but she does not earn enough to make paying off her student loans easy. “My current student loan debt load is $19,000, and my loan payments take about 20 percent of my monthly take-home pay. I just wish I could help my mom out more. After all, she is the reason I went to school: to lift us out of the cycle of poverty.”

Bernadette Binalangbang of Tukwila, Washington has had to take a job outside of her field just so she can work to pay off her student loans. “I really love to bake and making pastries is my passion, [but] I’m currently employed full-time at a medical lab. It’s a complete shift from what I’d like to be doing, but it pays my bills and keeps me afloat — just barely. My student debt payments take up more than 30 percent of my monthly income.”

Disinvestment by states has left students and graduates like Alex, Christina, Roxana, and Bernadette in an uphill battle against the mountain of debt they’ve accumulated. States like Washington and Connecticut need to reinvest in higher education, or even more students will find themselves with no choice but to take out loans that they will repay for years to come.