by Thomas Sugrue
A few things have caught my eye this morning: Over at TAP, Devin Fergus defends an obscure clause in the recently-passed financial reform bill that creates Offices of Minority and Women Inclusion (OMWI) in federal financial regulatory agencies. Wall Street Journal editors hyperbolically find it "the most brazen attempt to hijack central bank policy since its founding nearly a century ago."
If only. But I also don't buy Fergus's argument that law firms run by minorities and women will necessarily be more sensitive to predatory lending and its impact on minority communities. The OMWI will help minority-run firms win government contracts. Yes, more diversity. And yes, the financial crisis has disproportionately affected people of color.
In 2006, the last boom year, more than half of subprime loans went to African Americans, who comprise only 13 percent of the population. And a recent study of data from the Home Mortgage Disclosure Act found that 32.1 percent of blacks, but only 10.5 percent of whites got higher-priced mortgages (those with an annual percentage rate three or more points higher than the rate of a Treasury security of the same length.
But will black or Hispanic or women regulators necessarily focus their attention on these issues more than whites? I'm remain to be convinced. After all, Fannie Mae CEO Franklin Raines was African American. And while that made him and his fellow executives really rich, it did not keep FNMA from getting all cozy with Countrywide, one of the real villains in the home mortgage crisis.
And now for something completely different. The Tenured Radical, one of the best academic bloggers out there, dissects the current poll data showing that appalling numbers of Americans think that Obama is a Muslim and longs for the days when presidents like Kennedy called for the separation of church and state rather than wearing their godliness on their sleeve. Her take away point: it's more evidence of the ill-education of the American people. Only one in five Americans reads above a twelfth-grade level.
And closer to home, my jaw falls open at Megan McArdle's take on unemployment: first the eyeopener that "unemployment is inherently unpleasant," then this:
We cannot eliminate all the suffering inherent in unemployment, and more to the point, I don't think we should; being on the dole for life should not be an attractive alternative to working.
Here we have an early twenty-first century version of early nineteenth century British poor law: "A fundamental principle with respect to legal relief of the poor is that the condition of the pauper ought to be, on the whole, less eligible than that of the independent labourer." It was then--and is now--a highfalutin, moralistic justification for social programs that are inadequate to deal with the problem.
The reality is that no one in America is "on the dole for life" and no one will for the foreseeable future. Unemployment benefits now max out between 60 and 99 weeks, depending on the state. After that, the safety net is in shreds. Given the abysmal job market, the number of workers who max out but who can't find jobs is going to grow. What about the 2.6 million people marginally attached to the labor market--those defined by the Bureau of Labor Statistics as "individuals were not in the labor force," who "wanted and were available for work, and had looked for a job sometime in the prior 12 months." Tough luck for them.
Read and discuss.