Category Archives: Finance

Ad Data (beta)

Source: The Center for Responsive Politics, OpenSecrets, September 2016

From the press release:
Today, CRP is unveiling a new tool that allows users to track political ad buys daily, as they are reported to the Federal Communications Commission. CRP’s new project is the latest of several worthy efforts that have sought to unlock this information — crucial as it is to understanding how candidates, super PACs and dark money groups operate in elections. In 2012, Jacob Fenton (then of the Sunlight Foundation) created “Political Ad Sleuth,” a pioneering achievement that became the go-to resource for researchers and journalists tracking ad buys reported to the FCC. Similarly in 2012, ProPublica’s Free the Files project tracked FCC filings, and, like AdSleuth, it engaged users by asking them to help crowdsource the very messy data. ….

What you can do with OpenSecrets’ new ad tracker
We couldn’t have done our post on Majority Forward’s advertising in New Hampshire without being able to track its “issue ad” buys through station filings with the FCC, which is the data we are processing and making far more usable for journalists, the public and watchdog groups with our new tool. Having ready access to this data will, among other things, make it possible (for those who can’t afford an expensive private subscription service) to see who’s running political ads that aren’t reported to the Federal Election Commission.

Midyear update on student loan complaints: Income-driven repayment plan application issues

Source: Consumer Financial Protection Bureau, August 2016

This report analyzes more than 3,500 private student loan complaints, 2,400 federal student loan servicing complaints, and approximately 1,500 debt collection complaints related to private and federal student loan debt handled between October 1, 2015 and May 31, 2016. The information included in this report represents the Ombudsman’s independent judgment and does not necessarily represent the view of the Consumer Financial Protection Bureau….“This midyear update analyzes complaints submitted by consumers from October 1, 2015 through May 31, 2016. During this period, the Bureau also began handling complaints about problems managing or repaying federal student loans; this is the first report released by the Bureau discussing data on federal student loan servicing complaints. This report highlights the problems that borrowers face when seeking to enroll in an income-driven repayment plan, and provides recommendations to policymakers and market participants to better serve student loan borrowers.”…

The Growth Of Secret Spending In State And Local Politics

Source: Diane Rhem Show, July 21 2016

Since the Supreme Court’s Citizen’s United ruling six years ago, the flow of so-called dark money into federal elections has been well documented. A much less recognized phenomenon is spending by outside groups in state and local elections – mayoral races, public utility commission contests, school board votes. In 2014 the amount spent by unidentified donors on these smaller stages was nearly 40times the amount spent just four years earlier. And, critics say, a little money in these elections can go a very long way. A discussion about concerns over money and influence in state and local politics.

The Scariest Student Loan Number

Source: Derek Thompson, The Atlantic, July 19, 2016

Some focus on the largest figures, like total student debt ($1.3 trillion) and average debt ($30,000.) So why is the most dangerous student loan number less than $5,000? ….

…..Loans of $10,000 account for two-thirds of all defaults. This is particularly tragic, because these debt-without-degree adults chased the American dream into a dead end. Almost all of the evidence available to economists suggests that college graduates are more likely to be employed and make more money than non-grads…..

Investing in Higher Education: Benefits, Challenges and the State of Student Debt
Source: White House Council of Economic Advisers, July 2016

Higher education is one of the most important investments individuals can make for themselves and for our country. Many students access student loans to help finance their education, and last year federal student loans helped 9 million Americans to make that investment in their futures. Typically, that investment pays off, with bachelor’s degree recipients earning $1 million more in their lifetime and associate’s degree recipients earning $360,000 more, compared to high school graduates. Society also benefits from these investments through such mechanisms as higher tax revenues, improvements in health, higher rates of volunteering and voting, and lower levels of criminal behavior.

At the same time too many Americans feel that college may be financially out of reach and are concerned about rising student loan debt. Student loan debt can be especially burdensome for those who do not graduate or who attend schools that do not deliver a quality education. However, unmanageable debt is not the only issue facing current and former students. Some individuals who could benefit from a high quality postsecondary education do not apply and enroll in college, under-investing in education and shortchanging their future…..

Trends in College Pricing 2015

Source: The College Board, 2015

From the summary:
Trends in College Pricing provides information on changes over time in undergraduate tuition and fees, room and board, and other estimated expenses related to attending colleges and universities. The report, which includes data through 2015-16 from the College Board’s Annual Survey of Colleges, reveals the wide variation in prices charged by institutions of different types and in different parts of the country. Of particular importance is the focus on the net prices students actually pay after taking grant aid into consideration. Data on institutional revenues and expenditures and on changing enrollment patterns over time supplement the data on prices to provide a clearer picture of the circumstances of students and the institutions in which they study.
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Out of Reach? How a Shared Definition of College Affordability Exposes a Crisis for Low-Income Students

Source: Mark Huelsman, Dēmos, 2016

From the summary:
Because of this, many are proposing bold solutions to address the affordability crisis—from debt-free public higher education to tuition-free community college and expanded student loan forgiveness. These efforts will continue to be debated in the 2016 election and beyond, but they would benefit from a shared definition of what “affordable college” actually means. To this point, the term “affordability” has rested more on values and feelings than a shared formula. In some ways this makes sense, as the benefits of college vary by luck, academic preparedness, the strength of the macroeconomy, and the type of institution students are able to attend. But without a definition that colleges, states, and the federal government can use, we run the risk of improperly targeting resources, ineffectively aligning efforts to fund the system, and leaving students feeling like college is financially out of reach.

This analysis attempts to use one definition of affordability—the Rule of 10, created by a consortium of experts convened at Lumina Foundation2—to figure out which states have affordable college for which students. Simply, the Rule of 10 states that college is affordable if students can meet the total net price through 10 hours of work per week and 10 percent of a family’s discretionary income over 10 years. Using this benchmark, we examined the average net price for low-income students in every state at both public four-year colleges and community colleges.

We also created two additional scenarios—a worker returning to college after 10 years in the labor force making median earnings by race, and a student paying the average net price nationally and taking on student debt—to see how this benchmark holds up for the average student, by race.

Our findings include:
– The average net price for low-income students—those from families making $30,000 or less—is unaffordable in all 50 states at both public four-year colleges and community colleges.
– The “affordability gap” varies from slightly over $10,000 for a four-year degree in Hawaii, to nearly $40,000 for students in New Hampshire.
– At community colleges, the affordability gap ranges from just over $1,000 in Mississippi to $23,000 in New Hampshire.
– Black and Latino students making the median income by race cannot accrue enough savings to make a dent in the projected net cost of college. Black adult learners face an affordability gap of over $18,000 ($7,000 more than white adult learners), and Latino adult learners face an affordability gap nearly twice as large as white learners ($21,000 to $11,000).
– Among students who take on loans and earn the expected median income for college graduates, all workers still see an affordability gap. However, black and Latino students in our scenario face larger affordability gaps (over $12,000 and $14,000 respectively), than white and Asian students.
– Doubling the maximum Pell Grant could make college affordable in up to 26 states, while increasing the minimum wage to $15 an hour could make college affordable in 7-8 states.
Why you can’t work your way through college anymore
Source: Jillian Berman, Marketwatch, July 12, 2016

Low-income students can’t afford public college by earning minimum wage and getting grants.

Why debt-free college will not solve the real problems in America’s higher education system
Source: David H. Feldman, Robert B. Archibald, The Conversation, July 11, 2016

….We have been studying America’s higher education system and college costs. Our research tells us that the deep problems in American higher education today aren’t due to the fact that students borrow or pay tuition. It is because the schools serving the bulk of America’s underprivileged students are increasingly resource-starved.

So, what should our candidates be worrying about when it comes to higher education? And what policies might make a dent in our real problems?…

Who Got Rich Off the Student Debt Crisis?

Source: James B. Steele and Lance Williams, Center for Investigative Reporting and Reveal, June 28, 2016

42 million people owe $1.3 trillion in student debt. It’s a profit center for Wall Street and the government. Here’s how we got into this mess. ….

…. A generation ago, Congress privatized a student loan program intended to give more Americans access to higher education. In its place, lawmakers created another profit center for Wall Street and a system of college finance that has fed the nation’s cycle of inequality. Step by step, Congress has enacted one law after another to make student debt the worst kind of debt for Americans – and the best kind for banks and debt collectors. Today, just about everyone involved in the student loan industry makes money off students – the banks, private investors, even the federal government. ….
‘I’m A Student-Debt Slave.’ How’d We Get Here?
Source: Eric Westervelt, NPR, July 11, 2016

Most everyone knows someone adversely affected by student debt: More than 40 million Americans are shouldering a crippling $1.3 trillion in loans.

That burden is obstructing careers, families, dreams, employment and even retirement. Uncle Sam and Wall Street have made lots of money off the crisis.

We’ve covered this issue in many ways, including the debates, the players, tips for easing debt, how debt is affecting young people’s decision making and a lot more.

But how did we get here? Who has profited most and how?

The Center for Investigative Reporting and its weekly radio show Reveal recently dug deep into these questions and profiled people who’ve been affected. I reached out to CIR reporter Lance Williams, who co-investigated the story with journalist James B. Steel. Here’s an excerpt of our conversation…..

D.C.’s White Donor Class: Outsized Influence in a Diverse City

Source: Sean McElwee, Dēmos, June 2016

Key Findings:
– The donor class doesn’t represent the diversity of Washington D.C.’s population. While 37 percent of D.C.’s population is white, 62 percent of mayoral donors and 67 percent of City Council donors are white.
– The rich are disproportionately represented in the donor class. Only a quarter of D.C.’s adult population makes more than $100,000, but 59 percent of council donors and 61 percent of mayoral donors do.
– The pool of donors who make small donations is more representative than the pool of those who make large donations. Women make up about half of those giving less than $50 to mayoral and council races, but only 31 percent of those giving more than $1,000. People of color make up 47 percent of mayoral donors giving less than $25, but 31 percent of those giving more than $1,000.
– The small donor pool contains more income diversity as well. Those making $100,000 or more comprise 44 percent of donors giving $25 or less to mayoral candidates, but 72 percent of those giving $1,000 or more.
– Mayoral candidates relied heavily on big donors, raising less than 7 percent of their total funds from donors giving less than $100, and 67 percent from donors giving more than $1,000.
– A system of public financing would increase the diversity of D.C.’s donor class, leading to more responsive policymaking.

How public campaign finance can address growing inequality

Source: Alex Kotch, Institute for Southern Studies, Facing South, June 24, 2016

Numerous studies have shown that those giving the most to political campaigns are predominantly white, male, older and wealthy. For example, an Institute for Southern Studies report found that 95 percent of the biggest donors to a number of key federal races in the 2014 and 2016 election cycles were non-Hispanic whites. Other recent studies, such as Demos’ “Stacked Deck” and Every Voice’s “Color of Money“, discovered that most large donations to federal candidates came from wealthy, majority-white areas.

A homogeneous political donor class affects public policy. A 2014 paper by Martin Gilens and Benjamin Page found that the wealthiest 10 percent of Americans — mostly white — were 15 times more likely than the general population to have their policy preferences enacted.

Two new reports offer insights into how campaign finance reform can reduce the power of these big donors and elect lawmakers more responsive to the needs of their constituents, thereby reducing inequality.

Released this month, a report from Demos and the Brennan Center titled “A Civil Rights Perspective on Money In Politics” and another from the Brennan Center called “Breaking Down Barriers: The Faces of Small Donor Public Financing” explain that, unlike the major donors who dominate our political system, small donors are more representative of the electorate in terms of race, income, education levels and other measures. And public financing systems — including small-donor matching programs, block grants dependent on candidates raising a required amount of small donations, tax credits and vouchers — encourage more diverse and less affluent and well-connected candidates to run for office. By emphasizing small donations, public financing also encourages candidates to engage with more potential constituents….
INSTITUTE INDEX: Why an eviscerated Voting Rights Act matters in this year’s election
Source: Sue Sturgis, Institute for Southern Studies, Facing South, June 24, 2016