Wednesday, April 26, 2017
Wednesday, April 19, 2017
Chaos erupted and upwards of 1,000 people were arrested. Seventeen years later, at this year’s World Bank meetings, there are no protesters to be found in Foggy Bottom. The World Bank has attempted to incorporate some of the protesters’ concerns into their Spring Meeting event schedule: they have increasingly emphasized income inequality and other issues. This progress was displayed at the Civil Society Organization (CSO) Roundtable on April 18: CSOs posed their questions directly to World Bank executive directors.
The questions were direct, opening with “How can the bank do more to provide relief in wars and other crises?” Executive director Merza Hasan brought attention to the relief efforts of the past, but suggested there was room for improvement. The comments were in line with World Bank President Jim Yong Kim’s comments at the London a School of Economics last week.
Another CSO delegate discussed the internet shutdown in southern Cameron and the role the World Bank should play in pressuring the Cameroonian government. Mr. Hasan contended that access to information must be a right for all people. The economic record has shown the importance of access to information and to the internet's role in creating healthy democracies, institutions and growth. It is thus imperative that the World Bank and other multilateral institutions continue to support an open internet.
The second session focused on funding of CSOs and aid to developing countries. The last ten years have seen a decline in foreign aid and a frantic search for alternative funding. The World Bank has a role to play here in helping organize a focused development finance strategy and in ensuring investment quality over quantity.
Illicit transfers out of developing countries further exacerbate the funding issue. It is estimated that for every dollar in aid going to Africa, one dollar flows outwards in illicit transfers. The delegates suggested the need to pressure both developing and developed countries to limit these transfers.
Finally, CSO delegates insisted that the World Bank only finance environmentally sustainable projects. The Bank has made this a stated goal, but revelations last year showed that private banks in Bangladesh and Indonesia who received funding from the International Finance Corporation (the World Bank’s private sector arm) funded coal projects. This was rather indirect funding, however, and it appears that there have not been regular occurrences of this kind in recent years. Still, the World Bank can help discourage coal plant investments whose short term costs are cheaper than solar, but whose intergenerational costs are more expensive in the long run.
Additional events throughout the week will hopefully provide further discussion of these and other issues.
Tuesday, April 18, 2017
The Africa Policy Forum on Famine was held on Tuesday, April 4, 2017, at the US Capitol Visitor Center Auditorium, sponsored by the office of Congressmember Karen Bass. This forum discussed the escalating risk of famine on the Horn and the Sahel regions of Africa, and the efforts, unrealized thus far, to stop not only the famine, but its root causes as well.
The Horn of Africa has, for years, experienced many threats. These include drought, famine, and ongoing conflicts - from struggles for power to genocide. In fragile states like South Sudan, Eritrea, and Somalia, these threats have, in the present day, created a situation that threatens the lives of millions of refugees and the future of these states.
The Africa Policy Forum on Famine was a panel discussion moderated by Dr. Monde Muyangwa and featuring Gen. William “Kip” Ward (Ret.), John Prendergast, and Jon Brause. The discussion brought into question the roles various Western powers as well as the United States play in the famine situation. It also discussed the effect of the ongoing conflict and refugee situation in these countries. The discussion ended with what we need to do to solve the situation and how we need to change the tactics being used.
From all of the panelists, the largest critique of the major players, from governments to NGOs as well as belligerents in the conflict, was the lack of accountability. This lack of accountability refers specifically to efforts to resolve the crisis in these fragile states. Governments, NGOs, and other major world leaders have yet to take responsibility and the lead in doing what’s necessary to put a stop to the root causes of the famine in order to end the famine itself. This lack of responsibility has allowed the situation to deteriorate to the point of famine, a situation where internally displaced persons are unable to even receive basic necessities. Furthermore, the lack of responsibility enables many of the governments and regional leaders to sit back and point fingers in the midst of an international crisis.
The panel discussed the role of governments and states and reviewed the factors that contributed to the situation. In Sahel and Horn of Africa countries like Nigeria, Somalia, South Sudan and Eritrea, conflict has kept their economies from reaching maximum production despite holding enormous natural wealth. This, in turn, has created a situation where many of the residents are economically and socially vulnerable, a situation that can usher in even more conflict. Historically, people experiencing economic strife and dissatisfaction with government are highly influenced by extremism, and in this region of the world extremism translates to atrocities such as political disenfranchisement, corrupt governmental practice, theocratic oppression and genocide,
The solution, then, is to not only properly disclose root causes of famine — conflict, lack of accountability, and ineffective leadership — but to also work to ensure that famine cannot easily return. That means not only ensuring that states have food security, but ensuring that they have food sovereignty, something Western organizations and powers have time and again failed to do for many famine and conflict-stricken regions. Furthermore, all of the major players need to step up to the plate and use the resources that we have today in order to make a difference in the situation. Corrupt governments, fragile leadership at the local levels, as well as conflict are no longer excuse for allowing refugees to perish.
My biggest takeaway was that we need to work to fight these issues in the Sahel and Horn of Africa. Something needs to change; we have been fighting famine and conflict since the year 2000, and the same issues are with us today.
Leadership needs to become much more accountable, and the way that leaders lead needs to change: nine UN peacekeeping missions going on in Africa is nine too many.
Saturday, April 15, 2017
“Global Economic Prospects-Spring 2017” seminar. Brendan Cody, GWU student and Impact Investing Intern
David Stockton, Karen Dynan and Joseph Gagnon of the Peterson Institute took on this task and elaborated on their analysis of the global economy at the semiannual “Global Economic Prospects-Spring 2017” seminar on April 12.
All three believe there is potential momentum in the world economy with some regions expected to fare better than others. In the United States, tax reform, healthcare reform, rolling back of regulations and fiscal spending suggest solid growth prospects in the near future.
This optimism is tempered by concerns in both fiscal and monetary policy. In fiscal policy, the Trump administration has been inconsistent at times on its precise policy objectives and has already had difficulty in passing health care and tax reform.
Monetary policy may counteract growth as the Federal Reserve raises interest rates and begins to normalize its balance sheet in 2017.
Fiscal policy, monetary policy and the divergent growth between the United States and Europe could lead to further appreciation in the dollar, making US manufacturers less competitive globally. And short term policy changes will not be able to offset the long term effects of stagnant labor productivity growth and demographic changes. These demographic changes will cause a yearly 0.2% decline in the labor force participation rate for the foreseeable future.
Immigration is a potential remedy to this solution, but the Trump administration’s policy on immigration will only exacerbate this decline.
Additionally, the economists expressed concerns over the border adjusted tax (BAT) and the potential this tax has to upset global trade. Gagnon noted his research suggests BAT could lead to a 25% change in the value of the world’s reserve currencies.
Saturday, April 1, 2017
According to the New York Times,
"WASHINGTON — Top banking regulators were taken aback..when a California congresswoman helped set up a meeting in which the chief executive of a bank with financial ties to her family asked them for up to $50 million in special bailout funds, Treasury officials said.
Representative Maxine Waters, Democrat of California, requested the September meeting on behalf of executives at OneUnited, one of the nation’s largest black-owned banks. Ms. Water’s husband, Sidney Williams, had served on the bank’s board of directors until early last year and has owned at least $250,000 in stock in the institution. Treasury officials said the session with nearly a dozen senior banking regulators had been intended to allow minority-owned banks and their trade association to discuss the losses they had incurred from the federal takeover of Fannie Mae and Freddie Mac. But Kevin Cohee, OneUnited’s chief executive, instead seized the opportunity to plead for special assistance for his bank, federal officials said."
And then, there's this:
OneUnited “bought or leased luxury real estate the CEO used and, until federal regulators complained in 2008, paid for his Porsche. Cohee's East Coast spread was an $880,000 condominium on Miami Beach's Ocean Drive, and out west the bank leased a $26,500-a-month mansion for him on Palisades Beach Road in Santa Monica, Calif…he was twice arrested, on sexual assault and drug charges.”
Carver Federal, another Black owned bank, decided to attempt to help African Americans victimized by fraudulent subprime lending, something OneUnited failed to do. In addition, OneUnited went from making 74 multifamily loans in 2006 to making only 2 in 2007.
The Black community needs black banks, and no one argues with the material success of OneUnited's owners, but if they are going to be involved in the #BankBlack movement using service to low and moderate income communities as justification, OneUnited should be required to prove that they are, in fact, lending in low and moderate income communities. The record above shows otherwise.
A better option.
We suggest the following:
Focus on other Black Banks like Liberty Bank in New Orleans, Citizens in Atlanta or Illinois Federal Savings and Loan. Based on an analysis of social impact, any black bank but OneUnited.
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