Mayor Martin J. Walsh and the mayors of three other large U.S. cities shared a stage at UMass Boston Sunday to discuss financial empowerment strategies that help cities address increasing income inequality and persistent poverty.
New York Mayor Bill de Blasio, Baltimore Mayor Stephanie Rawlings-Blake, Seattle Mayor Ed Murray and Walsh covered such topics as expanding access to pre-kindergarten programs, raising the minimum wage and bolstering residents’ financial literacy, as well as their views the role private business can play in lifting people from poverty.
“Insecurity is affecting people right now,” Walsh said. “It’s undermining the American promise.”
Unemployment is relatively low in Boston and plenty of construction activity is happening, but inequality is still high in terms of financial attainment, Walsh said. He cited recent figures showing that 46 percent of Boston households don’t have enough assets to cover three months’ expenses. That’s sobering enough, but the figure is 69 percent for the city’s black households and 75 percent for Latino households.
By the Numbers
46 percent of Boston households don’t have enough assets to cover three months’ expenses.
69 percent of black households in Boston don’t have enough assets to cover three months’ expenses.
75 percent of Latino households in Boston don’t have enough assets to cover three months’ expenses.
Data presented by Federal Reserve Bank of Boston President Eric Rosengren further illustrated the inequality that exists in cities that appear to be thriving. Seattle, for instance is doing very well on metrics such as higher education attainment — but the statistics mask the unequal on-the-ground experience; many lifelong Seattle residents actually do not have college degrees, while college-educated adults migrating there raise the overall average.
The forum came a day before a meeting in Boston of the U.S. Conference of Mayors’ Cities of Opportunity Task Force, which is chaired by de Blasio with Walsh as vice chair. All four forum participants are Democrats, and all assumed the office in 2014 except Rawlings-Blake, who has led Baltimore since 2010.
Rawlings-Blake described a number of Baltimore initiatives, including “Your Money, Your Goals” financial literacy training and the “Baltimore CASH Campaign” free tax preparation and asset-building program.
While acknowledging there clearly are other issues such as education and racism that impact poverty, Rawlings-Blake emphasized the importance of engaging residents consistently and repeatedly around financial wellness.
“Part of the work of financial fitness is breaking that cycle of poverty that we have seen in too many of our families,” she said.
Back to basics
De Blasio highlighted his success in establishing universal pre-kindergarten, which he estimated saves many families $10,000 a year, and aggressive outreach to educate working families about the Earned Income Tax Credit, which brings an average additional refund of $2,500.
In Seattle, Murray signed a law last year that will phase in a $15 minimum wage, the highest in the nation. This sort of action does not come without pushback, though. Murray recounted a recent misinformation campaign by conservative media to blame several Seattle restaurant closings on the new wage law. In fact, Murray said, the restaurants had closed for unrelated reasons, and the owners actually supported the wage law. Further, new restaurants have opened and other businesses have moved to Seattle since the new wage law was signed.
“Folks, you raise the minimum wage, and it actually attracts business,” said Murray, adding, “When we talk about financial empowerment, everything we talk about won’t make a difference unless you give people a wage they can live on.”
De Blasio and Walsh also made the case for business support and engagement.
“This isn’t an anti-business conversation,” said Walsh, while discussing Boston’s living wage ordinance for city contractors and Massachusetts’ rising minimum wage and new domestic workers’ bill of rights. “This is a conversation about working together to ensure equality.”
De Blasio asserted the business community can step up to address income disparity.
“There’s no law against the private sector stepping forward,” he said. He suggested firms could go above minimum wage voluntarily, and called on industry to bring young people in the doors for their first jobs and partner with schools to educate students about the world of work.
Walsh launched a new Office of Financial Empowerment last fall to assist Bostonians with free tax preparation, employment assistance and asset building. Since October, the centers have served 1,800 low-income clients, he said. He also highlighted the recently revitalized Boston living wage ordinance, a new child savings account for college program, and outcomes measured so far in the financial empowerment centers, such as raised credit scores and improved spending patterns.
Attendee Bruce Marks, CEO of Neighborhood Assistance Corporation of America (NACA), commented afterward that the corporate world needs to be held to greater accountability, with banks at the very least pressured to eliminate checking account fees, reduce overdraft and credit card fees and do better outreach to lower-income clients.
The emphasis on financial education, Marks told the Banner, is a misplaced focus on the victims.
“It’s always about putting pressure on the people at the lowest rung of the ladder,” he said. “Where’s the pressure on institutions?”
