> Posted by Susan Buckles, Northwest Area Foundation
The Great Recession has left a wake significantly larger than the downturns of the early ‘80s, ‘90s, and 2000s. Officially declared over, the recession has left millions of Americans stripped of their assets. Many are fighting to stay out of poverty as they struggle with unemployment, reduced wages, or home foreclosures. According to real estate website, Zillow, 30 percent of all Americans now owe more on their mortgages than their homes are worth. The message is clear: In order to thrive, low- and moderate-income families need living-wage jobs and assets to weather financial storms.
Grassroots & Groundwork: Working Together to Reduce Poverty and Build Prosperity is a national conference that will share emerging and proven models that are successfully addressing those issues. Northwest Area Foundation, the conference sponsor, believes that a key part of building financial security is well-paying jobs. Many of the newly unemployed have outdated skills that don’t qualify for current openings[i]. A recent New York Times article states, “Employers who want to hire often complain that the jobless do not have the necessary skills,” while at the same time federal job training funds are becoming more scarce. Many programs are working to close the skills gap. For example, The Minnesota FastTRAC (training, resources, and credentialing) Shifting Gears Initiative is combining basic education with career-specific training. Another project, Skills for America’s Future, promotes partnerships between businesses and community colleges.
Assets are a necessary component of building a business. Yet a 2010 FDIC survey finds that 9 million Americans – 7.7 percent of all households – can’t access the credit services of mainstream financial institutions because they have insufficient collateral. Therefore, they have no hope of starting or expanding their own enterprise. The Mission Asset Fund’s Lending Circles program is directed toward the unbanked. This innovative approach offers participants a chance to lend and borrow money from a peer group. Repayments are reported to the credit bureau, enabling borrowers to build credit scores necessary to become regular banking customers.
The Foundation asserts that public policy plays a crucial role in the ability of families to overcome poverty and move toward prosperity. Policies that encourage and protect savings are particularly helpful. A good example is in Montana, where voters took on payday lenders and won. The Cap the Rate Coalition launched a successful statewide ballot initiative to put a limit of 36 percent on the interest rate, fees, and charges nonconventional lenders could place on loans. The new law banned practices in which people borrowing $325 ended up having to repay $793.
These are among the many successful efforts across the country. The challenge is learning about them. The Grassroots & Groundwork conference provides the forum to share new ideas like these and build partnerships for change. Another conference goal is to tap the wisdom of those who attend. Our nation needs these ideas, energies and resources.
“We believe all communities can prosper,” said Kevin Walker, president and CEO of Northwest Area Foundation. “We’re learning that every community – including those that are struggling and have deep needs – bring important ideas and energy to efforts that help people get out and stay out of poverty.”
Grassroots & Groundwork: Working Together to Reduce Poverty and Build Prosperity will be held June 6 -8, 2012, in suburban Minneapolis. To learn more or to register, visit www.grassrootsandgroundwork.org.