Rourke O'Brien: All Publications, Events and Press

Asset Building Report in the Washington Independent | 'Shop Till We Drop — or Save?'

Articles — Fri, 17 Oct 2008 11:46:00 -0400

New America in the News:

In a policy paper issued last month by the New America Foundation, researchers Reid Cramer, Rourke O’Brien and Alejandra Lopez-Fernandini summarize the trend: “Millions of low-income Americans,” they wrote, “are hearing two conflicting messages from their government: Save and Don’t Save.” LINK

How to Encourage Families to Save for College

Articles — Thu, 25 Sep 2008 08:31:00 -0400

This month, as parents of college-age students sign promissory notes for student loans and watch tuition checks diminish their bank accounts, Congress is encouraging all parents to wake up and start planning. While National College Savings Month -- meant to spread awareness about the need to save for higher education -- has a laudable goal, promoting the importance of saving won't do much to help struggling families afford the cost of higher education.

The decline of home prices means that most families can no longer count on equity… more

The Assets Agenda

Asset Building — Wed, 03 Sep 2008 07:25:00 -0400

The current economic downturn, triggered in part by excessive household debt and deflating housing prices, underscores the central role asset ownership plays in the economic security of American families and the broader economy. Broad asset ownership, whether through savings or investment, has the potential to connect economic opportunity with economic security and ensure that every member of society is afforded a real stake in the commonwealth. Assets are important not only because they can be deployed productively or tapped to help individuals and families weather unexpected events, but because they have behavioral effects that can change the manner in which people think about and plan for the future.

Past efforts to democratize access to property, capital, and credit have had positive effects. Yet the most notable feature of our current policy paradigm is how many it excludes. Through targeted tax breaks, affluent families are given many options to acquire assets, while those with fewer resources are offered less attractive ways to build wealth. The poorest families among us are given limited access to income supports and social services. This approach misses the potential of assets to help chart a path out of poverty. If we are to successfully broaden savings and assets ownership, our policy efforts must be expanded, strengthened, and directed toward those with the greatest need.

The purpose of this report is to outline a federal public policy agenda to broaden savings and asset ownership opportunities for lower-income Americans who have limited resources at their disposal. In developing our thinking on the subject, we have drawn on the research and expert analysis of many others in the field. The agenda we present here includes calls for new structures and policies at the federal level, as well as changes to existing tax systems, government programs, and financial products. Some of these policies are well developed, others need more seasoning, but all of them have the potential to contribute to the economic well-being of millions of American families.

This edition of New America's Assets Agenda is the most comprehensive to date, with 84 innovative asset-building ideas. Following the introduction, it is organized in 13 sections, each beginning with a brief synopsis of a problem, followed by specific policy proposals.

Paying City Students Is a Wise Investment

Ron Tang — Fri, 27 Jun 2008 04:59:00 -0400

Summer has arrived in Baltimore, and so has summer school -- bringing with it a chance for students who improve on their High School Assessment exams to pocket something more than academic success. A few months ago, Baltimore schools CEO Andres Alonso unveiled a controversial proposal to improve city schools: Pay students to perform. It's a simple idea that has generated quite a bit of controversy from purists who cringe at the thought of paying students to learn and from… more

Wheels Versus Welfare

Ron Tang — Thu, 19 Jun 2008 02:36:00 -0400

With falling home prices, rising food and fuel costs and an unemployment rate well above the national average, the current economic downturn may push already vulnerable California families to the brink of financial destitution. Thousands of people may turn to welfare for support in the coming months. That's OK -- that's the purpose of temporary assistance. It's not as if this is the money-for-nothing welfare of the early 1990s; these folks are required to start looking for work the second… more

Golden Dream Accounts

Asset Building — Wed, 14 May 2008 11:11:00 -0400

As the percentage of workers covered by traditional employer pension plans has plummeted in recent years, saving has become the only path to secure retirement income beyond social security. Although a significant proportion of employers now offer their workers a tax advantaged retirement savings product like the 401(k), tens of millions of workers nationwide simply do not have access to an employer sponsored retirement savings plan. In addition, individual retirement accounts (IRAs) and other retirement products offered by private financial institutions have failed to fill the gap in employer coverage, in part due to the high fees and complexity associated with these accounts. The time has come for government to play a role in expanding access to low-cost, high quality, retirement savings account.

This issue brief describes the conceptual framework for Golden Dream Accounts, a proposal to provide a voluntary, portable retirement account for California private sector workers who do not have access to a work-based retirement savings plan.

In summary, Golden Dream Accounts calls for the state of California, either on its own or in cooperation with one or more private financial institutions, to offer some combination of:

A low-cost Individual Retirement Account (IRA) that can be opened directly by workers;
A payroll deduction IRA, likely offered through employers, that allows employee contributions to be automatically deducted and deposited into the Golden Dream IRA; and
A SIMPLE IRA, offered through employers, with similar features to the account above, but offered as a SIMPLE IRA, enabling employers to contribute directly to the account.

For the full text of the issue brief, please see the PDF attached below.

The Assets Report 2008

Asset Building — Wed, 12 Mar 2008 01:03:00 -0400

The purpose of this annual report is to summarize and take stock of the current state of federal policy through an asset-building lens, especially as it affects the asset base of families with lower incomes and fewer resources, which is the focus of our work. The report is divided into three sections. The first is a review of policy developments from the past year related to asset building, highlighting administration action and significant legislation, including assets-related bills introduced in the first year of the 110th Congress; the second is an examination of the President’s budget proposals for Fiscal Year 2009 from an assets perspective; and the third is a forecast of the assets policy issues that may be considered in Congress during the year or two ahead. A companion report, The 2008 Assets Agenda, to be released in April will offer a detailed description of a range of policy proposals to broaden savings and asset ownership.

Below are the highlights of the report:

2007 Review

The Administration responded to the housing crisis by creating the HOPE NOW alliance to conduct aggressive outreach to homeowners at risk of delinquency and foreclosure.
FHASecure was launched as a refinancing option for homeowners with non-FHA adjustable rate mortgages in response to the housing crisis.
The IRS began allowing taxpayers to directly deposit their tax refunds among a maximum three accounts, a change expected to facilitate savings by simplifying the process of making deposits.
The Senate introduced the New Saver’s Act, a set of 14 low-cost proposals to increase savings, especially by lower-income Americans.
The House of Representatives reintroduced the ASPIRE Act, to establish universal children’s savings accounts, opened automatically at birth.
The Freedom to Save Act, the first sweeping proposal to reform asset limits in major public assistance programs was introduced by Representative John Conyers (D-MI).
Proposals to reform the asset limit in the Food Stamp Program were included in both the House and Senate versions of the Farm Bill.
The College Cost Reduction and Access Act was passed, changing the way some Section 529 accounts are treated in financial aid calculations.
Presidential candidates in both parties highlighted savings policies as part of their economic policy platforms.

President’s Budget Proposals FY 2009

The budget includes over $407 billion in tax expenditures related to asset building, which will overwhelmingly accrue to middle- and upper-income households, according to the Joint Committee on Taxation.
Consolidation of tax-preferred savings accounts is proposed which would create a system of Retirement Savings Accounts, Lifetime Savings Accounts, and Employer Retirement Savings Accounts.
The President makes his second consecutive proposal to extend “Saver’s Credit” eligibility to deposits made in Section 529 College Savings Plans.
The Community Development Financial Institutions (CDFI) is again slated for a drastic funding reduction, including the outright elimination of funding for Native Initiatives.

2008 Preview: What’s on the Agenda in Congress This Year

The stimulus package, passed by Congress in January and signed into law by the President, will deliver $110 billion in tax rebates beginning in May.
The potential onset of a recession may trigger additional calls for a policy response, which could include a focus on savings incentives and financial education. Though passage of specific savings legislation is unlikely, savings proposals are expected to generate interest and attention.
Further examination of issues that created the housing crisis may lead to legislative and regulatory changes in the mortgage market and more broadly to the provision of financial services.
Deteriorating economic conditions may lead to a second stimulus bill, creating opportunities to consider additional policies designed to encourage savings and financial stability.

For the full text of the assets report, please see the PDF attached below.

Saving Promises

Asset Building — Wed, 19 Dec 2007 10:14:00 -0500

For the first time since 1952, the absence of incumbents vying for the nomination of each major party has created a wide open race, one where the stakes are remarkably high. This has contributed to an extended campaign process that will last almost two years by the time the presidential election is held in November of 2008. While some lament the length of this campaign cycle, it has generated a great deal of activity in the policy arena as each candidate has sought to articulate their vision for America’s future and proposed policies that will help take us there.

In the field of savings and assets building, many insightful proposals have been made that are worth highlighting. Some of these proposals address issues of economic security, others focus directly on savings and access to financial services, and another set offer policies to promote homeownership and asset protection. This document represents our attempt to capture the major proposals and statements related to saving and asset building from the 2008 presidential campaign.

This paper will review and describe the set of proposals that have emerged from the candidates for president in both parties. These proposals have been presented by the candidates and campaigns in a variety of formats and in various degrees of detail. Some are included in detailed plans and policy briefs, others are outlined more generally on campaign websites, and others have been presented more rhetorically in speeches or on the campaign trail.

The full document can be downloaded below in PDF form.

Rourke O'Brien in the New York Post on Opportunity NYC

Communications — Tue, 18 Dec 2007 15:08:00 -0500

New America in the News:

More than 1,400 families have collected $740,000 in the first payout from the city's daring two-year experiment that rewards the poor with hard cash for doing good, officials said yesterday.

Another 919 families who enrolled in the "conditional cash transfer" program did not qualify by the first cutoff date, Nov. 15.

But city officials called the initial results of Opportunity NYC a success, noting that the first-in-the-nation initiative had been launched within months of being proposed and is now fully operational. ...

Rourke O'Brien, an asset-building analyst at… more

Technology is Helping Firms Reach Unbanked

Articles — Fri, 16 Nov 2007 11:24:00 -0500

Over a dozen financial institutions have applied to be the issuer of the Treasury Department's Direct Express electronic bank accounts for depositing Social Security and other federal benefits.

The Treasury touts the product as a safer, easier, and more convenient way to receive and access monthly benefits. In part, this is a strategy by the federal government to lower expenses for taxpayers by saving on the issuance of benefit checks. Compared with the 89 cents for sending a check… more

Let the Poor Save for Their Future

Articles — Fri, 07 Sep 2007 12:23:00 -0400

In 1990, newspapers around the country profiled the story of Grace Capetillo, a welfare mom from Milwaukee who, after managing to save $3,000 in the bank, was hauled into court by the county Department of Social Services and charged with fraud. Having breached the limit on allowable assets, Ms. Capetillo was found guilty and ordered to pay a fine of $1,000, spend down another $1,000 of the money she had worked hard to save, and promise not to save again… more

Restoring the Value of Saving

Articles — Tue, 04 Sep 2007 08:09:00 -0400

The value of saving is finally making a comeback. After years of over consumption and accelerating debt -- and more than two years with a negative personal savings rate -- Americans are finally beginning to fret over their empty coffers and negative balance sheets. As headlines profile subprime borrowers going into default around the country, the average American’s sense of economic security has jumped from unease to panic. As policymakers scramble to develop new policies to bolster working families, echoes… more

To Save, or Not to Save?

Communications — Thu, 26 Jul 2007 05:00:00 -0400

A New America Event
07/26/2007 - 12:00pm

This event is co-hosted by AARP, Center on Budget and Policy Priorities, CFED, National Disability Institute, The Retirement Security Project, Sargent Shriver National Center on Poverty Law, and World Institute on Disabilities.

As more and more Americans are expected to save for their own futures, millions of low-income individuals get conflicting messages from their government: Save, and don't save. Over the last decade a consensus has been emerging among researchers, policymakers, and practitioners about the importance of… more

Alan Colmes Interviews Rourke O'Brien on Conditional Cash Transfers

Communications — Tue, 19 Jun 2007 13:41:00 -0400

New America in the News:

ALAN COLMES, HOST: New York City is starting a pilot program to reward poor people for doing good things to break the cycle of poverty. We welcome Rourke O’Brien, policy analyst with the asset building program at the New America Foundation. Rourke, thank you so much for being with us tonight. You’ve written about this new program which is provoking a lot of controversy…ROURKE O’BRIEN, NEW AMERICA FOUNDATION: Well basically Alan, this program is designed to… more

Rourke O'Brien in New York Sun on Conditional Cash Transfers

Communications — Tue, 19 Jun 2007 09:13:00 -0400

New America in the News:

Getting a library card, going to the dentist, and keeping a job will soon yield up to $6,000 a year in bonus cash under a test program that New York City is trying as part of Mayor Bloomberg's anti-poverty initiative.About 13,000 families will be eligible for the payments, part of a $50 million program whose details were announced yesterday by the deputy mayor for health and human services, Linda Gibbs.The idea is to offer payments to… more

Investing Your Way Out of Poverty

Articles — Sun, 17 Jun 2007 10:54:00 -0400

The mayor of New York’s new antipoverty plan, which is scheduled to begin in the fall, will pay as much as $5,000 a year to poor families to help them meet specific goals like getting regular medical checkups, holding down full-time jobs and attending parent-teacher conferences.

Experience in developing countries shows that such ‘‘conditional cash transfer’’ programs are effective in combating poverty. Those who participate wind up with better education, health and life prospects than those who don’t. Such a… more

The Assets Agenda 2007

Asset Building — Wed, 11 Apr 2007 21:48:00 -0400

America’s personal savings rate has been negative for the last two years, a dubious economic feat not achieved since the Great Depression. While many Americans own assets, most of our public policies that support savings and ownership leave out those who own little or nothing. If we are to successfully broaden savings and assets ownership, our policy efforts must be expanded, strengthened, and targeted to those with the greatest need.

The purpose of this issue brief is to summarize a federal public policy agenda to broaden savings and asset ownership opportunities for Americans with lower incomes and fewer resources. It reflects our latest and best thinking, and draws heavily on the work of many experts focusing on various facets of savings and asset-building policy. The menu includes calls for new structures and policies, as well as changes to existing tax systems, government programs and financial products.

For the complete report, please see the attached PDF version below.

The Assets Report 2007

Asset Building — Thu, 01 Mar 2007 00:29:00 -0500

The purpose of this annual report is to summarize and take stock of the current state of federal policy through an asset-building lens, especially as it affects the asset base of families with lower incomes and fewer resources, which is the focus of our work. The report is divided into three sections. The first is a review of policy developments from the past year related to asset building; the second is an examination of the president’s budget proposals for fiscal year 2008 from an assets perspective; and the third is a forecast of the assets policy issues that may be considered in Congress during the year or two ahead. A companion report, The 2007 Assets Agenda, provides a detailed description of the policy options to broaden savings and asset ownership.

The year begins with a new Democratic majority in both chambers, which has brought renewed attention to poverty and economic opportunity issues, along with a greater focus on curbing predatory lending and certain credit card practices. Heightened attention to the balance sheets, declining incomes, and overall economic prospects of America’s low- and moderate-income families could bring added momentum to policies to build savings and wealth among those families. However, while a growing number of Democrats and Republicans support asset-building policies, such policies are still not seen as central to economic security and opportunity debates.

For the complete report, please see the attached PDF file below.

Eliminating the CalWORKS Asset Limit

Asset Building — Tue, 20 Feb 2007 03:01:00 -0500

For families making the difficult transition from welfare to work, developing assets is critical to achieving true economic independence. In order to prevent a complete backslide to public assistance, low income working families must begin to develop their own safety nets through personal saving for use in the event of an unexpected income shock due to illness or temporary unemployment. As personal saving is essential to achieving self-sufficiency – the stated goal of the CalWORKs program – saving should be encouraged, not penalized, by welfare policy and social service agencies.

To Save, or Not to Save?

Communications — Wed, 15 Nov 2006 21:00:00 -0500

A New America Event
11/15/2006 - 12:00pm

As Americans need to, and are expected to, save more for their futures, millions of low-income Americans are hearing two conflicting messages from their government: Save, and don’t save. Over the last decade a consensus has been emerging among researchers, policymakers, and practitioners around the importance of enabling low-income persons to save and build wealth, and state and federal programs have emerged to do just that. Yet, with limited exceptions, the rules of our nation’s public assistance programs aimed at… more