Carnegie Reporter, Vol. 2, No. 4

Borrowing to Make Ends Meet, a Démos report, traces the substantial rise in credit card debt during the 1990s and foreshadows an economy in which low- and moderate-income families face increasing financial insecurity. As cash has grown tighter and savings have dwindled or disappeared, more and more Americans have turned to credit cards to meet basic needs such as food, rent and health care. The result is widening economic disparity and a growing number of people who are perpetually in debt.

While credit card debt is often thought to be the result of poor fiscal discipline and unnecessary consumption, a broader look reveals the causal effects of economic trends and policy decisions within the banking industry.

Overall, the average American family saw a 53 percent increase in credit card debt between 1989 and 2001. For very-low-income families, however, the increase was 184 percent and for senior citizens, 149 percent. Even middle-class families experienced an increase of 75 percent in credit card debt.

Part of the reason may have to do with rising costs for housing and health care during a time when earnings, particularly for low- and moderate-income groups, stayed flat or decreased. And though incomes in the bottom 40 percent of the income distribution finally rose in the late 1990s, they quickly declined as the recession began in 2000.

The number of working families spending more than 50 percent of their income on housing has increased dramatically, rising almost 60 percent, from 3 million to nearly 5 million families, just between 1997 and 2001.

Health care costs grew by 18 percent during the 1990s and by another 11 percent during 2000 and 2001. At the same time, the proportion of workers receiving full health coverage from their employers fell significantly.

Démos, a nonpartisan public policy organization working to improve democracy, strengthen effective government and foster greater economic opportunity, along with The Annie E. Casey Foundation and the Fannie Mae Foundation, provided support for this study.

For more information, go to www.demos-usa.org.

Nonprofits Hard Hit But Meeting the Challenge

A report on the charitable segment of America’s nonprofit sector finds organizations managing to increase both services and revenue over the past year, despite the financial stress brought about by a weak economy and government cuts.

About 90 percent of the organizations surveyed faced fiscal difficulties in 2003 and nearly half of this group defined the difficulties as “severe.” Yet the majority wound up boosting revenue, and almost two-thirds were able to expand their activities to meet the greater demand for services.

Most organizations accomplished this through a combination of aggressive fund-raising, collaboration with other organizations, use of reserve funds and expanding their advocacy activities.

At the same time, belt-tightening forced more than half the groups to freeze salaries or decrease benefits. Over 70 percent reported postponing hiring, eliminating vacant staff positions or relying more on part-time staff.

Some respondents commented on the tension brought on by fewer resources and increased workloads. Others wondered about recruiting competent professional staff at a time of salary and benefit cuts. One particular worry is that the additional time and energy needed to assure survival may be detrimental to the services that charities are committed to provide.

The study focused on organizations working on behalf of children and families, the elderly, community and economic development and the arts. It is part of the Nonprofit Listening Post Project at the Center for Civil Society Studies at Johns Hopkins University and received
support from Carnegie Corporation, the Ewing Marion Kauffman Foundation, the Rockefeller Brothers Fund and the Surdna Foundation.

For more information, go to www.jhu.edu/listeningpost/news.

National Research Council Recommends Establishing Advisory Board for Biotechnology Research

Biotechnology research has led to many discoveries that have benefited medicine, agriculture and other life sciences, but its misuse has the potential to wipe out many of the advancements made over the past 100 years, and could also be used to create biological weapons.

A new report from the National Academies’ National Research Council (NRC), Biotechnology Research in an Age of Terrorism, offers recommendations for upgrading current procedures for reviewing experiments of concern by creating a tiered, self-governing system of institutional biosafety committees linked to the National Institute of Health’s Recombinant DNA Advisory Committee.

An independent National Science Advisory Board for Biodefense, made up of top scientists and security experts, would oversee the experiments, review processes and serve as a go-between for the scientific community and the federal government.

NRC also recommends expanding the number of research classifications to be monitored, including the addition of experiments on rendering vaccines ineffective, conferring resistance to therapeutic antibiotics and antiviral agents and altering the virulence in pathogens and nonpathogens.

Finally, the report stresses the importance of building global consensus and guidelines on biotechnology research, with the goal of building a coordinated system of monitoring dangerous pathogens and toxins worldwide and promoting consistency in research oversight.

The report was sponsored by the Alfred P. Sloan Foundation and the Nuclear Threat Initiative. For more information, go to www.nap.edu.


	William C. Velasquez Institute

Following the Money

Research into individual contributions to political campaigns in 2000 and 2002 finds most of the money for federal campaigns coming from America’s wealthiest neighborhoods, compounding the belief that the nation’s political agenda is being set by a small but monetarily influential percentage of the population.

A new study called The Real Color of Money analyzes more than $2 billion of personal contributions made to federal candidates, parties and political action committees (PACs) by comparing zip codes of donors to race, ethnic and income information from the 2000 U.S. Census.

Findings indicate that nine out of ten of the individual dollars ($200+) donated during the two election cycles come from zip codes that are predominantly non-Hispanic white.

About 50 percent of the individual contributions came from zip codes defined as being wealthy, although just 12 percent of the voting-age population lives in these neighborhoods.

In contrast, low-income neighborhoods, accounting for nearly 9 percent of the adult population, contributed just under 6 percent.

The study suggests that campaign money, not votes, dictates who can run for office and that it may bring undue influence to bear on legislative priorities as well. The underlying implication is that concerns critical to citizens of color and poorer Americans, who lack the entrée large contributions presumably guarantee, are not given the same priority. As a consequence, they experience a poorer quality of life, especially in matters like basic health care and educational opportunities.

While individual political contributions do not fall into the “soft” money category
targeted by the Bipartisan Campaign Reform Act, there is evidence that states with clean money/clean elections rules have begun to see a broader diversity of candidates running for election, including greater numbers of candidates of color and those from low- and moderate-income echelons. Under these rules, candidates who agree to strict campaign spending limits become eligible for public funding, opening the way for citizens to run for election who may otherwise not be able to afford a campaign.

The Real Color of Money is a collaborative effort of Public Campaign, the Fannie Lou Hamer Project and the William C. Velasquez Institute. It was made possible by funding from the Ford and Joyce foundations.

For more information, go to www.colorofmoney.org.

New Voters Project: Mobilizing Young Voters

A coordinated initiative to mobilize two million 18-to-24-year-old voters for the 2004 elections is under way in Colorado, Iowa, New Mexico, Nevada, Oregon and Wisconsin.

The nonpartisan New Voters Project is combining campaign strategy with grassroots canvassing to encourage political participation among eligible young people, a potential voting bloc of almost 24 million people nationwide.

The project’s coordinators are addressing concerns that America’s youngest voters are generally disengaged from political participation. Data from recent elections across the country reveal low numbers of youth votes while other reports describe small numbers of young people working on campaigns, raising doubts about the future of democracy if the trend continues as young voters age.

Using a network of partners—including Rock The Vote, MTV, Youth Vote and the Campaign for Young Voters—the project will launch voter drives in each of the six states, using peer-to-peer contacts and professional organizers to register and encourage youth involvement during the election period.

The New Voters Project is being coordinated by The George Washington University Graduate School of Political Management, in conjunction with Public Interest Research Group (PIRG) centers in Colorado, Iowa, New Mexico, Nevada, Oregon and Wisconsin. Principal funding for the initiative comes from the Pew Charitable Trusts. For more information, go to www.newvotersproject.org.

New Study Uses Patients’ Perceptions to Rate Quality of Health Care

Results of a Commonwealth Fund survey of patients’ perceptions of medical care systems in Australia, New Zealand, Canada, the United Kingdom and America suggest that the United States, which topped the list in per capita spending, may not be getting the best value for its money.

The survey was based on standards of health care established by The Institute of Medicine, including patient safety, timeliness, and patient-centeredness (the degree to which physicians involve patients in care decisions). The study’s findings are available in a report called Mirror, Mirror on the Wall: Looking at the Quality of American Health Care Through the Patient’s Lens.

Americans reported the least difficulty in waiting for hospital admission and for surgical procedures. However, American patients, along with those from Canada and the U.K., were more likely to report waiting five days or more for a doctor’s appointment.

In terms of patient safety, Americans were twice as likely as others to report a medical or medication error with serious health consequences.

The U.S. ranked last in healthcare efficiency. U.S. patients were most likely to be sent for duplicate tests and to have the test results fail to reach the doctor in time for an appointment. Americans were also more likely to say they had to repeat their medical histories multiple times.

Effectiveness of care was measured by the patient’s ability to follow up on care and whether physicians reviewed the course of treatment with them. The U.K. received the best rating in this area, while America tied for last place with Australia. U.S. patients were also most likely to report going without recommended care because of the cost involved. For more information go to www.cmwf.org