Mobile Phone Remittances Increasing in Africa with Questions Unresolved

mobile-money1New Orleans   The constant risk in reading the business press, and, yes, I’m talking about Rupert Murdock’s Wall Street Journal, is picking a path between the facts, the news, and blatant sales and promotion. That’s especially dangerous because at ACORN we eat up almost any article that pretends to talk about lowering the costs of money transfer remittances for migrant workers and immigrants as if it were an ice cream sundae. Needless to say, I scooped up an article with the headline, “Turning African Phones Into Wallets,” particularly because days ago in a Canada to France to the USA skype conference we had been all over this topic!

First the news. The World Bank, years away from the G-8 commitment to lower all costs of remittances to 5%, is now saying that they believe the cost globally is 8% and in Africa 12%. The facts continue to be that they are hedging their bets on the figures by not including all of the charges, but I’ll get to that. They do offer that remittances to sub-Saharan Africa rose by 2.2% to $32.9 billion in 2014 compared to 2013, doubling the average growth rate globally and projected to hit even higher between 2015 and 2017.

Interestingly, a lot of the transfers are now cross-border transactions between migrant workers in other African countries led by Nigeria, Senegal, and Kenya. Seeing that development elsewhere ACORN has been trying to change our strategy in Honduras and Ecuador. In Africa many of the transfers are being enabled by mobile phones, led by MFS Africa a 6 year old South Africa based company. Importantly, a smartphone is not required. 500 million users of cooperating communications companies allow access through a mobile payment account on the cell enabling transfers to the mobile phones of other enrolled customers who can essentially text something like a money order to the receiver’s phone and confirm completion with a PIN number. Pretty straightforward. MFS Africa makes its money, according to the Journal on a 30 cents per transaction charge with the average transfer being $80, which also resonates with ACORN International’s research.

There’s still a devil in Paradise though, which is where the story takes a bad turn into sales and promotion for the businesses and against the workers who are moving money home. There’s no discussion of the charges applied for currency exchange and pickup. The Journal obliquely mentions that MFS Africa gets a taste of the exchange from some communications companies, but it’s silent on how much rip-and-run is there. Same problem with the World Bank figuring.

In a conversation with an interesting startup called that thus far was only transferring money from Kenya and trying to open soon in Ethiopia to channels in the USA and Canada, their representative told me they take no front end charge but make all of their money on the exchange rate, though assuring me they took less than the 5% cap ACORN has been fighting for globally. There are huge, deep-pocketed companies trying to get a slice of migrants’ hard earned wages going home, including MasterCard and other joint ventures, so having no money for marketing makes such small efforts like Wave imperiled, but it also signals that without strong rules and regulations the exchange and after-transfer charges will likely continue to be predatory.

For a change it would be nice if the G-8, the World Bank, and countries around the world, desperate to maximize the money for development and personal investment in communities represented by remittance receivers, actually got ahead of the dark-side of this market, rather than just sitting in the stands and waiting for businesses to flash an applause sign. ACORN Canada is hopeful that it can convert a platform commitment from the Liberals to remittance reforms and caps into reality, given their recent election success, which would break new ground.

In the meantime the best we can hope is that we’re at two steps forward and only one step back, but it’s hard to be certain.

Keeping Politics Weird

17keepaustinweirdtshirtLondon   Going to Austin, Texas from time to time, you still see bumper stickers and window signs in this huge, boomtown that still say, “Keep Austin Weird.” At least with politics there’s no need for a bumper sticker, because these days it seems all about making sure politics is weird.

In the United Kingdom, the Conservative ruling party is claiming there is a constitutional crisis because the largely honorific, unelected House of Lords rather than being content with their sinecures and titles actually straightened their backs for the first time in 100 years and refused to go along with tax credit cuts for the working poor which would have hit millions for a loss of about $1200 per year. Lords are not just to the manor borne but include Labor lords and Liberal-Democrat lords and they teamed up for a bit of pushback getting headlines for something other than spending their expense money at massage parlors and the like. The Conservatives may modify the cuts or delay them somewhat and also may just back the House of Lords with more Lords to fatten their majority and put off another faux crisis like this for another century.

Meanwhile on the other side of the pond we have Donald Trump reduced to begging the crowd in Iowa to push his polling numbers back to the top and pretending he went to public high school with the rest of us by shouting in the Republican debate that Jeb Bush and Marco Rubio really don’t like each other. The one thing that Trump has contributed to the Republican primaries thus far is total admission that political primaries are in fact exactly the same as high school student council popularity contests. It was a surprise to find that Governor Chris Christie from New Jersey is still running for president. Same for Senator Rand Paul and Governor Bobby Jindal, but hey, let’s keep politics weird.

Meanwhile over here, I will fly out of Heathrow and leave the discussion of the splits in the Labour Party and its civil war over the election of Jeremy Corbyn, a harder left leader than many expected after a drubbing of the party’s former leader in the recent election that has left the party reeling. Somehow the former leader, Ed Milliband, turned up at a training of sorts offered by a UK community organizing group, and US-based Industrial Areas Foundation community organizer, Arnie Graf, was quoted in the New Statesman crowing about the fact that Milliband would have done better to have gone to the training before he was blown away in a curious exercise of kicking sand in his face after having claimed to help him previously. Arnie then took shots at Corbyn and his supporters, Vermont’s Senator Bernie Sanders, and progressives in general proving mainly that he was either having a very bad day and was caught by a reporter in the middle of it or has suddenly become even older and crankier than Bernie himself.

And, then to make sure Hillary is anointed by Democrats rather than loved by them and isolating progressives’ hopes for the future even more, she made it clear she was still committed capital punishment come hell or high water, just wanted a kinder and gentler path to the electric chair. Soon there will be a bumper sticker on her car saying, Keep Politics Weird, as well.

Progress on “Living Rent” in Scotland


Edinburgh       In the wake of the Scottish independence vote a bit more than a year ago, a coalition came together that included ACORN Scotland, EPTAG – the Edinburgh Private Tenants’ Action Group, an ACORN affiliate, the Scottish Student Union and others to form what we called the Living Rent Campaign.  The demands were not new, but the energy was high in the wake of the election with hopes that the prospects of some devolution of powers to Scotland might make long fought campaign goals around security of tenure and even rent control winnable.

It was fascinating to see how much progress had been made over the last year as I sat through the weekly Monday night planning meeting of the group with ACORN and EPTAG veteran warhorses Keir Lawson, Jon Black, Liz Ely and some other stalwarts as well as new found comrades from the student movement.   The discussions of petitions, post card campaigns, stalls, and doorknocking were part of a familiar song, but the new verses involved timelines and dates for submissions and testimony before various parliamentary committees, reports of meetings with yet more allies ready to sign up for the campaign, and briefings on meetings at the party congress of the current ruling party, the Scottish National Party (SNP).  This was heady stuff reflecting a hard and successful year of organizing.

Talking to the organizers, it was clear that for all the progress we were a long way from declaring victory and no matter the new momentum and kinder face of the government, the landlords continued to be well organized and a formidable opposition force on most of our points. The legislation was a long way from a done deal and like so many things in the legislative process, the devil was in the details.  We were focused on four main themes:  affordability, inclusivity for all tenants, flexibility in untenable situations, and security.

Security of tenure is a good case study of the push-and-shove that remains before we can say we have really won.  We believe the “no fault” language is still tenuous and under attack on evictions as well continuation of “hardship” defenses that have been in previous legislation dating back to 1988.  There are hard fights being waged on whether or not an initial six-month period would hold tenants in bad circumstances.  There is a constant tension in our “security” fight on wanting more security in terms of lease periods, but not being trapped in bad leases with recalcitrant landlords unwilling to maintain habitable apartments.

A similar fight is still at issue around rent controls.  Once again like with security “in principle” there is movement, but where our concern is affordability, landlords and some of their parliamentary allies are trying to reposition the controls as “predictability” of rent, even in these times of huge increases.  The compromise has been a discussion of limiting rent increases to the CPI, consumer price increase, plus 1% based on a factor of “N” with the “N” being a number establishing the fair market rate by local jurisdiction.  Our campaign believes that local circumstances are so varied between the red hot market in Aberdeen and even Edinburgh compared to elsewhere that local councils need to be able to set the floor, while others are pushing for a national rate which would make almost no one happy.

In a period of so-called devolution, most organizers are increasingly scoffing at the notion that much of any real power was devolved and in fact in some cases the counterattack on Scotland elsewhere in the United Kingdom may have England setting policies and forcing Scotland by default to have to adapt to them.  Ironically, a year after these concessions were made, in situations like the struggle over affordability embedded in our demands for rent controls, we are left still battling for more devolution into local jurisdictions more responsive to peoples’ needs and peoples’ organizational formations and pressure.

Living rent, like living wages, is not a fight with just one battle but a never ending war, so for ACORN we are in this for the long haul.

Banks are Building “Credit Deserts” in Birmingham and Elsewhere

182984189-465119Edinburgh   We have real deserts like Sahara, the Gobi, Mohave, or Chihuahuan in the world. We have food “deserts” in many lower income communities with little choice but mom-and-pops, corner stores, kiosks, and bodegas to serve millions. Now there’s increasing evidence that banks have been allowed to build “credit deserts” in many cities, and work in Birmingham, the second largest city in the United Kingdom, makes it clear the map of the desert is also the outline of lower income communities in the city.

It shouldn’t be a surprise. Reportedly, British banks have shut down 42% of their branches over the last 15 years, and of course a huge percentage of the closures have been in lower income areas. Fleeing from the responsibilities of community banking has long been a trend in the United States of course, but in the United Kingdom the concentration of most banking in a handful of companies exacerbates the crisis. The U.K.’s antitrust regulator, the Competition and Markets Authority, recently said that Britain’s retail banking market isn’t competitive enough, but then didn’t do much about it and made no proposals for forcing the country’s big lenders from making any radical changes to their businesses. U.K retail and business banking is dominated by four banks: Lloyds Banking Group , Royal Bank of Scotland Group , Barclays and HSBC Holdings holding approximately 70% of personal current accounts and 80% of business accounts in the U.K.

Now as data is becoming available in recent years on where small businesses, mortgage loans, and smaller consumer loans are being given by banks, the city council of Birmingham did some number crunching, and then laid out the results on a map. In general Birmingham citizens had less access to credit than virtually any other part of the UK, but more specifically when a comparison was made on where loans were NOT being made, the overlap with lower income communities was precise. There is no question that banks are discriminating against low and moderate income families as a matter of policy and as a key part of their business plan.

While the banks build a “credit desert,” the vultures that sweep in to feed on the people are of course the payday lenders and cities in the UK, just like the US and Canada are seeing a feeding frenzy. ACORN organizers not only in Birmingham but in other cities in England and Scotland were quickly able to rattle off the names and addresses of payday lenders, pawn shops, and other quick money spots in our neighborhoods.

While visiting we looked up the regulations on payday lenders in the UK. Not much hope for relief there in the credit desert. Pretty much everything goes if the interest rate on the loans was less than 100% of the loan itself. Checking the popular internet money lender, Wonga, to our shock they boldly displayed an APR or annual percentage rate for their lending rate at 1509%.

The plan seems to be to discriminate in lending and then open the door wide so that the pockets of lower income families can be picked clean.


“Payday Loan Song”by Erich Vieth

Newly Reelected Conservatives in UK Hitting Labor and the Poor Hard


organizers from London and Redding planning organizational growth

London    Whether meeting with organizers, union leaders, foundation and nonprofit executives or ACORN’s own organizers, almost always the conversations with drift over the difficult prospects for the next five years in the wake of the Conservative Party’s re-election, led by Prime Minister David Cameron, and the hope and fears accompanying the election of Jeremy Corbyn, as a left leaning head of the opposition Labour Party. One union program manager with Unite, the UK’s largest union, told me from the second we sat down that she had still “not recovered” from the election and the prospect of five years of pain.

It isn’t hard to understand why once I understood the gist of the government’s proposed amendments to the Trade Union Act. Any strike would require a two week notice to the employer. 50 per cent of the members would have to participate in the vote and have their ballots tallied by mail, which is often difficult in the public sector particularly where many members do not vote. A majority would have to approve. Any communications on social media would have to be submitted and approved two weeks in advance. It goes on and on like that. Is there any way to stop it? Not much from what I was told. A majority government means that they can ram through virtually anything and are likely to do so. There is also no constitution or bill of rights in the UK, that might protect freedom of speech, so don’t look for help there. Unions have little leverage to modify the new amendments and are hoping to get worksite voting and voting by smartphones as compromises so that they can make the numbers, but the deal is a long way from being done.

There’s a proposed multi-billion pound rollback of the tax credit program, which provides broad based welfare benefits. The program started small but now is approaching thirty billion pounds and under fire. It’s a complicated situation, but the end result will be devastating to poorer families, many of whom in cities like London are depending of the payments to offset the exorbitant costs of housing in the city.

There had been a lot of excitement about the election of Corbyn as the new leader of Labour, but there is virtually a civil war in the party ranks at the top, no matter how enthusiastic the base – and many new party members – have become. One union official who had voted for him told me he was simply “un-electable.” Their hope was that he would raise some issues and step aside for someone younger and more appeal-able two years before the next election. Some organizers were aghast as the communications disasters that Corbyn has already blundered into, and found that discouraging if there weren’t some quick fixes. Others thought he was raising some important and difficult questions for the majority which could shape the future in a more progressive direction whether he ran or not, and they held out hope. Organizers are terminally skeptical and optimistic, and some maintained hope for Corbyn, because “you can never tell.” One working for an on-line campaigning organization thought he could see from the constant stream of petitions and interest that came in on a daily basis and hunger that would have to be served.

A foundation executive, interestingly, held out hope for some communities taking advantage of the devolution of power being offered by Westminster that admittedly would transfer problems down the line, but also might offer the opportunity for more powers and a semblance of home rule in areas like Manchester for example where there is interest in aggregating a number of councils into a block. The Labour Party leads in many cities, especially in the northern parts of England so there might be something there. In fact some observers though the 2016 election for Mayor in London might be an interesting barometer for judging the popularity of Corbyn’s program and strategy and whether it could get some traction.

The one thing that was clear and unquestioned was even making the best of it, there are five years of hard times facing the people of the United Kingdom.

Special Multinational Court in Trans-Pacific Partnership Agreement

1439533698362New Orleans     President Obama sees the Trans-Pacific Partnership trade agreement as a legacy marker. News reports refer to the announcement of an agreement with the Pacific Rim countries including Japan, Canada, Peru, Mexico and many others as a “capstone” agreement for the president. The White House says that there are labor and environmental protections that are unprecedented for a trade agreement. Malaysia, Vietnam, and other countries had to agree to protect labor rights in a major announcement. Many big national environmental organizations are touting the agreement as a breakthrough including the World Wildlife Federation. Australia supposedly pushed hard enough that big Pharma can’t run roughshod over generics and cheaper access to drugs in developing countries.

Sounds good, huh, but what do we have here?

The Organizers’ Forum delegation met with a researcher and campaigner in Warsaw recently named Roland Zarzycki working with the Institute for Global Responsibility. In the course of the dialogue we touched on the troubling elements in the likely TTP agreement. One that was especially worrisome had to do with the special court provisions that would allow transnational companies to sue countries over restrictions on trade in their products, but would not allow countries to sue the multinationals nor provide access to any other parties to adjudicate their concerns. Such special provisions for multinational companies paint a picture of a world of particular privilege and provision for globalization that is worrisome.

Is this some imagined problem for the paranoid? Hardly. The proof seems to be in the last minute jostling that indicated that there would be special provisions in the TPP to prevent tobacco companies from being able to sue countries that are trying to put in place health protections for the many diseases advanced by tobacco. Under some agreements Big Tobacco has already tried to take countries like India and others to such international courts. So, this door was reportedly locked for tobacco in the TPP, and that’s good, but what about other ugly, unhealthy multinational products and practices that will continue to be able to access these special courts in order to try to circumvent country by country provisions and protections?

We really don’t know of course. The negotiations are conducted in secret and the agreements reached will not be public until such time that President Obama starts the 90-day clock for Congressional review and an up or down vote to approve or disprove the trade treaty as negotiated. It’s hard to dispute the need for some quiet and confidentiality in negotiations, but the lack of information about vital pieces of the agreement privileges insiders and multinationals as well, compared to all of us biscuit-cookers out there trying to figure out what’s up.

Maybe this is as good as they are spinning, but until we know the whole story, it’s worth a lot of worry, and in the wake of countless agreements like this in the past, it’s hard to be optimistic that this is going to be as good for all of us as it is for big companies and special interests who clearly already have the inside track.