Why is it so Hard for Policy Makers to Separate Access from Affordability?

981207_10156731174555570_8112977795619686083_oNew Orleans    Life, work, and the world are full of mysteries, but after years of hitting my head against various walls, I’m finally connecting the dots in trying to understand the peculiar responses we sometimes get in trying to change public policies and private pricing strategies.

Remittances are a prime example. Talking last week to a professor who teaches a course at a local university on personal finances, she was excited when I told her about ACORN’s Remittance Justice Campaign, because she wanted her students to understand the complicated world of money transfer systems. When she understood the topline demand of our campaign was to cap the pricing at 5% to stop remittance costs from being so predatory, her face almost deflated. Of course she supported our position, don’t get me wrong, but affordability had not occurred to her as an issue in the way that it is of course paramount to immigrant families and migrant workers trying to send money home to relatives and communities in their home countries.

ACORN Canada members are testifying this week before the CRTC (Canadian Radio & Television Commission) about the high price of internet in Canada. Quoting from an early copy of their prepared testimony:

…the organization released a report summarizing 400 testimonials from low-income Canadians about how vital yet unaffordable home internet is.

A recent CRTC survey suggests that many Canadians think home internet is essential, but too pricey. Half of the survey’s 29,000 respondents are dissatisfied with the price of their internet service. ACORN Canada members view affordable access to the internet as essential to improving low-income Canadians’ ability to succeed in the digital economy.

“How can low-income families get out of poverty if they can’t apply for jobs, or access government services? Our kids can’t even do their homework,” says ACORN Canada President Marva Burnett. “Access to the internet is a right, and going to the library or coffee shops are not practical solutions.”

The same dilemma was faced by the FCC in the United States and, as we recently discussed, and the FCC duck walked around the issue by subsidizing the cost of internet ostensibly for lower income families by around $10 per month, rather than tackling head on the fact that affordability is the barrier to access, rather than availability of the internet.

This is an old saw. In the housing collapse from 2007, the supposed “reform” was trying to force lenders, many of whom were overtly predatory in the subprime mortgage field, to have to assure the loan was affordable to the family before issuing the money. When they were just churning loans, there was more than enough access to mortgage lending capital, but whether it was affordable within an honest reckoning of family income was a diminished factor in pumping air into the bubble.

Why do policy makers refuse to routinely address the issue of affordability when dealing with the question of access of services and implementation of programs? This is where the divide of experience between the one-percenters and big whoops from the rest of us and especially from low-and-middle income families becomes so pronounced and creates such tragic results. They just don’t get it, and too often these days, seem unwilling to do the “homework” and listening to understand the issues from any other point of view, especially from the perspective of our people.

Simple suggestion: consider affordability first, and access later down the list. Make stuff work by understanding that pricing pushes people as a primary concern.



Magical Realism at the Border of Techies and the Poor

App for Louisiana food stamps

New Orleans    Don’t get me wrong, I am 1000% in favor of techies of all stripes and sizes trying to figure out a way to impact on the lives and fortunes of low and moderate income families. Nonetheless, when I read an article about JPMorgan Chase putting up $30 million through its foundation to create a Financial Solutions Lab to supposedly “build affordable financial services” within their financial industry, all my antennae immediately go up because for the life of me that sounds like a way for Chase to divert money into a tax exempt arm to do research and development for its core business, rather than anything to do with philanthropy. How jaded have I become?!?

The New York Times published a puff piece about the effort in a special section on something they called “fintech,” which I would recommend against ordering at a restaurant no matter how much you like seafood. They highlighted a company called Propel that seemed amazingly well intentioned and dedicated. They had thought of developing an application for a smartphone that would help lower income families apply for food stamps. They were sent with the other Chase lab rats to walk the “mean streets” of San Francisco to get a better sense of the needs of the poor. Did I really say San Francisco, one of the richest cities in the United States? Maybe they were looking to see how many lower income families had managed to stay in San Francisco…but I don’t want to get off my subject here. Anyway, Chase gave Propel a quarter of a million bucks, and they ended up switching over to develop an app to allow a low income family to be able to determine the balance they have left on their food stamp card.

I guess that’s a good thing, though in my experience most food stamp recipients can tell almost anyone within a penny how much they have on their card at any time day or night during any month you might want to ask. Or they walk to the corner store and find out, but, let’s stay positive here.

You will need a smartphone though for this app to help you. We have this nagging problem of the widening gap in internet access but according to various Pew Research surveys 74% of families making less than $30000 per year now have sometime access to the internet. 13% of families with internet access making less than $30000 can only do so with a smartphone, so for the subset of those who are also eligible for food stamps of that 13%, the app might have some value.

Of course smartphones cost money, and if a family making under $30000 can afford a smartphone, that doesn’t mean they can afford unlimited access to data of course. 48% in fact report on Pew surveys that they pretty regularly get cutoff from their smartphones because they don’t have the money to pay the bill. 30% also report that they regularly exhaust the minutes on their data plan so essentially have to cut themselves off from using their phones to access the internet.

Don’t get me wrong. I’m not saying this is a solution looking for a problem. I’m just saying that this “fintech” pretense of supposedly helping low income families who are unbanked and victimized by their lack of affordable access to the financial system is way ahead of its time until there is equal access to the internet, the cost of devices are lowered, and the FCC forces the predatory telecoms to produce affordable plans for lower income families. In fact if Chase had been willing to really be charitable and invest $30 million in a campaign to make that happen PDQ in the US, then we would be talking about a real step forward where we could let a thousand apps bloom. Until then other than providing R&D for big banks, it seems the cart has once again jumped ahead of the horse.


African Internet Barriers Dropping for Commerce not People

water for sale

water for sale

Nairobi    My first visit to Nairobi was more than a decade ago. Where I stayed claimed access to the internet on a dial-up modem so slow that each email would take fifteen minutes or more to send, if it didn’t timeout before completion. Doing the least amount after a day of work meant staying up until the wee hours to do the bare minimum to keep up and hold on the rest of my job. There’s improvement without question. There is more wireless access and at better speeds even at Shalom House, where they wisely have multiple routers. On my last trip to Nairobi, we met with an NGO managing an elaborately funded tech space who touted the city as the future Silicon Valley of Africa. Now three years later, the evidence is still hard to find.

The bright shining star of tech in Kenya has been via mobile phones and money transfers and payments via cellphones. The competition between Vodafone, AirTel, and Safaricom continues to be intense and, relatively speaking, costs have stayed down somewhat. There are signs everywhere in the malls claiming they accept mobile payments. There are more smartphones in evidence, but largely that means in the malls of the middle class. Talking to ACORN Kenya organizers the dominant phones are still the basic “burner” models often requiring a switch of SIM cards to access one or another of the dominant networks.

Cyber cafes are still the standard access, if any, for most people, and they are heavily metered. Most computer terminals are little more than typewriters with a screen so that work can be done off the grid, and then loaded up quickly through a thumb drive to keep the cost down. One of my organizers had worked out an off-the-records deal at a cyber café to be able to get on the internet in the low demand, after hours to cut the cost. They were signed up on Facebook, but didn’t really use it, because “time is money.” YouTube was unknown to my team though they were fascinated that ACORN International had its own YouTube channel. The notion that they would pay the tariff to listen to their interview on my radio show for thirty minutes was remote given the cost. The small Acer computer I had muled over to them on my last trip had expired long ago. A used computer donated to the office had been serviceable but on the eve of my arrival failed to turn on. The idea of surfing the web for research or information was a mirage for these capable and adept organizers. They looked over my shoulder with enthusiasm and interest as I fulfilled their request to create an ACORN Kenya Facebook page.

The much touted cellphone based money transfer system is also a mirage outside of commercial applications that benefit the carriers and commerce. Their bank now charges a fixed fee of 600 Kenya Shillings or $60 USD to handle the transfer from ACORN International to cover their expenses, taking a huge bite of every remittance. Meeting with the bank they explained they charge the same fee no matter the level of the remittance whether a hundred dollars or ten thousand, making a classic case for low-end exploitative, predatory pricing.

We spent some time trying to find a workaround with PayPal where the fees would be significantly cheaper. Kenya was prominently displayed on their website, so with Sammy and David over my shoulders spelling the street names and watching in wonder, I enrolled the ACORN Kenya Trust as a new member and successfully navigated the clunky site until the point where we would enter the bank account for ACORN Kenya. After hitting a score of links that seemed to lead that way and being returned as often to the original site, I was never able to enter the Kenya Commercial Bank and ended up sending a message to the Help site. I was troubled by seeing Equity Bank listed as perhaps a “preferred” receiver of transfers for PayPal, so I fear this much touted “solution,” is captive of yet another commercial transaction established with only one Kenyan banking institution.

The rest of our day was more productive but the lessons of high barriers to internet access and continuing predation for money transfers cast a cloud over many of the day’s plans and conversations.

mosquito net

mosquito net


On Internet Fight, Follow the Money to Keep the Scorecard

comcast-money-640x365Edinburgh     The problem of transactional versus transformational organizing is nowhere clearer than in the lines being drawn around the issues of net neutrality and the internet as a public utility between old line civil rights groups and reformers. Some are trying to make much of seeing groups like the NAACP, LULAC, PUSH, and old lions like Rev. Jesse Jackson trek into the offices of the FCC and its chair, Tom Wheeler, to ask the commission to let the companies do whatever they can to whomever they can to make their money.

It’s a sad and embarrassing commentary on the state of the institutional apparatus of reform. It is also a display of the real grease that smooths the engines of our movement rather than the direction we all know we need to travel on the highway.

Comcast, AT&T, Times-Warner and others have paid the pipers. For years they have underwritten conventions, conferences, partnerships, projects, ad books, awards, and scholarships for the old-line outfits. The big companies maintain relationship specialists with various names whose job description is in fact managing these relationships, providing the grease, pressing the flesh, solving little problems, and showing up at big events. This is soft power that tries to avoid the direct expression that a quid pro quo is involved; even when everyone involved realizes that there will come a time when the chits are called in. Most smoothly expressed, these big companies, and most others like banks for example, would maintain that at the most they are getting access and have the right rolodex to be able to present their best cases to the decision makers in these organizations.

I’m not saying that the organizations shouldn’t take the money. Times are hard for organizations. At the same time they have to be able to walk away and maintain their credibility or it’s all over. Look at the tragic farce that has become Andrew Young’s legacy from civil rights to politics and diplomacy, and now as corporate shill from Walmart to whoever makes the next contribution and pays the next plane fare. These are cautionary case studies. We saw this over and over when ACORN was in fights with the banks and other lenders for example. I’ve often told the story of the settlement with HSBC, where we insisted ACORN’s share for remediation had to be double the annual level of what they had paid an old line, Beltway civil rights organization to saddle up to defend them. In fact we saw it with Comcast when they refused to listen to our demands for outreach to our communities on internet access, and instead wanted to accuse us of a shakedown. They thought, and still think, it’s all transactional. In the arrogance of corporate power, many of these big whoops start to believe that everyone can be bought, even when they must know only some are really for sale.

There’s a reason that politicians and others are left scratching in the face of modern protests and turmoil around police brutality and racial discrimination. They don’t have anyone to call on their speed dials that has credibility on the streets and in communities. They are calling the old lions, but they are a long way from the action because in fact they are in the lobby waiting to come up the elevator for a chat now.

Reportedly Rev. Jackson argued to the FCC’s Wheeler that he needed to protect the big company’s monopolies so that they would make investments in minority communities. Given the tragedy of sorry access and utilization in our communities from these companies as well as the exorbitant pricing which creates the divide and maintains their millions, it is just a matter of time before everyone asks Rev. Jackson and others, “What investment?” And, that is a question to be feared, if the answer is only an investment in some this and that with these organizations, rather than in the communities that are so desperately demanding change.

Transactions are invariably temporary. Transformation is always permanent. When change is coming, and it is coming, it’s best to be on the right side of the line.


The Toronto Star Supports ACORN’s Digital Access Opportunity Campaign

11806302.JPGNew Orleans               In a Canada-wide day of action, ACORN used the occasion of children heading back to school to hit the major, monopoly internet companies, demanding low cost access to internet.   The Toronto Star editorially supported the campaign, and their arguments were excellent, which I’ll share.

Breaking down the digital divide for lower-income families: Editorial

Major broadband carriers can play a role in breaking down socio-economic barriers in education.

Published on Sun Aug 17 2014 – Toronto Star

A lot of time, study, and money has been spent making sure lower-income kids receive a good education.

But a new barrier threatens to divide the haves from the have-nots at school — and later on in their careers.

It’s a lack of access to home computers and affordable, fast connections to the Internet. In 2012, almost 98 per cent of the top income households were connected to the Internet, compared to only 58 per cent of those earning less than $30,000.

A home computer and Internet connection may sound like a luxury, but study after study shows it’s a necessity to help kids from lower-income families keep up at school.

Pew Research, a leading U.S. think-tank, found that 56 per cent of teachers face a “major challenge” incorporating more digital tools into their teaching, because of low-income kids’ lack of access. And 84 per cent of teachers agree digital technologies are leading to greater disparities between affluent and disadvantaged schools and school districts.

A London School of Economics study found providing home Internet access to low income households closes the gap in use, “potentially reducing disadvantage.” It also found kids who have Internet access at home spend more time online, providing them with “higher levels of online skills and self-efficacy.”

Interestingly, home computers may also keep kids out of trouble. A PCs for People study found kids who can connect to the Internet at home were 6 to 8 per cent more likely to graduate from high school than those who couldn’t. Why? Simply by giving them something constructive to do that engages their interest. It’s a source of entertainment, as well as an educational opportunity.

All of this is why ACORN Canada (the Association of Community Organizations for Reform Now), which represents low- and moderate-income families, is holding back-to-school “actions” across the country this coming week.

Plans include setting up fake Internet cafés outside Bell Canada offices in Toronto and forming a line-up from the Ottawa Public Library to Parliament Hill with three goals in mind. The first is to highlight the problem. The second is to ask the Canadian Radio-television and Telecommunications Commission to invest in breaking down the digital divide for low income kids (as they recently did for rural Canadians). The pressure broadband providers to create $10-a-month Internet connection packages for all low-income families. It’s not a pipedream.

Rogers Communications, to its credit, rolled out a $10 connection program in 2013 for 58,000 low-income families living in Toronto Community Housing.

Educators are stepping in, too. Peel District School Board, for example, partnered with computer companies to provide low-cost tablets and refurbished computers to low-income families and now is reaching out to Internet providers “to level the playing field,” says Carla Pereira, acting manager of communications.

That’s because teachers recognize libraries can’t fill the gap.

Ashley Morris, a single mum of a 7-year-old Owen and 2-year-old Charlotte, proves the point. When Owen has homework to do, she lugs both kids to the library through a “not great neighbourhood” at night. Even then, Owen may have to line up to use the computer and it doesn’t give him time for other creative activities.

Using computers is not just about doing homework, but about “a growing experience with using technology and supporting learning in other ways,” says Heather Mathis, the acting director of Toronto’s branch libraries.

ACORN’s protests should prompt Canada’s major Internet connectors — companies such as Rogers, Bell, Telus, and TekSavvy — to work out programs for low-income families to narrow the digital divide.

It’s not just an investment in young people, but one in Canada’s future economic competitiveness. Let’s get our kids connected. All of them.




Calculating the Benefits of Bridging the Digital Divide

iStock_000003223001_Small-300x199London     Our last meeting in London before schlepping our gear towards Heathrow was with a charming activist named Claire Milne over coffee and tea near Kings Crossing.  Claire is part of something called the Essential Services Access Network in Britain, which we’re clearly going to have to learn more about.  Interestingly, we were talking about her specialty, telecommunications and our efforts in ACORN’s Digital Access Opportunity Campaign in the US and Canada, and our head scratching efforts to figure out where low and moderate income families stood in this regard in the United Kingdom.

Though on the narrow level of “access,” both our organizers and research indicated the technical numbers are actually quite high, ranging towards 95%, much of that is more limited through phones, and only 50% or less own smartphones that might give somewhat more.  Directed to a report by the Tinder Foundation, we already knew from Claire that there needed to be a lot of leaping still to bridge the divide in the UK as well.

To quote from Appendix A:
11 million      Number of people in 2013 who don’t have Basic Online Skills, using the internet regularly – of which…
7 million       Number of people who have never used the internet
1 million        Number of people who are lapsed users of the internet
3 million       Number of people who use the internet regularly but don’t have Basic Online Skills
6.2 million    Number of people who, in 2020, won’t meet our criteria on current trends or with current programs

Our obvious argument has been that the internet is now a public utility, and like electricity, gas, or telephone, as a utility, access has to be universal as a matter of simple equity.  The Tinder Foundation report made a telling argument though about the economic losses for Britain due to the lack of access.   Quoting a government report they argued:

Government Digital Service (GDS), we know that just getting people totransact with government online could save some £1.7 billion a year. Not a big enoughnumber for you? Well thanks to the work of Martha Lane Fox, Go ON UK and Booze &Co, we also know that being a leading digital nation in the global economy would realisesome £63 billion worth of benefit. Since we also know that comparing dollars to the pound, our money spends like pesos in the UK, you can pretty much double those numbers to put them in a North American context, meaning a governmental savings of almost $3.5 billion and an economic benefit of over $120 billon.

There’s no sense pretending that everyone cares whether lower income families have an equal shake, since the evidence is glaringly obvious to the contrary, but transposing those kinds of numbers over to North America, perhaps we could get more attention if we forced the big whoops to reckon with the money they – and we – are losing by going to not make access universal.