[Joint House and Senate Hearing, 113 Congress]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 113-415
 
                    INCREASING ECONOMIC OPPORTUNITY 
 FOR AFRICAN AMERICANS: LOCAL INITIATIVES THAT ARE MAKING A DIFFERENCE 

=======================================================================

                                HEARING

                               before the

                        JOINT ECONOMIC COMMITTEE
                     CONGRESS OF THE UNITED STATES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             JULY 29, 2014

                               __________

          Printed for the use of the Joint Economic Committee

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                        JOINT ECONOMIC COMMITTEE

    [Created pursuant to Sec. 5(a) of Public Law 304, 79th Congress]

HOUSE OF REPRESENTATIVES             SENATE
Kevin Brady, Texas, Chairman         Amy Klobuchar, Minnesota, Vice 
John Campbell, California                Chair
Sean P. Duffy, Wisconsin             Robert P. Casey, Jr., Pennsylvania
Justin Amash, Michigan               Bernard Sanders, Vermont
Erik Paulsen, Minnesota              Christopher Murphy, Connecticut
Richard L. Hanna, New York           Martin Heinrich, New Mexico
Carolyn B. Maloney, New York         Mark L. Pryor, Arkansas
Loretta Sanchez, California          Dan Coats, Indiana
Elijah E. Cummings, Maryland         Mike Lee, Utah
John Delaney, Maryland               Roger F. Wicker, Mississippi
                                     Pat Toomey, Pennsylvania

                 Robert P. O'Quinn, Executive Director
                 Niles Godes, Democratic Staff Director



                            C O N T E N T S

                              ----------                              

                     Opening Statements of Members

Hon. Amy Klobuchar, Vice Chair, a U.S. Senator from Minnesota....     1
Hon. Richard L. Hanna, a U.S. Representative from New York.......     2

                               Witnesses

Ms. Angela Glover Blackwell, Founder and CEO, PolicyLink, 
  Oakland, CA....................................................     6
Dr. Eva Moskowitz, Founder and Chief Executive Officer, Success 
  Academy Charter Schools, New York, NY..........................     7
Mr. William Bynum, CEO of HOPE (Hope Enterprise Corporation/Hope 
  Credit Union), Jackson, MI.....................................     9
Dr. Aparna Mathur, Resident Scholar, American Enterprise 
  Institute, Washington, DC......................................    10

                       Submissions for the Record

Prepared statement of Hon. Richard L. Hanna......................    30
Prepared statement of Ms. Angela Glover Blackwell................    32
Prepared statement of Dr. Eva Moskowitz..........................    44
Prepared statement of Mr. William Bynum..........................    50
Prepared statement of Dr. Aparna Mathur..........................    57


                    INCREASING ECONOMIC OPPORTUNITY
                      FOR AFRICAN AMERICANS: LOCAL
                INITIATIVES THAT ARE MAKING A DIFFERENCE

                              ----------                              


                         TUESDAY, JULY 29, 2014

             Congress of the United States,
                          Joint Economic Committee,
                                                    Washington, DC.
    The committee met, pursuant to call, at 2:31 p.m. in Room 
G-50 of the Dirksen Senate Office Building, the Honorable Amy 
Klobuchar, Vice Chair, presiding.
    Representatives present: Paulsen, Hanna, Carolyn B. 
Maloney, Cummings, and Delaney.
    Senators present: Klobuchar, Casey, and Murphy.
    Staff present: Al Feizenberg, Connie Foster, Niles Godes, 
Colleen Healy, Christina King, and Robert O'Quinn.

  OPENING STATEMENT OF HON. AMY KLOBUCHAR, VICE CHAIR, A U.S. 
                     SENATOR FROM MINNESOTA

    Vice Chair Klobuchar. Okay, we are going to call the 
hearing to order. We are very glad we have a good number of 
people here in attendance, and thank you so much for coming, 
and thank you for this important conversation about increasing 
economic opportunity in the African American community.
    I would like to thank Congressman Cummings, who has worked 
with us to put this hearing together. Also, the people from my 
hometown of Minneapolis who met with me. We had a really good 
discussion about this issue, and talked about how not only do 
we want to shed some light, continue to shed light on this 
issue, but also talked about what has been working across the 
country and some positive developments, as well.
    I think we all know we have seen some positive developments 
in our economy, and that is a good thing. We have seen 
stability. I know in our State we are down to 4.6 percent 
unemployment. But we still have a lot of issues with long-term 
unemployed and people who, even though they have jobs, are not 
making enough money to really pay the bills and make ends meet.
    Paul Wellstone, who we miss every day in Minnesota, always 
said: We all do better when we all do better. And that is 
really what this hearing is all about.
    There is much work to be done. We know that the 
unemployment rate for African Americans has dropped 
significantly in the past six months, but it still remains well 
above the overall unemployment rate of 6.1 percent.
    In 2013, African Americans were 12 percent of the labor 
force but 24 percent of those unemployed for more than 6 
months.
    We are going to talk about some policy recommendations. I 
know we will hear about them from our witnesses, and those are 
improving workforce training. We did just pass a bill on that 
out of the Congress, but it is something we care a lot about. 
Education. Helping families build wealth. Revitalizing 
neighborhoods. And helping start their own businesses.
    Harlem Children's Zone is obviously a good example when it 
comes to education. A birth-through-college pipeline of 
programs reaching more than 12,000 young people annually, and 
has become the gold standard for comprehensive education 
programs built on outcomes- based models.
    We also are going to look at increasing the number of 
African Americans with STEM skills. We know that is important. 
I know there is a young man I just met out there--there he is 
in his blue shirt and orange tie--and asked him what his 
favorite subject is, and his first answer was, ``Math.'' Very 
good. That was good.
    And where's your grandma? You showed me where your grandma 
was.
    (Nigel indicates where his Grandmother is sitting.)
    Vice Chair Klobuchar. Okay, good. You should be very proud 
of him. That was a good answer.
    I am going to actually, instead of going through 
everything, because I know that I want to give Representative 
Cummings time to speak as well and introduce our witnesses, so 
I am going to first turn it over to Representative Hanna who is 
our chair today on the House side, and then we are going to 
come back to Mr. Cummings and hear from him, a few comments 
from him as well as introducing our witnesses.
    Mr. Hanna.

      OPENING STATEMENT OF HON. RICHARD L. HANNA, A U.S. 
                  REPRESENTATIVE FROM NEW YORK

    Representative Hanna. Thank you, Vice Chair Klobuchar, 
Members, distinguished witnesses, grandparents, parents, and 
scholars. Thank you for being here.
    Let me begin by noting: Through the title of this hearing, 
Vice Chair Klobuchar and her Democratic colleagues acknowledge 
that Washington does not have a one-size-fits-all solution to 
every problem that Americans face.
    Yesterday marked the 100th anniversary of the beginning of 
World War I when Austria-Hungary declared war on Serbia. The 
Great War disrupted the supply of immigrant labor to the 
American industries. In what became known as the Great 
Migration, hundreds of thousands of African Americans moved 
north to fill these positions.
    July 2nd marked the 50th anniversary of the passage of the 
Civil Rights Act of 1964 which outlawed discrimination in 
public accommodations and employment based on race, color, 
religion, sex, or national origin. Through this Act, both 
Democrats and Republicans sought to close the opportunity gap 
generated by racial prejudice and segregation.
    Over the last half-century, there has been substantial 
progress in narrowing the opportunity gap for African 
Americans. Fifty years ago, less than 25 percent of African 
American adults had a high school diploma; today, more than 85 
percent do.
    And there has still been a five-fold increase in the 
percentage of college graduates. Inflation-adjusted median 
family income of African Americans has nearly doubled. The 
percentage of African Americans living in poverty today has 
fallen by more than a third, and the percentage of children 
living in poverty has fallen by nearly half--but much, much 
more needs to be and can be done.
    Nevertheless, the opportunity gap for African Americans 
remains substantial. Much of what remains of the opportunity 
gap is caused by a lack of education and job skills needed to 
prosper in today's economy.
    The surest route to prosperity for every American is a good 
education. For poor African American children raised by single 
mothers in rough inner city neighborhoods, a good education, as 
Thomas Sowell argues, is their greatest chance at a better 
life.
    America has many great public schools with excellent 
teachers that provide them with outstanding education. 
Unfortunately, America also has failing public schools with 
struggling teachers, many of which are in inner cities serving 
poor children.
    Economically prosperous families can avoid sending their 
children to failing public schools by either moving to a 
different neighborhood with good public schools or enrolling 
them in private schools. Prosperous families always have school 
choice.
    Until recently, more families in inner cities had no 
choice. Their children were forced to enroll in the assigned 
public schools even if they failed to provide a good education. 
Over the past decade, however, the public school monopoly for 
the poor has begun to change.
    Some governors and legislators working with parents have 
developed new and innovative approaches to provide all parents, 
regardless of their income or wealth, with choice for where 
their children are educated.
    The choice movement has taken a number of different forms: 
charter schools, vouchers to attend private schools, and 
privately funded scholarships to attend private schools.
    One of our witnesses today is Eva Moskowitz, the founder 
and Chief Executive Officer of Success Academy, a charter 
school system in my own State of New York. She has overseen the 
expansion from one school in 2006 to 22 schools serving 6,800 
students--I understand soon to be 32 schools, serving many more 
students.
    Her students are largely from the poor minority families. 
One of the interesting statistics is that these students score 
in the top 1 percent in math, and the top 7 percent in English 
Language Arts in state testing.
    Americans are a generous people, willing to help the poor 
through government-funded assistance programs and providing 
charities. But Americans are also a practical people.
    We want our safety nets to be temporary, helping able-
bodied working-age people to move from poverty into the middle 
class, and beyond. We do not want our safety net to trap the 
poor in a multi-generational cycle of dependency.
    Another witness today is Dr. Aparna Mathur who has 
identified what local initiatives in social welfare programs 
can actually lift women, especially African American women, out 
of poverty and making economic growth even more inclusive for 
the poor.
    She has argued for streamlining existing programs in order 
to improve transparency about the implicit tax penalties 
associated with each program. Ms. Mathur, Dr. Mathur, will 
offer Members important lessons on how to restructure our 
existing anti-poverty programs, improving the lives of current 
beneficiaries while providing a better value for the taxpayer.
    I look forward to their testimony. Thank you all, again.
    [The prepared statement of Representative Hanna appears in 
the Submissions for the Record on page 30.]
    Vice Chair Klobuchar. Thank you, Representative Hanna. We 
have also been joined by Representative Paulsen of my home 
State of Minnesota. We are over represented on this Committee. 
And I will turn this over to Mr. Cummings.
    Representative Cummings. Thank you very much, Vice Chair 
Klobuchar. And thank you for holding today's hearing to enable 
us to examine how we can increase economic opportunities in the 
African American community.
    While the overall unemployment situation is improving, we 
must ensure that all Americans have the opportunity to live the 
American Dream. We must remember that minorities, particularly 
African Americans, have a long hard road to walk just to get 
back to where they were before the Great Recession.
    In a recent report entitled ``Beyond Broke,'' for example, 
the Center for Global Policy Solutions and its partners have 
revealed just how wide the gap between the net wealth of White 
households and Minority households is. And they have detailed 
how extensive the financial struggles of the Minority community 
really are.
    Among other findings, this report explains that home equity 
accounts account for 58 percent of the wealth of Whites; but it 
accounts for more than 90 percent of the personal net worth of 
African Americans. And African Americans are more than twice as 
likely as Whites to hold no financial assets whatsoever, and to 
have no, or negative net balance.
    When African Americans are able to find work, they are more 
likely to find themselves in minimum wage jobs in industries 
where their salaries barely allow them to make ends meet.
    There is much that we in Congress can do to help. We can 
raise the minimum wage, which at the moment is not high enough 
to lift a single parent working full-time above the poverty 
line.
    We can immediately extend unemployment benefits, which are 
a crucial lifeline for the millions of Americans who have lost 
their jobs and rely on this modest benefit to cover the cost of 
housing, food, health care, and child care.
    And we can work with federal housing regulators to expand 
programs designed to help homeowners struggling with their 
mortgage payments, and preserve the home equity that is so 
critical for the African American community.
    We can also shine a light on local programs that are 
achieving measurable economic results for Minority communities, 
including African Americans, and I thank you, Vice Chair 
Klobuchar, for holding this hearing to shine that light.
    We must approach this with urgency, the task of lifting all 
Americans, including communities of color, out or poverty into 
economic opportunity. And any initiative that has succeeded in 
this effort demands our attention. And I say to you, we do not 
have the right to remain silent.
    On the panel today to discuss these issues is Ms. Angela 
Glover Blackwell, the CEO and Founder of PolicyLink, a national 
research institute advancing economic and social equity. Ms. 
Blackwell previously served as a Senior Vice President at the 
Rockefeller Foundation. She also served as Vice Chair of the 
Board of Directors of the Children's Defense Fund; was a 
commissioner on the Robert Wood Johnson Foundation Commission 
to build a healthier America; and served on the President's 
Advisory Commission on Educational Excellence for African 
Americans. Earlier this year, Ms. Blackwell was named a 
National Honoree by the Center for Urban Families and the Fred 
and Rita Richmond Distinguished Fellow in Public Life by 
Brandeis University.
    Also with us today is Dr. Eva Moskowitz, the CEO and 
Founder of Success Academy Charter Schools, a network of 
charter schools throughout New York City. From 1995 to 2002, 
Dr. Moskowitz served as a New York City Councilmember for the 
Upper East Side of Manhattan, and chaired the Council's 
Committee on Education from 2002 to 2005.
    Mr. William Bynum is the founding CEO and President of Hope 
Enterprise Corporation and Hope Credit Union, a private, 
nonprofit community development financial institution that 
provides banking services and access to capital to 400,000 low-
income residents of Arkansas, Louisiana, Mississippi, and 
Tennessee. Finally, he has advised Presidents Clinton, Bush, 
and Obama on community development, small businesses, and 
financial services matters, serving for 10 years as a 
Presidential appointee and Chairman of the Department's 
Community Development Advisory Board.
    Finally, Dr. Aparna Mathur is a Resident Scholar at the 
American Enterprise Institute. She previously served as Adjunct 
Professor at Georgetown University, a consultant for the World 
Bank, and an instructor at the University of Maryland.
    So I look forward to our testimony, and I thank you, Madam 
Vice Chair, for including children. I have often said the 
children are the living messages we send to the future we will 
never see. The question is, how will we send them?
    Thank you.
    Vice Chair Klobuchar. Thank you very much. And I know that 
Representative Cummings has another hearing, meeting that he 
will be going to shortly, and I am going to have to vote. But I 
will come back. Never fear. So I may have to turn over the 
gavel to Mr. Hanna, or whoever else is here. I want to also 
mention Senator Casey is with us from the Great State of 
Pennsylvania.
    So let's start with you, Ms. Glover Blackwell. Thank you so 
much for being here.

  STATEMENT OF MS. ANGELA GLOVER BLACKWELL, FOUNDER AND CHIEF 
           EXECUTIVE OFFICER, POLICYLINK, OAKLAND, CA

    Ms. Glover Blackwell. It is my honor to appear before this 
Committee to talk about increasing economic opportunity for 
African Americans.
    The United States is on the cusp of a very important 
transformation that is being fueled by the rapidly shifting 
demographics, which show that by 2043 we will be a Nation which 
is majority people of color: Black, Latino, Native American, 
Asian. But already the majority of those under five are of 
color, and by the end of this decade the majority of all 
children under 18 will be of color.
    So we find ourselves in the situation in which investing in 
those who too often have been left behind, while it continues 
to be a moral imperative, has become a national and economic 
imperative.
    In making sure that African American and others can fully 
contribute to the Nation's growth and prosperity, we really 
have to focus as a Nation on work, place, and wealth.
    In the context of work, certainly increasing the minimum 
wage, expanding unemployment benefits, increasing job training 
programs, getting more youth summer jobs, and aligning job 
training programs with real jobs are important, but Oakland 
actually has a wonderful example, the Oakland Army Base, that 
has been shuttered for 20 years and is now being turned into a 
logistics hub for the region.
    And they are using this $800 million public/private 
investment, which will cover a land base larger more than 200 
football fields, to be able to lift up the population that is 
too often left behind.
    First, they are making sure that they limit the temporary 
jobs, so that these are long-term jobs. Next, they are 
eliminating the box. They are banning the box on application 
forms that too often people who have been formerly incarcerated 
have had to check and which has put them out of the running for 
a job. They do not have to indicate that unless they are well 
into the process.
    They are making sure that 25 percent of all the apprentice 
hours go to the vulnerable populations of Veterans, people 
formerly incarcerated, and those who have had difficulty 
getting work. And they are making sure that the jobs pay living 
wages and have benefits, a very exciting example.
    In Baltimore, a bioscience hub, they are making sure that 
the jobs that are going to be available in bioscience get to 
those who need them the most, by having mentoring programs for 
high school students. They get mentored, and then they get 
moved into jobs, a seamless process. Very exciting.
    But we know that in this Nation, where you live has so much 
to do with opportunity, particularly for African Americans, who 
live in communities where the schools are often failing them, 
suffering from disinvestment, in places where there are no jobs 
and little access to jobs. They are wonderful examples of being 
able to turn around this notion that place has become a proxy 
for opportunity.
    The Promise Neighborhood Program is a wonderful example. 
Building on the extraordinary success of the Harlem Children's 
Zone, where 12,000 children have been surrounded by all the 
supports that they need. One hundred percent of those children 
start school ready to learn because of early childhood 
investments. Ninety-five percent of those children will 
graduate from high school and have gone on and been accepted to 
college. And the schools are really providing for those 
children.
    But we also know that there are other local examples that 
are important. Pennsylvania has really demonstrated to the 
Nation that we can solve the problem of lack of access to fresh 
fruits and vegetables, and the Healthy Food Financing 
Initiative is building on that, making resources available; 
5,000 jobs have been created through this resource in 
Pennsylvania, and we are hoping for results beyond that 
magnitude across the country.
    But we also know, in addition to work and place, that 
wealth also matters. And the drivers of wealth are housing, 
inheritance, income, but also education. And as we are thinking 
about creating wealth, it is so important to understand that 
education not only leads to being able to develop wealth 
because of employment. By 2020 47 percent of all jobs in this 
country will require at least an associates degree. Only 28 
percent of African Americans have it.
    Not only does education lead to wealth, it can also be the 
cause for wealth stripping, when so many students have to go 
into debt and stay in debt and have their wealth stripped away 
because of the financial crisis that comes from student loans.
    Pennsylvania--I'm sorry, Tennessee has a wonderful example: 
Tennessee Promise. Governor Haslam actually has a program in 
which they guarantee--this program just started in May--that 
every single student who graduates from high school can have 
two years of free community college. Two years.
    That means no loans for the first two years. That means 
they're well on their way to the kind of investment that they 
will need to do well in the future. We know what works. We need 
to lift it up, put policy behind it, and create greater 
opportunity for all, including African Americans.
    Thank you.
    [The prepared statement of Ms. Glover Blackwell appears in 
the Submissions for the Record on page 32.]
    Vice Chair Klobuchar. Thank you very much.
    Dr. Moskowitz, thank you for being here, and thank you for 
bringing your students from Success Academy with you.

  STATEMENT OF DR. EVA MOSKOWITZ, FOUNDER AND CHIEF EXECUTIVE 
     OFFICER, SUCCESS ACADEMY CHARTER SCHOOLS, NEW YORK, NY

    Dr. Moskowitz. Good afternoon, Senator Klobuchar and 
members of the Committee. Thank you for your attention to this 
critical topic. I am also honored to be here.
    I am Eva Moskowitz, the Founder and CEO of Success 
Academies. We started August 20th, 2006, with 155 students. 
Today we have 32 schools K through 12. Our first high school we 
are opening in a couple of weeks. We have just shy of 10,000 
students; 3 out of 4 of our students live below the poverty 
line; 94 percent are kids of color; 15 percent of our children 
are special needs; and about 10 percent are English-language-
learners.
    And yet our students are in the top one percent in math and 
in science for the past five years, even with the new addition 
of the higher Common Core standards. And our kids are in the 
top seven percent in reading and writing. And we have been 
asked: Well how are you doing this?
    And I would argue that great schooling, world-class 
schooling is terribly complex. It is also terribly hard. But 
there are some elements that are key, and I would say that in 
order to have a great school, or set of schools, you really 
have to not only teach reading and writing, but you really need 
to go beyond that. We have chess as a fundamental and signature 
element. The amount of strategic thinking you teach children 
through chess is actually quite profound. Our kids competed in 
Dallas this year with 5,000 other children from around the 
country, and they took home 1st place, 3rd place, 4th, and 7th 
place.
    Our kids are on the Math Team. We have 40 percent of our 
children who are on the Math Team. That is unheard of in 
America. It is usually a few kids. And what we really try and 
do is have kids fall in love with mathematics. Our kids compete 
internationally on the Math Olympiad and do exceedingly well.
    We are also tremendous believers in science education. Our 
kids start science in kindergarten 5 days a week. It is not a 
second-class subject. We believe in inquiry-based science. Our 
kids do about 135 experiments every year starting in 
kindergarten. And if you want to try and figure out how we make 
this country more globally competitive and how we help our most 
vulnerable children, low-income children in neighborhoods like 
Harlem and Bed Sty and the South Bronx, it is a robust STEM 
education.
    We also do coding starting in kindergarten, believe it or 
not, with devices called BBOTs, which are little robots that 
the kids can program in a single direction. And by the time 
they get to middle school, they are doing JAVA SCRIPT. And by 
the time they graduate from high school, our kids will be able 
to program and earn roughly $90 bucks an hour as programmers. 
We want them to go to college and graduate first, but they will 
have that access to economic opportunity.
    It was mentioned that we have a number of students with us 
here today. Our scholars are incredibly passionate about 
learning, and our goal in schooling is to help children fall in 
love with school.
    If you love learning, you can teach yourself anything. Part 
of our success has to do with a robust teacher and principal 
training program. Unfortunately, schools can either, as was 
mentioned, either can be engines of opportunity or they can 
actually trap children and they can be poverty traps. And 
unfortunately in America, we have far too many failing schools.
    We have far too many mediocre schools. And what we need to 
do is to make sure that schools are really engines of 
opportunity. And when we do that, we will provide a foundation 
for economic success. Thank you, very much.
    [The prepared statement of Dr. Eva Moskowitz appears in the 
Submissions for the Record on page 44.]
    Vice Chair Klobuchar. Thank you, very much.
    Mr. Bynum is next, and I will be turning the gavel over to 
Representative Maloney while we have a vote, and then I will 
return.
    Mr. Bynum.

STATEMENT OF MR. WILLIAM BYNUM, CHIEF EXECUTIVE OFFICER OF HOPE 
  (HOPE ENTERPRISE CORPORATION/HOPE CREDIT UNION), JACKSON, MI

    Mr. Bynum. Good afternoon. Thank you, Vice Chair Klobuchar, 
for the opportunity to speak before this Committee.
    It is very encouraging that you are taking the time to 
focus on opportunities and challenges related to African 
Americans because as the Nation grows more diverse it is 
increasingly clear that all of our interests, our common 
interests, are tied to the fact that we equip these growing 
segments of the population with the capacity to prosper, to 
support their families, and to contribute to our Nation's 
economy.
    Over the past 20 years, HOPE, which is a community 
development financial institution, has worked to accomplish 
this by undertaking a range of asset development strategies in 
Mississippi, Arkansas, Louisiana, and Tennessee.
    During this period, we have generated over $2 billion in 
financing that has assisted over a half a million people. My 
comments will focus on our core elements of work: That is, 
providing retail financial services in what are becoming bank 
deserts across the country; affordable home ownership; and 
support for entrepreneurs.
    Our primary financial service vehicle is a credit union 
with 29,000 members, federally regulated; 7 out of 10 of our 
members are people of Color. Over half of them earn less than 
$35,000 a year. And 37 percent were unbanked before they joined 
HOPE.
    Since the financial crisis in 2008, we have more than 
tripled our presence in low-income communities, often in 
communities that have recently lost a bank. We have gone from 6 
to 23 service locations at a time when 1,800 bank branches have 
closed across the country; 93 percent in low-income census 
tracts. Of the 1,679 Zip Codes in my service area, 61 percent, 
1,031, have zero or one branch; 723 have no bank branches.
    Regarding home ownership, we expand access to home 
ownership by offering mortgage products that emphasize the 
applicant's ability to pay, not how much we can make in fees. 
We take the time to understand their situation, what they can 
afford, and help them develop a plan to succeed.
    In 2013, 82 percent of our mortgages were to Minority 
borrowers; 52 percent were low-income; over half were female; 
and 86 percent were to first-time home buyers. An annual survey 
of mortgage borrowers indicates that 41 percent reported 
improved education outcomes for their children since their 
families purchased the home.
    We also focus on small business lending. We've been doing 
this since we started, and nearly half of our commercial loans 
last year were to Minority or women-owned businesses. The 
average wages at these businesses that we finance was 
approximately $28,000, significantly above the $23,000 poverty 
threshold for a family or 4, or the $15,000 minimum wage. And 
80 percent of the employees at the companies we finance report 
that they have health insurance.
    I hope this gives you a sense of what is possible when 
African Americans and other under-served populations have 
access to a financial institution that is committed to 
providing affordable and responsible structured services.
    Related to this, I would like to make three--a few 
recommendations:
    First, I really urge you to increase the amount and the 
focus of federal resources that benefit persistently 
impoverished areas and under-served populations. A quarter of 
the Nation's persistently impoverished counties are in my 
service area. A disproportionate share of the residents are 
people of Color.
    Increase the long-term investments in institutions like 
community development financial institutions, cooperatively 
structured institutions like credit unions that have a track 
record in fostering opportunity among African Americans that 
will produce the kind of outcomes that I described earlier.
    Second, I would support strong federal consumer protection 
against products that target the under-banked and other 
vulnerable populations, and support increased accountability by 
banks.
    The mid-South has the highest concentration of payday 
lenders in the country. Subprime lending is higher than it is 
anywhere else. And combined with the bank closures in low-
income and Minority communities, this is a recipe for disaster.
    It is vital that you support strong rules preventing 
abusive financial practices and enforce laws that require banks 
to invest in communities from which they derive profits.
    These steps are essential for ensuring that Americans and 
families can participate in the economic system in a viable 
manner.
    I will close by quoting Dr. King, nearly five decades ago 
when he gave his final speech to the Southern Christian 
Leadership Conference. He put out a passionate call for 
economic justice. In that speech, he emphasized the importance 
of well capitalized, locally owned banks in Chicago and 
Cleveland as a critical part of the economic success of African 
Americans in those communities.
    We cannot allow financial services to become an extraction 
industry in low-income, rural, and Minority communities only 
taking revenue, while leaving large holes in those economies.
    Community development, credit unions, community development 
financial institutions like HOPE, have shown how a locally 
owned, locally accountable financial institution can foster 
economic opportunities for historically underserved people and 
places.
    Thank you.
    [The prepared statement of Mr. William Bynum appears in the 
Submissions for the Record on page 50.]

  STATEMENT OF DR. APARNA MATHUR, RESIDENT SCHOLAR, AMERICAN 
              ENTERPRISE INSTITUTE, WASHINGTON, DC

    Dr. Mathur. Vice Chair Klobuchar, and other members of the 
Committee, thank you for inviting me to testify on the very 
important issue of economic mobility and opportunity for 
African Americans.
    Economic mobility refers to the ability of an individual or 
a family to improve their economic status, either within a 
lifetime or across generations. It is a reflection of economic 
opportunities available to parents and their children as they 
attempt to move up the income ladder.
    Amongst all races, economic mobility is of particular 
concern for African Americans. Forty-four percent of African 
Americans in the bottom quintile stay there into adulthood, 
compared to just 25 percent of comparable Whites. Therefore, 
from a policy perspective understanding the correlates of 
opportunity and mobility is extremely important.
    Segregation, both by race and income, is an important 
factor influencing mobility. Many studies find that African 
Americans who live in segregated metropolitan areas have lower 
educational attainment and lower earnings than their 
counterparts who live in more integrated areas.
    There are several approaches to alleviate these issues. 
Studies advocate using community betterment projects in these 
neighborhoods such as improving school building, reducing crime 
rates, or investing in neighborhood infrastructure to encourage 
integration.
    Other policies help individual home buyers or renters gain 
access to existing neighborhoods. This approach is typified by 
the Community Reinvestment Act of 1977 which was moderately 
successful in reducing residential segregation.
    Also, empirical economic studies suggest that housing 
vouchers which moved African American children out of public 
housing and into less distressed homes as part of the Moving To 
Opportunity Project helped, as well, in reducing segregation.
    In a paper from earlier this year, my AEI colleague Abby 
McCloskey and I propose improving the human capital of 
disadvantaged city residents by introducing a greater degree of 
school choice.
    Studies focusing on charter and public schools in districts 
comprised mainly of Minority and low-income children suggest 
that school choice has significant and positive impacts on 
student test scores and attendance rates.
    Some examples of the successes, as have already been cited, 
are the Harlem Children's Zone Program in Harlem, New York, 
which combined charter schools with a web of community services 
designed to ensure that the social environment outside of 
school is supportive for children from birth to college 
graduation.
    Another example is the Public School Choice Lottery in 
North Carolina which ended the 30-year-old practice of busing 
students across a district to achieve racial desegregation.
    A few studies suggest that the more years of schooling 
African American children attain the more likely they are to 
move out of the bottom quintile. However, African Americans 
have a high school dropout rate that is double that of Whites.
    There is a growing body of research on using financial 
incentives to motivate educational goals. The accelerated study 
and associate programs granted full tuition waiver for full-
time college at the City University of New York, which was 
found to increase graduation rates. Roland Freyer of Howard has 
found that financial incentives can be a cost effective 
strategy for raising achievement among even the poorest 
Minority students in the lowest performing schools if properly 
structured.
    In our study, my colleagues and I propose a milestone 
credit where low-income teenagers receive a cash bonus upon 
receiving the high school diploma to realign the incentives to 
stay in school. The milestone credit should begin as a pilot 
program to test its efficacy in improving graduation rates, the 
size of the credit required, and the impact on lifetime 
earnings.
    The next challenge is labor markets. African American 
unemployment rates have been double that of Whites consistently 
over the last 50 years. Recent studies suggest that this is the 
result of racial mismatch rather than spatial mismatch.
    In other words, unemployment is not a result of African 
Americans living in areas with fewer jobs; but that even if 
they reside in areas that are dense with jobs, these jobs are 
more likely to be held by Whites.
    One approach would be to allow employers to develop 
customized job training and job placement programs based on 
their needs. A current experiment along these lines is the 
Wisconsin Fast Forward Initiative.
    This program allows employers to apply for state grants for 
worker training, provided the employers hire the workers after 
they are trained. Such programs can be targeted more 
specifically at disadvantaged groups such as African Americans.
    Certain federal and state government programs such as the 
Earned Income Tax Credit have been shown to have a positive 
effect on the employment of single mothers and economically 
disadvantaged populations.
    A possible improvement to the ITC would be to expand the 
credit and extend the credit to childless individuals. About 33 
percent of African American teenagers, and 25 percent of 
African American youth between the ages of 16 and 24, are 
unemployed.
    Since teenage and youth unemployment leads to lower incomes 
and fewer life opportunities, this is an urgent issue that 
needs to be addressed. Apprenticeship and training programs for 
youth have been shown to be effective at easing transitions of 
teenagers and disadvantaged youth to jobs.
    Since the 1960s, marriage rates have fallen more sharply 
for blacks than for whites. One of the reasons for changes in 
family structure is that increases in teen pregnancy rates mean 
more single motherhood at very young ages.
    Among all racial and ethnic groups, the teen pregnancy rate 
is highest for Black teens. Traditional prevention methods have 
included more birth control and sex education in schools. 
However, nontraditional methods are also worth exploring.
    A recent study finds that MTV's ``16 and Pregnant'' show 
was responsible for one-third of the reduction in teen 
pregnancy rates in an 18-month period.
    As the cost of child care increases, many mothers with 
young children may also decide to leave the labor force to care 
for children, or scale back the hours they work, to balance 
household responsibilities.
    In our paper, my colleague and I propose streamlining the 
current child care subsidies and tax credits which are 
needlessly confusing, have low recipient rates, and leave out 
many low-income women who need them the most.
    The core of our proposal is to substantially increase the 
amount of the child care tax credit and make it refundable. The 
system of tax credits and means-tested transfers, such as the 
EITC, TANF, SNAP, impose high marginal tax rates of up to 30 
percent on low-income households which discourages the 
workforce participation.
    At the very least, combining some of these programs into a 
single program could improve take-up rates and allow 
policymakers to obtain a clearer understanding of the marginal 
tax rates faced by low-income individuals.
    To conclude, the most important challenges going forward 
are the creation of stable family structure that will invest 
sufficiently in the education and upbringing of the children, 
as well as providing the right kind of high quality education.
    In addition, improving labor market outcomes through the 
expansion of the EITC and other programs is important. I have 
proposed seven reforms to existing welfare and workfare 
programs, as well as incentives for teenagers and youth to 
attain higher education.
    Thank you. If you can address some of these challenges, 
America may remain the land of opportunity for generations to 
come. Thank you.
    [The prepared statement of Dr. Aparna Mathur appears in the 
Submissions for the Record on page 57.]
    Representative Maloney [presiding]. Thank you. And I want 
to thank all of the witnesses for being here today, and for 
their insightful testimony.
    In particular, I would like to welcome Dr. Eva Moskowitz 
and thank her for travelling here from my home City of New York 
to tell us about her organization and experience with working 
with low-income children.
    Her testimony mentioned an important point: the large 
skills gap in our country that is keeping too many Americans 
from landing stable, well-paying jobs.
    Even younger Americans who just graduated from college, 
whose school sets should be up-to-date, are finding it 
difficult to land good jobs. And it is one of the highest 
unemployment rates for youth that I have seen in my lifetime. 
And what is so sad about it is that it just is cumulative. If 
you cannot find a job, then it gets harder and harder going 
forward.
    According to the Economic Policy Institute, over 25 percent 
of young college graduates are unemployed or underemployed. And 
this issue is a particular concern for Minorities and women, 
groups that have been under-represented in the growing science 
and the technology fields.
    Currently, Minorities make up only one-quarter of the STEM 
workforce, and African Americans only comprise 6 percent. I 
have introduced legislation, the Minorities and Women In STEM 
Booster Act to encourage more Americans from these sets and 
these communities to think about a career in science and 
technology.
    And Chairlady Klobuchar has a bill in to create 100 STEM 
high schools across this country.
    It is a priority of President Obama to encourage more young 
people to go into STEM, particularly Minorities and women, and 
there is a huge focus in this Administration on it.
    So I would like to hear from our panelists about how we can 
encourage greater interest in STEM education and boost Minority 
participation. And if you have an experience, direct experience 
that you have had successfully in working with Minorities to 
get them into STEM.
    And I am going to begin with the hometown girl, Dr. Eva 
Moskowitz. Good to see you again, Eva.
    Dr. Moskowitz. Good to see you, Congresswoman Maloney. Yes, 
I think part of the barrier here is that we also have a teacher 
shortage in this area, and it is very, very hard to find math 
and science teachers, particularly at the high school level.
    Representative Maloney. That is true. What do we do about 
it? I have been to some of the high schools in my District, and 
the teachers are literally from foreign countries in math and 
science. So what do we do about it to get the teachers in those 
fields?
    Dr. Moskowitz. Well longer term, these young men and women 
behind me will be able to do that job. So it is sort of short-
term. If we do not train the kids, then we will not have the 
teachers later on.
    But I think short term what we have had to do is to become 
a school of education. We have to teach our teachers the math 
and the science in order to be able to teach the kids. It is 
hard, and it takes resources, but it is doable.
    You know, it is even harder in the field, frankly, of 
coding, because people obviously can make much more money in 
the private sector. But there are actually ways to train 
teachers that are online. Coding is something that, you know, 
people who have a knack for it can learn pretty quickly.
    There is an organization called TreeHouse that has 72,000 
students online, and is really providing training for the job 
market. We need to use some of those resources for the field of 
education.
    Representative Maloney. Dr. Glover, Ms. Glover Blackwell?
    Ms. Glover Blackwell. Thank you. It is so important that 
school boards adopt policies that make sure that STEM education 
is just a standard part of the primary and secondary 
curriculum.
    These issues just get pushed to the side when it is not 
something that every child and every family is thinking about. 
In addition to making it a standard part, we really have to 
focus on training.
    Coding is so important. There's the Black Girls CODE 
Program in San Francisco, and also Code 2040, taking young 
African Americans and Latinos and making sure that they have 
the skills that they need to have an advantage.
    And we need to make sure that companies are providing 
internships with employment opportunities at the end of the 
internships. These kind of programs have been proven to make a 
difference.
    The mentoring that things like Code 2040 provide is 
absolutely essential, because so many young Black men and 
women, girls and boys, do not see people who look like them in 
these jobs. So programs that connect engineers who are Black 
and coders who are Black with these children make a tremendous 
difference.
    And then we just need to put more money into it so every 
school district has the resources they need.
    Representative Maloney. I've got to tell you, the most 
successful programs I have seen in New York are when industry 
comes in and adopts a school----
    Ms. Glover Blackwell. Yes.
    Representative Maloney [continuing]. And literally trains 
the young people for the jobs that they have. IBM has done 
that. But also in Harlem, some of the hospitals have come in 
for technicians and things that they need.
    In other words, where you really focus the education to 
what the job will be so that you are fitting the child with the 
job.
    Doctor--Mr. Bynum, I really wanted to tell you that I 
have--I really appreciate and admire your work and HOPE brings 
financial services to many communities that have been 
underserved.
    The FDIC has reported that 21 percent of Black households 
are unbanked, double the rate of other populations. Why do you 
think so many are unbanked? And what can we do to remove the 
barriers?
    But I must tell you, I also serve on the Financial Services 
Committee. I was a little late because I was at that Committee 
meeting. And a lot of what we tried to correct in Dodd-Frank 
were really predatory abuse of policies towards the least 
fortunate in our society.
    They were really aimed at selling products to people that 
could not afford it, so that they could get their fee and just 
let the chips fall where it may. But even the CARD Act, which I 
authored to protect from unfair, abusive practices in the 
credit card industry, very much targeted the low-income 
community.
    So the low-income community is often targeted with these 
predatory practices and products, and I would like to hear your 
comments on it. And do you think that the fees are just too 
high, overdraft fees, ATM fees? Why are so many in the Minority 
community, or many communities, unbanked?
    Mr. Bynum. Thank you. That is something that we live with 
and struggle with every day. We are a regulated depository, but 
we have found that there are prudent ways to provide financial 
services in low-income communities. As I've said, 40 percent of 
our members were unbanked before they joined our credit union.
    We have tripled our presence in what we are calling ``bank 
deserts.'' Since the Recession, as banks have left in record 
numbers, there is unfortunately little accountability when 
banks decide to leave these communities.
    The Community Reinvestment Act, which is the law of the 
land, requires banks to reinvest in those communities from 
which they derive profits. It was based on a system when there 
were bank branches everywhere. Now most of us have not been 
into a bank branch in six months. We do everything 
electronically.
    And when banks do not have branches, they do not have an 
assessment area and are not held accountable to reinvest in 
these bank deserts. They are leaving.
    Representative Maloney. Oh, I did not realize that that had 
really affected the Community Reinvestment Act with the new 
technologies.
    Mr. Bynum. It has changed the financial industry 
dramatically, as bank branches--you know, bricks and mortar and 
expensive. People are expensive. And banks are in the business 
to maximize profits for their shareholders.
    As a credit union, our profits are used to reinvest in our 
members: offer them lower rates on their loans; higher rates on 
their deposits. And so the business model exists that can 
benefit these communities.
    And banks, even some credit unions--I get into trouble with 
my peers in the financial industry when I hear them have a 
knee-jerk reaction to too much regulation. There is smart 
regulation. We saw what happened in the absence of regulation--
--
    Representative Maloney. Absolutely.
    Mr. Bynum [continuing]. During the financial crisis, and 
that is why the Consumer Finance Protection Bureau is so 
important. It is great to have an agency that is actually 
looking out for the interests of consumers and is holding banks 
more accountable to offering products that are not deceptive 
and abusive; and that hopefully in the near future will put 
some brakes on the proliferation of payday lenders.
    Because as banks leave these communities, payday lenders 
are going into them in record numbers. And those most 
vulnerable in our society can least afford to pay 400, 500 
percent for small-dollar loans.
    We have had so many people come into our doors where we had 
to restructure debt traps that they were caught in to get them 
back on their feet.
    One woman in Memphis needed--she needed--she got accepted 
into trooper school, State Trooper School. She needed $1,600 to 
buy the uniform. She didn't have the money because she had been 
in a payday lending situation, and had gotten so trapped down 
in debt. We were able to make the financing available to her. 
She's got--she's in the Trooper School. She is on her way to a 
better job and being able to support her family.
    Representative Maloney. My time has long expired, but I 
appreciate so much your testimony and all of the panelists. 
Thank you.
    Mr. Bynum. Thank you.
    Vice Chair Klobuchar [presiding]. Thank you.
    Representative Hanna.
    Representative Hanna. Thank you.
    Dr. Moskowitz, you mentioned in your testimony that schools 
need to be incubators of opportunity, not poverty traps. Yet 
Dr. Mathur, to that point, you mentioned--correct me if I am 
wrong--but if you are born in poverty, you have something like 
a 70 percent or so chance of, to be callous, dying in poverty.
    And we know that education is that single best way around 
that. We have Nigel, and Ananda, and Aida back here, proof that 
you can break out of that with enthusiasm. I listened to them 
earlier and they are just excited about what they are doing and 
where they are at the Success Academy.
    So, Dr. Moskowitz, I have a question for you that seems to 
me there is no reason to pit anyone against anyone when the 
outcome we're all looking for is the same. So my question is a 
simple one, I think.
    How do you make children love education?
    Ms. Moskowitz. It's a simple question. It's the $64,000 
question, and I would say that there are many ingredients. But 
I think with all the technical fixes, and expertise, we have 
forgotten something incredibly important in education, which I 
think all parents know.
    But actually, schools have to love children. They have to 
know when they walk through the gate that the principal loves 
them, and that their teachers love them, and every adult in the 
building loves them.
    Obviously you need more than love to run a great school, 
but I don't think that can be underestimated, the emotional 
bonds that we have with our students. At our schools, every 
principal greets every student every day, and says goodbye to 
them every day. And every adult in the building is expected to 
know every child's name.
    Two of the three students behind me, Aida and Ananda, were 
my students when I was the principal of the first school. And 
having that relationship not only with the kids but, frankly, 
their parents and their grandparents is very powerful in terms 
of motivating kids to love school.
    I also think when you think about school design--and I do 
think we have to think more about school design very, very 
deliberately--we often think about school design from the 
adult's point of view: what is convenient? What is the least 
amount of work?
    My best example of this is when schools do not allow recess 
when it is cold out. I don't know about you, but I've never met 
a child who is cold when it's time to go outside. They 
usually--you're fighting with them to put on their winter 
jacket, not the other way around.
    Vice Chair Klobuchar. Unless you're in Minnesota and it's 
10 below zero.
    Dr. Moskowitz. Yes.
    Vice Chair Klobuchar. I just had to put that on the record.
    Dr. Moskowitz. Fair point.
    Vice Chair Klobuchar. Or 30 below.
    Dr. Moskowitz. But at our schools, winter or not, kids like 
to put on their snow pants and, assuming it's safe of course, 
go outside and run around.
    And so if you imagine all of schooling designed from the 
point of view of the kid and what do they like to do, and how 
do you make school really, really interesting. We say to our 
faculty and to our principals, if there were no laws mandating 
school and parents did not need child care--which is very hard 
to imagine; I say that as the mother of three--would the kids 
come to school?
    And I think in many, many cases in America they would not. 
They would not choose to come to school. And we have to make 
sure that as educators we don't treat children as a captive 
audience.
    Representative Hanna. How do you engage the--in what 
fashion do you engage the parents of these children? There must 
be something different about that. Go ahead.
    Dr. Moskowitz. Well, we partner with parents. That doesn't 
mean that parents run the school, but we do have a very 
profound respect for our parents. They are their child's first 
teacher and last teacher. And no matter how many hours a day we 
have their children, respecting parents, but also demanding 
that parents can't see the school as the babysitting operation 
where they then check out.
    It's got to be a true partnership between the school and 
the parents. The school can't do it alone. Parents can't do it 
alone. We together, their children join us. We call it a 13-
year marriage. We're in it together, and we've got to see their 
kids through thick and thin.
    And we have some very concrete demands that we do make of 
our parents. And the most important is reading to their child 
every night K to 2. And then starting in 3rd grade, our kids 
must read 45 minutes a day.
    Representative Hanna. My time has expired. Thank you, very 
much.
    Vice Chair Klobuchar. Thank you, very much. We'll turn to 
Senator Casey.
    Senator Casey. Thank you, Madam Chair. I want to thank Vice 
Chair Klobuchar for having this hearing on a very important set 
of topics to focus on. I want to thank our panel for your 
testimony and for your work in this area.
    I will not get to each of you for a question, but I wanted 
to start with Angela Blackwell, not only because you mentioned 
Pennsylvania once in your testimony and you referred to a 
Pittsburgh program in your written testimony, but I might as 
well just start there.
    But the real reason was that you did highlight the 
Pittsburgh Central Keystone Innovation Zone as a good example, 
and I wanted to--an example in terms of job creation and a real 
strategy that leads to that. And I just wanted to get your kind 
of summary of why you think that program is successful, and 
whether or not--I am assuming you would answer, yes, that we 
should scale up those programs like that, but whether you think 
it is possible and what we can learn from that example.
    Ms. Glover Blackwell. Thank you for the question. And I 
have been so happy that I can lift up Pennsylvania as examples 
in more than one area.
    I think that the Keystone Project actually demonstrates 
what we can do when we target and when we are deliberate. And 
it is so important that as we are talking about the plight of 
African Americans, how they have been marginalized in the 
economy, over-incarcerated, and pushed aside when it comes to 
so much that is essential for being able to reach your full 
potential, that as you are looking for strategies, you not 
start as if you have a blank slate and all that has not 
happened before.
    It is so important to acknowledge the struggle, the impact 
of that struggle, and to target strategies. And so we are 
seeking examples around the country, and Keystone is just one 
of those examples, where in the creation of something that is 
going to be good for the region, good for the city, we think 
that we have to do multiple things at the same time.
    The need is too great for us to have a special program to 
deal with every one of the things that has to be addressed. 
When we are thinking about the things that the economy needs, 
things that the region needs, that is how we are going to 
achieve equity and full inclusion: by targeting strategies, 
making sure that we are removing barriers, measuring outcomes, 
engaging partners, and doing this in a public/private way.
    And I think that Maryland, Pennsylvania, California, so 
many places are learning this and solving our social problems 
as we solve our economic problems.
    Senator Casey. And even as we look--and we do have in our 
State a number of good models--but even as we look at those, I 
cannot, nor can anyone in our State, be satisfied with these 
numbers when you consider that the African American population 
as a percent of the adult population in our State is 10.4 
percent, yet the unemployment rate is 12.4.
    The same holds true for long-term unemployment: 2.5 for all 
races, more than double that, 5.4, for African Americans. So we 
like a lot of places have a long way to go. But I was grateful 
you mentioned that.
    I am also grateful for the Healthy Food Financing 
Initiative, which as you know is a national strategy, but it is 
being carried out in a lot of states. And we are grateful for 
that.
    I know I am low on time, but I wanted to get to a question 
for Mr. Bynum. I note for the record that a lot of what has 
been talked about today in terms of strategies that work, I was 
particularly pleased that the JEC staff noted in the memo for 
the hearing on page 4 in terms of kind of efforts that can 
reduce these numbers that we highlight, expanding early 
childhood education--I am reading from the memo here, quote:
    ``Expanding access to quality, affordable preschool 
education can close the gap in school readiness between some 
African American children and their peers.'' Unquote.
    That is a passion of mine, and I know a lot of people here 
in both parties. We have not been able to get agreement on it, 
but I think all of us know if kids learn more now they are 
going to earn more later. That is not just a nice rhyme, but it 
happens to be true, and all the data shows it. So I know that 
many people here are focused on that as one of the strategic 
focuses.
    Mr. Bynum, maybe I will submit it for the record and you 
can answer it for the record in a longer form, but in the world 
of financing and capital, if you could highlight one strategy 
or one effort that Congress could undertake that could actually 
pass, what would it be?
    And if you want to answer that, you can, but you can add 
more in a written statement, if you would like.
    Mr. Bynum. I would focus on--again, I appreciate the focus 
on strategies that work. And I think, while the Community 
Development Financial Institution Fund in the Department of the 
Treasury is relatively small, the results have been staggering.
    It has been able to leverage capital from private investors 
into low-income distressed communities as these banks are 
leaving, and the results are targeted investments in 
communities that we all need, but low-income communities lack.
    So I would say increasing investments in the CDFI Fund, and 
focusing those efforts and those resources in a more targeted 
way on persistently impoverished and underserved communities.
    Senator Casey. Thank you, very much. Thank you, Madam 
Chair.
    Vice Chair Klobuchar. Thank you very much. Representative 
Paulsen.
    Representative Paulsen. Thank you, very much.
    First of all, I have to say it is a real pleasure to see 
Dr. Moskowitz here. You and I have not had a chance to interact 
since you and I were both in the Aspen Institute's first Rodel 
Fellowship Program.
    I will start out by saying I think you are truly a hero to 
thousands of New Yorkers of modest means who have been able to 
see their children get a better education. And as a mathematics 
major myself, it is fun to see Nigel here talk about his 
enthusiasm for math down the road.
    Let me follow up on what was mentioned earlier, because I 
also agree with the comments you made in your testimony about 
having engines of opportunity, incubators of opportunity, and 
not having poverty traps. That is the foundation of building 
success and skills in the future workforce that we will need to 
fill.
    You talked a little bit about school design, interaction 
with parents, and teachers, and principals. Would you say that 
having equipped students with not only the skills they need but 
the confidence, the hope, and their treatment as adults 
motivates them to personally invest in themselves, and then 
hold themselves responsible to succeed?
    Dr. Moskowitz. Yes. Confidence, you know, breeds--
confidence generated by mastery, and that is a really important 
point, because I sometimes think schools pursue self esteem 
that is not connected to mastery. But in schools where mastery 
is driving the confidence, our kids just know how to tackle 
difficult problems.
    It is really interesting. On the Math Olympiad, the kids 
really have to think. It's a problem, and when they are 
practicing for that, you know, it can go on an hour or two. And 
they're little. And so they have to be able to puzzle through 
it. They cannot solve the answer in 30 seconds.
    Similarly, the chess games. The kids get two hours on the 
clock. So those games last four hours when they are competing. 
And they have to think for four hours. It's very funny. They 
are starving when they're done. They are very hungry. And we've 
learned the hard way that our snacks are insufficient for that 
amount of thinking.
    But I think we are a little bit afraid to challenge kids 
and allow them to struggle intellectually, and we have to get 
over that. We have to allow them to struggle, and also allow 
them to experience, frankly, the pleasure of struggling 
intellectually, overcoming that, and succeeding.
    Representative Paulsen. Unfortunately, I won't have a 
chance to ask everyone on the panel a question, but, Dr. 
Mathur, you mentioned earlier in your testimony that segregated 
areas in cities have lower economic opportunity and school 
choice equalling less positive results.
    You spoke a little bit about the EITC and welfare reform. 
Now recently there was a little bit of attention in the news, 
because the House Budget Committee Chairman, Paul Ryan, put 
forth this discussion draft on a proposal suggesting the 
consolidation of different anti-poverty programs, I think 11 
different anti-poverty programs, into one Opportunity Grant. So 
then states could participate and I guess incorporate work 
incentives into that safety net and reallocate welfare dollars 
where they are needed most.
    Would you agree that program consolidation would help 
impoverished families get those specific needs met from one 
overall provider? And if you are familiar with the draft, maybe 
you can offer some insight.
    I know this has just started that conversation.
    Dr. Mathur. Right. I think in our own research we do 
suggest that. So we know we are spending about $800 billion on 
anti-poverty programs that we have, these whole slew of 
programs that the problem is that people don't know about the 
eligibility for different programs. Their takeup rates are low 
because they just don't know if they will be eligible for 
multiple programs at the same time.
    So there is a lot we can do to improve transparency. And I 
think the first step towards that is consolidating programs 
into a few programs that people can understand, that they know 
they are eligible for, and which would improve takeup rates, 
and particularly target low-income people.
    So I think I agree with those proposals. I think there are 
a lot of programs that we could combine and make more 
effective, given that we have so many that exist today.
    The other issue with these programs is also the phase-in 
rates, the phase-out rates, the fact that people are going off 
the program, you know, low=income people are going off the 
programs and facing really high marginal tax rates which 
affects their incentive to participate in the labor force.
    So again, having transparency, reducing the number of 
programs into a few programs, and understanding what the tax 
rates are actually faced by these low-income people would 
really help.
    Representative Paulsen. Thank you, Madam Vice Chair. I 
yield back.
    Vice Chair Klobuchar. You have a minute left, or 20 
seconds. I notice that Ms. Glover Blackwell wanted to answer, 
raised your hand up there. We'll give her a little time.
    Ms. Glover Blackwell. Thank you. Thank you for the 20 
seconds. I did want to say that I worry a lot about the 
consolidation of all those programs and pushing them to the 
states to make decisions.
    Very important. We saw when we had the recent Great 
Recession that it is so important for the Federal Government to 
be able to increase food stamps and make sure that we are not 
hungry. We do not want to just leave that to the states. We 
have to have a floor below which we do not let people fall.
    I don't think that we yet have gotten to the place as a 
Nation where we can abandon the federal responsibility to make 
sure that we always maintain a floor. I think that there is 
room for innovation and states should be encouraged to do that, 
but we cannot abandon the floor. That is a national 
responsibility.
    Thank you.
    Vice Chair Klobuchar. Senator Murphy, welcome.
    Senator Murphy. Thank you, very much, Madam Chair. Thank 
you for all of you being here. I am sorry that I came a little 
late but I got the chance to read a lot of your testimony.
    I wanted to maybe talk about two very diverse subjects, one 
that I will direct at you, Mr. Bynum, and am happy to have 
other people weigh in on this.
    Last week, Bank of America announced that they were closing 
two branches in the north end of Hartford, which is the 
predominantly African American section of the city, leaving 
only one bank in the entire north end of the city. There are a 
lot of other ATMs, but there would only effectively be one, 
maybe, depending on your definition of the neighborhood, two 
retail banking locations.
    And the excuse was that there wasn't enough traffic, and 
that people could just access banking online. The reality is 
that online connectivity in that neighborhood is pretty 
miserable as well, and there are plenty of alternatives to 
traditional banking--check cashing locations at the top of the 
list.
    So I am hopeful that I am going to be able to prevail upon 
Bank of America to reconsider closing at least one of those two 
locations. But let me ask you about that question about how you 
convince banks to be located in economically distressed 
neighborhoods--which, you know, in my state often tend to be 
neighborhoods in which you do have a high concentration of 
African Americans living.
    We have a real problem in Connecticut of people without 
banks. You know, there are thousands of people in New Haven and 
Hartford who have absolutely no bank that is attached to them 
and their money, and thus they spend lots and lots of 
additional dollars in alternatives to those banks.
    It is not hard to understand when you walk around a 
neighborhood and cannot find a bank. So how do we convince 
banks to look on this question differently?
    Mr. Bynum. I hope you are successful in convincing Bank of 
America to revisit that, because I think that we have seen many 
banks focus too much on profit maximization in the short term, 
rather than looking at the needs of the communities where they 
do extract tremendous profits.
    The banks have had the most profitable year in history, 
$154 billion in profits last year, which is a dramatic 
turnaround from where they were in 2008 or 2009.
    There is a gentleman that was at the University of Michigan 
who wrote a book, ``The Fortune At The Bottom of The Pyramid.'' 
He I think made a very compelling case that the people in low-
income communities need the same things that everyone else 
needs. And there are large numbers of people in these markets. 
And if banks took the time to, and focused on serving them as 
opposed to moving to more affluent communities which we have 
seen in record numbers, I think they would find that there are 
ways to prudently structure financing, or as I mentioned in my 
testimony, 86 percent of our mortgages were to first-time home 
buyers. At a time when banks are focusing on refinancing, and 
very few new mortgage originations to first-time home buyers, 
but our losses have been at less than half a percent.
    And so we know that with the proper structuring, with 
proper counseling, things that they make available to more 
affluent customers, people can succeed.
    We also know that when there is a bank in a community, 
access to business financing is more likely to occur. The same 
thing with, as banks leave, you have a proliferation of payday 
lenders in those communities.
    There is a significant tie-in with the education 
conversation that is going on, because communities cannot 
generate the revenue to support schools if they do not have 
business, if the economies are not vibrant. And the economies 
cannot be vibrant without strong financial institutions.
    The same thing. Kids don't live in schools, they live in 
families. They need households and communities. There are data 
that show that when kids move into a home, not only do they do 
better in school, but they have better recreation outcomes. 
Families report that they feel they are in safer neighborhoods 
and it stabilizes those communities. Increased tax revenue. 
Increased revenue to support schools and other investments to 
strengthen these communities.
    So there is a strong economic case to make, but I think 
public policy has to hold banks accountable to staying in these 
communities and reinvesting in them.
    Senator Murphy. Doctor--I'm not over my time, right?
    Vice Chair Klobuchar. No.
    Senator Murphy. Dr. Moskowitz, I assume that a lot of the 
conversation here has been centered around education, which is 
of course the key to unlock the prospect of economic 
opportunity for people throughout the country, African 
Americans of course included, but there's a barrier that 
happens in our schools for many African American children, and 
in particular African American boys. And that is, the school 
discipline process.
    Many African American boys have their education 
interrupted, and often ceased, because of an unjustifiably 
disparate way in which we treat African Americans, particularly 
African American boys, when they get in trouble in schools. And 
we all know about the school-to-prison pipeline by which kids 
get suspended, and then expelled, and then are in the juvenile 
justice system.
    That is the quickest way to keep yourself on the outside of 
the economy is to get yourself locked up. And the reality is 
that one of the reasons that you have a disparity in the number 
of African Americans versus the number of Caucasians in jail as 
adults is because you have a disparity starting in the schools 
as to how African Americans are treated when they just goof 
off. And 95 percent of school discipline is for nonviolent 
offenses, for kids that are just late for class, or who are 
just being rude to a teacher, and then ultimately they end up 
getting pushed out.
    So what do you recommend that we do about this continuing 
lingering difference between the way in which African 
Americans, and Latinos, but it's really a problem more 
specifically to how African Americans are treated with respect 
to school discipline, so that that doesn't become an increased 
burden that hamstrings individuals and families as they try to 
progress through the educational system into economic 
prosperity.
    Dr. Moskowitz. Well often when there is disorder in 
schools, children bear the brunt of the consequences. And it is 
usually the adults who are not running the lunchroom properly, 
or not setting the expectations and teaching kids, you know, 
what the expectations are.
    You know, we at Success Academies are somewhat old-
fashioned in that regard. We think we need to teach kids to say 
``please'' and ``thank you,'' and we need to make sure that 
there is real civility and respect. And that is something we 
don't expect children to come in automatically with, and 
particularly when you have a bunch of five-year-olds together 
it can get chaotic and you have to teach children how to 
interact in the school environment.
    I liken it, you know, you act a certain way in a library. 
You don't act the same way when you're at the stadium. And that 
has to be taught. But unfortunately, in many of our schools 
adults are not taking responsibility for the behaviors that 
they are seeing, and they are blaming the children, which is 
really unfair.
    Senator Murphy. I wholeheartedly agree. Do you track school 
discipline by the race of the student? And do you have any 
information about whether that disparity, which does exist writ 
large, exists in the Success Academy Charter Schools?
    Dr. Moskowitz. Well the vast majority of our kids are kids 
of color, and there aren't significant differences between 
Latino and African American rates.
    Senator Murphy. Thank you, Madam Chair.
    Vice Chair Klobuchar. Thank you, very much.
    I now have a few questions. We issued this report, and I 
thank the JEC staff today, ``Economic Opportunity in The 
African American Community,'' and we did a state-by-state 
analysis and looked at it regionally as well.
    I guess I will start with you, Ms. Glover Blackwell. It 
actually shows that the Midwest has the higher poverty--highest 
poverty and unemployment rate for African Americans, as well as 
the lowest median income for African Americans. And so African 
Americans over the age of 25 in the Midwest are less likely to 
have a post-secondary degree.
    Why do you think they are worse than these other regions on 
the economic metrics?
    Ms. Glover Blackwell. The work that has really been looking 
at social mobility in America has pointed out that the Midwest 
and the South really are the areas where we are seeing the 
worst outcomes across the board, particularly for African 
Americans.
    In the Midwest we have a situation in which there was 
extraordinary dependence on manufacturing. And we have seen a 
complete shift from manufacturing to the service and knowledge 
economies, and the Midwest has not been fast in terms of making 
that adjustment.
    So you have an area of the country that has really suffered 
devastation because of a reorganizing of the economy. In 
addition, African Americans suffered historical discrimination, 
and that historical discrimination often had them coming in to 
the workforce and making progress at a later point than others. 
And so when the recession hit, they were hit hardest. They were 
let go. We have not had an educational system that has been 
moving people into the new jobs. And so the combination of a 
bad economy, the impact of historical racism, and the impact of 
an educational system that has not prepared people, has left 
the Midwest hurting, and really hurting in the African American 
community.
    If I could just take a moment to comment on the school 
discipline issue, too, because what we are seeing is that so 
many young Black men are not able to get into work, even when 
it is there, because of a criminal record. And it starts with 
the discipline in the school system.
    California has really taken this up and started a Select 
Committee on Men and Boys of Color, and they have lifted this 
issue of school discipline up. They are tracking by race, what 
is going on, and they have eliminated schools being able to 
suspend children because of ``willful defiance'', which is so 
nebulous: anything can come under it. This is forcing people in 
the schools to pay more attention. It starts there. It ends up 
with unemployment.
    And I think the Midwest is suffering more from all of these 
things.
    Vice Chair Klobuchar. Yes. Because what is interesting, and 
you and I talked about our situation in Minnesota where we have 
a gap with people of color, yet we have the lowest unemployment 
rate in the Twin Cities in the country. And I think part of 
this is that the manufacturing that we have now requires 
different manufacturing skills than the manufacturing you're 
talking about that was traditionally in the Midwest. And that 
we similarly have not adjusted in our schools and through the 
way we approach workforce training to the new reality.
    And we have, you know, two-thirds now of our manufacturers 
in our state who still have openings for people. And they are 
not all in the Twin Cities, so there are some mobility issues. 
But I think part of it is the workforce training issue.
    And if you could comment on that, and also what we could be 
doing more. I know Secretary Duncan came out to Minnesota and 
some of our areas are doing some innovative things with 
businesses, and so the kids are actually getting degrees in 
high school while they are in high school that will be a one-
year degree, a two-year degree, and they can then go on from 
there, or they can work for awhile with those degrees.
    Do you want to talk about that?
    Ms. Glover Blackwell. Thank you. The truth of the matter is 
that now the skills and education required to get the middle-
skills jobs, the advanced manufacturing jobs, are the same kind 
of skills one needs to go on to college.
    And so schools that are not preparing young people for a 
college education are also not preparing them for the 
manufacturing jobs that are coming online.
    We also know that the job training programs too often are 
separated from where the jobs are.
    Vice Chair Klobuchar. Um-hmm.
    Ms. Glover Blackwell. The best job training programs are 
programs that are developed with employers, with the employers 
helping to design the curriculum and making arrangements for 
young people who come through the programs to be fully trained 
to be able to take those jobs.
    California is actually taking advantage of the Workforce 
Innovation Act to be able to align its training programs with 
jobs, so that they are targeting the areas that are most 
vulnerable. They are targeting the areas that need work most. 
And they are making sure that the employers are working 
directly with the training programs so that we are targeting 
the jobs, and we are targeting the people, and we can make the 
connection.
    For all of the things we are talking about, the good news 
is: You show me a problem, and I can show you a place in the 
United States where communities together are solving the 
problems. What we have not done is figure out how to tease out 
the policy implications and take all this innovation and good 
work to scale.
    Vice Chair Klobuchar. Okay. Dr. Mathur, I know you agree on 
some of this workforce training. Do you want to comment on that 
and how you believe we could take it to scale?
    Dr. Mathur. Right. Absolutely. As I mentioned in my 
testimony, I think the programs that are going to work right 
now are where employers are taking on prospective--and this is 
a solution I discussed earlier when we were talking about the 
issue of long-term unemployed. In order to get those people 
back into the labor market, we need customized job training 
programs where the employers have an incentive to train the 
people so that they are ready to take on the jobs that are 
offered to them.
    And in Wisconsin I think they are trying exactly that kind 
of initiative where the employers are getting state grants to 
train, out of the pool of unemployed, train people to fit the 
jobs that the employer eventually offers to them. So I agree 
completely with having more training programs that are 
customized to get people on the job and back into the labor 
market.
    Vice Chair Klobuchar. And, Dr. Moskowitz, I know you 
commented about your students getting--being able to be trained 
in computer programming, which you said can pay like $90,000 a 
year. So was part of the thought there that, one, you want them 
to go to college, obviously, but they also have this skill they 
could use immediately if they wanted to?
    Dr. Moskowitz. Yes. We are just practical people and we 
want to make sure that they can economically navigate the 
twists and turns of life and having that practical skill, as 
well as it being intellectually challenging and interesting we 
thought would put them in good stead.
    Vice Chair Klobuchar. Yes. And I think it is that kind of 
thinking, this idea that we work more with where the jobs are, 
and I've seen it work so well in places like Rochester, 
Minnesota, because the Mayo Clinic is there, and IBM has a 
major presence, and it is easier for the community colleges, 
and the high schools, to see exactly where there might be some 
immediate jobs, and then what those longer jobs are that 
require more advanced degrees so they can plan.
    It is sometimes harder to do with the inner city because 
you do not have the employers right there, and you somehow have 
to match the way the education system is working with those 
employers. And I think to do it more broadly you have to look 
at what those job classes are that are looking for those 
immediate jobs that also pay well.
    Dr. Moskowitz. And it is just challenging as the economy is 
changing so fast, and schools tend to be sort of ossified that 
it is hard for them to be agile and respond to the economic 
changes.
    Vice Chair Klobuchar. And I think that is why in places 
like that Rochester, or in Thief River Falls, Minnesota, where 
we now have 200 job openings at one employer, they are able. 
They can go right to the school district, and right to the 
community college and say we're going to have 50 openings in 
this area. This is how much it is going to pay. The parents 
know how much it is going to pay. And it is just easier to get 
the kids and the parents on board, I think, as part of this.
    Because people understandably after what Ms. Glover 
Blackwell was pointing out, you know, after jobs have gone away 
and vanished that people thought they had, people get very 
cynical, especially in the manufacturing area, that that is 
going to be a job for their child. Yet there are openings, and 
there are some well-paying openings.
    Mr. Bynum, I will just finish up with you. You have got 
clearly something good going, and how do you think people in 
other parts of the country can replicate the success you have 
had in the lower Mississippi Delta?
    Mr. Bynum. I think that it is great that we have been able 
to help some people in the Delta, but we have clearly not 
helped as many as needs exist.
    Since the Recession, we have seen, as these banks have 
closed and payday lenders have expanded, there is a need for 
accountability to require banks to reinvest in these 
communities. But when they don't, Community Development 
Financial Institutions have demonstrated that we know how to 
deploy capital into these areas.
    We have taken a relatively small amount of funding from 
Treasury. We slowly gained access to other federal programs. 
The SBA and USDA have tools that are very important in I think 
prioritizing access to those tools by CDFIs is critically 
important.
    The CDFI industry has grown over the country. There are 
some in most Congressional Districts. We are not nearly at a 
scale we need relative to the problem, and so I think investing 
significantly more in long-term capital to support the 
expansion. And as Angela said, there are models that work. They 
need to be taken to scale.
    There also needs to be a continued focus on protections so 
that payday lenders do not have a free rein to extract capital 
from communities that can least afford it.
    Vice Chair Klobuchar. Okay. Very good.
    Do any of my colleagues have any additional questions?
    Representative Hanna. Madam Chair?
    Vice Chair Klobuchar. Okay.
    Representative Hanna. There is a--Secretary Duncan has a, 
it's not universal, people, children 200 percent below the 
poverty line who are pre-K. And you spoke, Dr. Mathur, about 
the connection between being born in poverty.
    And, Dr. Moskowitz, can you give me a quick notion of how 
important it is towards breaking that intergenerational poverty 
that pre-K is? In other words, going to school with that extra 
headstart? Just take a minute.
    Dr. Moskowitz. It makes the education much easier if you 
have that early childhood foundation. I mean, it obviously can 
be done when you get the kids in kindergarten. We are doing it 
at Success Academies. But it is absolutely essential for 
worldclass schooling to be educating 3- and 4-year-olds. We 
just have to be careful that it is done well. Because if it is 
warehousing of children, that is not worldclass education. But 
what you can do is you can really do all the pre-reading work 
that needs to be done in terms of comprehension.
    It will be much easier to teach a child to read if they 
have heard the same stories over and over again and can act 
them out. You can do that in pre-K. Kindergarten is actually 
quite academic these days, and we have to kind of rush kids 
into reading.
    And so if you could do all that work, not to mention the 
social and emotional skills that kids need, you could do so 
much more in early childhood education if you could have the 
pre-K.
    Representative Hanna. So the children who are not read to 
at home, who do not have access to books, whose parents are not 
engaged with them academically, pre-K can help equalize that 
opportunity of going to kindergarten?
    Dr. Moskowitz. Yes. But I would also say it can support 
parents in reading to their children. And don't forget that 
that's what great schooling does: it inspires parents to be 
engaged in the academic development of their children.
    And it is when the children are young that parents are 
inclined to. Everyone has a mama bear or a papa bear instinct; 
it's just that people aren't quite sure what exactly to do. And 
pre-K can be that community center where you involve parents 
from when their children are very, very young. And that 
investment in parents will carry you over the long haul.
    So I think pre-K is seen as just about the kids. It is also 
about the adults and getting everyone inspired to be committed 
to their children's education over the long haul.
    Representative Hanna. Thank you, very much.
    Thank you for indulging me.
    Vice Chair Klobuchar. That's okay. Anyone else have any 
questions?
    (No response.)
    Vice Chair Klobuchar. All right. Well I want to thank our 
witnesses today. These are great initiatives going on across 
the country. I think we all know there's a lot of work to be 
done, and we look forward to hearing from you again and working 
with you in the future.
    The record will remain open for five days for any Member 
who wishes to put in some comments or additional questions. You 
can wait for those, our witnesses.
    The hearing is adjourned. And thank you for our three 
students in the front row, and my interns that I think are in 
the back row, for all listening and staying awake through the 
entire hearing. Thank you, very much. The hearing is adjourned.
    (Whereupon, at 4:00 p.m., Tuesday, July 29, 2014, the 
hearing in the above-entitled matter was adjourned.)
                       SUBMISSIONS FOR THE RECORD

  Prepared Statement of Hon. Richard L. Hanna on Behalf of Hon. Kevin 
               Brady, Chairman, Joint Economic Committee
    Vice Chair Klobuchar, Members, and distinguished witnesses:
    Let me begin by noting that, through the title of this hearing, 
Vice Chair Klobuchar and her Democratic colleagues acknowledge that 
Washington does not have a one-size-fits-all solution to every problem 
that Americans face.
    Yesterday marked the 100th anniversary of the beginning of World 
War I when Austria-Hungary declared war on Serbia. The Great War 
disrupted the supply of immigrant labor to American industries. In what 
became known as the Great Migration, hundreds of thousands of African 
Americans moved north to fill these jobs. There, African Americans 
enjoyed a level of economic freedom and prosperity that they had not 
previously known.
    Also, July 2nd marked the 50th anniversary of the passage of the 
Civil Rights Act of 1964, which outlawed discrimination in public 
accommodations and employment based on race, color, religion, sex, or 
national origin. Through this Act, both Democrats and Republicans 
sought to close the opportunity gap, generated by racial prejudice and 
segregation, and provide African Americans with an equal opportunity to 
pursue the American Dream.
    Over the last half-century, there has been substantial progress in 
narrowing the opportunity gap for African Americans. Fifty years ago, 
less than 25 percent of African American adults had a high school 
diploma; today, more than 85 percent do. And there has been a five-fold 
increase in the percent of college graduates. Inflation-adjusted median 
family income of African Americans has nearly doubled. The percent of 
African Americans living in poverty has fallen by more than a third, 
and the percent of children living in poverty has fallen by nearly 
half.
    Nevertheless, the opportunity gap for African Americans has not 
been completely closed. Much of what remains of the opportunity gap is 
caused by the lack of education and job skills needed to prosper in 
today's economy, and the dependency on discordant government programs, 
which penalize personal advancement and work.
    The surest route to prosperity for every American is a good 
education. For poor African American children raised by single mothers 
in rough inner city neighborhoods, a good education, as economist 
Thomas Sowell argues, is their one chance at a better life.
    America has many great public schools with excellent teachers that 
provide students with an outstanding education. Unfortunately, America 
also has failing public schools with struggling teachers, many of which 
are in inner cities serving poor children.
    Economically prosperous families can avoid sending their children 
to failing public schools by either moving to a different neighborhood 
with good public schools or enrolling their children in private 
schools. Prosperous families have always had school choice.
    Until recently, most poor families in inner cities had no choice--
their children were forced to enroll in the assigned public schools 
even if they failed to provide a good education. Over the last decade, 
however, the public school monopoly for the poor has begun to crack.
    Republican governors and legislators working with parents have 
developed new and innovative approaches to provide all parents, 
regardless of their income or wealth, with choice for where their 
children are educated. The choice movement has taken a number of 
different forms----charter schools, vouchers to attend private schools, 
and privately funded scholarships to attend private schools.
    One of our witnesses today is Dr. Eva Moskowitz, the founder and 
Chief Executive Officer of Success Academy, a charter school system in 
my own state of New York. She has overseen an expansion from one school 
in Harlem in 2006 to 22 schools serving 6,800 children. Her students, 
who are largely from poor minority families, score in the top 1 percent 
in math and the top 7 percent in English Language Arts in state 
testing.
    Americans are a generous people, willing to help the poor through 
government-funded welfare programs and private charities. But Americans 
are also a practical people. We want our safety net to be a 
trampoline--helping able-bodied, working-age Americans to move from 
poverty into the middle class. We don't want our safety net to be fly 
paper--trapping the poor in a multigenerational cycle of dependency.
    Another witness, Dr. Aparna Mathur, has identified what local 
initiatives in social welfare programs can actually lift women, 
especially African Americans, out of poverty, and making economic 
growth even more inclusive for the poor. She has argued for 
streamlining existing programs in order to improve transparency about 
the implicit tax penalties associated with each program. Dr. Mathur 
will offer Members important lessons on how to restructure our existing 
anti-poverty programs--improving the lives of current beneficiaries, 
while providing a better value for taxpayers.
    With that I look forward to hearing the testimony of today's 
witnesses.

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