We've been in our new offices on the 3rd floor at the CityWalk @Akard development in Downtown Dallas since mid-January. If you are interested in more details about the project, use the search tool on this page and you can read previous posts about the building and its development.
Now that we're in the building with the 140 or so tenants who live in it, the experience has turned out to be better and more encouraging than I had imagined. It is the sort of place that forces one into reflection, almost on a constant basis.
Developing quality, affordable, supportive housing for the poorest people in Dallas is anything but easy. CityWalk required (to be more accurate, still requires) every ounce of creative energy all of us can drudge up. Whether you consider cost, funding for cost, design, marketing, politics, public-private realities, or lease-up challenges abound! One thing is for sure: almost nothing about the project has been routine, boring or expected!
Given the basic nature of the development deal, it might seem easy to overlook or to look past all of the human implications of the development. But, it's not.
The people who live here and who want to live here provide a constant stream of human stories--stories that move, shape, inspire and just "break you down."
One of our residents is a screen writer. He's shared his concept papers for two different shows, one about being homeless, another about a local high school football team torn apart by the involvement of some of the players in serious criminal activity. Brilliant guy. . .who has been homeless.
Another plays the saxophone like crazy! Carries it with him lots of the time, and stopped by my office last week to play for me, but I was out of the office and missed him.
Last week we hosted an orientation session for potential new members for our Board of Directors. Seven of those who attended were residents of the building. One young man asked us, "You mean that this meeting with us is to see if we want to be on your Board of Directors?"
When I confirmed that we were doing just that, he seemed taken back, like he couldn't imagine our wanting low-income folks on our leadership board. He was energized by the idea and said he wanted to pursue the process.
Another woman told us that she had always wanted to do something like this, but added, "It's taken me all this time to just get to here. I grew up in Oak Cliff, was abused by my parents, abandoned, half-starved to death, all on my own." Tears flowed as her voice broke. I assured her that she was exactly the sort of person we needed on our board to inform our work at every turn.
Others of the tenants told us they had no idea that CDM did all the things that we do.
"My, my, the hand of the Lord is all over this place," one older woman almost shouted to me after the meeting broke up.
Then, there are the children, about 40 of them in the building. They bring laughter, smiles, energy and joy to the 15-story, vertical community/neighborhood!
As I toured the building with an interested supporter last week, I was overwhelmed by all of the good that is going on. For all of the difficulty and challenge, for all of the headaches, the deal was more than worth it!
The following report appeared last Friday, August 27, 2010 in StreetInsder.com, a stock market information and news website.
I thought you'd find the story interesting.
Sleep Experts, Central Dallas Ministries Share Gift of Sleep with Those in Need
August 27, 2010 1:05 PM EDT
Dallas-Fort Worth mattress retailer Sleep Experts continues to share the gift of sleep with North Texas families in need with a donation of more than 50 mattress sets to Central Dallas Ministries, a faith-based organization focused on fighting poverty.
Dallas, TX (PRWEB) August 27, 2010 -- Local mattress retailer Sleep Experts continues to share the gift of sleep with North Texas families in need with a donation of more than 50 mattress sets to Central Dallas Ministries, a faith-based organization focused on fighting poverty.
Among the Central Dallas Ministries programs that will benefit from this donation are Transition Resource Action Center (TRAC), a program aiming to improve the self-sufficiency of youth aging out of foster care; CityWalk@Akard, a model of affordable permanent housing which recently opened in a 15-story office tower in downtown Dallas; and Destination Home, a program providing rental assistance and other support to chronically homeless, disabled individuals transitioning into self sufficiency.
Seems like time to provide a brief update on the development of our new "Opportunity Center" located on a 4-acre tract at the corner of Malcolm X Boulevard and I-30.
The new center will include a new, expanded health clinic; a large wellness center; a versatile commercial production kitchen designed to instruct neighbors in healthy food preparation and training in culinary arts; robust employment training programs delivered in partnership with Workforce Solutions of Greater Dallas; an expanded food distribution center; a retail grocery store; a community garden and other training and life-improvement options.
Our initial partners in the endeavor include the Embrey Family Foundation, whose gift allowed us to assemble the property and PepsiCo whose commitment to improving the lives of urban residents has been extremely motivational for us. Numerous other philanthropists have joined the endeavor to move us to about the halfway mark in our funding efforts, including the Sowell Family Foundation, the Rees-Jones Foundation, the Halbert Family Foundation, Bank of America with others in process. Much more on this in coming days.
Recently, the Metro Dallas HomelessAlliance commissioned a poll of Dallas residents to determine their attitudes and opinions regarding Permanent Supportive Housing (PSH) and its development here in the city. Here's what the pollsters discovered.
Survey results show that there is city-wide support, among Dallas voters, for permanent supportive housing (PSH) projects in their neighborhood. After hearing messages supporting and opposing PSH, 55% of respondents said they would support a PSH project in their neighborhood, while 38% said they would not be supportive.
The following five statements are the top reasons why Dallas voters would support putting a PSH project in their neighborhood:
1. The organizations placing homeless individuals in permanent supportive housing projects will make sure the residents have demonstrated the ability to live on their own successfully.
73% of respondents were supportive of PSH after hearing this message
2. Permanent supportive housing will help some of Dallas’ homeless population get back on the right track by providing services like counseling and health services.
73% of respondents were supportive of PSH after hearing this message
3. Residents of permanent supportive housing projects must abide by lease agreements that prohibit them from any illegal activities and have consequences for anyone who breaks the lease terms.
71% of respondents were supportive of PSH after hearing this message
4. Permanent supportive housing provides the necessary social services that these residents need all under one roof so they don't have to go to different locations throughout the City.
70% of respondents were supportive of PSH after hearing this message
5. Permanent supportive housing projects have on-site services to provide the critical services these residents need to be good neighbors and successful members of their community.
69% of respondents were supportive of PSH after hearing this message
MDHA Dallas Poll Methodology
Calls were made over a three night period from August 6-8, 2010, to registered Dallas voters throughout each of the 14 council districts, with 350 completes. The margin of error for this survey is +/- 3%.
Last year I travelled with a group of service providers and political leaders to Los Angeles where we visited and observed several "housing first" programs. We also met with leaders from the LA area who were involved in the growing "PUSH 50" movement. These efforts identify the most costly homeless persons in an area or a city in LA County, and then respond by providing permanent supportive housing that employs the housing first methodology: basically using stable housing, not programs, as the primary intervention in the lives of chronically homeless persons.
The following report substantiates much of what we witnessed.
Dallas can learn from LA's approach.
'Housing first' and helping the homeless
Initial findings on 'housing first' programs, such as Project 50 in Los Angeles, show that they may be a solution to chronic homelessness and possibly save taxpayer money.
By Jon Morgenstern
August 15, 2010
In its recent series on a controversial program for the homeless, The Times described a project called Project 50 that seeks to put a roof over the heads of substance abusers without requiring them to undergo substance-abuse treatment, while still offering them as many services as they would use.
The new approach, known as "housing first," has been heralded in communities across the nation as a promising solution to end homelessness and save taxpayer money. Skeptics have asserted that the program is both wasteful and immoral because it simply warehouses substance abusers, enabling them to continue their self-destructive lifestyles with the support of taxpayer dollars.
The best answers to this debate will come through careful research. My colleagues and I are evaluating a similar program in New York City, which three years ago began the effort to house 500 chronically homeless individuals with alcohol and drug-abuse problems. While the results of this study are forthcoming, our initial findings on this and similar programs can help inform the current debate.
As with any social program, questions about the success of housing first depend on the expectations. Here are three useful measurements: Does it reduce homelessness, save taxpayer dollars and help rehabilitate individuals compared with other programs?
My friend, Dr. John Siburt, serves the Richardson East Church of Christ as its Senior Minister. John is an extremely bright, creative leader. He's a person to watch as an important emerging leader for our entire community.
On Sunday, August 15, John delivered a message entitled "Asking the Right Question." To listen to his sermon click here. It's worth your time.
Judy Pasternak, a writer/reporter, published an insightful article with aolnews.com on the benefits and challenges of the Summer Lunch Program in the U. S.
It is definitely worth a read. Central Dallas Ministries' involvement with the lunch program over the past several years has placed us up close to the lives and struggles of very low-income children and families.
This summer, our Food on the Move initiative that teamed up with PepsiCo's Food for Good effort, CDM AmeriCorps and the Texas Department of Agriculture to feed over 16,000 children more than 500,000 meals at 209 locations in Dallas County--more than twice as many as last year. PepsiCo's mobile capacity allowed us to extend into areas where children live without the benefit of organized summer programs. Clearly, we were reaching some of the most hungry children in our community.
Pasternak's report is revealing.
Record Number of US Kids Facing Summer of Hunger
AOL News WASHINGTON (June 16) -- With the school year ending in communities across America, more than 16 million children face a summer of hunger.
While classes were in session, they relied on free or discount cafeteria meals subsidized by the U.S. Department of Agriculture. But they will not be reached by the patchwork summer food programs financed by the USDA, which feed fewer than one in five of the total number of kids poor enough to qualify.
The children caught in the gap will likely spend the next few months cadging leftovers from neighbors, chowing down on cheap junk, lining up with their families at food banks that are already overmatched or simply learning to live with a constant headache, growling stomach and chronic fatigue. When school rolls around again in the fall, they will be less healthy and less ready to learn than their peers.
What made America? What makes us? These two questions are at the heart of the new PBS series Faces of America with Henry Louis Gates, Jr. The Harvard scholar turns to the latest tools of genealogy and genetics to explore the family histories of 12 renowned Americans — professor and poet Elizabeth Alexander, chef Mario Batali, comedian Stephen Colbert, novelist Louise Erdrich, journalist Malcolm Gladwell, actress Eva Longoria, musician Yo-Yo Ma, director Mike Nichols, Her Majesty Queen Noor, television host/heart surgeon Dr. Mehmet Oz, actress Meryl Streep, and figure skater Kristi Yamaguchi.
The program provides amazing insight into the history of our nation of immigrants. It also makes clear just how connected we are to one another now and across the generations.
Our friends over at Voice of Hope in West Dallas published the following essay byMark Shriver, "Our Future Dims as Childhood Poverty Jumps."The message is beyond disturbing to say the least.
I applaud the fine work being done by our partners at Voice of Hope.
We're all in this fight together.
USA Today reported this week that the national poverty crisis now affects 1 out of 5 children in the United States, up from 1 out of 6 just four years ago. This astonishing figure is a sober reminder that the recession isn't just stretching our safety net, but it's also threatening the success of the next generation of Americans.
Indeed, childhood poverty in the United States ignites a devastating chain of consequences that leads to equally devastating places:
• Four-year-old kids living in poverty are 18 months behind their peers. These gaps in early childhood persist throughout a child's youth, with clear and established links to the high school dropout rate, teenage pregnancy and unemployment.
• Only a little over 15 percent of fourth graders from poor homes are reading at levels considered proficient by the U.S. Department of Education. According to a recent study from the Casey Foundation, the clearest sign a child will drop out of high school is subpar reading scores in elementary school. Almost half of all high school dropouts are on government assistance and a high school dropout is eight times more likely to be incarcerated.
• Half of kids living in rural areas -- where poverty is at extraordinary levels -- are obese or overweight, compared to one third nationally. The obesity crisis puts kids at risk for "adult" diseases like type 2 diabetes and heart disease, stunting their productivity and straining an already exhausted health care system.
We can have a debate about the best and most effective ways of eliminating poverty but there's no better place to start than the by protecting the next generation. Doing so means reversing the effects of poverty through smart interventions and innovative programs.
There are many highly effective steps we can take to blunt poverty's permanent effects on young kids. Here are three:
• Invest in public-private partnerships that are proven to make a real difference in a toddler's development. The Early Learning Challenge Fund would provide billions of dollars in grants to innovative early education programs and save billions over the long term through a better educated and more productive America.
• After-school programs can give kids reading below grade level the extra boost they need to catch up with their peers. There are three bills in Congress that would increase after-school programs for kids struggling to read. These programs work--Save the Children's after-school program almost doubled the number of kids reading at grade level at some schools in the most remote, low-income parts of the nation
• We can combat the twin childhood hunger and obesity crises by increasing access to healthier school lunches. The Healthy, Hunger-Free Kids Act of 2010 would provide healthier meals to hundreds of thousands more kids than the current school lunch program does.
In the midst of this economic downturn, we may not be able to end poverty for all kids. Still, that's no reason why businesses, families, non-profits, and, yes, government can't work together so that kids being raised by struggling parents get a fair chance in life.
Why would we deny productive students a place in our national community?
Why would we squander such resources?
Why would we abandon someone in whom we all have invested so much?
Consider this story. . .
IN MANY WAYS, Eric Balderas's story is the typical American dream. He came to the United States with his parents at age 4. He was the valedictorian of Highlands High School in San Antonio and was admitted to Harvard's class of 2013. There, he studies molecular and cellular biology and is about to begin his sophomore year. He dreams of helping to find a cure for cancer.
To read the rest of Eric Baldera's story click here.
I received links and referrals to the Op-Ed essay by G. Jeffrey MacDonald, "Congregations Gone Wild," that appeared in The New York Times recently. It is compelling stuff and I have pasted it below.
The pressure for congregations to grow numerically results in some fairly amazing and disappointing realities. When church-goers are seen as consumers, everything changes, and I would say for the worse.
Churches that decide to go a different way, to take a more difficult pathway leading into the brokenness and pain of the world may not grow numerically, but they can play a significant role in growing their communities and in the people who wrestle with life who live in them.
And, over the long haul, a congregation determined to engage the world transparently, boldly, faithfully and radically may find itself growing in more sustainable ways than those groups that settle for fluff and the slick marketing of so-called "mission."
What do you think?
Congregations Gone Wild
By G. JEFFREY MacDONALD
August 7, 2010
THE American clergy is suffering from burnout, several new studies show. And part of the problem, as researchers have observed, is that pastors work too much. Many of them need vacations, it’s true. But there’s a more fundamental problem that no amount of rest and relaxation can help solve: congregational pressure to forsake one’s highest calling.
The pastoral vocation is to help people grow spiritually, resist their lowest impulses and adopt higher, more compassionate ways. But churchgoers increasingly want pastors to soothe and entertain them. It’s apparent in the theater-style seating and giant projection screens in churches and in mission trips that involve more sightseeing than listening to the local people.
As a result, pastors are constantly forced to choose, as they work through congregants’ daily wish lists in their e-mail and voice mail, between paths of personal integrity and those that portend greater job security. As religion becomes a consumer experience, the clergy become more unhappy and unhealthy.
The trend toward consumer-driven religion has been gaining momentum for half a century. Consider that in 1955 only 15 percent of Americans said they no longer adhered to the faith of their childhood, according to a Gallup poll. By 2008, 44 percent had switched their religious affiliation at least once, or dropped it altogether, the Pew Forum on Religion & Public Life found. Americans now sample, dabble and move on when a religious leader fails to satisfy for any reason.
In this transformation, clergy have seen their job descriptions rewritten. They’re no longer expected to offer moral counsel in pastoral care sessions or to deliver sermons that make the comfortable uneasy. Church leaders who continue such ministerial traditions pay dearly. A few years ago, thousands of parishioners quit Woodland Hills Church in St. Paul, Minn., and Community Church of Joy in Glendale, Ariz., when their respective preachers refused to bless the congregations’ preferred political agendas and consumerist lifestyles.
I have faced similar pressures myself. In the early 2000s, the advisory committee of my small congregation in Massachusetts told me to keep my sermons to 10 minutes, tell funny stories and leave people feeling great about themselves. The unspoken message in such instructions is clear: give us the comforting, amusing fare we want or we’ll get our spiritual leadership from someone else.
Congregations that make such demands seem not to realize that most clergy don’t sign up to be soothsayers or entertainers. Pastors believe they’re called to shape lives for the better, and that involves helping people learn to do what’s right in life, even when what’s right is also difficult. When they’re being true to their calling, pastors urge Christians to do the hard work of reconciliation with one another before receiving communion. They lead people to share in the suffering of others, including people they would rather ignore, by experiencing tough circumstances — say, in a shelter, a prison or a nursing home — and seeking relief together with those in need. At their courageous best, clergy lead where people aren’t asking to go, because that’s how the range of issues that concern them expands, and how a holy community gets formed.
Ministry is a profession in which the greatest rewards include meaningfulness and integrity. When those fade under pressure from churchgoers who don’t want to be challenged or edified, pastors become candidates for stress and depression.
Clergy need parishioners who understand that the church exists, as it always has, to save souls by elevating people’s values and desires. They need churchgoers to ask for personal challenges, in areas like daily devotions and outreach ministries.
When such an ethic takes root, as it has in generations past, then pastors will cease to feel like the spiritual equivalents of concierges. They’ll again know joy in ministering among people who share their sense of purpose. They might even be on fire again for their calling, rather than on a path to premature burnout.
Now some members of Congress are suggesting that in order to properly reform and control immigration to the United States we should repeal the 14th Amendment to the Constitution.
Setting aside the facts that such a process could take years and cost millions of dollars, is this really good policy given the history and significance of this amendment to our history and subsequent national life? This amendment has provided an objective, agreed upon standard for citizenship since it was ratified in 1868 in the difficult aftermath of a bloody civil war.
It is hard to imagine just how such a process would work.
I can envision a situation in which immigrants, even those with documentation, bearing children in the U. S. would in essence create an entire new underclass or "other-class." Furthermore, the process would take away much of the strength and promise of immigrant populations for the future growth and stability of the nation.
Repealing the basic standard of citizenship that has served us so well for so long seems a desperate attempt to avoid the heart of the matter when it comes to effective, comprehensive immigration reform.
1. All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.
2. Representatives shall be apportioned among the several States according to their respective numbers, counting the whole number of persons in each State, excluding Indians not taxed. But when the right to vote at any election for the choice of electors for President and Vice-President of the United States, Representatives in Congress, the Executive and Judicial officers of a State, or the members of the Legislature thereof, is denied to any of the male inhabitants of such State, being twenty-one years of age, and citizens of the United States, or in any way abridged, except for participation in rebellion, or other crime, the basis of representation therein shall be reduced in the proportion which the number of such male citizens shall bear to the whole number of male citizens twenty-one years of age in such State.
3. No person shall be a Senator or Representative in Congress, or elector of President and Vice-President, or hold any office, civil or military, under the United States, or under any State, who, having previously taken an oath, as a member of Congress, or as an officer of the United States, or as a member of any State legislature, or as an executive or judicial officer of any State, to support the Constitution of the United States, shall have engaged in insurrection or rebellion against the same, or given aid or comfort to the enemies thereof. But Congress may by a vote of two-thirds of each House, remove such disability.
4. The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned. But neither the United States nor any State shall assume or pay any debt or obligation incurred in aid of insurrection or rebellion against the United States, or any claim for the loss or emancipation of any slave; but all such debts, obligations and claims shall be held illegal and void.
5. The Congress shall have power to enforce, by appropriate legislation, the provisions of this article.
Hear Randall Kennedy of Harvard Law School discuss the 14th Amendment on The Takeway below:
Central Dallas Ministries
511 N. Akard St., Suite 302
Dallas, Texas 75201
Contact: Stacy Olds (214) 823–8710
Central Dallas Ministries’ Thrift Store Gets Artsy
Framed Art Sale Starts Aug. 12
DALLAS – Already low Thrift Store prices on framed prints, oils and other mediums will be slashed another 50% during Central Dallas Ministries Thrift Store’s “Fabulous Framed Art Sale” starting this Thursday, August 12. Art now priced from $10 and up will be sold during this event for 50% of the marked price.
Located at 1213 North Washington at Live Oak in Dallas 75204, the Thrift Store is a few blocks west of Baylor University Medical Center, and minutes from Central Expressway.
The Thrift Store, now celebrating its second anniversary, stocks thousands of items of clothing, furniture, house wares and electronics, plus many vintage items. Many name brands are included, and each item is inspected before going on sale. Open Monday through Friday 9 a.m.-6 p.m. and Saturdays 10 a.m.-3 p.m., the store provides a constantly updated selection of ready-to-use and ready-to-wear bargains.
Proceeds from the Thrift Store help fund Central Dallas Ministries’ programs. Founded in 1988, Central Dallas Ministries is one of the largest, most effective faith-based organizations in North Texas. We operate a network of services and programs focused on fighting poverty through hunger relief, health care, housing and hope. In 2009, we reached more than 43,000 individuals and families.
Take a look at the video below to check in on the beginning demolition in preparation for Central Dallas Ministries' development of a new 50,000 square foot "Opportunity Center" at the corner of I-30 and Malcolm X Boulevard, a major gateway into South Dallas.
Thanks to a partnership anchored by the Embrey Family Foundation and PepsiCo, the new center will include a state-of-the-art health and wellness center; offices for Work Force Solutions of Greater Dallas; a training center for Central Dallas Ministries WorkPaths employment training program; a new, innovative food distribution center; teaching kitchens; new headquarters for our AmeriCorps team; a community garden and a retail grocery store.
The center will open in January 2012.
We're looking for "investment partners" for this work of faith. Interested?
University of Texas President Supports the DREAM Act
Austin, TX -- University of Texas President William Powers is one of the newest university presidents who has made public his support for the DREAM Act. With President Obama's visit to UT, the University Leadership Initiative (ULI) hopes President Obama takes note of how the DREAM Act would help meet our nation's higher education goals.
Under the headline UT Support for the DREAM Act, President Bill Powers reiterates his support for the legislation and those it would benefit. President Powers stated:
"If Texas educates these young people, it should provide them with access to legal employment. At UT, we support the goal of our graduates having the opportunity to put their education to work on behalf of our state and our nation."
According to a recent report from the Migration Policy Institute 258,000 individuals in Texas would benefit from the DREAM Act.
"We thank President Powers for his support of the legislation," said Julieta Garibay, a University of Texas alumnus & ULI Co-founder. "Every year, students who would benefit from the DREAM Act graduate from public universities in our state, including the University of Texas. We hope that our state's senators and congressional delegation are taking note of the overwhelming support."
Jose Torres from the University Leadership Initiative added, "The economic benefits of an increasingly educated labor force to our state will be significant. It's no wonder that this law boasts supports from business groups, institutions of education, conservatives, and liberals."
In 2001, the Texas legislature overwhelmingly approved legislation to allow certain undocumented students who met residency requirements pay in-state tuition rates at public universities. The legislation was signed into law by Governor Rick Perry. The DREAM Act shows bipartisan support in Congress.
You may have seen Peter Schrag's opinion piece in The Dallas Morning News on Sunday, August 1, 2010. You don't have to agree with him on all points to recognize he makes good sense about his main point: the answer for our borders will not be discovered in building a fence. See if you agree.
Why good fences make bad policy
Even before 2007, when the last attempt at comprehensive immigration reform was killed in the Senate, immigration restrictionists made "sealing" the U.S.-Mexican border a precondition for supporting legalization of the more than 11 million illegal immigrants already in the United States. For a lot of Americans, this idea has been orthodoxy ever since.
Now, with immigration reform again on the table, President Barack Obama has duly taken up the call for a stronger border. In his speech on immigration last month, he lamented the "porous" and "broken" state of U.S. borders, and he described controlling them as an "obligation" and a "responsibility," arguing that the nation has "more boots on the ground near the Southwest border than at any time in our history."
More than 670 miles of border fences, walls, bollards and spikes that Congress decreed in 2006 at an estimated cost of $4 billion (plus future maintenance) are almost completed. The Border Patrol, which was increased from 9,000 agents in 2001 to 20,000 in 2009, costs an estimated $4 billion annually.
Throw in the cost of occasional deployments of the National Guard, as Obama has ordered again; the cost of electronic sensors, surveillance aircraft, training of local police; the cost of detaining, incarcerating and deporting illegal immigrants; and the countless other expenses associated with border security, and the bill runs us nearly $10 billion a year.
But will more boots really seal the border? Immigration reform has a long history of unintended consequences: More than two decades of increased enforcement since the passage of the Immigration Reform and Control Act of 1986, or IRCA, has done little to reduce the number of illegal immigrants. In fact, it seems to have increased their numbers. Meanwhile, the question of jobs, which are the true driver of legal and illegal immigration, has been largely neglected.
Princeton University sociologist Douglas Massey pointed out nearly a decade ago that measures to secure the border seemed to produce almost the opposite of what was intended. By making the northward crossing more dangerous and expensive, Massey and co-authors Jorge Durand and Nolan J. Malone wrote in 2002, the border buildup discouraged seasonal laborers from going back to Mexico when they were not working.
With increasing border enforcement, workers who used to shuttle between jobs in California or Texas and home in Zacatecas or Michoacan simply began to stay put and sent for their families, becoming permanent, if sometimes reluctant, residents. According to Massey, post-IRCA border enforcement may have increased the size of the permanent Mexican population in the United States by a factor of nearly four.
More unintended consequences: The anti-immigrant backlash that sparked Arizona's string of anti-illegal-immigration legislation was produced in large part by tighter border controls in Texas and California. That enforcement squeezed the smuggling of immigrants and drugs into Arizona's Sonoran Desert and mountains.
As noted by the nonpartisan Public Policy Institute of California, among many others, the element missing from this picture is that immigration, both legal and illegal, is driven more by the economy than it is restrained by border enforcement.
That's not all that different from the immigration patterns of the past century and a half, when immigration levels were almost invariably trailing indicators of the U.S. economy and its sometimes severe worker shortages. One hundred fifty years ago, after the dislocations and slaughter of the Civil War, some states even sent agents to Europe to recruit workers. When times were good, we beckoned to immigrants; when they were bad, we tried to expel them.
"We wanted workers," says Philip Martin, an immigration economist in California, "but we got people."
Americans have historically been ambivalent about new arrivals. Ever since colonial days, immigration and immigration restriction have been tightly wound around each other like a double helix. In the same polls in which Americans express support for Arizona's immigration legislation, they also say that by paying fines and back taxes (which most already pay) immigrants should have the right to be legalized.
Some places accept, even welcome, illegal immigrants. Some try to expel them. My state of California grants illegal immigrants relatively low in-state college tuition but denies them driver's licenses.
In the past three years, the U.S. population of illegal immigrants has declined, perhaps by as much as 10 percent, from about 12 million to 11 million. Anti-immigration groups such as the Center for Immigration Studies credit tougher border and workplace enforcement for much of that decline. But some, if not most, has almost certainly been driven by the recession, beginning in the construction industry and continuing in many other sectors that employ large numbers of immigrants. During those three years, more immigrants returned to Mexico than came north.
None of this means giving up on border control, especially if it's focused on drugs and other criminal activities. But if the objective is to reduce the attraction of U.S. jobs for undocumented workers – about a third to half of whom, in any case, have overstayed their visas, not crossed the border illegally – it requires different strategies.
Here's a very interesting story from Portland, Oregon where housing and services for the homeless are "indexed" on the basis of need and, I would add, community impact. The story highlights differences in opinion and approach as to how to best address the needs of chronically homeless persons across the nation, as well as in a city like Portland.
Old Town project sorts out who should get 130 apartments
By Peter Korn The Portland Tribune, Aug 5, 2010
Construction has started on the $49 million Resource Access Center, which will provide housing for 130 homeless people and include an overnight shelter and a daytime facility.
Sometime this autumn, the people who work in Portland’s safety-net medical clinics and social service agencies will be filling out new assessment forms for every homeless patient or client they see. These forms will be graded and ranked, and will provide housing officials with a list of the 260 most vulnerable homeless people in the city.
The assessments are part of an ambitious, first-of-its-kind Portland housing project in Old Town. The challenge is to find 130 homeless people most likely to die or become victims of abuse if left homeless, and to provide them with apartments in one building – the $49 million Resource Access Center, that should be completed in the spring. The building will house other services for the homeless, including an overnight shelter and a daytime facility.
But the 130 apartments will be the most experimental part of the access center. Most of the residents will suffer from mental illness and addiction and diseases such as cirrhosis and kidney failure. They will be among the most hard-core homeless, many unwilling or unable to accept help in the past.
Housing officials say it will cost the city and the Housing Authority of Portland quite a bit of money to manage the residents in the access center apartments. But if the experiment works to stabilize the lives of its tenants, they say, it will save millions of dollars because these are the homeless people who, when left on the street, require the most in unpaid hospital care, as well as in police, jail and court costs.
The access center apartments will represent the single largest housing development for the homeless ever built in Portland. It was not an easy matter to choose who, among the estimated 1,600 homeless people in Portland, would get those apartments, says Margaret Van Vliet, director of the Portland Housing Bureau.
“There will be thousands of people who don’t get served,” Van Vliet says. “It is the ‘Sophie’s Choice.’ ”
The city could have targeted homeless veterans or held a lottery or even operated the building as the housing authority runs the rest of its public housing projects – on a first-come, first-served basis.
But targeting the most vulnerable among the homeless, a relatively new idea gaining popularity among housing officials in many cities, makes sense, Van Vliet says. Other programs provide housing vouchers for homeless veterans, and options for homeless families and abused women.
“It’s a humanitarian crisis,” Van Vliet says. “Let’s serve the people who aren’t getting served in any other part of the system. Nobody else is going to get to this population.”
And the policy could make good financial sense.
The access center apartments and the city’s vulnerability index are modeled on pioneering work done in Seattle by that city’s Downtown Emergency Service Center, a nonprofit dedicated to homeless housing.
Bill Hobson, executive director of the service center, says one of those models is the 1811 East Lake Project, a building opened to late-stage, chronic alcoholic homeless people who were given 75 apartments. Seattle, like Portland, follows a Housing First policy (see sidebar), which means residents were not required to stop drinking in order to keep their rent-free apartments.
“It pissed off the Western Hemisphere when we did this,” Hobson says.
It cost his agency an extra $100,000 a year to run those 75 apartments, Hobson says. Staff on the site included nurses familiar with mental health and addiction issues who could be ready for emergencies, and could assist tenants in getting health care.
Yet, during two years, according to Hobson, 1811 East Lake saved more than $4 million in jail, shelter, detox and emergency medical care costs. He says it works to target public housing for the most vulnerable.
“The most vulnerable people are racking up an awful lot of taxpayer-funded crisis services,” Hobson says. “It’s a more prudent use of the public purse.”
If similar savings are realized through the access center, Van Vliet says, she’d like to find a way that the housing bureau gets more than credit, but gets some of the money back. Long-term, she’d like to see a system put in place so that hospitals, for instance, would analyze how much money they were saved and send some of that money to the housing bureau to subsidize management of the apartment buildings.
Van Vliet acknowledges that both the population in the apartments and the apartments’ location as part of the access center could present unique problems.
“We want to set this up for success,” she says. “It’s a lot of fragile people in a single building. Nobody’s really done this.”
That means more staff, say Jacob Fox, assistant housing director of the housing bureau. “These are people who are not good rules followers,” he says.
The housing authority plans to have one staff member for every seven building residents, says Rachael Duke, the agency’s assistant director of residential services. Most public housing buildings have one staff member for every 30 residents.
The 130 apartments will cost the housing authority about $975,000 annually to run, most of which will come from federal funds. The city has dedicated $500,000 a year in operating costs for the apartments.
Becky Kanis, director of a nationwide project to find and house the 100,000 most vulnerable homeless people in the country, says the housing authority might be surprised at how demand for their housing management team drops after a while.
Kanis works for Common Ground, a New York City nonprofit that pioneered the idea of the vulnerability index by assessing all the homeless in Times Square, and eventually luring all but one of the most vulnerable into public housing apartments.
Common Ground operates buildings that house more than 3,000 formerly homeless New York residents, Kanis says. Most of those tenants were hard to place in traditional public housing, she says, because they were labeled “bad tenants” – bothersome to neighbors and requiring a great deal of intervention by social workers.
For the first six months in Common Ground apartments, the tenants did use 30 percent more service hours from building management staff, Kanis says. But after that, most stabilized their lives and didn’t require the help of case managers much at all.
“People who have been on the streets forever are pretty darn self-sufficient people,” Kanis says. “They’ve figured out how to survive on the streets; going to chemo appointments they can deal with.”
Common Ground’s buildings differ from the proposed access center’s plan in one significant aspect. Kanis says Common Ground never dedicates one building to those who score highest on the vulnerability index. Instead, the New York agency combines the most vulnerable of the homeless with a more typical low-income population of renters.
“We always blend, so it doesn’t have an institutional feel,” Kanis says.
The housing authority’s early plans were for a full block access center with between 150 and 200 apartments and Duke says in that scenario, a less uniform tenant population was planned. When city financing was cut and the access center became a half-block project, the number of apartment units was nearly halved, and the decision was made to focus on the most vulnerable of Portland’s homeless.
Major James Sloan, Portland-area coordinator for the Salvation Army, says the city’s decision to find the most vulnerable to house could potentially lead to another problem. Sloan says the Salvation Army tries to house people who have come forward wanting a place to stay and a place to change their lives.
“There needs to be effort on their part,” Sloan says. “This is a gift to 130 people and I don’t begrudge them that, but it feels like there should be some matching of effort.”
Portland's decision to house the most vulnerable of the chronically homeless means many of the tenants in the Resource Access Center's apartments will have drug and alcohol addiction problems.
Years ago, that would have meant the new residents of the access center would have had to commit to being clean and sober or risk being kicked out. Not anymore.
The access center is a partnership between the city and the Housing Authority of Portland. The city follows a Housing First model, which concedes that most alcoholics, for instance, cannot commit to abstinence even when confronted with a potential loss of housing. And getting homeless alcoholics and addicts stability in their lives, in the form of permanent housing, can be the foundation that helps them change their lives.
One thing tenants at the Resource Access Center won't be allowed to do is smoke. The Housing Authority has a strict rule making all its buildings smoke free.
Central Dallas Ministries has enjoyed a great partnership with PepsiCo's "Food for Good" initiative for a second summer. Last year we partnered in a mobile lunch delivery effort with PepsiCo. This summer we rolled out a fully developed mobile delivery strategy in Dallas, while PepsiCo replicated the pilot program in Chicago with Catholic Charities as a partner.
The whole deal is way beyond cool and exciting!
Here's the report as we close in on the last three weeks of the joint effort that linked CDM's AmeriCorps team, PepsiCo and the Texas Department of Agriculture, the Illinois Department of Agriculture and the U. S. Department of Agriculture.
• The summer feeding program created 100 summer jobs and has now served more than 200,000 meals in Dallas, Texas across 10 routes with 3 weeks to go!
• We kicked off a mobile summer feeding program in Chicago on July 12 that has served more than 10,000 meals across 2 routes.
• We have 6 farm stands up and running in Dallas that, in just a few weeks, have profitably provided more than 20,000 servings of fruits & vegetables and valuable business skills to 30+ volunteers.
• The students at Paul Quinn College here in Dallas continue to run a fully operational urban farm, including harvesting and selling more than 100 pounds (!) of fruits & vegetables last week.
More details to come. We're making very significant progress!
Great story in yesterday's edition of The Dallas Morning News about our partnership with the U. S. Department of Agriculture, AmeriCorps and PepsiCo to provide hundreds of thousands of additional summer meals to low-income children in Dallas.
Here's a taste of the report by Ananda Boardman:
Food for Good summer program serves 200,000th meal in Dallas
Htee Kushee remembers running from soldiers in her native Burma as a 3-year-old.
Htee still runs, but now she and her friends gather twice a day at the Towne Center Apartments in northeast Dallas, where their motivation is happiness instead of fear. Thanks to the Food for Good Initiative, a partnership between PepsiCo Inc. and Central Dallas Ministries, 10-year-old Htee and other North Texas youngsters get a free breakfast and lunch each weekday.
"I like it," Htee said simply.
Texas ranks second to Mississippi as the state with the most kids at risk to go hungry each day, according to Feeding America, a Chicago-based hunger relief organization.
Between 300,000 and 400,000 children receive free or reduced-price lunches in the Dallas area during the school year, but during the summer, access to such meals is severely limited.
For the second consecutive year, the Food for Good program has helped fill that void.
On Wednesday, it served its 200,000th meal of the summer, and officials expect to do more.
Joel Kotkin, author of The Next Hundred Million: America in 2050, has interesting things to say about immigration, population growth and the future of the U. S. economy and position in the world. On Sunday, The Dallas Morning News published an essay "adapted" from his new book. Here's a taste of it.
Estimates of the U.S. population at the middle of the 21st century vary, from the U.N.’s 404 million to the U.S. Census Bureau’s 422 to 458 million. To develop a snapshot of the nation at 2050, particularly its astonishing diversity and youthfulness, I use the nice round number of 400 million people, or roughly 100 million more than we have today.
The United States is also expected to grow somewhat older. The portion of the population that is currently at least 65 — 13 percent — is expected to reach about 20 percent by 2050. This “graying of America” has helped convince some commentators of the nation’s declining eminence. For example, international relations expert Parag Khanna envisions a “shrunken America” lucky to eke out a meager existence between a “triumphant China” and a “retooled Europe.” Morris Berman, a cultural historian, says America “is running on empty.”
Immigration will continue to be a major force in U.S. life. The United Nations estimates that 2 million people a year will move from poorer to developed nations over the next 40 years, and more than half of those will come to the United States, the world’s preferred destination for educated, skilled migrants. In 2000, according to the Organization for Economic Co-operation and Development, an association of 30 democratic, free-market countries, the United States was home to 12.5 million skilled immigrants, equaling the combined total for Germany, France, the United Kingdom, Australia, Canada and Japan.
If recent trends continue, immigrants will play a leading role in our future economy. Between 1990 and 2005, immigrants started one out of four venture-backed public companies. Large American firms are also increasingly led by people with roots in foreign countries, including 15 of the Fortune 100 CEOs in 2007.
For all these reasons, the United States of 2050 will look different from that of today: Whites will no longer be in the majority. The U.S. minority population, currently 30 percent, is expected to exceed 50 percent before 2050. No other advanced, populous country will see such diversity.
Nell Irvin Painter is out with a must-read new book, The History of White People. Painter's resume is impressive. Award-winning author of many books, including Sojourner Truth, Southern History Across the Color Line, Creating Black Americans, and Standing at Armageddon, Painter currently serves as Edwards Professor of American History, Emerita, at Princeton University and lives in Newark, New Jersey.
Here's just a taste of what's in store for anyone who engages this challenging history:
Our story begins in Greek and Roman antiquity where the concept of race did not exist, only geography and the opportunity to conquer and enslave others. Not until the eighteenth century did an obsession with whiteness flourish, with the German invention of the notion of Caucasian beauty. This theory made northern Europeans into "Saxons," "Anglo-Saxons," and "Teutons," envisioned as uniquely handsome natural rulers.
Here was a worldview congenial to northern Europeans bent on empire. There followed an explosion of theories of race, now focusing on racial temperament as well as skin color. Spread by such intellectuals as Madame de Stael and Thomas Carlyle, white race theory soon reached North America with a vengeance. Its chief spokesman, Ralph Waldo Emerson, did the most to label Anglo-Saxons--icons of beauty and virtue--as the only true Americans. It was an ideal that excluded not only blacks but also all ethnic groups not of Protestant, northern European background. The Irish and Native Americans were out and, later, so were the Chinese, Jews, Italians, Slavs, and Greeks--all deemed racially alien. Did immigrants threaten the very existence of America? Americans were assumed to be white, but who among poor immigrants could truly become American? A tortured and convoluted series of scientific explorations developed--theories intended to keep Anglo-Saxons at the top: the ever-popular measurement of skulls, the powerful eugenics movement, and highly biased intelligence tests--all designed to keep working people out and down.
Click on the book's title above to order you a copy or visit your public library to check it out.
The images in the video below sum up "Food on the Move," a partnership effort of Central Dallas Ministries (CDM), the CDM AmeriCorps team, the Texas Department of Agriculture and PepsiCo's "Food for Good" initiative.
Hundreds of thousands of meals will have been served to low-income children by the end of the program in August. Here's where we are through July 28: 201,124 meals served to 7,924 unduplicated children and youth through the joint-effort, mobile feeding program.
The effort is one of a kind, a new national model of food delivery, as well as a new kind of partnership involving a local non-profit, two publically funded programs and a major, international corporation.
Amazing encouragement to children, their families, our AmeriCorps members, and the drivers and volunteers from PepsiCo.
The July 2010 issue of Harper's Magazinecontains a most disturbing story byFrederick Kaufman, "The food bubble: How Wall Street starved millions and got away with it." If you are looking for a story of how greed and unregulated business practices on Wall Street and beyond affect life, literally in "life and death" scenarios, this is one you need to read and understand. The essay is long. I've cut and pasted pieces for your consideration. You may want to pick up a copy and read the entire essay. ___________________________________________
The history of food took an ominous turn in 1991, at a time when no one was paying much attention. That was the year Goldman Sachs decided our daily bread might make an excellent investment.
Agriculture, rooted as it is in the rhythms of reaping and sowing, had not traditionally engaged the attention of Wall Street bankers, whose riches did not come from the sale of real things like wheat or bread but from the manipulation of ethereal concepts like risk and collateralized debt. But in 1991 nearly everything else that could be recast as a financial abstraction had already been considered. Food was pretty much all that was left. And so with accustomed care and precision, Goldman’s analysts went about transforming food into a concept. They selected eighteen commodifiable ingredients and contrived a financial elixir that included cattle, coffee, cocoa, corn, hogs, and a variety or two of wheat. They weighted the investment value of each element, blended and commingled the parts into sums, then reduced what had been a complicated collection of real things into a mathematical formula that could be expressed as a single manifestation, to be known thenceforward as the Goldman Sachs Commodity Index. Then they began to offer shares.
As was usually the case, Goldman’s product flourished. The prices of cattle, coffee, cocoa, corn, and wheat began to rise, slowly at first, and then rapidly. And as more people sank money into Goldman’s food index, other bankers took note and created their own food indexes for their own clients. Investors were delighted to see the value of their venture increase, but the rising price of breakfast, lunch, and dinner did not align with the interests of those of us who eat. And so the commodity index funds began to cause problems.
Wheat was a case in point. North America, the Saudi Arabia of cereal, sends nearly half its wheat production overseas, and an obscure syndicate known as the Minneapolis Grain Exchange remains the supreme price-setter for the continent’s most widely exported wheat, a high-protein variety called hard red spring. Other varieties of wheat make cake and cookies, but only hard red spring makes bread. Its price informs the cost of virtually every loaf on earth.
As far as most people who eat bread were concerned, the Minneapolis Grain Exchange had done a pretty good job: for more than a century the real price of wheat had steadily declined. Then, in 2005, that price began to rise, along with the prices of rice and corn and soy and oats and cooking oil. Hard red spring had long traded between $3 and $6 per sixty-pound bushel, but for three years Minneapolis wheat broke record after record as its price doubled and then doubled again. No one was surprised when in the first quarter of 2008 transnational wheat giant Cargill attributed its 86 percent jump in annual profits to commodity trading. And no one was surprised when packaged-food maker ConAgra sold its trading arm to a hedge fund for $2.8 billion. Nor when The Economist announced that the real price of food had reached its highest level since 1845, the year the magazine first calculated the number.
Nothing had changed about the wheat, but something had changed about the wheat market. Since Goldman’s innovation, hundreds of billions of new dollars had overwhelmed the actual supply of and actual demand for wheat, and rumors began to emerge that someone, somewhere, had cornered the market. Robber barons, gold bugs, and financiers of every stripe had long dreamed of controlling all of something everybody needed or desired, then holding back the supply as demand drove up prices. But there was plenty of real wheat, and American farmers were delivering it as fast as they always had, if not even a bit faster. It was as if the price itself had begun to generate its own demand—the more hard red spring cost, the more investors wanted to pay for it.
“It’s absolutely mind-boggling,” one grain trader told the Wall Street Journal. “You don’t ever want to trade wheat again,” another told the Chicago Tribune.
“We have never seen anything like this before,” Jeff Voge, chairman of the Kansas City Board of Trade, told the Washington Post. “This isn’t just any commodity,” continued Voge. “It is food, and people need to eat.”
The global speculative frenzy sparked riots in more than thirty countries and drove the number of the world’s “food insecure” to more than a billion. In 2008, for the first time since such statistics have been kept, the proportion of the world’s population without enough to eat ratcheted upward. The ranks of the hungry had increased by 250 million in a single year, the most abysmal increase in all of human history.
Then, like all speculative bubbles, the food bubble popped. By late 2008, the price of Minneapolis hard red spring had toppled back to normal levels, and trading volume quickly followed. Of course, the prices world consumers pay for food have not come down so fast, as manufacturers and retailers continue to make up for their own heavy losses.
Imaginary wheat bought anywhere affects real wheat bought everywhere. But as it turned out, index traders had purchased the majority of their long wheat futures on the oldest and largest grain clearinghouse in America, the Chicago Mercantile Exchange. And so I found myself pushing through the frigid blasts of the LaSalle Street canyon. If I could figure out precisely how and when wheat futures traded in Chicago had driven up the price of actual wheat in Minneapolis, I would know why a billion people on the planet could not afford bread.
The man who had agreed to escort me to the floor of the exchange traded grain for a transnational corporation, and he told me several times that he could not talk to the press, and that if I were to mention his name in print he would lose his job. So I will call him Mr. Silver.
In the basement cafeteria of the exchange I bought Mr. Silver a breakfast of bacon and eggs and asked whether he could explain how index funds that held long-only Chicago soft red winter wheat futures could have come to dictate the spot price of Minneapolis hard red spring. Had the world starved because of a corner in Chicago? Mr. Silver looked into his scrambled eggs and said nothing.
So I began to tell him everything I knew, hoping he would eventually be inspired to fill in the blanks. I told him about Joseph in Egypt, Osaka in 1730, the Panic of 1857, and futures contracts for cat pelts, molasses, and onions. I told him about Goldman’s replication strategy, Gorton and Rouwenhorst’s 2005 paper, and the rise and rise of index funds. I told him that at least one analyst had estimated that investments in commodity index funds could easily increase to as much as $1 trillion, which would result in yet another global food catastrophe, much worse than the one before.
And I told Mr. Silver something else I had discovered: About two thirds of the Goldman index remains devoted to crude oil, gasoline, heating oil, natural gas, and other energy-based commodities. Wheat was nothing but an indexical afterthought, accounting for less than 6.5 percent of Goldman’s fund.
Mr. Silver sipped his coffee.
Even 6.5 percent of the Goldman Sachs Commodity Index made for a historically unprecedented pile of long wheat futures, I went on. Especially when those index funds kept rolling over the contracts they already had—all of them long, only a smattering bought in Kansas City, none in Minneapolis.
And then it occurred to me: It was neither an individual nor a corporation that had cornered the wheat market. The index funds may never have held a single bushel of wheat, but they were hoarding staggering quantities of wheat futures, billions of promises to buy, not one of them ever to be fulfilled. The dreaded market corner had emerged not from a shortage in the wheat supply but from a much rarer economic occurrence, a shock inspired by the ceaseless call of index funds for wheat that did not exist and would never need to exist: a demand shock. Instead of a hidden mastermind committing a dastardly deed, it was old Mike Mullin’s “brainless entity,” the investment instrument itself, that had taken over and created the effects of a traditional corner.
Mr. Silver had stopped eating his eggs.
I said that I understood how the index funds’ unprecedented accumulation of Chicago futures could create the appearance of a market corner in Chicago. But there was still something I didn’t get. Why had the wheat market in Minneapolis begun to act as though it too had been cornered when none of the index funds held hard red spring? Why had the world’s most widely exported wheat experienced a sudden surge in price, a surge that caused a billion people—
At which point Mr. Silver interrupted my monologue.
Index-fund buying had pushed up the price of the Chicago contract, he said, until the price of a wheat future had come to equal the spot price of wheat on the Chicago Mercantile Exchange—and still, the futures price surged. The result was contango.
I gave Mr. Silver a blank look. Contango, he explained, describes a market in which future prices rise above current prices. Rather than being stable and steady, contango markets tend to be overheated and hysterical, with spot prices rising to match the most outrageously escalated futures prices. Indeed, between 2006 and 2008, the spot price of Chicago soft red winter shot up from $3 per bushel to $11 per bushel.
The ever-escalating price of wheat and the newfound strength of grain markets were excellent news for the new investors who had flooded commodity index funds. No matter that the mechanism created to stabilize grain prices had been reassembled into a mechanism to inflate grain prices, or that the stubbornly growing discrepancy between futures and spot prices meant that farmers and merchants no longer could use these markets to price crops and manage risks. No matter that contango in Chicago had disrupted the operations of the nation’s grain markets to the extent that the Senate Committee on Homeland Security and Governmental Affairs had begun an investigation into whether speculation in the wheat markets might pose a threat to interstate commerce. And then there was the question of the millers and the warehousers—those who needed actual wheat to sell, actual bread that might feed actual people.
Mr. Silver lowered his voice as he informed me that as the price of Chicago wheat had bubbled up, commercial buyers had turned elsewhere—to places like Minneapolis. Although hard red spring historically had been more expensive than soft red winter, it had begun to look like a bargain. So brokers bought hard red spring and left it to the chemists at General Mills or Sara Lee or Domino’s to rejigger their dough recipes for a higher-protein variety.
The grain merchants purchased Minneapolis hard red spring much earlier in the annual cycle than usual, and they purchased more of it than ever before, as real demand began to chase the ever-growing, everlasting long. By the time the normal buying season began, drought had hit Australia, floods had inundated northern Europe, and a vogue for biofuels had enticed U.S. farmers to grow less wheat and more corn. And so, when nations across the globe called for their annual hit of hard red spring, they discovered that the so-called visible supply was far lower than usual. At which point the markets veered into insanity.
Bankers had taken control of the world’s food, money chased money, and a billion people went hungry.
Mr. Silver finished his bacon and eggs and I followed him upstairs, beyond two sets of metal detectors, dozens of security staff, and a gaudy stained-glass image of Hermes, god of commerce, luck, and thievery. Through the colored glass that outlined the deity I caught my first glimpse of the immense trading floor of the Chicago Mercantile Exchange. The electronic board had already begun to populate with green, yellow, and red numbers.
The wheat harvest of 2008 turned out to be the most bountiful the world had ever seen, so plentiful that even as hundreds of millions slowly starved, 200 million bushels were sold for animal feed. Livestock owners could afford the wheat; poor people could not. Rather belatedly, real wheat had shown up again—and lots of it. U.S. Department of Agriculture statistics eventually revealed that 657 million bushels of 2008 wheat remained in U.S. silos after the buying season, a record-breaking “carryover.” Soon after that bounteous oversupply had been discovered, grain prices plummeted and the wheat markets returned to business as usual.
The worldwide price of food had risen by 80 percent between 2005 and 2008, and unlike other food catastrophes of the past half century or so, the United States was not insulated from this one, as 49 million Americans found themselves unable to put a full meal on the table. Across the country demand for food stamps reached an all-time high, and one in five kids came to depend on food kitchens. In Los Angeles nearly a million people went hungry. In Detroit armed guards stood watch over grocery stores. Rising prices, mused the New York Times, “might have played a role.”
On the plane to Minneapolis I had read a startling prediction: “It may be hard to imagine commodity prices advancing another 460 percent above their mid-2008 price peaks,” hedge-fund manager John Hummel wrote in a letter to clients of AIS Capital Management. “But the fundamentals argue strongly,” he continued, that “these sectors have significant upside potential.” I made a quick calculation: 460 percent above 2008 peaks meant hamburger meat priced at $20 a pound.
On the ground in Minneapolis I put the question to Michael Ricks, chairman of the Minneapolis Grain Exchange. Could 2008 happen again? Could prices rise even higher?
“Absolutely,” said Ricks. “We’re in a volatile world.”
I put the same question to Layne Carlson, corporate secretary and treasurer of the Minneapolis Grain Exchange. “Yes,” said Carlson, who then told me the two principles that govern the movement of grain markets: “fear and greed.”
But wasn’t it part of a grain exchange’s responsibility to ensure a stable valuation of our daily bread?
“I view what we’re working with as widgets,” said Todd Posthuma, the exchange’s associate director of market operations and information technology, the man responsible for clearing $100 million worth of trades every day. “I think being an employee at an exchange is different from adding value to the food system.”
Above Mark Bagan’s oversize desk hangs a jagged chart of futures prices for the hard red spring wheat contract, mapping every peak and valley from 1973 to 2006. The highs on Bagan’s chart reached $7.50. Of course, had 2008 been included, the spikes would have, literally, gone through the roof.
Would the price of wheat rise again?
“The flow of money into commodities has changed significantly in the last decade,” explained Bagan. “Wheat, corn, soft commodities—I don’t see these dollars going away. It already has happened,” he said. “It’s inevitable.”
Larry's new book, now available from Amazon.com! Also, now in Kindle format! To place your order visit Amazon.com today! Also, available at Barnes and Noble bookstores and on the web. Click on the image above to order!
Larry James' Urban Daily
A repository of ideas, resources, commentary and opinions concerning the issues facing low-income residents of the inner cities of the United States and how mainstream America largely forgets or, worse, ignores the day-to-day realities of urban life for the so-called "poor." Written and edited by the President & CEO of CitySquare. Please visit CitySquare.
Today and throughout 2013, we need your support to continue our life-changing work in inner-city Dallas. Every day hundreds of our wonderful neighbors arrive at our doors seeking our assistance, offering their help and prepared to pursue a better life. Frankly, the folks we "serve" make essential contributions to the scope, nature and soul of the work we attempt. At CitySquare we honor and recognize the amazing value and richness of our low-income neighbors. During 2012, almost 55,000 different people received the benefit of our wide-ranging services designed to assist in the process of building better lives. We need your help TODAY as we continue to respond to the needs of our community. Even more, we need you to become our PARTNER in the work of compassion and community renewal--work that continues day after day at CitySquare.