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Regulatory Improvement For Independent Workers: A New Vision

by Michael Mandel and Alec Stapp

One of the biggest productivity advances in recent years has been the use of platforms to connect buyers and sellers at lower cost. Platforms offer less rigid contractual arrangements, expanded earnings opportunities for workers and access to essential goods and services for underserved communities. Overall, platforms generate win-win economic activity which benefits everyone.

The flexibility of platforms will play a critical role in helping the U.S. labor market recover more quickly from the Covid recession. In most economic recoveries, companies have been apprehensive about making the commitment to hire given lingering economic uncertainty. That has typically made employment a lagging indicator in recoveries. By contrast, platforms will make it easier for workers to scale up hours worked gradually as the economy expands, which will boost consumer spending and demand, which will in turn boost employment.

The big question, though, is how to regulate platforms in a way that preserves the flexible nature of the work and the benefits to our economy at large, while continuing to protect both workers and consumers. The Progressive Policy Institute believes strongly in the importance of regulation for a well-functioning market economy. Yet we have long advocated for “regulatory improvement” as essential for accelerating growth and job creation.

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Forward

Oral Health Disparities in the U.S. and COVID-19
by Arielle Kane, Director of Health Care

"I know that delayed dental care is the number one reason for avoidable emergency visits. I know that poor oral health is a huge class divide — affecting health outcomes and employment opportunities. Yet even though we know all of this, policymakers have struggled to close the gap between those who regularly go to the dentist and those who don’t."

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OPINION: Bridgeport (CT) Schools Must Do More to Prepare For Fall
by Tressa Pankovits, Reinventing America's Schools Project

Bridgeport Public School students were in trouble before the pandemic shuttered schools in March. Each year, BPS students take the “Smarter Balance” state tests. On the 2019 test, not a single BPS school recorded 50 percent of its students meeting or exceeding expectations for their grade level in reading, with the exception of two select enrollment magnet schools.

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Credit Rating Agencies: Sending A Clear Signal

by Micheal Mandel, Chief Economic Strategist

The Covid-19 pandemic has sent the global economy and financial markets into an unprecedented crisis. The path of the downturn and recovery is difficult to discern. Some companies and nations are likely to survive and prosper, while others will struggle indefinitely.

In this context, bond markets will be looking to rating agencies to objectively assess the changing prospects of bond issuers, both private and public. Even the Federal Reserve is counting on the rating agencies—the Fed’s own rules for which bonds it can purchase under the new Primary Market Corporate Credit Facility explicitly reference the ratings produced by major nationally recognized statistical rating organizations (“NRSRO”).1

Can the credit rating agencies be trusted to do a good job analyzing the credit prospects of borrowers in the downturn? Will the resulting rating actions balance the needs of investors, issuers, and the financial markets? Will ratings downgrades unnecessarily make the economic and financial situation worse?

Before the virus struck, two independent advisory committees at the SEC in the United States were in the process of examining the business and compensation models of credit rating agencies such as Moody’s Investors Service and S&P Global. The issue was whether their “issuer pays” business model gives them an incentive to inflate the initial ratings of corporate bonds and other securities, or an incentive to slow-walk necessary ratings downgrades in tough times. Several meetings were held at the SEC in 2019 and 2020 to discuss alternative compensation models that might not have the same conflicts of interest.

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WEBINAR: To Open or Not to Open: Educational Equity under COVID
by Arielle Kane, Director of Health Care

Over 4,000 parents, educators, advocates, funders, journalists, and policy makers registered to hear from experts in teaching, parental engagement, system leadership and health on how to equitably reopen schools in the fall.

Our moderator and panel discussed the health, policy, and budgetary factors school systems should consider before making a decision grounded in educational equity for all students.

The Reinventing America's Schools Project was glad to sponsor such an important conversation at this time. Thanks to Alma Vivian Marquez, George Parker, Paul Vallas, and Dr. Leana Wen for joining our Deputy Director Curtis Valentine!

WATCH HERE

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