Americans often think of our country as being one of great opportunity – where anyone can rise from very modest circumstances, if they work hard and make good choices. We believe that often remains true.

But, for children and youth growing up in poverty, such upward mobility in America is too rare. Indeed, just 30 percent of those growing up in poverty make it to middle class or higher as adults. Though we’ve made progress in reducing poverty over the past several decades, our poverty rates are still too high and our rate of economic advancement for poor children has been stuck for decades. That is an embarrassment for a nation that prides itself on everyone having a shot at the American Dream.

What can we do to reduce poverty and increase economic mobility? In our polarized and poisoned political atmosphere, it is hard to reach consensus on policy efforts. Both progressives and conservatives want lower poverty; but progressives want more public spending programs to improve opportunity and security for the poor, while conservatives generally argue for more responsibility from them before providing more help.

Even so, progressives and conservatives might not be as far apart as these stereotypes suggest. The two of us—one a conservative Republican and the other a progressive Democrat—were recently part of an ideologically balanced group of 15 scholars brought together by the American Enterprise Institute and the Brookings Institution. Our charge was to generate a report with policy proposals to reduce poverty and increase upward mobility. An additional goal was simply to see whether we could arrive at consensus among ourselves, and bridge the ideological divide that has so paralyzed our political leaders.

Together we decided that the most important issues facing poor Americans and their children are family, education and work. We had to listen to each other’s perspectives on these issues, and be open to others’ truths. We also agreed to be mindful of the research evidence on these topics. In the end, we managed to generate a set of policy proposals we all find compelling.

To begin with, the progressives among us had to acknowledge that marriage is a positive family outcome that reduces poverty and raises upward mobility in America. The evidence is clear: stable two-parent families have positive impacts on children’s success, and in America marriage is the strongest predictor of such stability. Therefore marriage should be promoted as the norm in America, along with responsible and delayed child-bearing.

At the same time, the conservatives among us had to acknowledge that investing more resources in the skills and employability of poor adults and children is crucial if we want them to have higher incomes over time. Indeed, stable families are hard to maintain when the parents – including both the custodial mothers and the (often) non-custodial fathers – struggle to maintain employment and earn enough to support their families. Investing in proven, cost-effective, education and training programs such as high-quality preschool and training for jobs in high-growth economic sectors can improve the skills and employability of kids from poor families and lift them out of poverty through work.

Another important compromise was that progressives acknowledged that expecting and even requiring adults on public assistance to work can reduce poverty, as we learned in the 1990s from welfare reform; programs today like Disability Insurance, among others, need reforms to encourage more work. And reforms that encourage innovation and accountability would make our public education programs for the poor more effective at all levels. We need more choice in public K-12 education (through charter schools) and a stronger emphasis on developing and retaining effective teachers, while basing our state subsidies to higher education institutions more heavily on graduation rates, employment, and earnings of their graduates.

Conservatives also had to acknowledge that requiring the poor to work only makes sense when work is available to them. In periods or places with weak labor markets, we might need to create jobs for some by subsidizing their employment in either the private or public sector (as we did during the Great Recession). We agreed that no one should be dropped from the benefit rolls unless they have been offered a suitable work activity and rejected it. And we also need to “make work pay” for those who remain unskilled or can find only low-wage jobs – by expanding the Earned Income Tax Credit (especially for adults without custody of children) and modestly raising the minimum wage.

We also all agreed on other topics. For instance, work-based learning—in the form of paid apprenticeships and other models of high-quality career and technical education—can play an important role in raising both skills and work experience among poor youth and adults.  And, if we raise public spending for the poor, we need to pay for it—and not increase federal deficits. We all agree that reducing certain tax deductions for high-income families and making our retirement programs more progressive are good ways to finance our proposals.

As our report demonstrates, it is possible for progressives and conservatives to bridge their differences and reach compromises to generate a set of policies that will reduce poverty and improve upward mobility. Can Congress and the President do the same?

Editor's Note: this piece first appeared in Inside Sources.

Downloads

• Explore the full report

La monnaie électronique a émergé dans les pays de l'Union Economique et Monétaire Ouest Africaine, à la faveur de l'adoption, en 2006, d'une Instruction de la Banque Centrale, instaurant un cadre réglementaire souple et incitatif pour l’exercice de cette activité. L'implication des opérateurs de télécommunications dans l'offre de services financiers basés sur la téléphonie mobile a donné,  dès 2009, une nouvelle dimension à cette activité par l'accroissement du nombre des utilisateurs et des volumes de transactions.

Une activité en expansion

A fin septembre 2015, 22 millions de personnes, soit près d'un quart de la population de l'Union, ont souscrit à des services financiers via la téléphonie mobile. Environ 30% de ces abonnés réalisent au moins une opération sur une période de 90 jours.

Près de 500 millions de transactions ont été aussi réalisées au cours des neuf premiers mois de l'année 2015. La valeur cumulée des transactions atteint 5000 milliards de FCFA (8,5 milliards USD) à fin septembre 2015. De septembre 2013 à septembre 2014, cette valeur est passée de 1000 milliards à 2068 milliards de F CFA, soit une hausse de 107%.

Le réseau de distribution des services financiers via la téléphonie mobile suit également cette tendance haussière, en passant de 93 621 points de services en 2014 à plus de 132 658 points de services à fin septembre 2015.

Source: BCEAO

Le contexte socioéconomique de l'Union explique pour une large part, le succès des services de paiement via la téléphonie mobile. En effet, ce mode de prestation des services de transfert ou de paiement se révèle particulièrement adapté pour les personnes n'ayant pas accès au système bancaire classique, tout en offrant l'opportunité à des institutions non bancaires, en contrepartie de dépôt d'espèces, de mettre à la disposition des usagers une monnaie autre que fiduciaire, dont l'encours leur permet d'effectuer des transactions financières diverses.

L'implication croissante des opérateurs de télécommunications

Les partenariats entre les banques et les opérateurs de télécommunications occupent une place dominante sur le marché. En fin 2015, sur les 33 émetteurs de monnaie électronique sous licence, 25 appartenaient aux dits partenariats.

Au titre du modèle non bancaire, sept acteurs non bancaires ont été agréés pour émettre la monnaie électronique en qualité d'Etablissement de Monnaie Electronique (EME).[1]

Source: BCEAO

Un cadre réglementaire rénové

A la faveur de l'expansion des services financiers via la téléphonie mobile et de l'implication croissante des opérateurs de télécommunication, la Banque Centrale a rénové son cadre réglementaire afin de renforcer la sécurité et la qualité des services de paiement adossés à la monnaie électronique. Les principaux axes d'amélioration portent sur:

• une responsabilisation accrue des émetteurs en clarifiant leurs rôles dans les partenariats avec des prestataires techniques. Ainsi, les activités de prestataire technique sont limitées, sous la responsabilité de l'émetteur, au traitement technique de la monnaie électronique ou à sa distribution. De même, les émetteurs demeurent responsables, de l’intégrité, de la fiabilité, de la sécurité, de la confidentialité et de la traçabilité des transactions réalisées par chacun de leurs distributeurs;


• une stimulation de la concurrence par la transparence de la tarification avec l'obligation faite aux émetteurs de publier leurs tarifs;


• la formulation d'exigences spécifiques en matière de gouvernance et de contrôles interne et externe pour les établissements de monnaie électronique, en exigeant l'honorabilité des dirigeants, le respect du secret professionnel et des audits réguliers des infrastructures;


• une protection accrue des détenteurs de monnaie électronique avec d'une part, le cantonnement des fonds dans  des comptes dédiés, et l'exigence d'une équivalence continue entre l'encours de monnaie électronique et les soldes des comptes de cantonnement et d'autre part, l'obligation de la mise en place d'un mécanisme de recueil et de traitement des réclamations des porteurs de monnaie électronique;


• le renforcement du dispositif de supervision, par la réduction des délais de reporting des activités des émetteurs à la Banque Centrale, et l'adoption de sanctions pour les infractions aux dispositions réglementaires.

L'offre de services financiers via la téléphonie mobile

L'offre de services financiers via la téléphonie mobile comprend trois catégories de services. Il s'agit des services qui impliquent l'usage des espèces (monnaie fiduciaire), de ceux qui sont effectués en monnaie électronique et des services dits de « deuxième génération ».

Le premier type de services concerne essentiellement les dépôts d'espèces ou rechargements de porte-monnaies électroniques, ainsi que les retraits. Ils représentent 24% des transactions effectuées par les utilisateurs. Les dépôts d'espèces sont prédominants et permettent aux clients d'approvisionner leurs comptes de monnaie électronique.

La monnaie électronique rechargée est utilisée à hauteur de 76%, prioritairement pour les achats de crédit téléphonique, les paiements de factures, l'exécution de transferts de personne à personne, de personne à entreprise et aux Administrations publiques. Les principaux services de paiement dans l'UEMOA sont liés au règlement des factures relatives à la consommation d'eau, d'électricité, l'abonnement à des chaînes de télévision satellitaires, l'achat de marchandises dans les grandes surfaces ou de carburant dans les stations-service.

Des paiements d'impôts et taxes auprès des Administrations publiques et le remboursement des échéances de microcrédit sont également effectués, mais de façon très marginale.

Dans l'UEMOA les services dits de « deuxième génération », à savoir la micro-assurance, la micro-épargne et le micro-crédit, font leur apparition. Leur développement pourrait constituer une opportunité de bancarisation des utilisateurs de ces services.

Enfin, un début d'interopérabilité est mis en œuvre sur la base de conventions bilatérales entre les acteurs, notamment en vue d’offrir des services de paiement transfrontaliers entre les Etats membres de l'Union.

Les défis à relever

L'examen de l’évolution des services financiers via la téléphonie mobile dans l'UEMOA fait ressortir quelques obstacles à un développement plus rapide de ces services financiers au sein de l'UEMOA. Il s'agit de:

• la faiblesse du taux d'utilisateurs actifs, en raison du coût élevé des services;
• la méconnaissance des services, du fait d'une éducation financière insuffisante;
• la faible digitalisation des circuits de paiement des Administrations publiques;
• l'insuffisance des partenariats entre les émetteurs bancaires et non-bancaires pour le développement d'une offre de services plus inclusifs, dits de « seconde génération »

En collaboration avec toutes les parties prenantes, la Banque Centrale a développé une stratégie d’inclusion financière visant à améliorer l’accès et l’utilisation de divers services financiers personnalisés et aux prix abordables. La mise en place de ces actions, comme décrite dans la stratégie d’inclusion financière conçue par la BCEAO, devrait résoudre les défis mentionnés ci-dessus.

Lire en anglais »

[1] EME: toute personne morale, autre que les banques, les établissements financiers de paiement, les systèmes financiers décentralisés, habilitée à émettre des moyens de paiement sous forme de monnaie électronique et dont les activités se limitent à l'émission et la distribution de monnaie électronique.

Americans often think of our country as being one of great opportunity – where anyone can rise from very modest circumstances, if they work hard and make good choices. We believe that often remains true.

But, for children and youth growing up in poverty, such upward mobility in America is too rare. Indeed, just 30 percent of those growing up in poverty make it to middle class or higher as adults. Though we’ve made progress in reducing poverty over the past several decades, our poverty rates are still too high and our rate of economic advancement for poor children has been stuck for decades. That is an embarrassment for a nation that prides itself on everyone having a shot at the American Dream.

What can we do to reduce poverty and increase economic mobility? In our polarized and poisoned political atmosphere, it is hard to reach consensus on policy efforts. Both progressives and conservatives want lower poverty; but progressives want more public spending programs to improve opportunity and security for the poor, while conservatives generally argue for more responsibility from them before providing more help.

Even so, progressives and conservatives might not be as far apart as these stereotypes suggest. The two of us—one a conservative Republican and the other a progressive Democrat—were recently part of an ideologically balanced group of 15 scholars brought together by the American Enterprise Institute and the Brookings Institution. Our charge was to generate a report with policy proposals to reduce poverty and increase upward mobility. An additional goal was simply to see whether we could arrive at consensus among ourselves, and bridge the ideological divide that has so paralyzed our political leaders.

Together we decided that the most important issues facing poor Americans and their children are family, education and work. We had to listen to each other’s perspectives on these issues, and be open to others’ truths. We also agreed to be mindful of the research evidence on these topics. In the end, we managed to generate a set of policy proposals we all find compelling.

To begin with, the progressives among us had to acknowledge that marriage is a positive family outcome that reduces poverty and raises upward mobility in America. The evidence is clear: stable two-parent families have positive impacts on children’s success, and in America marriage is the strongest predictor of such stability. Therefore marriage should be promoted as the norm in America, along with responsible and delayed child-bearing.

At the same time, the conservatives among us had to acknowledge that investing more resources in the skills and employability of poor adults and children is crucial if we want them to have higher incomes over time. Indeed, stable families are hard to maintain when the parents – including both the custodial mothers and the (often) non-custodial fathers – struggle to maintain employment and earn enough to support their families. Investing in proven, cost-effective, education and training programs such as high-quality preschool and training for jobs in high-growth economic sectors can improve the skills and employability of kids from poor families and lift them out of poverty through work.

Another important compromise was that progressives acknowledged that expecting and even requiring adults on public assistance to work can reduce poverty, as we learned in the 1990s from welfare reform; programs today like Disability Insurance, among others, need reforms to encourage more work. And reforms that encourage innovation and accountability would make our public education programs for the poor more effective at all levels. We need more choice in public K-12 education (through charter schools) and a stronger emphasis on developing and retaining effective teachers, while basing our state subsidies to higher education institutions more heavily on graduation rates, employment, and earnings of their graduates.

Conservatives also had to acknowledge that requiring the poor to work only makes sense when work is available to them. In periods or places with weak labor markets, we might need to create jobs for some by subsidizing their employment in either the private or public sector (as we did during the Great Recession). We agreed that no one should be dropped from the benefit rolls unless they have been offered a suitable work activity and rejected it. And we also need to “make work pay” for those who remain unskilled or can find only low-wage jobs – by expanding the Earned Income Tax Credit (especially for adults without custody of children) and modestly raising the minimum wage.

We also all agreed on other topics. For instance, work-based learning—in the form of paid apprenticeships and other models of high-quality career and technical education—can play an important role in raising both skills and work experience among poor youth and adults.  And, if we raise public spending for the poor, we need to pay for it—and not increase federal deficits. We all agree that reducing certain tax deductions for high-income families and making our retirement programs more progressive are good ways to finance our proposals.

As our report demonstrates, it is possible for progressives and conservatives to bridge their differences and reach compromises to generate a set of policies that will reduce poverty and improve upward mobility. Can Congress and the President do the same?

Editor's Note: this piece first appeared in Inside Sources.

Downloads

• Explore the full report

Editor’s Note: Brookings will hold an event and live webcast on Wednesday, August 26 to discuss the findings of the 2015 Financial and Digital Inclusion (FDIP) Report and Scorecard. Follow the conversation on Twitter using #FinancialInclusion 

Access to affordable, quality financial services is vital both for ensuring the financial well-being of individuals and for fostering broader economic development. Yet about 2 billion adults around the world still do not have formal financial accounts.

The Financial and Digital Inclusion Project (FDIP), launched within the Center for Technology Innovation at Brookings, set out to answer three key questions:

• Do country commitments make a difference in progress toward financial inclusion?
• To what extent do mobile and other digital technologies advance financial inclusion?
• What legal, policy, and regulatory approaches promote financial inclusion?

To answer these questions, the FDIP team spent the past year examining how governments, private sector entities, non-government organizations, and the general public across 21 diverse countries have worked together to advance access to and usage of formal financial services. This research informed the development of the 2015 Report and Scorecard — the first in a 3-year series of research on the topic.

For the 2015 Scorecard, FDIP researchers assessed 33 indicators across four dimensions of financial inclusion: Country commitment, mobile capacity, regulatory environment, and adoption of selected basic traditional and digital financial services.

The 2015 FDIP Report and Scorecard provide detailed profiles of the financial inclusion landscape in 21 countries, focusing on mobile money and other digital financial services.

On August 26, the Center for Technology Innovation will discuss the findings of the 2015 Report and Scorecard and host a conversation about key trends, opportunities, and obstacles surrounding financial inclusion among authorities from the public and private sectors.

Register to attend the event in-person or by webcast, and join the conversation on Twitter at #FinancialInclusion.

Event Information

Approximately two billion adults across the world lack access to formal financial services. To address this particular economic challenge, many developing countries have made significant efforts to expand access to and use of affordable financial services for the world’s poor. Financial inclusion can be achieved via traditional banking offerings, but also through digital financial services such as mobile money, among other innovative approaches.

The Brookings Financial and Digital Inclu­sion Project (FDIP) Report and Scorecard seeks to help answer a set of fundamental questions about today’s global financial inclusion efforts, including;

1. Do country commitments make a difference in progress toward financial inclusion?
2. To what extent do mobile and other digital technologies advance finan­cial inclusion?
3. What legal, policy, and regulatory approaches promote financial inclusion? 

To answer these questions, Brookings experts John D. Villasenor, Darrell M. West, and Robin J. Lewis analyzed finan­cial inclusion in 21 geographically, economically, and politically diverse countries. This year’s report and scorecard is the first of a series of annual reports examining financial inclusion activities and assessing usage of financial services in selected countries around the world. 

On August 26, the Center for Technology Innovation at Brookings held a forum to launch the 2015 FDIP Report and discuss key research findings and recommendations. Financial inclusion experts from the public and private sectors also joined the discussion.

Join the conversation on Twitter at #FinancialInclusion and @BrookingsGov

Video

• Measuring progress on financial and digital inclusion

Audio

• Measuring progress on financial and digital inclusion

Transcript

• Uncorrected Transcript (.pdf)

Event Materials

• 20150826_financial_inclusion_transcript

Editor’s Note: This post is part of a series on the 2015 Financial and Digital Inclusion Project (FDIP) Report and Scorecard, which were launched at a Brookings public event in August. Previous posts have highlighted five key findings from the 2015 FDIP Report, explored financial inclusion developments in India, and examined the rankings for selected FDIP countries in Southeast and Central Asia, the Middle East, and Africa.

The 2015 Financial and Digital Inclusion Project (FDIP) Report and Scorecard were launched in August of this year and generally reflect data current through May 2015. Since the end of the data collection period for the report, countries have continued to push forward to greater financial inclusion, and international organizations have continued to assert the importance of financial inclusion as a mechanism for promoting individual well-being and macroeconomic development. Financial inclusion is a key component of the United Nations’ Sustainable Development Goals, signaling international commitment to advancing access to and use of quality financial products among the underserved.

We discussed one recent groundbreaking financial inclusion development in a previous post. To learn more about the approval of payments banks in India, read “Inclusion in India: Unpacking the 2015 FDIP Report and Scorecard.”

Below are four other key developments among our 21-country sample since the end of the data collection period for the 2015 FDIP Report and Scorecard. The list is in no way intended to be exhaustive, but rather to provide a snapshot illustrating how rapidly the financial inclusion landscape is evolving globally.   

1) The Philippines launched a national financial inclusion strategy.

In July 2015, the Philippines launched a national financial inclusion strategy (NFIS) and committed to drafting an Action Plan on Financial Inclusion. The Philippines’ NFIS identifies four areas central to promoting financial inclusion: “policy and regulation, financial education and consumer protection, advocacy programs, and data and measurement.”

 As discussed in the 2015 FDIP Report, national financial inclusion strategies often serve as a platform for identifying key priorities, clarifying the roles of key stakeholders, and setting measurable targets. These strategies can foster accountability and incentivize implementation of stated initiatives. While correlation does not necessarily equal causation, it is nonetheless interesting to note that, according to the World Bank, “[o]n average, there is a 10% increase in the percentage of adults with an account at a formal financial institution for countries  that launched an NFIS after 2007, whereas the increase is only 5% for those countries that have not launched an NFIS.”

2) Peru adopted a national financial inclusion strategy.

With support from the World Bank, Peru’s Multisectoral Financial Inclusion Commission established an NFIS that was adopted in July 2015 through a Supreme Decree issued by President Ollanta Humala Tasso. The strategy contains a goal to increase financial inclusion to 50 percent of adults by 2018. This is quite an ambitious target: As of 2014, the World Bank Global Financial Inclusion (Global Findex) database found that only 29 percent of adults in Peru had an account with a formal financial services provider. The NFIS also commits the country to facilitating access to a transaction account among at least 75 percent of adults by 2021.

Peru’s NFIS emphasizes the promotion of electronic payment systems, including electronic money, as well as improvements pertaining to consumer protection and education. Advancing access to both digital and traditional financial services should boost Peru’s adoption levels over time. As noted in the 2015 FDIP Report, while Peru’s national-level commitment to financial inclusion and regulatory environment for financial services are strong, adoption levels remain low (Peru ranked 15^th on the adoption dimension of the 2015 Scorecard, the lowest ranking among the Latin American countries in our sample).

3) Colombia updated its quantifiable targets and released a financial inclusion survey.

The 2015 Maya Declaration Progress Report, published in late August 2015, highlights a number of quantifiable financial inclusion targets set by the Ministerio de Hacienda y Crédito Público de Colombia (Colombia’s primary Maya Declaration signatory) relating to the percentage of adults with financial products and savings accounts. For example, the target for the percentage of adults with a financial product is now 76 percent by 2016, up from a target of 73.7 percent by 2015. The goal for the percentage of adults with an active savings account in 2016 is now 56.6 percent, up from a target of 54.2 percent by 2015. To learn more about concrete financial inclusion targets among other FDIP countries, read the 2015 Maya Declaration Progress Report.

In July, Banca de las Oportunidades, a key financial inclusion stakeholder in Colombia, presented the results of the country’s first demand-side survey specifically related to financial inclusion. As noted by the Economist Intelligence Unit, previous national-level surveys conducted by entities such as the Superintendencia Financiera and Asobancaria have identified supply- and demand-side indicators pertaining to various financial services. As discussed in the 2015 FDIP Report, national-level surveys that focus on access to and usage of financial services can help identify areas of greatest need and enable countries to better leverage their resources to promote adoption of quality financial services among marginalized populations.

4) Nigeria’s “super agent” network enables greater access to digital financial services.

In September 2015, telecommunications company Globacom launched a “super agent” network, Glo Xchange, which can access the mobile money services of any partner mobile money operator. The network has been launched in partnership with four banks. Globacom was given approval in 2014 to develop this network; since then, the company has been recruiting and training its agents. About 1,000 agents will initially be part of this system, with a goal to recruit 10,000 agents by September 2016. Expanding access points to financial services by building agent networks is hoped to boost adoption of digital financial services.

Despite having multiple mobile money operators (19 as of October 2015, according to the GSMA’s Mobile Money Deployment Tracker), Nigeria’s mobile money adoption levels have not reached the degree of success of some other countries in Africa: The Global Findex noted that less than 3 percent of adults in Nigeria had mobile money accounts in 2014, compared with over 30 percent in Tanzania and about 60 percent in Kenya. Nigeria’s primarily bank-led approach to financial services, which excludes mobile network operators from being licensed as mobile money operators, is one factor that may have constrained adoption of mobile money services to date. You can read more about Nigeria’s regulatory environment and financial services landscape in the 2015 FDIP Report.

We welcome your feedback regarding recent financial inclusion developments. Please send any links, questions, or comments to FDIPComments@brookings.edu.

More than a decade after the start of the war in Afghanistan, America continues to face significant challenges in the Middle East. While news of U.S. struggles often dominate foreign policy discussions, Senior Fellow Bruce Riedel says it is important to remember that the United States is also making progress in the region. From the death of Osama bin Laden to an agreement on the use of Afghan military bases for U.S. counterterrorism operations, America is learning from its past mistakes and using these lessons to guide its response to the Arab Spring.

Video

• We Shouldn't Lose Sight of the Positive Developments in the Middle East

Emerging economies may chafe at international agreements calling for sustainable development, but Nonresident Fellow Nathan Hultman says many governments are putting plans for sustainability and green innovation in place out of self-interest, and cooperating with neighbors across the globe.

Video

• Nathan Hultman: Global Progress in Sustainable Development

Abstract

Progress in closing differences in many objective outcomes for blacks relative to whites has slowed, and even worsened, over the past three decades. However, over this period the racial gap in wellbeing has shrunk. In the early 1970s data revealed much lower levels of subjective well-being among blacks relative to whites. Investigating various measures of well-being, we find that the well-being of blacks has increased both absolutely and relative to that of whites. While a racial gap in well-being remains, two-fifths of the gap has closed and these gains have occurred despite little progress in closing other racial gaps such as those in income, employment, and education. Much of the current racial gap in well-being can be explained by differences in the objective conditions of the lives of black and white Americans. Thus making further progress will likely require progress in closing racial gaps in objective circumstances.

Downloads

• Subjective and Objective Indicators of Racial Progress

With Washington adrift and the United Nations climate change panel again calling for action, the search for new clean energy finance solutions continues.  

Against this backdrop, the Metro Program has worked with state- and city-oriented partners to highlight such responses as repurposing portions of states’ clean energy funds and creating state green banks.  Likewise, the Center for American Progress just recently highlighted the potential of securitization and investment yield vehicles, called yield cos. And last week an impressive consortium of financiers, state agencies, and philanthropies announced the creation of the Warehouse for Energy Efficiency Loans (WHEEL) aimed at bringing low-cost capital to loan programs for residential energy efficiency. WHEEL is the country’s first true secondary market for home energy loans—and a very big deal. 

Another big deal is the potential of bond finance as a tool for clean energy investment at the state and local level. That’s the idea advanced in a new paper released this morning that we developed with practitioners at the Clean Energy Group and the Council for Development Finance Authorities.

Over 100 years, the nation’s state and local infrastructure finance agencies have issued trillions of dollars’ worth of public finance bonds to fund the construction of the nation’s roads, bridges, hospitals, and other infrastructure—and literally built America. Now, as clean energy subsidies from Washington dwindle, these agencies are increasingly willing to finance clean energy projects, if only the clean energy community will embrace them.

So far, these authorities are only experimenting. However, the bond finance community has accumulated significant experience in getting to scale and knows how to raise large sums for important purposes by selling bonds to Wall Street. Accordingly, the clean energy community—working at the state and regional level—should leverage that expertise. The challenge is for the clean energy and bond finance communities to work collaboratively to create new models for clean energy bond finance in states, and so to establish a new clean energy asset class that can easily be traded in capital markets.

Along these lines, our new brief argues that state and local bonding authorities, clean energy leaders, and other partners should do the following: 

• Establish mutually useful partnerships between development finance experts and clean energy officials at the state and local government levels
• Expand and scale up bond-financed clean energy projects using credit enhancement and other emerging tools to mitigate risk and through demonstration projects
• Improve availability of data and develop standardized documentation so that the risks  and rewards of clean energy investments can be better understood
• Create a pipeline of rated and private placement deals, in effect a new clean energy asset class, to meet the demand by institutional investors for fixed-income clean energy securities

State and local bond finance represents a powerful but underutilized tool for future clean energy investment.

For 100 years, the nation’s state and local infrastructure finance agencies have issued trillions of dollars’ worth of public finance bonds to fund the construction of the nation’s roads, bridges, hospitals, and other infrastructure—and literally built America. Now, as clean energy subsidies from Washington dwindle, these agencies are increasingly willing to finance clean energy projects, if only the clean energy community will embrace them.

So far, these authorities are only experimenting. However, the bond finance community has accumulated significant experience in getting to scale and knows how to raise large amounts for important purposes by selling bonds to Wall Street. The challenge is therefore to create new models for clean energy bond finance in states and regions, and so to establish a new clean energy asset class that can easily be traded in capital markets. To that end, this brief argues that state and local bonding authorities and other partners should do the following:

• Establish mutually useful partnerships between development finance experts and clean energy officials at the state and local government levels
• Expand and scale up bond-financed clean energy projects using credit enhancement and other emerging tools to mitigate risk and through demonstration projects
• Improve the availability of data and develop standardized documentation so that the risks and rewards of clean energy investments can be better understood
• Create a pipeline of rated and private placement deals, in effect a new clean energy asset class, to meet the demand by institutional investors for fixed-income clean energy securities

Downloads

• Report
• Press Release

Event Information

In 2015, 193 countries adopted the Sustainable Development Goals (SDGs), a new global agenda that is more ambitious than the preceding Millennium Development Goals and aims to make progress on some of the most pressing issues of our time. Goal 4, "To ensure inclusive and quality education for all, with relevant and effective learning outcomes," challenges the international education community to meet universal access plus learning by 2030. We know that access to primary schooling has scaled up rapidly over previous decades, but what can be learned from places where transformational changes in learning have occurred? What can governments, civil society, and the private sector do to more actively scale up quality learning?

On April 18-19, the Center for Universal Education (CUE) at Brookings launched "Millions Learning: Scaling Up Quality Education in Developing Countries," a comprehensive study that examines where learning has improved around the world and what factors have contributed to that process. This two-day event included two sessions. Monday, April 18 focused on the role of global actors in accelerating progress to meeting the SDGs. The second session on Tuesday, April 19 included a presentation of the Millions Learning report followed by panel discussions on the role of financing and technology in scaling education in developing countries.

 Join the conversation on Twitter #MillionsLearning

Video

• Getting millions to learn: What will it take to accelerate progress on meeting the Sustainable Development Goals?
• Scaling quality education: The launch of the Millions Learning report
• Do funders help or hinder scaling in education?
• What role can technology play in scaling education?

Audio

• Getting millions to learn: What will it take to accelerate progress on meeting the Sustainable Development Goals?

Transcript

• Uncorrected Transcript - Day 1 (.pdf)
• Uncorrected Transcript - Day 2 (.pdf)

Event Materials

• 20160418_millions_learning_transcript
• 20160419_millions_learning_transcript