Sunday, January 25, 2009

Build "Third Sector" Infrastructure, Too!

Opinion: Adding to the Nonprofit Work Force Is a Smart Way to Stimulate the Economy -

"...[L]et’s urge Congress and the White House to make charitable employment a key component of the economic-stimulus plan..."

"Spending government money on jobs at nonprofit causes would accomplish several goals. The government would be financing jobs that paid workers a decent living, money they could use to invest in goods and services in their hometowns. It also would help nonprofit groups deal with the short-term increase in demand for services and a shortfall of private and government money available to hire new workers to meet those demands."

"And perhaps most important, it would give nonprofit groups an opportunity to train a cadre of workers who can sustain charitable institutions over the long haul as demographic changes make it harder to attract workers."

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Mayors Propose National Plan to Create 1.6 million jobs

The U.S. Conference of Mayors has issued another report on infrastructure needs that can be addressed through their proposed Main Street economic stimulus plan.

The mayors report that:

" 779 cities of all sizes in all regions of the country, a total of 18,750 local infrastructure projects are 'ready to go.' These projects represent an infrastructure investment of $149,758,339,126 that would be capable of producing an estimated 1,604,371 jobs in 2009 and 2010.

"These are the cumulative totals of projects, required funding, and jobs to be created that have been reported in the four surveys of cities conducted by the Conference of Mayors over the past three months. The populations of the 779 cities submitting projects total 77,946,664."

The report identified 10 priority areas for additional public investment:

It is important to understand that our MainStreet Economic Recovery plan calls for funds to flow quickly and directly to cities through 10 federal funding streams that are already in existence; many of these have demonstrated their effectiveness over many years.

The 10 infrastructure investments we are recommending are:

Community Development Block Grants – CDBG would be used to create jobs through: the construction of public facilities and improvements, water and sewer facilities, streets, and neighborhood centers; the conversion of school buildings for eligible purposes; activities relating to energy conservation and renewable energy resources; and assistance to profitmotivated businesses to carry out economic development and job creation/retention activities.
Energy Block Grants and Green Jobs – The new Energy Efficiency and Conservation Block Grant (EECBG) program would be used by cities, counties, and states to create thousands of energy efficiency and renewable energy production projects. These projects could include energy retrofits of public and private buildings in local areas, installation of solar panels or wind turbines for the production of electricity on local buildings, deployment of new energy distribution technologies (such as distributed generation or district heating and cooling systems) that significantly increase energy efficiency, and development of systems to capture and generate power from methane at landfills.
Transit Equipment and Infrastructure – Transit funding would be used to purchase buses,street cars, rail cars, and other rolling stock and equipment needed to create additionalcapacity; help stabilize fare increases; and improve reliability. It would also be used torestore and maintain facilities and infrastructure in a state of good repair through projectsthat could, for example, expand station capacity, improve rail tracks, and provide customerinformation screens.
City Streets/Metro Roads – Highway funding must be distributed through the SurfaceTransportation Program (STP); this ensures that it will provide maximum flexibility to cities, counties, and states to undertake bridge, bus and rail, and road projects in metropolitan areas.
Airport Technology and Infrastructure – Projects funded through the Airport ImprovementP rogram (AIP) would include runway and taxi rehabilitations, extensions, and widening;obstruction removal; apron construction, expansion and rehabilitation; rescue andfirefighting equipment and facilities; airside service or public access roads; and noisemitigation and abatement (Part 150) associated with aircraft operations, including voluntaryhome buyout, which would fuel the local housing market, and residential and businessinsulation programs.
Amtrak – Amtrak would use infrastructure funding to make necessary upgrades to tracks,bridges and tunnels, electric traction, interlockings, signals and communications, andstations on the Amtrak system. In addition, Amtrak could refurbish rail cars that arecurrently in storage and return them to service.
Water and Wastewater Infrastructure – Local governments contribute 98 percent of the total investment in wastewater and 95 percent of the investment in water infrastructure. Water and wastewater infrastructure grants would be used to assist with rehabilitating agingwater and sewer infrastructure, complying with sewer overflow issues, and promoting sourcewater protection and availability.
School Modernization – Federal school modernization funds would be used to repair andmodernize school buildings in both large- and small-city school districts, improve theirenergy efficiency, and equip them with first-class technology.
Public Housing Modernization – Public Housing Capital Funds would be used for repair and construction projects, including safety repairs.
Public Safety Jobs and Technology – Providing COPS hiring grants to local policedepartments would allow them to put additional police officers on the streets and in theschools as school resource officers. Additional Byrne Justice Assistance Grant funding could be used to hire personnel, support those personnel, and purchase equipment and new technologies which make law enforcement personnel more effective in their jobs.

Read the full report and list of projects

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Grassroots support needed for economic recovery legislation

Media coverage of Obama's proposed economic recovery plan is indicating that it faces significant opposition from conservative legislators.

This is an important reminder that passage of even this initial building block toward job creation and lower unemployment is not assured!!

From: Obama focusing on winning support for $820 billion economic stimulus package (CBC News):

" the weeks ahead, Obama has to win over Republicans and some fiscally conservative Democrats who don't like the economic recovery package.

House Republicans say they won't support it because it's too reliant on government spending and doesn't provide enough tax relief for families and small businesses. They also charge that the plan contains too much 'pork-barrel' spending - cash infusions earmarked for some curious causes."

"Curious causes"? Is fixing America's crumbling schools and collapsing bridges a "curious cause?"

We strongly urge grassroots organizations to work with local city councils, county legislatures and other bodies to pass local municipal resolutions in support of a strong Main Street Stimulus package. See the National Jobs for All Coalition's sample resolution. Let's help Main Street be heard in the halls of Congress.

Passing a resolution will also help create local discussion and debate about unmet social needs. What opportunities do we have to create living wage jobs for all, by addressing the huge backlog of infrastructure projects and service needs? Elected officials are waiting to hear from YOU.

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Obama's team turn to EU bank for inspiration - Business News, Business - The Independent

Obama's team turn to EU bank for inspiration - Business News, Business - The Independent

President Barack Obama's administration is looking to establish a $60bn (£43.5bn) infrastructure bank based on the European Investment Bank (EIB), which is bailing out small UK businesses hit by the financial crisis. ...It is estimated that the backlog of [U.S.] road repairs is close to $5 trillion.

A spokesman for the Federal Highway Administration said on Friday: "There are no plans currently in place, as the US Secretary of Transportation was only sworn in yesterday. [But] I can tell you that state infrastructure banks are being considered."

These banks would have lent states cash for roads projects, but instead the new transport team, led by former congressman Ray LaHood, have been impressed by the EIB model. Rather than just act as a middleman directing money from central government, the EIB can raise funds from the capital markets through a mix of commercial paper and bonds. In 2007, the EIB borrowed €55bn.

Also, the EIB lends to specific projects rather than to individual EU states. This, said one EU source, has intrigued the Obama team, which originally planned to lend money to states rather than to specific transport schemes. If the US bank follows the EIB's lead, it could look at infrastructure projects beyond roads, such as housing and hospitals. Bridges are also likely to be highlighted, as more than a quarter across the US are in a state of serious disrepair...

Read rest of article here

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Saturday, January 17, 2009

Advice on the Crisis and economic/political recovery

Though Krugman, unlike NJFAC, considers 5% unemployment to be full employment, he estimates a minimum of $500 billion a year necessary for a recovery. But he includes here far more than a recovery program.

What Obama Must Do, Paul Krugman, January 14, 2009
How bad is the economic outlook? Worse than almost anyone imagined.

The economic growth of the Bush years, such as it was, was fueled by an explosion of private debt; now credit markets are in disarray, businesses and consumers are pulling back and the economy is in free-fall. What we're facing, in essence, is a yawning job gap. The U.S. economy needs to add more than a million jobs a year just to keep up with a growing population. Even before the crisis, job growth under Bush averaged only 800,000 a year - and over the past year, instead of gaining a million-plus jobs, we lost 2 million. Today we're continuing to lose jobs at the rate of a half million a month.

There's nothing in either the data or the underlying situation to suggest that the plunge in employment will slow anytime soon, which means that by late this year we could be 10 million or more jobs short of where we should be. This, in turn, would mean an unemployment rate of more than nine percent. Add in those who aren't counted in the standard rate because they've given up looking for work, plus those forced to take part-time jobs when they want to work full-time, and we're probably looking at a real-world unemployment rate of around 15 percent - more than 20 million Americans frustrated in their efforts to find work...........

But the New Deal's job-creation programs, while they certainly helped, were neither big enough nor sustained enough to end the Great Depression. When the economy is deeply depressed, you have to put normal concerns about budget deficits aside; FDR never managed to do that.....

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Sunday, January 11, 2009

Obama Recovery Plan Targets Construction & Retail Sectors

Christina Romer and Jared Bernstein have written a memo which estimates how many jobs might be created by President-elect Obama's economic recovery plan.

The paper includes the following table estimating the distribution of jobs in the 4th quarter of 2010:

Job Creation of Recovery Package by Industry
(Industry Jobs Created in 2010Q4)

Mining 26,000
Construction 678,000
Manufacturing – Total 158,000
Retail Trade 604,000
Information 50,000
Financial Activities 214,000
Professional and Business Services 345,000
Education and Health Services 240,000
Leisure and Hospitality 499,000
Other Services 99,000
Utilities 11,000
Transportation and Warehousing 98,000
Government – Total 244,000

Total 3,675,000

Sources: Authors’ calculations and estimates of effects by industry from Mark Zandi, “The Economic Impact of a $600 Billion Fiscal Stimulus Package,” Moody’s, Nov. 28, 2008.

"...The estimates suggest that 30% of the jobs created will be in construction and manufacturing, even though these industries employ only 15% of all workers. Both sectors have been particularly hard hit recently. The other two significant sectors that are disproportionately represented in job creation are retail trade and leisure and hospitality (mining is also represented disproportionately, but employs less than 1% of all workers)."

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"Worst year for job loss" since 1945

AFL-CIO NOW BLOG Disaster: Unemployment at 7.2 Percent. Real Rate 13.5 Percent:

The jobless numbers out today are worse than even the most pessimistic analysts imagined: 524,000 jobs lost in December, pushing the nation's unemployment rate to 7.2 percent. Under the Bush administration, 2008 has become the worst year for job loss since 1945, with nearly 2.6 million jobs lost last year alone.

...[I]t’s taking longer and longer to find a job, as National Employment Law Project Executive Director Christine Owens notes: "It is particularly telling that the number of Americans who have been looking for work for more than six months skyrocketed to a whopping 2.6 million, now accounting for nearly one in four of the unemployed."

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Krugman Examines "Obama Gap"

Economist Paul Krugman is warning that the $775 billion Obama economic recovery plan is too heavy on tax cuts, and falls short of the level of public investment needed to get the economy moving.

Paul Krugman: The Obama Gap -

...Mr. Obama’s prescription doesn’t live up to his diagnosis. The economic plan he’s offering isn’t as strong as his language about the economic threat. In fact, it falls well short of what’s needed.

Bear in mind just how big the U.S. economy is. Given sufficient demand for its output, America would produce more than $30 trillion worth of goods and services over the next two years. But with both consumer spending and business investment plunging, a huge gap is
opening up between what the American economy can produce and what it’s able to sell.

And the Obama plan is nowhere near big enough to fill this “output gap."

...To close a gap of more than $2 trillion — possibly a lot more, if the budget office projections turn out to be too optimistic — Mr. Obama offers a $775 billion plan. And that’s not enough...

Read rest of article

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Tuesday, January 6, 2009

Fighting Concentrated Poverty: Nonprofits and Their Networks of Support

Here's a great article by Rick Cohen of the Nonprofit Quarterly on the role that nonprofits can play in a national strategy of poverty reduction and job creation.

The Cohen Report: Fighting Concentrated Poverty: Nonprofits and Their Networks of Support

If President Obama is going to confront the depths of urban and rural poverty in the U.S., he is going to need to build the capacities of, and infuse capital into, community-based nonprofit organizations in poor communities. In addition to joblessness, lousy schools, high crime, and poor health outcomes, the least successful poor communities lack local nonprofits capable of providing ideas, expertise, and leadership for community renewal. The few localities making some progress, notwithstanding the past eight years of intentional downgrading and corrosion of federal government support, are those with functioning nonprofits—generally backed by an infrastructure of national and regional capacity-builders, financial intermediaries, and foundations.

...Our incoming president ought to be concerned not only with resuscitating the federal government’s commitment to eradicating poverty, but with building and sustaining an infrastructure of nonprofit organizations capable of organizing, planning, visioning, advocating, and implementing solutions.

The National Jobs for All Coalition recognizes the important role played by nonprofits in meeting community needs and advocating for community needs and social justice. Further, we think there are many opportunities for investing in human services infrastructure that will both create jobs and meet critical community needs.

Please check out the Drive for Decent Work to see how using public dollars to create jobs through community-based public and nonprofit agencies is a win-win solution for the current economic crisis. We welcome your thoughts on other opportunities for publicly-funded job creation.

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