Monday, June 29, 2009

Lingering Unemployment Likely to Challenge Obama and the Nation -

Recovery's Missing Ingredient: New Jobs
Experts Warn of A Long Dry Spell

By Michael A. Fletcher
Washington Post Staff Writer
Monday, June 22, 2009

"Despite signs that the recession gripping the nation's economy may be easing, the unemployment rate is projected to continue rising for another year before topping out in double digits, a prospect that threatens to slow growth, increase poverty and further complicate the Obama administration's message of optimism about the economic outlook..."

"...Analysts say the high levels of joblessness would be accompanied by increases in child poverty, strained government budgets, and black and Latino unemployment rates approaching 20 percent."

"I find it unfathomable that people are not horrified about what is going to happen," said Lawrence Mishel, president of the Economic Policy Institute. "I regard all this talk about how the recession is maybe going to end, all the talk about deficits and inflation, to be the equivalent of telling Americans, 'You are just going to have to tough it out.' But we're looking at persistent unemployment that is going to be extraordinarily damaging to many communities. There is a ton of pain in the pipeline."

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Daily Kos Proposes Housing Progress Administration (HPA)!

Daily Kos [Steven Attewell]: “Reason Not the Need”: Housing Policy and Jobs:

"...My suggestion would be for the Federal government, along with the state and local governments, to go into areas where the housing market has failed (large proportions of renters paying more than 30% of income in rent, housing values far out of sync with median incomes, large numbers of abandoned foreclosed properties, or a lack of affordable housing in general) and do three things: first, to restore and rehabilitate derelict housing and second, to build new housing units where new housing is needed in central cities, and third, to destroy 'ghost towns' that are now nothing of blight in such a way that as much of the materials can be saved as possible."

"If we were establish a Housing Progress Administration (HPA) to employ 5 million unemployed workers (many of whom would no doubt be former construction workers) to do this, and we paid $24k a year (assuming an overhead rate of 30%, which is actually 10% higher than the WPA's historic 20% rate), making a deal with states and localities to pitch in for the cost of land and materials, it would cost approximately $155 billion per year. If we kept the program going for the next two years, at which point economic growth would start to transition into employment growth, it would cost $310 billion – less than half the cost of the stimulus bill. And it would create at least 5 million jobs, nearly the total number of jobs lost in this recession..."

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California Budget Crisis is Tip of the Iceberg

In a Crisis, Rethinking Fiscal Federalism - Economix Blog -
By Harold Pollack AND Ed Kilgore 6/29/09

"The Los Angeles Unified School District will cancel most summer programs this year because of California’s budget woes. The state’s entire welfare-to-work system may also be on the chopping block, cuts that could deny health coverage to 900,000 children."

"Although California’s budget woes and political hijinks hit the front page, that state is not alone... "

"Media accounts present each state’s difficulties in light of its distinctive politics and economic circumstances: the budget-crippling ballot initiatives in California, the culture of corruption in Illinois, the liberal health policies of Massachusetts.... It’s fun to ponder the local flora and fauna, but the real problems lie underneath: the frayed partnership between states and the federal government."

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Majority of states face severe budget problems

By Elizabeth McNichol and Iris J. Lav
Center on Budget and Policy Priorities 6/29/09

The ongoing decline in tax receipts has worsened state budget problems. At least 48 states addressed or are facing shortfalls in their budgets for the upcoming year totaling $166 billion or 24 percent of state budgets. New data show a majority of states expect shortfalls in 2011 as well. Aggregate gaps through 2011 likely will exceed $350 billion...

...If revenue declines persist as expected in many states, additional spending and service cuts are likely. Budget cuts often are more severe in the second year of a state fiscal crisis, after largely depleted reserves are no longer an option for closing deficits.

The experience of the last recession is instructive as to what kinds of actions states may take. Between 2002 and 2004 states reduced services significantly. For example, in the last recession, some 34 states cut eligibility for public health programs, causing well over 1 million people to lose health coverage, and at least 23 states cut eligibility for child care subsidies or otherwise limited access to child care. In addition, 34 states cut real per-pupil aid to school districts for K-12 education between 2002 and 2004, resulting in higher fees for textbooks and courses, shorter school days, fewer personnel, and reduced transportation.

Expenditure cuts and tax increases are problematic policies during an economic downturn because they reduce overall demand and can make the downturn deeper. When states cut spending, they lay off employees, cancel contracts with vendors, eliminate or lower payments to businesses and nonprofit organizations that provide direct services, and cut benefit payments to individuals.

In all of these circumstances, the companies and organizations that would have received government payments have less money to spend on salaries and supplies, and individuals who would have received salaries or benefits have less money for consumption. This directly removes demand from the economy. Tax increases also remove demand from the economy by reducing the amount of money people have to spend – though to the extent these increases are on upper-income residents that effect is minimized because much of the money comes from savings and so does not diminish economic activity.

The federal government — which can run deficits — can provide assistance to states and localities to avert these “pro-cyclical” actions...

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Herbert: No Recovery in Sight

No Recovery in Sight -
Bob Herbert, 6/26/09

"...Economists are currently spreading the word that the recession may end sometime this year, but the unemployment rate will continue to climb. That’s not a recovery. That’s mumbo jumbo."

"Why this rampant joblessness is not viewed as a crisis and approached with the sense of urgency and commitment that a crisis warrants, is beyond me. The Obama administration has committed a great deal of money to keep the economy from collapsing entirely, but that is not enough to cope with the scope of the jobless crisis..."

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Monday, June 1, 2009

Expanding the Boundaries of Public Debate

Last week, the National Jobs for All Coalition, the National Council of Churches and other groups held an organizing meeting to plan to a national conference on job creation and full employment in the fall. We expect the conference will take place in New York on Nov. 19 and 20, and we hope it can become a model for meetings in other parts of the U.S.

Here's the call we sent out for the meeting. We'd welcome your thoughts, ideas, sponsorship and financial support!

Creating Decent Jobs, Meeting Human Needs & Sustaining the Environment

The Problem and the Goals: Temporary and Permanent

Even before the onset of our current, deep recession, we faced chronic unemployment, low and stagnant wages, myriad unmet needs and unprecedented environmental degradation.

Today’s rapidly escalating unemployment has put job creation back on the public agenda for the first time in recent history. Over 13 million people were officially unemployed in March 2009, and hidden unemployment brings total joblessness up to an appalling 28 million with 9 seekers for every available job. If it is possible to ignore the chronic unemployment that besets millions of people in normal times, it is much harder to ignore this current, mass unemployment and its staggering social and economic costs.

What should Progressives do about mass unemployment? What long-term goals should we have for the economy? A strong economic stimulus is imperative to meet the current emergency. Yet, a stimulus that achieves its promise-- to create 4 million jobs--would only reduce official unemployment by a third! Nor is it good enough to return to official unemployment of 5 million women and men and millions more working poor even in the “best” of recent times or to be satisfied with the host of unmet needs with which this recession began. In the words of FDR, “We cannot be content, no matter how high the general standard of living may be, if some fraction of our people … is ill-fed, ill-clothed, ill-housed, and insecure.”

Crises present opportunities for progressive change. This is the time for Progressives to mobilize and to develop goals for an economy that provides living wage jobs for all, sustains the environment and repairs our social and physical infrastructure. This is the time for Progressives to devise economic and political strategies for achieving these short- and long-term goals.

The Proposal: A National Conference to Create Living-Wage Jobs, Meet Human Needs and Sustain the Environment, New York City, November 19-20, 2009.

Participation and sponsorship for this National Conference would be broad--including not only institutions with a primary focus on the quality and quantity of jobs, economic justice, social security, the safety net and poverty. Other critical participants are organizations not primarily concerned with employment whose goals for health care, education, child care, elder care, disability rights, housing, eco-restructuring, public transportation and the arts would be furthered by job creation in their areas of interest. The hope is to gain their ongoing commitment to conquering unemployment and low wages-- even after the crisis subsides. This would build on a plan of the National Jobs for All Coalition to simultaneously create living wage jobs for all and, through a renewed public sector, to repair our deeply deficient social and physical infrastructure.

We propose establishing a Steering Committee consisting of representatives of the New York City Central Labor Council, National Jobs for All Coalition, National Council of Churches and other potential leaders. The tasks of the Steering Committee are to: secure a paid, conference coordinator; choose and acquire a conference site; recruit other potential sponsors, both grassroots and mainstream; select outstanding speakers to present solutions and strategies for progressive change; develop a plan for gaining the widest possible participation and the widest possible publicity for the conference and its outcome; and initiate plans for ongoing action such as follow-up conferences in cities throughout the nation and a mass Mobilization for Living Wage Jobs and Public Investment in Washington DC.

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Stimulus projects bypass hard-hit states

Another wake-up call about why we need a new federal jobs program like the WPA to help areas and regions where there is high unemployment and underemployment. The US economy fails to create enough decent jobs in good times as well as bad, and it consistently fails to help many workers and groups who are structurally unemployed and underemployed.

The next round of stimulus funding should create multi-year, accountable, federally-financed jobs program to address unmet needs for infrastructure repair, environmental restoration, education and human services. The jobs created should be tracked through a National Employment Accounting Office, to report the economic and social benefits of the jobs program back to the American people.

Stimulus projects bypass hard-hit states -
By Brad Heath, USA TODAY, May 27, 2009

"States hit hardest by the recession received only a few of the government's first stimulus contracts, even though the glut of new federal spending was meant to target places where the economic pain has been particularly severe.

Nationwide, federal agencies have awarded nearly $4 billion in contracts to help jump-start the economy since President Obama signed the massive stimulus package in February. But, with few exceptions, that money has not reached states where the unemployment rate is highest, according to a USA TODAY review of contracts disclosed through the Federal Procurement Data System.

In Michigan, for example — where years of economic tumult and a collapsing domestic auto industry have produced the nation's worst unemployment rate — federal agencies have spent about $2 million on stimulus contracts, or 21 cents per person. In Oregon, where unemployment is almost as high, they have spent $2.12 per capita, far less than the nationwide average of nearly $13.

That money 'is needed nowhere more than it is needed in Michigan,' says Leslee Fritz, a spokeswoman for the Michigan Economic Recovery Office, which is coordinating stimulus efforts in that state. She said officials are generally satisfied with the pace of federal aid, but added, 'We certainly feel very intensely the need to move quickly.'"

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Federal Stimulus Should Address Huge Growth in Underemployment

Good article from the Washington Independent quotes NJFAC's Trudy Goldberg and Phil Harvey

t r u t h o u t -- Underemployment Presents Challenges:

...There's no single agency that tracks the underemployed, so researchers have to cobble together data from all corners of the economy to come up with an estimate on disenfranchised workers. According to Philip Harvey, a professor of law and economics at Rutgers School of Law, the United States is short by nearly 23 million jobs, a far greater number than the 13.7 million of officially unemployed workers.

Gertrude Goldberg, chair of the National Jobs for All Coalition, says that lowballing the number of distressed workers leads to an inadequate response. "By under-defining it you reduce the notion of a mass of people at risk in terms of tomorrow," she said. And while they may disagree on precisely how to count underemployed Americans, nearly all agree that their growing numbers could lead to problems both in the short term as well as in the

Despite these troubling clues, though, [Goldberg says] the government hasn't been aggressive or inclusive enough in designing stimulus programs that help out the underemployed as well as the unemployed. Although the federal government has extended unemployment benefits and given states money to boost the benefits by a nominal amount, none of this helps the employee forced to work a four-day week or take a part-time job to replace lost full-time employment...

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WPA Writers Documented Regional Differences in Food System

Interesting piece an output of the Federal Writers project!

Q What could a new WPA accomplish in terms of 1) supporting arts and culture 2) promoting a more locally-based, sustainable, high quality food system?

Concord Monitor - Diet was once function of geography:

"Among the first programs to be shut down was President Franklin D. Roosevelt's economic stimulus package for the Depression, the Works Progress Administration. The WPA put Americans to work on a wide variety of projects. One, the Federal Writers Project, operated in all 48 states and employed more than 4,500 writers, including Studs Terkel, Saul Bellow, Richard Wright, Nelson Algren, Claude McKay, Conrad Aiken, Ralph Ellison, Zora Neale Hurston, Kenneth Patchen, John Cheever and Kenneth Rexroth.

By February 1943, when the WPA was closed down, these writers had published 1 million words about America. There were at least 276 books, some still in print and enjoyed today. In all, with pamphlets and brochures included, the group produced more than 1,000 publications.

Now the raw, unedited manuscripts of the project's last creative effort - canceled after Pearl Harbor and never assembled - was contained in the gray boxes before me. That ambitious effort explored the social and gastronomic traditions of American food. Novelists, anthropologists, out-of-work reporters, teachers, secretaries, typists and penniless people who had always wanted to be writers were instructed to send in recipes, interviews, stories of parties and picnics, pancake breakfasts and weddings, and anything else they could find that had something to do with food and eating in America."

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WPA Posters

Created with Admarket's flickrSLiDR.