Understanding Government

In the shadow of the more or less pristine Mt. Shasta and Trinity Alps lies one of the most contaminated sites on Earth. Now an Environmental Protection Agency Superfund site, the Iron Mountain Mine has been undergoing remediation for over two decades and has been acknowledged as an environmental problem for over a century. (more…)

The Washington Post’s Alec McGillis had a great piece this weekend revealing that the $25 billion “green jobs” portion of the stimulus bill has, well, yet to produce more than a few dozen green jobs. It’s a complex issue but the crux of green jobs seems to be this: If you are first concerned about global warming or whether federal and state governments use energy in an efficient way, it’s a promising program. If you are first concerned about job creation, “green jobs” stinks. (more…)

The New York Times’ Jackie Calmes adds to the articles about the Obama administration and Congress considering an expansion of elements in the stimulus package, due to ever-rising unemployment. The programs that Calmes reports will be expanded are varied — there is extending unemployment benefits and the COBRA program, which provides health care to the recently laid off, both programs that expire Dec. 31. But then they are the “tax credit” plans — a tax credit to first-time purchasers of homes and a tax credit to businesses who hire new workers or don’t lay off current ones.

What’s missing from this discussion is any new government programs that more directly help the unemployed. Extending unemployment benefits and COBRA, of course, directly helps the unemployed. But these tax credits seem a limp, and easily exploited, way to nudge consumers and businesses to more stimulating behavior. I’d like a push for more civil servant and public goods projects — or at least a move to recall some of the teachers and health workers state governments were forced to lay off. The government should be one job market more able to respond to a recession, yet 53,000 government jobs were shed just last month.

It’s politically risky to push for such an expansion of government. But the NYT piece implies that what’s riskiest for Obama and Democratic leaders in Congress is to maintain the status quo and see unemployment continue to rise well into next year. Maybe in the case of fighting unemployment, helping people who need it most can also be good politics.

The White House Council on Economic Advisers issued a report Sep. 11 claiming that the American Reinvestment and Recovery Act, better known as the stimulus bill, has created up to 1.1 million jobs. But all stimulus jobs are not created equal – 227,000 are summer-only employment for poor or otherwise disadvantaged people, ages 14-24. These jobs were for 20-30 hours a week, paid the minimum wage, and ended after 6-10 weeks. Summer is over – and so are these 227,000 jobs.

About $1.2 billion of the stimulus bill went toward bringing back the summer-only employment program, a part of the Workforce Investment Act youth program that runs out of the Labor Department. The mission of summer employment programs for disadvantaged youth is both vague and tantalizing – they’re supposed to spur consumer spending, provide for poor families, teach job skills, and open a world of possibilities for often ghettoized young people. The experience here in Chicago and across the country is that summer youth jobs begin to accomplish some of these goals. But summer jobs do not give disadvantaged young people what they really need – a year-round program to put them on track toward permanent employment.

Summer Stimulus

Summer youth jobs are the quintessential social program – conditionally funded by Democrats and reflexively opposed by Republicans. (more…)

Apropos of my back-to-school extravaganza on teacher merit pay, the New York Times’ Sam Dillon takes a look today at teacher layoffs around the country. Dillon can’t give figures on how many teachers have been laid off in the past year, but a clear pattern emerges: State X can’t generate any revenue in the recession. So they lay off, say, 1,000 teachers. Then State X taps into stimulus money and re-hires, say, 700 teachers they’ve just laid off.

One issue here is whether the stimulus should have been big enough to prevent all teacher layoffs or whether the most sensible policy is really the status quo that just makes the layoffs less severe. Related is something I wrote about in the merit pay piece: the Education Dept. got $115 billion from the stimulus bill — more than twice its yearly budget. But a significant amount of that money is not just formula funding so states can deal with budget shortfalls. Billions, instead, are in competitive grants awarded to states whose education policy goals (more charter schools, strict evaluations of teachers) are in line with Barack Obama and Education Sec. Arne Duncan.

I’m ambivalent about how this allocation of education stimulus money is a good idea. On the one hand, if the federal Education Dept. thinks these state education departments are currently not very effective than maybe they’re right to use the stimulus to make these states change, instead of just blindly comping the status quo. But the fiscal crisis might not be the best time for innovation at a state level. Can school districts implement splashy new policies when these same districts are looking for coins under couches to keep band programs and 5th grade art teachers?-MB