Republican policymakers that seek to implement austerity programs to address the Nation’s fiscal problems rationalize the bitter medicine by asserting that failing to reduce the Nation’s debt will place an undue burden on future generations.
However, these policymakers fail to include the long-term costs associated with implementing austerity programs too early in the Nation’s recovery, and policies that remove oversight of the private sector and weaken workers' voice.
If these policies are pursued, future generations may not face a serious debt burden, but the following will happen:
• Long-term unemployment will remain elevated,
• Minority, youth, and older worker joblessness will remain elevated, and
• Part-time employment will remain elevated.
As a result, future generations will have to pay for the costs of:
• Elevated worker idleness and higher crime rates,
• Larger class sizes and fewer teacher resources,
• Elevated levels of clinical depression,
• Elevated levels of poverty and food insecurity, and
• Elevated numbers of families that can’t achieve a “living wage”.
When these and other costs are included, immediately cutting government spending and returning to the policies of the 1980s at a time when the recovery has stalled, becomes an unattractive and dangerous policy path.
Wednesday, September 14, 2011
Tuesday, March 8, 2011
Violating Conventional Wisdom: Cutting Education, Training and Financial Stability Programs is Wrong
The February Bureau of Labor Statistics employment report contained some very good news. Over 200,000 private sector jobs were added and over the last 12 months, 1.5 million private sector jobs were created.
But, we must temper our positive reaction. The 1.5 million translates into a monthly average of 127,000, still below the 150,000 that’s needed to increase high school graduate, youth, and minority employment.
The report showed the consequences of the sustained, but modest growth. The college graduate unemployment rate fell because they obtained jobs. The high school graduate jobless rate fell too, but due to labor force exit. Further, earnings barely kept pace with inflation.
With these bifurcated outcomes, now is not the time to cut funds for education and training programs. Now is not the time to cut funds for Volunteer Income Tax Assistance Programs (VITA). VITA programs:
• Ensure financial stability. They maximize the use of tax code benefits and incentives, such as the Earned Income Tax Credit and Child Tax Credit.
• Help people create bank accounts and save a portion of their refund to pay for necessities.
• Provide an alternative to predatory tax preparers. Clients receive 100% of their tax refunds.
Yes, the federal budget needs trimming, but cutting education, training, and VITA programs violates a basic rule of thumb. You don’t cut funding that helps Americans achieve financial stability, especially so soon after the “Great Recession”, and when uncertainty remains that the economy can sustain itself without stimulus.
But, we must temper our positive reaction. The 1.5 million translates into a monthly average of 127,000, still below the 150,000 that’s needed to increase high school graduate, youth, and minority employment.
The report showed the consequences of the sustained, but modest growth. The college graduate unemployment rate fell because they obtained jobs. The high school graduate jobless rate fell too, but due to labor force exit. Further, earnings barely kept pace with inflation.
With these bifurcated outcomes, now is not the time to cut funds for education and training programs. Now is not the time to cut funds for Volunteer Income Tax Assistance Programs (VITA). VITA programs:
• Ensure financial stability. They maximize the use of tax code benefits and incentives, such as the Earned Income Tax Credit and Child Tax Credit.
• Help people create bank accounts and save a portion of their refund to pay for necessities.
• Provide an alternative to predatory tax preparers. Clients receive 100% of their tax refunds.
Yes, the federal budget needs trimming, but cutting education, training, and VITA programs violates a basic rule of thumb. You don’t cut funding that helps Americans achieve financial stability, especially so soon after the “Great Recession”, and when uncertainty remains that the economy can sustain itself without stimulus.
Wednesday, February 16, 2011
Economics Literacy for Adults, especially Young Adults
Emma Taylor of Acredited Online Colleges shared with me one of their recent blog postings: Money 101: 40 Financial Lectures to Prepare You for the Real World.
http://www.accreditedonlinecolleges.com/blog/2011/money-101-40-financial-lectures-to-prepare-you-for-the-real-world/
The site pulls together a wealth of on-line lectures by scholars and practitioners on an array of topics such as financial happiness, negotiation, investment and philanthropy, and credit, loans and retirement.
Enjoy!!!
http://www.accreditedonlinecolleges.com/blog/2011/money-101-40-financial-lectures-to-prepare-you-for-the-real-world/
The site pulls together a wealth of on-line lectures by scholars and practitioners on an array of topics such as financial happiness, negotiation, investment and philanthropy, and credit, loans and retirement.
Enjoy!!!
Saturday, February 12, 2011
New Piece on Kids and Economics
The folks at Nightly Business Report invited me to give a second 60 second commentary. I spoke about kids and economics, highlighting the Rutgers' Econkids.rutgers.edu site. Here is the link to the Monday, February 7th show: http://www.pbs.org/nbr/info/video.htm.
Sunday, January 9, 2011
Review of Last Week's Labor Market Commentary
Friends:
From my posts over the past year, you all now know that I spend 3-4 days prior to the first Friday of each month pouring over statistics in preparation for the release of the Bureau of Labor Statistics' unemployment rate and payroll employment growth.
The monthly report also contains information on the length and type of unemployment. For example, in December, 44% of the unemployed have been out of work for at least 27 weeks. We have almost 9 million Americans that are working part-time, but want a full-time job. Counting them as unemployed raises the jobless rate from 9.4% to 16.7%. Many call this the "real" unemployment rate.
My commentary on the labor market started with an early Wednesday morning interview on NPR's "The Takeaway". Ryan Wineland, a Block Buster Video manager and I reacted to a new study that found that 84% of those surveyed said they planned on switching jobs this year, up from 60% last year.
(http://www.thetakeaway.org/2011/jan/06/does-worker-dissatisfaction-signal-positive-job-growth-ahead/)
Thursday (Jan. 6th) was a first. I did a short commentary for the Nightly Business Report. The piece expressed my concerns about a new surge in income inequality in 2011 and beyond. The commentary presents a broad framework for us to consider. (http://www.pbs.org/nbr/info/video.html)
On Friday, I spent the morning and early afternoon at CNN. University of Maryland economist Peter Morici and I commented on the falling of the December unemployment rate form 9.8 to 9.4% for Your $$$$. (http://transcripts.cnn.com/TRANSCRIPTS/1101/08/cnnitm.01.html)
I also served as a resource for Mary Snow's Situation Room piece "On the Front Lines of a Job Search." http://edition.cnn.com/video/#/video/business/2011/01/07/tsr.snow.searching.for.a.job.cnn?iref=allsearch. She highlighted the job search experiences of not only the unemployed, but also the 9 million Americans that want to work full-time, but only have part-time hours.
My last bit of input was to help CNN staff writer Aaron Smith shine a greater light on the disparate impacts that the recession and now the weak jobs recovery are having across age, race and gender. http://money.cnn.com/2011/01/07/news/economy/unemployment_racial_gap/index.htm
If there is a common thread to my commentary, it is to remind us of the recovery's various contours of experience.
From my posts over the past year, you all now know that I spend 3-4 days prior to the first Friday of each month pouring over statistics in preparation for the release of the Bureau of Labor Statistics' unemployment rate and payroll employment growth.
The monthly report also contains information on the length and type of unemployment. For example, in December, 44% of the unemployed have been out of work for at least 27 weeks. We have almost 9 million Americans that are working part-time, but want a full-time job. Counting them as unemployed raises the jobless rate from 9.4% to 16.7%. Many call this the "real" unemployment rate.
My commentary on the labor market started with an early Wednesday morning interview on NPR's "The Takeaway". Ryan Wineland, a Block Buster Video manager and I reacted to a new study that found that 84% of those surveyed said they planned on switching jobs this year, up from 60% last year.
(http://www.thetakeaway.org/2011/jan/06/does-worker-dissatisfaction-signal-positive-job-growth-ahead/)
Thursday (Jan. 6th) was a first. I did a short commentary for the Nightly Business Report. The piece expressed my concerns about a new surge in income inequality in 2011 and beyond. The commentary presents a broad framework for us to consider. (http://www.pbs.org/nbr/info/video.html)
On Friday, I spent the morning and early afternoon at CNN. University of Maryland economist Peter Morici and I commented on the falling of the December unemployment rate form 9.8 to 9.4% for Your $$$$. (http://transcripts.cnn.com/TRANSCRIPTS/1101/08/cnnitm.01.html)
I also served as a resource for Mary Snow's Situation Room piece "On the Front Lines of a Job Search." http://edition.cnn.com/video/#/video/business/2011/01/07/tsr.snow.searching.for.a.job.cnn?iref=allsearch. She highlighted the job search experiences of not only the unemployed, but also the 9 million Americans that want to work full-time, but only have part-time hours.
My last bit of input was to help CNN staff writer Aaron Smith shine a greater light on the disparate impacts that the recession and now the weak jobs recovery are having across age, race and gender. http://money.cnn.com/2011/01/07/news/economy/unemployment_racial_gap/index.htm
If there is a common thread to my commentary, it is to remind us of the recovery's various contours of experience.
Subscribe to:
Posts (Atom)
