22.03.2011
Policy Points
From a report in The New York Times…
Without a flood of food stamps and tax benefits for low-income families, about 250,000 more New Yorkers would have slipped into poverty at the height of the recession, according to calculations to be released Monday by city officials.
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As it was, while the federal poverty rate for the city remained about the same from 2008 to 2009, 17.3 percent, by a measure developed by the city it rose to 19.9 percent. The city takes into account factors the federal standard does not — higher local costs of living and expenses for health care, commuting and day care, or the value of benefits like food stamps, housing allowances and tax credits that can supplement cash income.
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“To a large degree, economic stimulus programs and policy initiatives aimed at bolstering family income succeeded in preventing a rise in poverty in New York City,” according to the report by the mayor’s Center for Economic Opportunity.
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“Not every antipoverty program meets its goals and deserves to be protected,” the report by Dr. Mark Levitan, the center’s director of poverty research, says, “but calls for across-the-board cutbacks to programs that help low-income families cannot be justified by the assertion that when it comes to poverty, ‘nothing works.’ ”
21.03.2011
Policy Points
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21.03.2011
Policy Points
Free Exchange catches the budget hawks wearing no clothes:
It’s hard not to be cynical about government policymaking, and this is why. Forget about fiscal stimulus for the moment. At present, both Republicans and Democrats are committed to cutting the government’s budget in the current fiscal year. These cuts will almost certainly threaten programmes with positive economic returns; job retraining programmes are on the chopping block, for instance. Certainly few party leaders are seriously discussing new spending on programmes with positive economic returns. America has substantial infrastructure needs—current spending is inadequate to simply maintain critical infrastructure at its current state of repair—and yet the odds of passing a new transportation law to replace the one that was scheduled to expire in 2009 but which has since been extended repeatedly, well, they’re close to zero. Why? No one can agree on a way to fund new infrastructure spending.
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Libya poses no threat to America. It’s far from clear that American intervention will yield positive outcomes for Libyans. And yet here America goes, launching massively expensive sorties, dropping massively expensive ordnance. And obviously it isn’t just America, Britain managed to join the fight despite its austerity drive.
And the bottom line:
The point here is not that government spending should never be cut. It should be, and it almost certainly must be if America is to avoid a serious fiscal crisis down the road. But for a very long time now, much of official Washington—Democratic and Republican leaders, along with policy intellectuals and op-ed pages—has acted as though an immediate fiscal crunch loomed. This was never true. American debt levels may be an issue by the end of the decade, but they aren’t now, and deficits are forecast to fall sharply for the next few years. Bond yields have rarely been lower. The fiscal problem is long-term, not short-term. And yet dire fiscal scenarios have been used to sell painful short-term cuts, some of which were necessary but could have been accomplished later, many of which weren’t necessary at all. Americans have been told, by the president of the United States and his chief Republican antagonists, that in hard times the government, like households, must tighten its belt. And then along comes Libya to put the lie to all of these assertions.
21.03.2011
Policy Points
Naked Capitalism can’t understand why Americans who lose jobs “become pariahs in the job market.”
I think there have been significant second-order effects as a result of a restructuring of the American workplace by employer who like to claim that “employees are our most important asset”: but really treat them as expenses to be minimized, ruthlessly. One is the way unemployment quickly becomes a barrier to getting a job again. There has always been bit of a stigma surrounding unemployment, since the concern is that the individual lost his job for performance reasons, as opposed to bad luck …
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But I’ve seen the bias become far more ingrained over time, reinforced and rationalized by the bizarre way that companies now spec jobs. Whereas in the stone ages they’d hire a competent-seeming individual with some relevant experience, they now look for people who have done exactly the same job at a similar company. This overly narrow hiring spec then leads to absurd, widespread complaint that companies can’t find people with the right skills. That’s bunk. As Dean Baker has pointed out repeatedly, it means they need to pay more, or as I’d suggest, they need to broaden their horizon a tad. The idea that people need a lot of costly training is in most cases grossly exaggerated, a convenient “whocoulddanode” for manager who are quick to fire people and then discover when they want to gear back up that there are costs of brining new workers on, no matter how hard they try to minimize them.
The post concludes
So this “skills” meme is basically an excuse for bad policy and lazy management. It allows for the rationalization of outcomes that would have been seen as unacceptable in the Reagan era. And it’s hard to pin this development on the Fed. This weakening of the position of workers is the result of both deliberate action and misguided economics frameworks. It’s time to take aim at the ideology, not just some of its key followers.
18.03.2011
Policy Points
Economic policy reports, blog postings, and media stories of interest:
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