Something we can all get behind: Subsidized Jobs

“How can we get more low-income adults into jobs, so they can better support their families and move up the economic ladder? … One approach to achieving this goal is through supporting subsidized jobs.” – Rep. Dave Reichert (R-WA)

This idea was a frequent refrain—repeated yesterday by Republicans and Democrats alike—at a hearing convened by Congressman Dave Reichert, Chairman of the House Ways and Means Subcommittee on Human Resources.

As my colleague Rachel West put it in a column published yesterday:

“It is high time for Congress to re-examine the evidence on subsidized jobs… an effective tool for increasing economic security—and ensuring that those who have been left behind by the labor market have access to job opportunities.”

My appreciation for the power of subsidized jobs has its roots in North Philadelphia. Fresh out of law school in the Fall of 2009, I was a new attorney at Community Legal Services (CLS) and the Great Recession was in full swing. Nationally, unemployment was approaching 10 percent. In Philly, unemployment was nearly 11 percent—and fully a quarter of the city’s residents were living in poverty.

As part of the American Recovery and Reinvestment Act of 2009 (aka, the stimulus package), federal funding was made available for states to establish subsidized jobs programs. In partnership with the Philadelphia Unemployment Project, we at CLS drafted a plan for what ultimately became Way to Work Pennsylvania—a statewide, subsidized jobs program that created 20,000 jobs for adults and youth around the Commonwealth.

While short-lived—the program ran from May 2010 through the funding’s expiration in September of that same year—Way to Work was by all accounts a great success. A partnership between Pennsylvania’s Department of Labor and Industry and the Department of Public Welfare, Way to Work connected low-income Pennsylvanians with private, nonprofit and public sector jobs paying up to $13 per hour. Per federal guidelines, priority populations for jobs placement included the long-term unemployed, low-income youth, welfare recipients, and people with criminal records (even people with minor records, such as a summary offense or an arrest without a conviction, can face significant barriers accessing jobs).

From the start, Way to Work was a win for both struggling Pennsylvanians and employers. The Philadelphia Inquirer reported on small businesses that were able to expand by taking on Way to Work employees, alongside profiles of people like Barbie Izquierdo, a mother of two who had been been out of work for more than a year before getting a subsidized job at the Greater Philadelphia Coalition Against Hunger.  Izquierdo then obtained a permanent position with the organization when one opened up. “This job has given me stability,” she told the Inquirer. “I’m living proof that Way to Work works.”

In all, 39 states and Washington, D.C. launched programs, using $1.3 billion in federal funding to place some 260,000 workers into subsidized jobs—which comes to $5000 per worker.  If you think the numbers are compelling, watch the personal testimonials of workers and employers who benefited from Pennsylvania’s program.

But the clock was ticking. The federal funds were set to expire at the end of September 2010. Workers and employers banded together and lobbied Congress to extend the deadline so that the programs could continue. Governors of red and blue states alike—including then-Governor of Mississippi Haley Barbour (R)—joined the chorus calling for the funding to be extended. In Pennsylvania, people felt so strongly about Way to Work, that a large group—including several employers—hopped a bus down to Washington in the July heat to tell members of Congress what Way to Work meant to them.

Despite bipartisan support, reauthorization of the federal funding failed to advance when the Senate couldn’t muster 60 votes, and the funds expired on schedule. Most states scaled down their programs as the funding dried up.

But as the Center on Budget and Policy Priorities and the Center on Law and Social Policy point out, the legacy of these programs is a blueprint for how subsidized jobs can serve as an effective tool for boosting economic security and mobility.

As West notes, subsidized jobs do not lessen the need to raise the minimum wage and pursue job creation, but:

“…when job opportunities remain elusive for whole groups of workers—even as economic conditions improve—these workers are denied the chance to protect their families from poverty and hardship, and chart a path to the middle class. As Congress evaluates the evidence on subsidized jobs programs, our lawmakers should consider subsidized jobs as an important strategy to increase economic mobility for those workers who need to get a foot in the door.”

Let’s hope Congress takes a serious look at an idea backed by something so rare it is now considered an anomaly: strong bipartisan support.





A Historic Executive Order for Good Jobs

Today is a great day for American workers.

President Obama will sign an executive order that in essence demands that companies clean up their acts and comply with labor laws if they are to receive federal contracts.  Now they will have to disclose any past violations of wage and safety laws, and other worker protections such as the right to not be discriminated against because of race or gender, and companies with a track record of violating workplace laws will no longer receive the federal contracts they have come to expect.

To put this change in perspective: the United States federal government is the largest purchaser of goods and services in the world, spending $500 billion a year on government contracts.  More than one in five workers are employed by a company that contracts with the federal government.  Further, reforms that are initially limited to contractors – such as when President Johnson signed an executive order banning gender and racial discrimination – often later expand to the broader workplace.

Responsible contracting reforms will put millions of dollars into workers pockets, reduce workplace discrimination, and increase safety.

In short, the executive order that will be signed today will have a significant impact on the lives of American workers.

Unfortunately, our current system for reviewing a contractor’s history of workplace safety and wage violations is inadequate and has allowed those with poor records to continue to receive government contracts.  In fact, according to a recent report by Sen. Tom Harkin (D-IA), companies that currently receive government contracts comprise one-third of the top offenders of workplace safety and wage laws.  From 2007 to 2012, wage theft by federal contractors amounted to $82 million in back wages for workers – hardly insignificant, especially for low-wage workers whose families are living on the brink.  During the same five-year period, 42 workers employed by companies with government contracts died due to workplace safety violations. Responsible contracting reforms will put millions of dollars into workers pockets, reduce workplace discrimination, and increase safety.

This executive order will be good for America’s taxpayers.  Contracting with companies that have egregious records of workplace violations – companies that are bad actors – frequently wastes taxpayer dollars and results in low-quality services to the government. According to a report by the Center for American Progress Action Fund, between 2005 and 2009, one-fourth of all government contractors that had the worst workplace safety records also had performance issues ranging from cost overruns to development delays to outright fraud.

This executive order will move the nation towards rewarding businesses that want to do right by their workers and taxpayers. Law-abiding businesses will celebrate this change.  They will no longer be placed at a competitive disadvantage with companies that reduce costs by paying lower wages than those required by law and by cutting corners on workplace safety.

All too often, the federal government has contracted with companies based on their ability to provide low-cost services – no matter what they are doing in the workplace.  President Obama’s action today will be a game changer – it will help ensure that companies follow the law, and that good companies are rewarded while bad actors are held accountable.

Perhaps most importantly, today’s action will improve the workplace as well as the pay for millions of workers who are struggling to get by – workers whose needs and rights have too often been on the periphery when it comes to awarding lucrative federal contracts.

With this executive order, those days are over, and that’s something worth celebrating.




The Three False Premises of the Ryan Poverty Plan

Paul Ryan has received a lot of attention for his recent poverty proposals. One wonders why, given that he has demonstrated time and again that he’s either unaware of the research on the topic, doesn’t understand it, or is intentionally misrepresenting it. In any case, he should be ignored.

But he’s Chair of the House Budget Committee, a leader within his party, and, whatever poverty scholars and more serious analysts might wish, he will still set many of the terms of the poverty policy debate in DC. He should be ignored, but he probably can’t be.

So what’s so bad about Paul Ryan’s thinking about poverty?

First, there’s nothing new in it. He offers block grants, cuts to programs, new work requirements, school vouchers, regulatory repeal, more money to faith-based initiatives, and privatizing social services, presenting us with little more than fresh marketing for tired ideas that — when tried in the past — made people’s lives worse, not better. Even the proposals that might seem promising are badly designed — like his way of expanding the Earned Income Tax Credit.  With the possible exception of his proposals to reduce some mandatory minimum sentences — which advocates of all stripes have been agitating for for decades — it’s old wine in old bottles.  Why should we treat it as newsworthy or innovative?

There’s a deeper problem with Ryan’s approach beyond the details of his proposal.  The foundation itself is rotten: the project is built upon three fatal, false premises.

The first assumption is that poverty is a complex problem — that we don’t know what works to reduce it, and that we need more data and more research.

This is wrong, and there are two easy ways to see that we could reduce poverty right now. First, we could look overseas. Every other rich democracy on the planet has a lower poverty rate than we do. They do it in all kinds of different ways, but most depend on generous, national, universal, programs — the exact opposite of what Ryan proposes. Can reducing poverty really be that hard if everyone else has figured it out?

We can also look to our own history. In 1959, official poverty rates among people over 65 were higher than for any other age group.  Today, they are lower than for any other age group. What happened? Social Security, which became more generous and nearly universal over time. It turns out that if you send people money every month — wait for it — they will be less poor.

The second assumption undergirding Ryan’s plan is that private or not-for-profit agencies are inherently more effective than public ones, and that state and local approaches do better than national ones — “devolution,” conservatives used to call it.

These particular claims, not borne out by the evidence, are rooted in the idea that long ago we had a golden age of private charity and civic volunteerism that provided effective, targeted aid to poor people — the kind of assistance that impersonal, distant government is incapable of delivering, the argument goes. This is pretty bad history, but its bad history with a pedigree.  Real historians, like Gertrude Himmelfarb and David Beito — and pretenders, like Marvin Olasky and Newt Gingrich — have made these kind of assertions in previous eras of “reform,” and even helped shape the harmful welfare policies of the Clinton years.

So Ryan is merely cribbing from the anti-welfare moralists of the 1980s, who were actually drawing on 19th century social thought. And those arguments were based in earlier British Poor Law philosophy that insisted that cash aid to poor people was only going to make them worse off. These are really old ideas that have been discredited by more than a century of increasingly sophisticated social science.

Paul Ryan wants the very government that he doesn’t trust to distinguish between the deserving and the undeserving and to treat them accordingly

More simply: you can’t have much knowledge of US history if you think overall well-being was better in the 19th century before the creation of the modern American welfare state, weak though it may be. And it is comparatively weak. Yet when Ryan claims that US social welfare programs have failed, he never includes the fact that every effort to expand them — from the Progressive Era to the New Deal to the Great Society — has been met with determined opposition, disproportionately from wealthy, white, Southern men (once Democrats, they are now Republicans). This is especially true of efforts to improve the well-being of women and people of color. The extent to which social welfare programs come up short today — as with the 2009 Recovery Act or the 2010 Affordable Care Act, for example — is in no small part due to Ryan’s Party trying to make them fail.

The final false premise that frames Ryan’s proposal is that poor people need counseling and guidance; they are broken and in need of fixing.  As a consequence, the Ryan Plan is built on intrusive casework and the micro-management of poor families’ lives (limited government is rarely a priority where poor people and people of color are concerned). But too often caseworkers are an obstacle to be overcome, not a boon to those looking for help too get by (and I say that as a Professor of social work). And perhaps that’s really the purpose of Ryan’s plan: research going back at least to the early 1960s shows that the more professional caseworkers there are in a city, and the more they are involved in the provision of relief, the less likely people are to get material assistance.

For Ryan, poverty is a failure of character.  Just as ideologues have done for centuries, he wants the very government that he doesn’t trust — not even with basic service provision — to distinguish between the “deserving” and the “undeserving,” and to treat them accordingly, even in the absence of evidence that those categories represent any recognizable reality. What he envisions might as well be called the Office for the Reformation and Redemption of the Poor, and for all of his supposed efforts to listen to people living in poor communities, he never comes to realize the most simple truth. As one homeless man put it to me a few years ago, “I’m not stupid, I’m just poor. People don’t seem to get the difference.”

Paul Ryan’s power must be taken seriously. But his analysis of the causes of poverty and possible ways to reduce it should not be.





Bearing Witness and Calling for a Good Jobs Executive Order

Today, underpaid workers from federal buildings all across our nation’s capital are on strike, calling on President Obama to do more than raise their wages to $10.10 an hour.  The President’s Executive Order doing just that was signed in response to a half dozen strikes that the workers engaged in over the past year, raising their voices and bearing witness to violations of labor law happening on federal property.


 Low-wage federal contract workers strike at Union Station for a Good Executive Jobs order. They were joined by Interfaith Worker Justice, SEIU, NETWORK, Members of Congress, and other organizations.

People I have talked with about this have said “The workers have won, they got a raise.  Why should the President take more action to address their concerns?”

I urge them, and anyone else who believes that a $10.10 minimum wage is enough to support a family to walk a mile in the shoes of Karla Quezada.  Karla has worked for more than a decade prepping food, making sandwiches and working the cashier serving customers at the Ronald Reagan federal building in Washington DC.  A single mother, she has worked day-in and day-out, sometimes more than 70 hours per week, trying to support her family.

In a complaint with Department of Labor (DOL), Karla alleges that she is a victim of wage theft.  She says that Subway never paid her the overtime premium that she was due when she would work more than 40 hours in a week. According to the complaint, Karla went on strike to highlight the abuse of federal contract workers, and her employer cut her hours, hoping to force her to quit and find another job.  But Karla has other ideas and greater resolve.

She has continued to raise her voice, highlighting the fact that wage theft and other abuses are taking place in federal buildings.  Karla and her coworkers joined with other federal contract workers to file that complaint with the DOL about their stolen wages.  It’s been over a year since the first complaint was filed, and the workers have not yet gotten a response.

I’m reminded of this Bible passage in Romans 4:4 – “Now to one who works, wages are not reckoned as a gift but as something due.” Raising wages is a great first step, but it’s not enough.  We need to guarantee that workers like Karla are paid every single penny of the money they have earned. It’s the moral thing to do, the right thing to do.  I believe the American people agree. Our tax dollars should not go to companies that are violating not only moral imperatives, but also actual laws.

In fact, our contributions as taxpayers should help guarantee that the jobs our tax dollars create are good jobs that can support a family, not keep hard working people living in poverty.

President Obama can do more to help federal contract workers.  A recent report by the public policy organization Demos found that if the president where to take action on a Good Jobs Executive Order he could put 20 million Americans on a path towards the middle class.  Eight million workers and their families employed in jobs created by taxpayer dollars could stop relying on public assistance in order to make ends meet.


A Good Jobs Executive Order could give preference to those companies that pay a living wage and provide good benefits, follow the law, allow workers to collectively bargain and don’t overspend on CEO pay.

Why should taxpayers reward companies that exploit their workers who are our neighbors and friends?

Muslim, Christian, and Jewish faith leaders agree and are supporting these workers in their struggle for fairness and a real opportunity to achieve the American dream.  Our faith compels us to stand with them, because their struggle is just and it is our struggle as well. Karla and her coworkers are not doing this out of selfishness. Millions of workers that Karla has never met can benefit from the risks she and her coworkers are taking.  Although they don’t all know each other, they do share one thing:  Taxpayer dollars are being used to keep them in poverty.

The President can change that with the stroke of his pen.




Three Ways to Create Jobs and Lower Poverty

The market is not providing enough jobs. There are 9.5 million people without work; six million children are living with at least one unemployed parent. The jobs that are available are too often inadequate, with not enough hours and volatile schedules that make it exceedingly difficult to supplement with other income. Median family income has not risen appreciably in 20 years.

That’s why in my last piece I echoed a call to combine a guaranteed $4,800 credit for every child with a guaranteed $15,000/year job for every family. That combination would drop child poverty to below one percent. The economic case for the child credit is simple and powerful: child poverty is really expensive, and addressing it early saves a lot of money in the long run.

Can the same economic case be made for a guaranteed job? To do so, you’d have to find jobs that cost the public more by not paying people to do them than the proposed $15,000 annual salary. You’d also have to find jobs that you reasonably believe the market would not provide alone. Finally, you’d want to find enough jobs that you could actually move the needle on poverty and employment.

I can think of three areas of public job provision that should meet all three criteria.

Infrastructure jobs. Congress has once again artlessly avoided fixing our highway trust fund in a sustainable way. Spending on infrastructure has fallen steadily for fifty years, and our country has dangerously crumbling roads, bridges, levees, public transit, and airports.

A Brookings Institution brief estimates that the annual economic cost of poor infrastructure is more than $170 billion. Funding a national corps of infrastructure workers would meet criterion one: it’s costly not to. It also clearly meets criterion two: inadequate infrastructure spending is not exactly a new problem. If the market alone were going to create these needed jobs, it would have by now.

Does it meet the third criterion? The proposal calls for jobs that pay $15,000 a year. For several years—at least as we upgrade our infrastructure—$170 billion in economic savings would pay for 11 million new jobs at that salary.

Community health workers. As the US population ages, healthcare spending will consume an ever-greater share of national resources. A principal economic goal, then, should be to reduce the cost of per-person healthcare spending.

The Urban Institute recently published a case for Community Health Workers, which would do just that:

Community health workers help people improve their health, manage their illnesses, and obtain services in timely and appropriate ways. Community health workers are lay people with close ties to the communities they serve who readily win clients’ trust. Trained to have health knowledge and selected for “people skills,” they promote wellness and connect clients with medical and other services, especially disadvantaged clients.

These types of services represent one of the more promising ways to keep costs down by improving health and the value of care, according to the Urban Institute. In fact, there is growing evidence that Community Health Workers do just that, but they lack adequate funding: Medicare and Medicaid don’t pay for them and so far private insurers have not done so either.

Community health workers therefore meet all three criteria: they provide cost savings, the field is not growing organically, and in the coming decades there will be great demand for their services.

An army of “sous-teachers”. This op/ed by a public school teacher argues poignantly that, for teachers, “there is never enough”—never enough time, energy, resources:

As a teacher, you can see what a perfect job in your classroom would look like. You know all the assignments you should be giving. You know all the feedback you should be providing your students. You know all the individual crafting that should provide for each individual’s instruction. You know all the material you should be covering. You know all the ways in which, when the teachable moment emerges (unannounced as always), you can greet it with a smile and drop everything to make it grow and blossom.

A good teacher knows these things, the writer argues, but with 30 hours a week of planning and grading and mandatory lunch and recess duty and overcrowded classrooms and not enough money for school supplies…no teacher can actually reach that standard.

So, let’s pair every public school teacher with a sous-teacher. Sous-teachers will complete a training program that equips them to grade simple assignments and quizzes, make copies, manage the classroom, and supervise playtime, all while leaving teachers time and space to realize the goal of that “perfect” classroom.

Full disclosure: I haven’t seen as clear an evidence base on the cost-effectiveness of this third idea. But we know that investing in children’s early development leads to health benefits and increased productivity. Improving the richness and quality of our children’s classroom seems a promising route – and in the meantime we could create hundreds of thousands of jobs.

If we, the public, adopt a long-term mindset of investing in our own economy, children, and workers, then we will find a long list of ideas that meet the criteria outlined here. It’s a matter of moving away from our “fiscal cliff” version of emergency governing to a long-term vision—one that empowers workers and families and builds a sustainable economy.