Policy Shop

Policy as if people mattered

Good News For Grads in the Jobs Report

(Demos DataByte)
While the September jobs report from the Bureau of Labor Statistics provided plenty of political ammunition, it remains an ambiguous signal about the current labor market. Young people, who are at a disadvantage when hiring is slack, tend to fare worse in such good news/bad news situations. They confront the same challenges as the working population overall, but are not as well-positioned to endure them. In this case those obstacles include weak growth, persistent rates of long-term unemployment, and a substantial rise in workers holding part-time positions because they cannot find the full-time work they need. Young adults have less job experience and lower savings than older workers, making them more likely to accept employment that provides the bare minimum they need to get by—not the best situation for someone looking to launch a career or start a family. But in addition to sharing the challenges, this month workers ages 20 to 34 experienced the same positive outcomes as did the...

Hey! Hey! Government Is Hiring Again

(Demos DataByte)
Here's one very interesting piece of news from today's jobs report : The public sector has stopped firing people and started hiring. According to the report, government at all levels has added 68,000 workers in the past three months. This hiring spree comes after three years of nearly non-stop government layoffs, with over 600,000 public sector workers losing their jobs—including over 200,000 teachers or other school workers. The downsizing of government amid hard times has been one of the most preventable aspects of the unemployment crisis. Americans have wanted government to solve this problem, and instead government made it worse—specifically, by Congress's failure to provide enough federal assistance to states facing shortfalls. More government hiring suggests that revenues of state and local governments are picking up again. But these entities are not out of the woods by a long shot and federal aid is still badly needed if Washington is truly interested in speeding up the...

Obama and Romney: What About Inequality?

(Flickr/PaulSteinJC)
Just a year ago, Occupy Wall Street commanded attention from the media and politicians alike. Yet last night the central concern of that social movement—one shared by a majority of Americans—wasn't even mentioned as both candidates and the moderator ducked the problem of economic inequality. Yes, Obama did say several times that America does best when the middle class is growing. But he never overtly talked about the growing chasm of income and wealth—or how a big reason that ordinary people are not doing so well is because so much new prosperity created in today's economy gets channeled upward to a tiny sliver of the population. Not mentioning inequality when talking about the plight of the middle class is like not mentioning poaching when discussing the future of elephants. Obama's omission was especially notable in that his campaign is one of the most populist in memory, with nonstop attacks on Romney as part of the plutocratic problem and repeated calls for higher taxes on the...

Finally! Schneiderman Goes After JP Morgan Chase

New York Attorney General Eric Schneiderman, with the support of the mortgage task force formed by the Obama administration last January and the Justice Department, has commenced the long overdue prosecution of the Big Banks for their role in triggering the financial crisis of 2008. (That is not a typo—the Justice Department has finally moved against the Big Banks.) The case is a civil proceeding for unspecified damages against JP Morgan Chase, as successor to Bear Stearns (which it acquired with the backing of the Fed in 2008). It alleges systematic fraud against the buyers of residential mortgage backed bonds prior to the merger. Schneiderman deserves praise for leading the effort. It is a welcome counter to self-serving assertions of Fed officials that the investors should have understood the risks that they were getting into. Even now, the allegations in the Complaint stir outrage, though most have been known for many months. Bear Stearns bond-marketing documents are cited for...

Barry Commoner's Legacy

(TIME Magazine)
Yesterday brought the sad news that noted environmental advocate and scholar, Barry Commoner , had passed away. As pointed out in the many tributes to his life and achievements, Commoner was one of the founders of modern environmentalism and embraced a more complex, holistic view of environmental issues. Commoner believed in addressing multiple issues, such as racism, sexism, war, and—most importantly—the failings of capitalism at the same time as environmentalism because they were, and still are, all related issues of a larger central problem. Commoner had four informal rules of ecology: Everything is connected to everything else Everything must go somewhere Nature knows best There is no such thing as a free lunch Decades later, these rules still hold true. The first idea addresses the concept that environmentalism is just one piece of a larger picture. For instance, gender rights are not thought of as a traditional environmental issue. Yet, empowering women is one of the best ways...

Diane Ravitch on the "Effort to Destroy Public Ed"

(Flickr/Kevin Lock)
Diane Ravitch receiving a National Education Association award in 2010. Click here to read part 1 of the Prospect 's interview with the former assistant secretary of education. When Diane Ravitch changed her mind about education reform, she became one of the leading critics of a movement that dominates American policy. For the most part, both Democrats and Republicans now push to make school systems resemble economic markets. They want fewer teacher protections, more testing, and more charter schools for parents to choose from. President Barack Obama's Department of Education, headed by education reformer Arne Duncan, shares many policy goals with those of George W. Bush's administration. Ravitch herself was once part of the movement, promoting student assessments and helping to create voluntary academic standards. After serving as assistant secretary of education under George H.W. Bush, she held positions at the pro-school-reform movement Thomas B. Fordham Foundation and was a member...

Your Credit Score Could Be A Fake

Say you want to buy a house or a car and you need a loan to do it. You do what every personal finance site recommends and obtain a free copy of your credit report from annualcreditreport.com . Then, urged on by the ads from TransUnion, Equifax, or Experian—the “big three” credit reporting firms that compile the reports—you opt for not only the free report but also shell out for what the companies promise is your actual three-digit credit score . A number! Now, you may think, I know what the auto lenders and banks making mortgages really think of me. I have a sense of what rates I qualify for and what type of car or home I can afford. There’s just one problem: the score you paid for is likely not the same one potential lenders will use to assess you . In fact, it could be way off. What many consumers don’t realize is that they have no single “credit score”— FICO alone has more than 49 different scoring models . And new research from the Consumer Financial Protection Bureau (CFPB) finds...

Jerry Perenchio: California's Sheldon Adelson

(AP Photo)
While Sheldon Adelson and the Koch brothers have become emblematic of outside spending at the national level, it is local outside spending that could have the greatest impact on policy. Jerry Perenchio is California's homegrown Sheldon Adelson, and he's using his fortune to decide the future of the nation's most populous state. California's income inequality is among the worst in the country. And as the ongoing fight over Proposition 30 shows, that often translates into political inequality. Proposition 30, which Californians will vote on this year, is Governor Jerry Brown’s attempt to solve the state’s budget deficit while maintaining funding of California schools by raising taxes on individuals making over $250,000 dollars a year. The initiative is badly needed. Without Prop. 30, California's budget deficit would slash education funding by $6 billion . Perenchio recently made a $200,000 donation against Prop. 30. As it is, California lags behind the rest of the country when it comes...

An Antidote to Voter Suppression

Yesterday, hundreds of non-partisan organizations came together for National Voter Registration Day to ensure that hundreds of thousands of Americans will be able to exercise their freedom to vote and make their voices heard this upcoming November. While a 21st century upgrade of our elections system is desperately needed to make a National Voter Registration Day unnecessary , we take this moment to recognize several states around the country that make every single day a “state voter registration day” by ensuring that voter registration services are provided at public agencies under the National Voter Registration Act ( NVRA ), commonly known as “the Motor Voter Law.” Many of us have experienced the Motor Voter Law when we have visited a motor vehicles department and have registered to vote or updated our voter registration information. Less well known is that public assistance agencies also are required to offer voter registration services. Unfortunately, over the first ten years...

Against a TSA Democracy

For the first time ever, people around the country who love American democracy have decided to come together to observe a National Voter Registration Day on September 25, 2012—a day to pull out all the stops in making sure that every eligible voter is registered and able to vote in this critical election year. Hundreds of non-partisan organizations have agreed to reach out to help hundreds of thousands of people get registered to vote so that they can fulfill their civic duty as citizens and make their voices heard in November. This is an inspiring project that all of us should support. But it also provides an important occasion for asking deeper questions about our voting system: Why exactly are there so many Americans who are not registered to vote, and how can we improve our electoral system to get rid of red tape around the registration process and ensure that every eligible person is able to exercise the freedom to vote? American democracy should be a model for the world. A...

History Lesson: Tax Cuts Are No Magic Bullet

No idea is more central to conservative economic thinking than the belief that cutting taxes leads to higher economic growth. One can certainly understand the appeal of this belief: It would be great if government could collect the same amount of revenue, but with much lower tax rates, because those rates fostered strong growth. Alas, the historical record doesn't offer much validation of this sunny supply-side vision -- as I have noted here repeatedly. David Leonhardt discussed the record yesterday in the New York Times. One interesting point he noted was that cutting taxes may make a difference when taxes are extremely high, but the rate changes of recent years are relatively small and thus it's no surprise that the effects would be modest. Listening to today's tax debate, you'd think our political leaders were debating capitalism vs. socialism. In fact, though, going back to the Clinton-era tax rates would mean raising the top income tax bracket by less than 5 percent. That's not...

Wall Street Built That

(Flickr/Ed Gaillard)
As we celebrate Occupy Wall Street’s first birthday, the movement's pivoted from financial regulation to focus on crushing consumer debt . While reforming debt is crucial (particularly student debt), finance remains an imminent threat to the American economy. We shouldn't forget it. There's little evidence that Wall Street's changed since 2008. The drumbeat of flagrant financial crimes has continued unabated in the year since Occupy Wall Street’s inception. As Senior Fellow Wallace Turbeville aptly illustrates, the culture of the "alpha" remains . In addition, coming on the heels of a report by Better Markets last week that apprised the cost of the financial crisis at $12.8 trillion dollars in lost wealth and human capital, a new report from the Americans for Financial Reform estimates the financial crisis’ additional costs. Some glaring figures the AFR highlight: 8.8 million Americans (1 in 20 full-time workers) lost their jobs between 2007 to 2009. The unemployment rate doubled from...

Big Oil's Political Blitz

News came out last week that fossil fuel interests have spent over $153 million in television ads attacking the President’s clean energy agenda, including criticizing new air pollution rules and the delay of the Keystone XL pipeline. This figure is likely to grow, as there is still two months before the election. And, this is in addition to the $13 million the fossil fuel industry gave to the Republican National Committee and associated PACs, $950,000 to the Democratic National Committee, and $70 million spent in lobbying . While the amount of money spent seems to indicate the industry is under attack and is going on the defensive, nothing could be further from the truth. Domestic oil production is at its highest level in decades, the Obama Administration has made its commitment to natural gas development well-known, as well as its commitment to and investment in “ clean coal ”, even though fracking is extremely hazardous and there seems to be little progress towards making clean coal...

Riches to Massive Riches: The Michael McCaul Story

(mccaul.house.gov)
Sick of investment advice from hacks like Warren Buffet and Donald Trump? Ask a congress member. Roll Call published their latest list of the “ 50 Richest Members of the 112th Congress ” last week. Texan House Representative Mike McCaul took first place, reporting a minimum net worth of $305.46 million for 2011. His wealth has increased exponentially over the past few years while the current median household income is the lowest it’s been since the late 1990s, according to recent data from the US Census: In 2011, real median household income was 8.1 percent lower than in 2007, the year before the most recent recession, and was 8.9 percent lower than the median household income peak that occurred in 1999. The average Texan made $38,294 in 2011. One play from the McCaul book involves influencing legislation to turn a profit. The McCaul family holds between $325,000 and $750,000 worth of stock in a parent company of Pratt & Whitney, according to Republic Report . Pratt & Whitney...

Understanding Poverty: What the Census Doesn't Tell Us

(Demos.org)
It’s time we change how we think about poverty. The newly released Census report on poverty received a lot of attention from the chattering class. But was it really deserved? There are many ways in which the rate understates poverty. The poverty line, individuals making $11,484 a year, has been used since 1964. A CBS report explores the inadequacy of the measure: This amount was originally set as the earnings line below which a family of three or more would have to spend more than a third of its income on food. Notably, the report does not consider other major expenses, such as housing, transportation, medical care and child care, in gauging the nation's poverty rate. That’s a big blind spot. In his article for the Prospect’s Poverty issue , Mark Levinson provided a thorough critique of the way that the Census measures poverty. The poverty line was roughly equal to 50 percent of median income when it was set in the 1960s. It has now declined to about 36 percent. So today’s official...

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