Driving to Work - Doing Good for Our Economy

Sunday, February 28, 2010 | Margy's Blog & Updates


Our official research arm – the GAO – just released a new report about access to driving and license suspension. Thanks to Representatives Pete Stark, Jim McDermott, and Gwen Moore for their interest in the impact of state policy and practice on local economic conditions and economic license suspensions!

Mobility Agenda readers know that we encourage policy-maker focus on access to driving and the impact of license suspension on communities, employers, and workers. We’ve hosted a national roundtable and published our research on economic license suspensions. Read more about this topic here.

We’re pleased to see this interest in Congress. Read the report to learn more about promising alternatives to suspension in some places. 

Low-wage workers with access to a reliable car are more likely to work, earn more, and work more hours. So, lack of a driver’s license is a barrier to work. In addition, some jobs – especially in construction and health care – require a license of all applicants. For workers without a license, jobs may be inaccessible because a license is a prerequisite, or because a car is the only means of access to a job far from home. The most common reasons for license suspension and revocation are for non-driving offenses, as states have moved to use the license as a means to enforce other goals and raise revenue. The Mobility Agenda studies strategies to reduce the impact of license loss for economic reasons.



What Ails the U.S. Labor Market: Too Many Bad Jobs

Monday, April 21, 2008 | Margy's Blog & Updates

Writing in the New York Times Week in Review, Louis Uchitelle reviews the recent decline in the floor for wages in the U.S. labor market.

The $20 hourly wage, introduced on a huge scale in the middle of the last century, allowed masses of Americans with no more than a high school education to rise to the middle class. It was a marker, of sorts. And it is on its way to extinction.

Americans greeted the loss with anger and protest when it first began to happen in big numbers in the late 1970s, particularly in the steel industry in Western Pennsylvania. But as layoffs persisted, in Pennsylvania and across the country, through the ’80s and ’90s and right up to today, the protests subsided and acquiescence set in.

Hourly workers had come a long way from the days when employers and unions negotiated a way for them to earn the prizes of the middle class — houses, cars, college educations for their children, comfortable retirements. Even now a residual of that golden age remains, notably in the auto industry. But here, too, wages are falling below the $20-an-hour threshold — $41,600 annually — that many experts consider the minimum income necessary to put a family of four into the middle class.

The nation’s political leaders — Democrats and Republicans alike — have argued that education and training are a route back to middle-class wages for those who have fallen out. But the demand isn’t sufficient to absorb all the workers that the leaders would educate.

…. The trend in the hourly work force is striking. Take only the peak years in each business cycle, starting in 1979. The proportion earning at least $20 an hour declined from 23 percent that year, to 20 percent in 1980, to 18 percent in 1989, and to 16 percent in 2000. Manufacturing was hit the hardest.

Uchitelle doesn’t take the data to the next point, which is a focus of our research at The Mobility Agenda: the high proportion of the U.S. labor market made up of low-wage jobs. Our policy leaders haven’t focused nearly enough on the fact that the U.S. isn’t just losing better jobs, growth in low-wage jobs is changing our economy in ways that affect all of us. Our economy is heavily dependent on individual spending. When workers don’t earn enough to take care of daily expenses like housing, transportation, and food – spending and consumption decline. And that hurts the economy for all of us. As is apparent today.

Unfortunately, over 40 million jobs in the United States—about one in
three—pay low wages of $11.11 or less, often providing no employment benefits and little flexibility
. Even though the United States is among the wealthiest nations in the world, employers pay these workers less than workers who hold similar jobs elsewhere.

The last decade has seen some progress on advancing a number of well-known policies to improve job quality by boosting the minimum wage and expanding publicly subsidized employment benefits, like child care and wage subsidies such as the Earned Income Tax Credit. Likewise, we support efforts to address education and advancement strategies that prepare workers for skilled jobs.

Still, when one worker advances out of a low-wage job and another worker takes it, the job does not change.

In contrast to the manufacturing jobs, many of these jobs are in growth sectors like retail and hospitality, jobs that will not be off-shored because they are geographically specific.

At The Mobility Agenda, we’ve surveyed key contacts across the nation for new ideas and strategies to strengthen the labor market by improving these jobs. State and local stakeholders are experimenting with a host of new initiatives to improve low-wage jobs. These innovative ideas are less well known and are not commonly incorporated into the agenda of advocates and academics. For much more information about these new strategies, see our web based resources on this research, starting here.

Talking about the Economy, Not Poverty

Thursday, April 03, 2008 | Margy's Blog & Updates

The Nation magazine recently praised efforts by the Congressional Progressive Caucus, led by Congresswoman Barbara Lee (D- CA), to introduce a plan to cut poverty. The detailed package of policy proposals, “The Anti-Poverty and Opportunity Initiative,” calls for:

…. $73 billion in FY 2009, increasing to $129 billion in FY 2018, to fund a comprehensive strategy to cut poverty in half in a decade, including: expanding child care and increasing Head Start funding; making the Child Tax Credit fully refundable and expanding the Earned Income Tax Credit for larger families; increasing funding for Food Stamps programs; increasing housing vouchers by 200,000 annually; lifting restrictions on TANF, Food Stamps, SSI and Medicaid for documented immigrant families; fully funding block grants to states with broad anti-poverty strategies and distributing targeted grants to states for families where a parent or child has a disability; increasing funding for Indian Health Services, education, housing and infrastructure, natural resources management, and other areas impacting Native American poverty; and reversing the 20 percent cut in child support enforcement.

The initiative incorporates many policy ideas advocates, academics, community organizations, and other stakeholders have been wishing that Congress and the administration would adopt – for many years now. Individual lists might differ a bit from Congresswoman Lee’s, but any Congressional staffer from a progressive office already has a list like this memorized.

So why aren’t these proposals the law of the land?

It’s probably because supporters have reached everyone persuadable by talking about the proposals as “anti-poverty” initiatives for forty years. And all that support still isn’t enough to overcome the opponents of legislation like this. While many people want to do something about poverty—it’s not a high priority for voters. In February, the Gallup Poll asked voters about “the most important problem facing the country” and just 2 percent named poverty/hunger/homelessness.

That means friendly policymakers don’t have the political space they need to take on opponents.

And continuing to use the poverty banner means it is unlikely that this plan will generate adequate support in the future. There are a few reasons for this:

* The U.S. definition of poverty is out of date and flawed, allowing opponents to use it to limit policy solutions to a narrow very low-income group.
* Public understanding of the causes of (irresponsible and immoral behavior) and remedies (responsible personal behavior) for poverty hinders adoption of the policy solutions we seek to address it.
* Defining the problem as “poverty” opens the door to a losing scenario in the legislative debate.

In fact, when Senator Clinton announced her support for a plan to adopt a goal to cut child poverty in late February, the conservative think tank Heritage Foundation took the opening to criticize and offer their alternative:

Robert Rector, senior research fellow on welfare and family issues at the Heritage Foundation, says Clinton refuses to even acknowledge the two primary causes of child poverty — out-of-wedlock births, and parents living on welfare instead of working. “What she wants to do is combat poverty by putting the responsibility on the U.S. taxpayer, who already spends about $450 billion a year fighting poverty,” says Rector, “while [at the same time] specifically avoiding the issue of changing the behaviors that are the cause of poverty.”

See the problem?

The poverty debate provides a classic example of the imperative not to sacrifice our larger policy goals for the sake of an incremental or different advance, particularly when that advance actually undermines the shared agenda for the long term. By advancing a plan to set a target for cutting poverty, elected officials and candidates set up a problematic future, and one that threatens to undermine the policy goals.

Let’s imagine the likely scenario to come. Whether or not a candidate who has promised to set a goal to cut poverty wins the White House, we can expect continued efforts by some advocacy groups and members of Congress to push for the goal and the policy to match.

The mainstream media will portray the likely legislative options as two competing proposals: one we like (a comprehensive approach to addressing inequality and economic mobility) and one we don’t (solve poverty with marriage and harder work).

Our opponents are able to push these concepts with success because they are consistent with a broad public understanding of the causes of poverty, and a widely held belief that government programs cannot really address the issue of poverty or inequality. We already lost this same fight in battles over welfare. Why would we want to engage in it again?

We don’t need to re-fight that battle. We know that some people (democrats and low-income voters) are persuaded by a sympathy lens on the issue (the one that the word “poverty” calls up for many people in this country) to support a limited set of policies. Unfortunately, this language actually decreases support for progressive policies like a living wage.

Moreover, we also know that using an economic narrative moves these same voters and others (working-class, non college-educated men, older men, Republican voters, union households, and older voters without a college education) to support more of our policy goals.

So, if there is no true demand for a goal to cut poverty and it won’t help add new support, it would be much smarter strategically to use an economic case to promote the same larger policy agenda without the damaging poverty headline.

In fact, the Progressive Caucus members have proposals that would address poverty, social and economic mobility, and inequality that they’ve put under an economy title, the “Rebuild and Reinvest in America Initiative.” They should focus on this legislation and incorporate the “anti-poverty” agenda into that legislation.

Everyone who wants anti-poverty policy to be high on the agenda after the upcoming election should stop talking about goals to cut poverty and instead talk about an economy that will work for everyone.

Changing the way we start the conversation with others about this issue doesn’t mean we don’t care about the poor anymore or that our policy goals have to change at all. It’s just an acknowledgment that if we want to win, we have to change the narrative to one that works for us, and for more of the public too.

Pay-As-You-Drive Car Insurance

Thursday, March 20, 2008 | Margy's Blog & Updates

The cost of car insurance can be a major barrier to driving. And we know that people with access to a reliable, affordable car are more likely to be employed, earn more, and work more hours. We also know that low-wage workers drive fewer miles than higher income people, which makes transportation to work a regressive tax on employment. (For much information more on transportation and work, see our resource page on transportation and the labor market.)

Recently, we’ve been monitoring efforts in a couple states to reduce the cost of car insurance and we found this new article about pay-as-you-drive car insurance in the popular journal Democracy intriguing.

Pay-As-You-Drive Car Insurance
by Jason Bordoff

If you’re like most Americans, you eat too much at all-you-can-eat buffets. With auto insurance, it’s no different. Drivers who are similar in all respects—age, gender, driving record—pay roughly the same premiums whether they drive 5,000 or 50,000 miles per year, even though the likelihood of a collision increases with each mile. This “all-you-can-drive” pricing scheme imposes significant costs on society: more traffic accidents, congestion, air pollution, greenhouse gas emissions, and dependence on oil. It’s also inequitable, as low-mileage drivers, particularly low-income people and women, subsidize high-mileage drivers.

Read More.