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Sunday, June 24, 2018

Where There’s A Will, There’s A WPA: Stopping The Slow-Motion Jobs Disaster

Where There’s A Will, There’s A WPA: Stopping The Slow-Motion Jobs Disaster

We can create the political will to tackle the jobs crisis by advancing a progressive economic narrative.

The question we must ask today, on the 78th anniversary of the founding of the Works Progress Administration is: Why isn’t there the political will to take dramatic steps to address today’s jobs emergency?

Let’s start with the obvious. There was a far greater share of Americans unemployed in the Great Depression. In 1934, unemployment peaked at 24.9 percent — 1 out of 4 people officially out of work is much more of a crisis than 1 out of 10 (9.6 percent), the peak in the current recession in 2010. The impact is even greater than two and a half times, as such a huge drop in consumer spending means that marginal businesses able to survive 10 percent unemployment rates were swept away in the Depression. And during the Depression – much more than now – it was impossible not to know people whose lives had been devastated.

The other obvious difference is that we have cushioned the impact on the unemployed through the establishment of New Deal programs, notably unemployment insurance, which is providing income to half of the more than 12 million people who have been laid off, and Social Security, which has helped older workers unable to find a job. In a broader sense, the bailout of the financial sector in 2009 was a lesson learned from the New Deal, stopping the Great Recession from becoming a second Great Depression.

For most middle-class Americans, the Great Recession was not a sudden shock to a prosperous lifestyle. It was a deepening of a three-decades long trend of families seeing their incomes and lifestyles squeezed by stagnant wages and eroding benefits. Median household income increased in real terms by only 14 percent from 1972 to 2007.  During this period, the richest Americans captured most of the benefits of economic growth: Their share of national pre-tax income of the top 1 in 1,000 quadrupled from 3 percent to 12 percent. Much of the meager growth through 2007 was lost in the Great Recession; by 2011 median household income had dropped below 1996 levels.

Of course, the Great Recession did real harm to tens of millions of Americans, as Wall Street took away their retirement savings and banks took away their homes. The more than 20 million who are out of work or working less than they would like feel the pain every day. However, most people whose homes were foreclosed on are not on the streets, and the long-term unemployed are scraping by and aren’t in bread lines. Additionally, the retirement crisis — another slow-moving crisis — represents a long-term crippling of prospects rather than an immediate disaster.

The New York Times’ coverage of Friday’s weak jobs report highlights the slow-motion nature of today’s jobs crisis. The Times focused on a report by the National Employment Law Project, written by Roosevelt Institute Fellow Annette Bernhardt, that revealed most of the new jobs emerging from the Great Recession pay low wages. The Times article also highlighted the persistent growth in temporary jobs, and concluded with a quote from NELP Executive Director Christine Owens, underscoring the nature of today’s job crisis:

“This seems to be a long-term sleeper crisis too, as we think about long-term unemployed workers who are in midlife and older workers who are likely dipping into retirement savings in order to stay afloat. We’re setting ourselves up for somewhere, 10 years down the road, when a lot of retirees who didn’t expect to live in poverty are going to be in poverty.”

For those of us who understand that we do have a jobs emergency today — even if it is a slow-motion disaster — the question is, how do we create the political will to address the underlying crisis? The answer is to make jobs the central issue in the bigger story about the economy, so that the concerns of the unemployed are the same as the great majority of Americans who are employed.