Is the Jobs Bill Creating Jobs?
Cohen, Patricia
Is the Jobs Bill Creating Jobs? A Report from the Field by Patricia cohen Remember the Emergency Supplemental Appropriations Act of 1983? The act, passed this Marchby acongressunder...
...In other words, not a penny of that $1.2 million in emergency assistance will have helped anyone until ten months after the bill’s passage...
...Interested in finding out how much of the appropriation has been spent, and the number of new jobs created so far...
...For starters, the urgency that sorheone who’s been jobless for six months feels is often not shared by the administrators who dole out the money...
...In other words, most of the bill’s beneficiaries haven’t been laid-off blue-collar workers struggling to feed their families long after their unemployment and health insurance benefits have expired...
...The money will be used to subsidize a new train route across Cape Cod to Hyannisport...
...A cardinal rule on Capitol Hill is that if you ever want cooperation for one of your own pet projects (worthy or no), don’t criticize someone else‘s pet project, no matter how unworthy...
...But to qualify for a tree-planting grant, Baltimore had to have the trees in place by September, even though August’s 100-degree heat would probably kill them...
...Most of the beneficiaries have been people whose biggest anxiety is the fear of losing the job they already have...
...suddenly saw virtue in the idea, assuring the nation: "This is not just another quick fix...
...Then the hiring began...
...the projected cost per job is just $10,000...
...Given that this was an emergency jobs measure, Congress could have given priority to labor-intensive repair work, or placed a limit on the portion of money earmarked for uses other than wages...
...Nor should the act’s defects suggest that the government has no business trying to put the unemployed back to work...
...This is the ultimate irony of the Emergency Supplemental Appropriations Act of 1983: having failed provide much of the emergency relief it promised, it has managed to make it more difficult than ever to enact a “jobs bill” that’s as good as its name...
...Representative Silvio Conte, a Republican who once donned a Miss Piggy mask for reporters as part of his long standing campaign against pork-barreling, remained silent-as did Tip O’Neill-as the state of Massachusetts got a $10 million Amtrak grant...
...In this case, the two are one and the same...
...How right Reagan was...
...So then the hiring began...
...In many agencies, the list of winners, by no odd coincidence, reads like a state-by-state listing of the members of the House Appropriations Committee...
...Michigan and West Virginia, two states that compete with each other for the dubious distinction of having the nation’s highest unemployment, received less per capita than South Dakota, which ranked dead last in the joblessness sweepstakes...
...Those who have been unemployed for 15 weeks or longer should be given preference “to the extent possible...
...Each is required to submit information to the Office of Management and Budget, but no one person, group, or agency has responsibility for where all the money is going, and how effective it's been...
...Next, Baltimore’s Board of Estimates had to accept EDA’s offer, which was less than the city had originally requested...
...Unfortunately, there’s no assurance that those most in need of the work will be those hired...
...Of course, 100,000 new jobs is better than nothing...
...Again, some time was actually saved because the results showed that a full environmental impact study was unnecessary...
...Be patient...
...Congress, however, had other ideas...
...The act, passed this Marchby acongressunder heavy pressure to relieve double-digit unemployment, appropriated $4.6 billion to create an estimated 400,000 jobs...
...In the case of the Small Business Administration, Baltimore’s problem was not with delay, but with undue and senseless haste...
...Fortunately, there were few serious objections to the plan, and after a second meeting the final application was forwarded to the EDA in July...
...But if the government is going to take the lead in fighting unemployment, the 1983 jobs bill provides a graphic illustration of how not to run a jobs program...
...The jobs must be labor-intensive, with no less than percent of the funds used for wages...
...Reagan himself, who had vetoed a similar measure iust eight weeks earlier...
...Only after that could the architect begin the real design work...
...A good model is a bill currently before Congress known as the Community Renewal Employment Act...
...The New York Times recently reported that this route wasn’t even on Amtrak’s list of priorities...
...Some of the water projects funded in this bill can cost as much as $100,000 for every job created...
...Rather than creating new jobs, this means much of the money will go to prevent the layoffs of those already working...
...Senator Lowell Weicker said it would get “out on the streets where it will do some good!’ Martin Feldstein, who chairs the President’s Council of Economic Advisers, sounded like a Keynesian when he argued that, amidst the severe recession, this was a perfect time to perform some badly needed repair work on the nation’s crumbling infrastructure...
...To be eligible, a person must be unemployed for weeks or more...
...work on schools, for example, must begin within 120 days of the bill’s passage...
...Over $33 million of that money went to William Lehman, the subcommittee’s chairman, for bus shelters and Metrorail parking in Dade County, Florida...
...But anyone who's taken a closer look at how the money has actually been used will come to a wholly different conclusion...
...But it’s a start, and if those jobs were targeted to the neediest-especially the 60 percent who have no unemployment insurance or whose benefits have expired-they would relieve a great deal of suffering...
...Reagan, who in taking political credit for the “jobs bill” has been noticeably unconcerned about whether the money is actually helping anyone, opposes this .act...
...The explanation for these differences lies, not surprisingly, in the behind-the-scene-and-in-thecloakroom politicking that is as much a tradition on Capitol, Hill as the pork barrel...
...Jamie Whitten, chairman of the full committee, snagged a $33 million highway demonstration project for his home state of Mississippi that will supposedly demonstrate a new technique for widening roads...
...According to the National Governors Association and the National Conference of State Legislatures, North Dakota, whose 1982 unemployment rate of 5.8 percent was then one of the lowest in the country, received the second highest funding on a per capita basis...
...Each project had to meet a variety of local and federal regulations that mandated such things as public hearings, land use compliance determinations, audits, you name it...
...So then the hiring began...
...But it took until late September for EDA to approve the application...
...There’s nothing necessarily wrong with heavy construction, as anyone who’s looked at the sorry condition of our roads and bridges well knows...
...Jamie Whitten, chairman of the House Appropriations Committee, said he was “proud” of a bill that “put people back to work...
...Congress divided the $4.6 billion among about 60 different federal agencies and programs...
...they make up less than 10 percent of all construction workers...
...The administrators in Washington who are parceling out the money won't admit this, nor will the grateful local officials who are eager to keep the federal money flowing into their coffers...
...Though preliminary work had been done on the project, an architect had yet to be chosen to draw up the initial plans...
...But because public works are so capital-intensive, they don’t generate many jobs...
...Even if you had time to sit down with 60 different auditors, you wouldn’t be able to find out...
...It would appropriate $3.5 billion for new jobs, tying this assistance directly to a state’s unemployment rate...
...Read the bill closely and you’ll discover that most of the $4.6 billion will be used to “accelerate” the schedules of government projects already in progress...
...Unfortunately, the 400,000 figure itself is a bureaucratic fiction...
...You may recall that everyone from Ronald Reagan to Tip O’Neill on the political spectrum sang its praises...
...The proposals were presented to the City Council six weeks later, and the finalists were selected on May 22...
...Advertisements soliciting bids from local contractors could go out...
...Start with the estimate that the $4.6 billion would create 400,000 new jobs...
...others point to the nation’s declining unemployment rate...
...So much for Robert Michel’s “seed money...
...Given the number of jobless and the staggering task of repairing the nation’s decaying bridges, highways, and water systems, if anything the government should be far bolder (see Timothy Noah’s “Bring Back the WPA:’ September 1982...
...Of the more than half-dozen officials I quizzed in Washington, none could say how many jobs had been created by their portion of the money and one-the associate director of the Illinois Washington Office-simply laughed at the question...
...Baltimore is as good a place as any to examine in some detail...
...But hemight instead hire his friendsor give his existing workers a lot more overtime...
...After Congress approved the jobs bill on March 24, the city got busy designing proposals for the $17 million it was entitled to under the bill...
...The bulk of the $132 million appropriated by the act is divided up among the districts or states of the five members of the Appropriations Committee and a handful of other powerful congressmen such as Dan Rostenkowski and James Howard, chairman of the Public Works Committee...
...Representative Gus Hawkins, chairman of the House subcommittee on employment opportunities, estimates the jobs bill-out of the 400,000 jobs it finances-will really create only 100,000 to 200,000 new jobs...
...If you didn’t hear many congressmen complain about this process last spring, don’t be surprised...
...A few will even be so bold as to suggest the recent dip in the unemployment rate is proof of the bill's speed and effectiveness...
...It was followed by meetings with business and community groups, where the details and goals for the plan were reviewed...
...Be patient...
...Two-thirds of the $4.6 billion is allocated for public works or heavy construction...
...A $5.6 million highway project in Mississippi will employ a grand total of 83 people...
...Nor is there any provision to ensure that priority is given to those who’ve been unemployed so long they’ve exhausted their benefits, or those who live in households where no one else is working...
...The existence of this bill was the primary reason that a number of congressmen were persuaded to support the first piece of jobs legislation...
...To understand what the jobs bill has really accomplished, you have to get out into the field, where the money is supposedly going into the pockets of desperate, unemployed workers...
...House Minority Leader Robert Michel called it “seed money...
...Most inexplicable of all, more than 60 percent of the money is given to state and local governments with absolutely no consideration of their unemployment rate...
...After the city earmarked $1.2 million for the renovation, a public hearing on the project was held in mid-June...
...Virginia Kearney, an administrator for the project, says they will have to “check the mortality rate next spring...
...Many congressmen feel they’ve already voted for a jobs bill...
...Mark Sissman, who oversees Baltimore’s block grant money, says that the Department of Housing and Urban Development didn’t even send out the forms needed to apply for the new funds until May, two months after the bill’s passage...
...Finally, the bill recognizes the urgency of spending the money...
...Other Baltimore projects illustrate several other defects in the jobs bill...
...Of course, some maverick legislators ignore this rule, such as Representative Robert Walker of Pennsylvania, who observed that the bill has “nothing to do with unemployment” and that projects were chosen depending on whether a representative “was in the proper place at the proper time...
...What’s more, such projects do little to help the women and minorities who are often thefirst casualties of a recession...
...Pork power Of course, the jobs bill has not proved a complete failure...
...They might be deserving, too-but they’re hardly the people the editorial writers had in mind when they exhorted Congress last spring to pass the legislation...
...Unfortunately, the Emergency Supplemental Appropriations Act also hasn't proved much of a fix, period...
...Write if you get work It’s not that Congress couldn’t devise a jobs bill that gave the greatest help to those in greatest need when they needed it...
...How hard each agency tries is, not surprisingly, up to each agency...
...Nearly $1 billion of the appropriation was earmarked for such emergency, nonemployment purposes...
...An environmental assessment came next...
...originally scheduled for October 1, that didn’t happen until mid-November because the architect took longer than expected to submit his design...
...Speaking of concrete-there’s plenty in the bill, which is another of its shortcomings...
...Probably not until January 1984, after the contractor is selected...
...During deliberations on the jobs bill, Weyerhaeuser, one of the nation’s largest forest products companies, lobbied heavily to earmark $50 million to the SBA for tree-planting projects...
...Every project had different requirements, so for illustrative purposes let’s follow a typical one-an Economic Development Administration grant to renovate a publicly owned building for use by a biomedical company...
...Admittedly, this is a small number compared to 11 million unemployed workers...
...Take mass transit...
...Vicki Otten, who works for Representative Paul Simon, observes, "The program has turned into a bureaucratic nightmare:' A staffer for another House Democrat who voted for the bill is more blunt: "It would be virtually impossible to spend more money, and create fewer jobs, in a less timely manner, than with this bilI:' Just how badly the government has bungled this program is impossible to say...
...Hardly...
...The most potent argument against this second jobs bill is the dismal record of the first one...
...Unfortunately, the bill also stands little chance of passage...
...The best the city could do was to secure volunteers to do extra watering...
...namely, on the [Appropriations] committee:’ And, as an aide says, “NO one is going to give Walker five pounds of concrete unless they put it on his feet...
...So when will the hiring begin...
...Thousands of people have been returned to productive work or given emergency food and shelter...
...Patricia Cohen is a Washington, D.C, writer...
...first preference is given explicitly to those who’ve exhausted their unemployment benefits...
...As for the new jobs created when a highway construction contractor is told to hire a new road crew, he might conduct an exhaustive search aimed at finding the neediest workers in his area...
Vol. 15 • December 1983 • No. 9
