Stimulus Delivering Jobs & Preserving State Education Programs

Stimulus Delivering Jobs & Preserving State Education Programs

Thursday, October 22, 2009




Stimulus Delivering Jobs & Preserving State Education Programs

In his major stimulus speech in January, President Barack Obama stated, "I am confident [the stimulus] will save or create at least three million jobs over the next few years."  In particular, he emphasized that state fiscal relief "will save the public sector jobs of teachers, cops, firefighters and others who provide vital services."

Indeed, initial reports demonstrate that the stimulus is achieving one of its primary objectives:  to save and create jobs.  The effect is most notably evident in preserving funds for public education and reducing the prospect of massive teacher layoffs.  In fact, the White House reports that 250,000 education positions have been created or maintained across the country.  Governors and state officials across the country are lauding the progress of the economic recovery.  For instance, Pennsylvania Gov. Ed Rendell, highlighting new projects and offering insight on the overall recovery, commented "[t]he positive impact on the economy is unmistakable...the direct investments translate into about $780 per household in (Pennsylvania)." Other states are reporting similar numbers of jobs either saved or created with stimulus funds, including:

  • California:  100,000 jobs, 62,000 in education
  • Michigan: 19,498 jobs, 14,483 in education
  • Minnesota:  11,800 jobs, 5,900 in education
  • Missouri8,500 public education jobs
  • New Mexico: 4,128 jobs

Additionally, compiled data from each state on jobs saved or created through the distribution of federal contracts and finds that, to date, this figure has reached 30,383 nationally.

More information will become available later this month. Since reporting requirements mandate that jobs be reported by hours of employment instead of the actual number of people working, the total economic stimulative effect will not be captured by this data release. Moreover, as the Coalition for an Accountable Recovery (CAR) points out, the data released in early October represents less than half of total funding available. It only covers direct jobs created and will not reveal information about the "ultimate recipient of Recovery Act funds." Nevertheless, as early reporting indicates, the stimulus is fulfilling intended objectives and assisting states through the economic crisis, especially considering the major role it has played in maintaining funding for public education.

Concerns about States' Use of Stimulus Funds for Education:  As positive as these reports are, the Inspector General of the U.S. Department of Education (USDE) released an alert memorandum in September, denoting that certain states are improperly using stimulus funds to replace education budget cuts, which "could adversely impact the achievement of the education reform objectives of the SFSF (State Fiscal Stabilization Fund) program."  The Inspector General notes that as a stipulation of receiving federal stimulus dollars, states are required to preserve education funding at FY2006 levels, a provision intended to allow budgeting flexibility.  But, some states, which planned to allocate a certain level of funding towards education before passage of ARRA, utilized this statute to actually reduce funding and still take advantage of the availability of federal dollars.  For instance, before Congress passed the stimulus, Connecticut intended to allocate $1.889 billion to education in FY2010.  After passage, the state reduced the amount to FY2006 levels, representing a 14.3% reduction in funding.

Looking Ahead:  The Center on Budget and Policy Priorities (CBPP) finds that not only is the stimulus achieving certain economic objectives, but it has also assisted six million Americans from falling below the poverty line this year, including almost two million children and 500,000 seniors. ARRA has had an evident impact and alleviated the worst of the economic downturn.

As of August, less than 25% of total stimulus funds had been spent. Accordingly, as states continue to utilize recovery dollars in the upcoming fiscal year, lawmakers should be mindful that proactive investments in vital areas, such as education, augment job growth and improve overall economic conditions. 

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California Governor Signs Law to Boost Young Voter Participation

Governor Arnold Schwarzenegger has signed legislation, HB 30, allowing the pre-registration of 17-year-olds in the state of California.  The state joins seven others that allow pre-registration at either 17 or 16.  This follows close on the heels of North Carolina, which made their pre-registration age 16 over the summer.  As with campaigns in other states, students themselves were the most persuasive advocates for pre-registration.  Civically-minded youth and student leaders pointed to the opportunity that would be opened for students like themselves to encourage their peers to register and prepare for voting.  Students and a range of advocates including the New America Foundation, AARP, The League of Women Voters and FairVote, made the case the this is a no cost way to boost participation by allowing registration before 18, when many people are in transition.

Young people who start voting early tend to stay regular voters.  Knowing this it is important that we increase the amount of education that young people receive about how to be active citizens, including how and why to vote.  Preregistration increases the salience of civic education by allowing students to register at then, not a year or two afterward.  It is an easy but important step to increasing youth participation and strengthening our democracy that all states should take.  And Massachusetts may be the next one to do so as a member of the House leadership has put this as a top agenda item.  Before going on to list the benefits of preregistering young people, she bluntly stated at a press conference that "[w]e are looking for good bills to pass that don’t cost anything because we don’t have any money.”

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Compromise Preserves State Power to Protect Consumers from Abuses by National Banks in Proposed U.S. House Bill

Yesterday, the U.S. House Banking Committee defeated amendments that would have gutted provisions in law to restore state powers to protect consumers of national banks.  Instead, the Committee approved compromise language that, while not as expansive in the protection of state legislation as the Obama administration had urged, is still a significant victory overall against large financial interests.  By a vote of 29-38, the committee defeated a proposed amendment by Rep. Jeb Hensarling (R-Texas) that would have preempted all state regulation of national financial institutions.

As we detailed last month, the provisions to restore state authority to enforce consumer protections against abuses by national banks have been one of the most contentious parts of the new legislation (see also our conference call on the issue).  The amendment that was approved would give the Office of the Comptroller of the Currency, which regulates national banks, the optional power to override the states, but only if it found that the state law “significantly” interfered with federal regulatory policies.  Since under the Bush Administration, the Office of the Comptroller had claimed the right to preempt state law automatically without any evidence of interference with federal policies, this will be a significant change in legal standards.

Especially given the stated Obama administration strengthening of state regulation, this amendment should preserve the ability of states to promote stronger consumer fraud law, repossession, foreclosure, and collection law reforms applied to national banks in coming years.

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Eye on the Right

Businesses Split over Climate Change

The debate over clean energy is ripping open divisions in conservative business lobbies.  Debate on federal climate change legislation has led an increasing number of businesses to leave the Chamber of Commerce, the National Association of Manufacturers, and other business associations because of those organizations' stances against recognizing the scientific validity of climate change. The revolt has been growing ever since a senior Chamber official called for a "Scopes monkey trial of the 21st century" to evaluate evidence of global warming.

Some of the nation's largest energy utilities — including Pacific Gas & Electric, PNM Resources and Exelon, the largest U.S. operator of nuclear plants — quit the Chamber altogether, and Nike stepped off of the Chamber's board, leading Business Week to question the Chamber's clout and credibility. A recent article cited the dysfunction of the Chamber and its outdated policies as a main reason why it is losing its status:

Climate legislation “is becoming more real,” said Brian Hertzog, director of strategic communications at PG&E, which resigned from the Chamber last month. “That dynamic has thrown things into a sharper relief.”

Other high profile businesses to leave recently include Apple, and the parent company of Revlon is debating whether or not to leave over differences on global warming.  In addition, local Chambers of Commerce in New York and San Francisco are distancing themselves from the National's right-wing policy position.  Due to increased scrutiny, the Chamber has actually started citing the actual number of businesses that they represent - 300,000 versus the 3 million that they had been claiming.

There are also splits occurring at other business associations - Duke Energy, a large utility company, announced in May that it would leave the National Association of Manufacturers over the issue.  Duke and several other companies, including aluminum-maker Alcoa, dropped out of American Coalition for Clean Coal Electricity, which promotes building coal-fired power plants.

In addition, there are efforts by businesses in unlikely states to push for clean energy reforms.  Entergy Arkansas and other members of the group Arkansas Business Leaders for a Clean Energy Economy joined representatives of 150 businesses from around the country to lobby for clean energy legislation that they say would create hundreds of new jobs in the state.  These unlikely allies' voices have provided a counter to traditional business claims that a climate change bill would lose jobs, and they provide the statistics to prove that clean energy can mean job growth:  a study from Pew Charitable Trusts showed that in 2007, 448 Arkansas businesses had generated more than 4,500 clean-energy jobs.  The same study shows that in ten years, clean energy jobs in South Dakota will increase by over 93 percent compared to overall job growth of 5 percent.

The divisions reflect that many businesses see a clean energy economy and measures to address climate change not as a burden, but as a business necessity and even a chance to boost the economy -- and create new business opportunities.  And they are questioning the conservative ideological allegiance of traditional business associations that are increasingly not meeting their needs.

For more resources, please visit:
San Francisco Chronicle:  Changing alliances shape climate-change debate
Business Week:  Does the U.S. Chamber Speak for Big Business?
Pew Charitable Trusts:  The Clean Energy Economy

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Research Roundup

New Reports on the Green Energy Economy

  • Understanding the State Energy Program - This Green For All report  offers a basic understanding of the U.S. Department of Energy’s State Energy Program and guidance on how to produce the best results possible.
  • Map: The Economics of Clean Energy in 50 States - This resource from the Center for American Progress provides state-by-state facts about jobs, savings, investment, competitiveness, and the costs of climate inaction in the clean energy economy.
  • Renewable Energy for America- A resource by the Natural Resources Defense Council uses Google Earth software to show existing and future renewable energy generation infrastructure across the country, linking this software to resources on technologies and state profiles of how different states are generating renewable energy.

Focus on poverty and inequality:

  • Inequality as Policy: The United States Since 1979 - Since the end of the 1970s, the United States has seen a dramatic increase in economic inequality, as detailed in this Center for Economic and Policy Research paper. Noting that public policy helped encourage greater equality during the decades after World War II, the paper emphasizes the changes in public policy that helped drive increased inequality in the last three decades.
  • Tables of Alternative Poverty Estimates: 2008 - Using an alternative measure for poverty, based on recommendations from the National Academy of Sciences, new U.S. Census Data finds that one in six Americans, or 15.8 percent, were living in poverty in 2008.  This number is significantly higher than the 13.2 percent as calculated using the official federal poverty measure.

The Shriver Report: A Woman's Nation Changes Everything - With women for the first time making up nearly half of all U.S. workers, this report by the Center for American Progress and Maria Shriver details how the increase in women in the workplace changes how women spend their days and how this changes how we all work and live, including women's families, co-workers, bosses, faith institutions, and communities.

Strengthening Correctional Education for Adults - This new policy brief from The Working Poor Families Project reviews state efforts to help prisoners reenter the workforce and society and makes recommendations to improve correctional education policies to reduce recidivism rates.

Strengthening Community Colleges' Influence on Economic Mobility - This Economic Mobility Project report finds that a college degree quadruples the chances that an individual born into the bottom 20 percent of earners will reach the top 20 percent in adulthood.  To further improve results, the report recommends more career counseling and assessment and making financial aid accessible to low-income, high-performing students.

Sick in the City:  What the Lack of Paid Leave Means for Working New Yorkers - Nearly half of New York City workers do not have paid sick days, and nearly two-thirds of low-income New Yorkers lack paid sick days, according to this report by the Community Service Society and a Better Balance.  Those without sick days are more likely to go to work sick, send sick children to school, be threatened by their employers, and use the emergency room for medical care than similar workers with paid sick days.

Labor Day: A Movie - Released in selected theaters, this movie profiles how workers in unions get engaged in political mobilizations, in this case detailing how SEIU mobilized members through canvassing, calling, registering voters, and knocking on doors in more than a dozen critical swing states during the 2008 Presidential campaign.  Group discounts are available.

Please email us leads on good research at


Stimulus Delivering Jobs & Preserving State Education Programs

CAR - What to Expect on Oct. 15, 2009
CAR - Coalition for an Accountable Recovery Praises Timely Release of Recovery Act Recipient Reports; Criticizes Tools for Understanding Data
Christina D. Romer, Chair, Council of Economic Advisers - Back from the Brink
Council of Economic Advisers - The Economic Impact of the American Recovery and Reinvestment Act of 2009, First Quarterly Report
Council of Economic Advisers - Estimates of Job Creation from the American Recovery and Reinvestment Act of 2009
Domestic Policy Council, Executive Office of the President - Educational Impact of the American Recovery and Reinvestment Act
Economic Policy Institute -'s jobs data: A (very) partial monty
Lawrence Mishel, Economic Policy Institute - The Safety Net and the Recession - Most Jobs Created by State (Figures shown are for Federal Contracts only)
States for a Transparent and Accountable Recovery - Overcoming ARRA Perception Problems
USDE - Political Consequences of the Maintenance of Effort Requirements under the American Recovery and Reinvestment Act State Fiscal Stabilization Fund

California Governor Signs Law to Boost Young Voter Participation

FairVote - Youth Voter Pre-registration
Progressive States Network - Expand Youth Voting
New America Foundation - Commending Gov. on Passage of HB 30
Progressive States Network - NC Passes Key Youth Voting Reform

Compromise Preserves State Power to Protect Consumers from Abuses by National Banks in Proposed U.S. House Bill

Progressive States Network - Protecting State Consumer Protection from Preemption in Federal Financial Reform
Americans for Financial Reform - Summary of Preemption and Relation to State Law Provisions in The Consumer Financial Protection Agency Act of 2009: H.R. 3126


The Stateside Dispatch is written and edited by:

Nathan Newman, Executive Director
Nora Ranney, Legislative Director
Caroline Fan, Immigration and Workers' Rights Policy Specialist
Altaf Rahamatulla, Tax & Budget Policy Specialist
Julie Schwartz, Broadband and Technology Policy Specialist
Christian Smith-Socaris, Election Reform Policy Specialist
Adam Thompson, Health Care Policy Specialist
Julie Bero, Executive Administrator and Outreach Associate
Mike Maiorini, Online Technology Manager
Marisol Thomer, Outreach Director


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