Category: Uncategorized

Reviving the Labor Market with Middle-Skill Jobs

Posted on by The Progressive Policy Institute

Download the report.

The importance of worker education and skills to labor market success in the U.S. has never been clearer than it is now. The current economic downturn has hit all groups quite hard, but especially those with the least education and fewest skills. And as the labor market slowly begins to recover this year, we will be reminded of a basic fact of economic life: Workers increasingly need meaningful postsecondary education or training to find jobs that pay enough to sustain a middle-class lifestyle.

To its credit, the Obama administration recognizes how essential education and skills are in expanding labor market success, and has created some important initiatives to improve outcomes for all groups — especially the disadvantaged, who suffer the most from “achievement gaps” that open early in life. The administration’s Race to the Top fund creates strong incentives and financial support for school reforms in the K-12 system. Its American Graduation Initiative will provide grants for innovation in community colleges designed to improve both attendance and graduation rates. And the government has hiked Pell Grants by a considerable amount, as part of recently enacted reforms in the funding of federal student loan programs.

But are these initiatives enough, or should we be casting a wider net when dealing with various kinds of skill gaps and their role in labor markets? We need to consider the many levels at which shortfalls in education and skills plague American workers, and then determine the appropriate range of remedies for these problems.

Specifically, we need to prepare American youth and adults not only for jobs requiring four years of college and graduate study, but also for those we call “middle-skill” jobs — jobs that require something beyond a high school diploma but less than a bachelor’s degree. These jobs frequently pay well and are in high demand in the U.S. labor market, but too few workers now have the skills to fill them. A range of policy interventions to improve the skill levels and workforce-relevant credentials among Americans can raise the numbers of good jobs they can fill, and provide a gateway to the middle class that is now often closed for so many.

The Scale of Our Challenge

About a quarter of all American youth still drop out of high school each year.1 The research shows that some do so because of poor basic skills, but others are driven by boredom and the lack of any observed relevance of their high school coursework to their future earnings prospects.2 Of course, by dropping out, they create a self-fulfilling prophecy in which their earnings prospects are certain to be poor throughout their lives. Many will withdraw from the labor market altogether — especially under the current circumstances of a severe downturn and likely slow recovery. For some groups of dropouts (like young African-Americans), the odds of becoming incarcerated and parenting outside of marriage will be enormous, generating huge costs to themselves and to the rest of society.

Another quarter of American youth fail to attain any postsecondary education beyond high school graduation.3 They leave school without occupational skills or work experience that the labor market rewards, and with no plans for enhancing those skills. Both their employment rates and earnings levels after leaving school will be limited for many years, as they move from one unrewarding job to the next.

Among those who attend college — whether two- or four-year — dropout rates are also very high. Fewer than 60 percent of students in four-year colleges graduate within six years.4 For those who attend community college, the odds of emerging with any type of credential after six years are even lower, below 50 percent.5 This is particularly true for minority and disadvantaged students, both youth and adults. Indeed, it is likely that a large majority of newly funded Pell Grant recipients will attend college, get stuck in remedial classes and drop out before obtaining any meaningful credential.

Even among those who finish, the labor market value of the certificates and associates degrees they acquire vary enormously, with too many students obtaining credentials that the market does not particularly value or reward.6 Our community and four-year colleges often lack any direct ties to our workforce development systems, and do not provide students with available information on career progressions or labor market opportunities. And many colleges do not face incentives or financial support for expanding capacity in areas of strong market demand, especially in the technical areas where instructors and equipment are relatively more costly to obtain.

Building Up the Middle-Skill Market

Our labor market generates strong rewards on average for those with college and, especially, graduate degrees, particularly in the “STEM” fields (science, technology, engineering and math). Improving student attainments in these areas is important for maintaining a competitive economy. But it is also striking that, over time, there remains strong demand in the U.S. for many middle-skill jobs.

Contrary to the popular view that we are developing a “dumbbell” labor market or an “hourglass” economy — with a shrinking middle and an expanding top and bottom — my work with Robert Lerman points to continuing strong demand and good pay in a wide range of jobs and sectors at the middle of the labor market. Indeed, a wide range of evidence shows that employers often have difficulty filling these middle-skill jobs, even when wages are rising and the job market is not very tight.

What kinds of jobs are these, and where are they located? In health and elder care, there will continue to be strong demand for nurses (including licensed practical nurses and certified nursing assistants) and many other kinds of technicians and aides. In construction (which will recover, albeit slowly, from the bursting of the housing bubble), there are frequent shortages in the skilled crafts. In manufacturing — despite a long-term decline in employment — demand remains quite strong for skilled workers, like machinists and even for welders.

A wide variety of economic sectors generate demands for technicians in equipment installation, maintenance and repair. A shift to a “greener” economy will generate many such jobs, as will increased federal spending on the repair and modernization of infrastructure. And in several diverse parts of the service sector, there is a strong need for well-trained personnel: police and firefighters, legal aid and protective service employees, and even cooks and chefs in restaurants.

Many of these jobs pay well enough to help support a middle-class lifestyle, and would be within reach of many of our high school graduates and dropouts who currently flounder in the job market and in life. It’s a tragic irony that over two million Americans are incarcerated on any given day — and several times that number are permanently scarred by criminal records — because many never saw pathways to good-paying jobs, while employers frequently can’t find enough trained welders, electricians and plumbers when they need them.

Of course, strong basic skills are required in all of these areas. No one would argue against the need to close the “achievement gaps” in youth literacy and numeracy skills — or that young people should be better prepared to handle college-level work. Still, the many levels at which educational outcomes are weak, along with the lack of occupational training and relevant workplace experience for so many who will likely not attend or complete college, suggests the need for a broader approach — one that prepares young people for labor market opportunities, wherever they appear.

A Range of Fixes

Both federal and state governments need to implement a range of policies that will reduce high school dropout rates and encourage young people and adults to develop the skills needed to obtain a postsecondary credential and succeed in the workforce. Different policies are appropriate for different groups; there is no magic bullet, and one size does not fit all.

Research is now generating a body of statistical evidence on “what works” in enhancing educational and employment outcomes for different populations.

First, it is clear that high-quality career and technical education in secondary and postsecondary schools can generate strong payoffs for at-risk youth. The Career Academies, which operate at 1,500 high schools nationwide, provide students with occupational training and work experience in a particular economic sector, even while they take academic courses and curricula. Evidence suggests that the Academies strongly reduce dropout rates among at-risk youth and improve their earnings for many years afterwards without discouraging students from obtaining postsecondary education. Other models, like Tech Prep and other apprenticeship programs, provide strong payoffs by moving young people directly from high school into community or technical colleges and offering them relevant work experience.

For youth who have already dropped out of school, the successful models are less clear. Intensive remediation efforts in a variety of settings — including the military model of the National Guard Challenge program — show some promise. But we also know that the provision of paid work experience to low-income young people is often critical for maintaining their interest and participation because they so value the upfront rewards of compensation. And systemic approaches that combine a range of services with educational and employment opportunities for young people, such as those in the Youth Opportunities program for poor neighborhoods implemented at the end of the Clinton administration, have generated successful outcomes.7

Second, workforce training for disadvantaged adults with some decent basic skills can be very successful if it generates a postsecondary credential and targets a strong sector of the economy that provides good-paying jobs. Indeed, sectoral training, in which workers are connected to employers and obtain work experience while they receive training, has shown some very strong results. Career pathway models, which combine classroom curricula and work experience leading to occupational certifications at a variety of levels, are also very promising.

Often, an active “intermediary” is needed to assist trainees with making connections to the labor market and obtaining the necessary support services (like child care and transportation) along the way. State-level training grants and technical assistance to employers in these sectors can often encourage them to train more of their incumbent workers and generate pathways into better-paying work within existing firms. Indeed, states like Pennsylvania, which have actively targeted key economic sectors and integrated their workforce and economic strategies, will likely reap major rewards as their labor markets recover in the next few years.

Third, we are learning what generates greater success in improving the odds of certificate or degree completion for disadvantaged students in community colleges. Performance-based financial aid (above and beyond the Pell Grant), which might include stipends, mandatory support services and small “learning communities” of students, all seem to help.

Further, programs that integrate remedial education and occupational training seem to generate higher success rates for disadvantaged students. One such approach, the well-known I-BEST program in the state of Washington, integrates basic adult education with occupational training (from two teachers) in each class; statistical evidence so far indicates that it has a potentially strong impact on educational outcomes. New curricular developments, like modular classes and “stackable credentials,” might help as well.

Fourth, under the very best circumstances, millions of low-income youth and adults will still end up in the many low-paying jobs that our economy now creates. We need stronger pay incentives to make sure these workers remain attached to the labor market under these circumstances. The Earned Income Tax Credit played a huge role in encouraging low-income single mothers to take jobs under welfare reform, and would likely have similar success in rewarding disadvantaged childless adults and non-custodial fathers when they work. And subsidized work for ex-offenders in the form of “transitional jobs” reduces their recidivism and raises work effort, at least in the short term.

Conclusion

What all of this suggests is that a broader set of educational and employment supports must be provided to encourage further success at all these levels. Reforms in the K-12 system remain critical and greater funding for Pell Grants will help.

But these should not be done in isolation from efforts to expand high-quality career and technical education, and better integrate education, workforce and economic development systems. Enhanced financial support for both youth and adults in a wide range of postsecondary education institutions, including community and technical colleges and apprenticeship programs, must be linked to a broader range of labor market information and services for them, while the systems themselves must be made more responsive to labor market realities. And expanding both educational opportunities and work supports for at-risk or disconnected youth and adults — including those still in high school as well as those who have dropped out of school and the labor market — are critical as well.

Any public resources expended in such efforts should be based on evidence of best practices and tied to further rigorous evaluation. In the current fiscal situation, such resources are scarce. But the social and economic costs of not making the needed investments in the skills of our youth and adults are enormous, while the payoffs to successful efforts in these realms can be quite impressive.

____

1 James Heckman and Paul LaFontaine, “The American High School Graduation Rate: Trends and Levels.” IZA Discussion Paper No. 3216, December 2007.

2 Robert Lerman, “Career-Focused Education and Training for Youth,” in H. Holzer and D. Nightingale eds. Reshaping the American Workforce in a Changing Economy. Washington, D.C.: Urban Institute Press, 2007.

3 See Heckman and LaFontaine, op cit.

4 Frederick M. Hess, et. al., “Diplomas and Dropouts: Which Colleges Actually Graduate Their Students (and Which Don’t),” American Enterprise Institute, June 2009; available at https://www.aei.org/paper/100019.

5 Thomas Bailey, et al., “Is Student Success Labeled Institutional Failure? Student Goals and Graduation Rates in the Accountability Debate at Community Colleges,” Community College Research Center, Teachers College, Columbia University, 2006. Of those students entering in any year, 36 percent earn degrees and certificates while another 13 percent have transferred elsewhere but not yet earned a degree.

6 Louis Jacobson and Christine Mokher, “Pathways to Boosting the Earnings of Low-Income Workers by Increasing their Educational Attainment,” The Hudson Institute and CNA, January 2009.

7 See “Youth Opportunity Grant Initiative: Executive Summary,” Decision Information Resources, March 2008. Report submitted to Employment and Training Administration, U.S. Department of Labor, Washington, D.C. The evaluation evidence showed increases in secondary school enrollments and in labor force participation rates for youth in the high-poverty neighborhoods receiving these grants.

Download the report.

Obama’s Nuclear Policy — An Opportunity for Bipartisanship

Posted on by The Progressive Policy Institute

The following is an excerpt from Jim Arkedis’s op-ed published today in AolNews.com:

In today’s polarized political debate — with congressional Republicans refusing to cooperate on much of anything and their Democratic counterparts not terribly inclined to include them anyway — finding common ground on any issue has been nearly impossible. But this coming week might highlight one issue that could galvanize long-overdue bipartisanship: nuclear security.

On Tuesday, the administration released its Nuclear Posture Review, which charts a new course on the use of nuclear weapons. On Thursday, President Barack Obama travels to Prague, where he’ll sign the new Strategic Arms Reduction Treaty with Russian President Dmitri Medvedev. And early next week, the United States will play host to more than 40 world leaders at a nuclear security summit.

These events all aim to work toward the long-held promise of a world without nuclear weapons, a goal the president outlined a year ago this week in the Czech Republic.

After that speech, some conservatives jumped at the opportunity to cast the new president as green on weighty foreign policy issues. But Obama wasn’t driven by some fanciful naivety, as he was crystal clear that as long as others possessed the weapons, so would America. And it was a necessary reorientation—the work of ridding the world of nuclear weapons needed to be taken up anew after being sidetracked under Obama’s predecessor.

Read the full column at AolNews.com.

Photo credit: https://www.flickr.com/photos/macandliz/ / CC BY 2.0

Will the FCC Go Nuclear?

Posted on by The Progressive Policy Institute

The D.C. Circuit Court ruled yesterday (PDF) that the Federal Communications Commission (FCC) doesn’t have authority over the Internet. Back in 2007, Comcast was filtering the Internet connections of users who were suspected of using file-sharing programs and eating up a lot more bandwidth than expected. The FCC told Comcast to cut it out, under the concept of net neutrality, which required that all packets of data sent over the Internet be treated equally. Comcast challenged the FCC’s right to do that, and yesterday the court agreed with the Philly-based company.

The FCC had argued that it had the right under the authority given to it by Title I of the Communications Act of 1934, which established the FCC. According to the FCC’s argument, Title I empowered the commission to regulate Internet connectivity as an “ancillary” authority, even though it wasn’t explicitly charged to do so by Congress in the act (which, after all, was passed more than half a century before the World Wide Web was launched). The D.C. Circuit Court said no, Title I does not give the FCC that authority. While the decision can be appealed to the Supreme Court, which could reverse the ruling, even proponents of a strong net neutrality role for the FCC admit the decision is pretty solid.

While the case is technically a “win” for Comcast (their challenge was upheld) some observers say it could turn out to be a Pyrrhic victory. Now the FCC could claim authority to regulate Internet communication under its Title II powers. Regulating the Internet under Title II, which covers “common carriers,” would require Internet service providers (ISPs) to adhere to net neutrality as a common carrier requirement. This means that physical providers of an Internet connection to your house (in other words, traditional phone and cable companies that have evolved into ISPs) would be limited in their ability to manage the information going over their networks — unable to prioritize some data over other data — much as phone companies have no control over whom you talk to over your phone line.

This is apocalyptically referred to as “the nuclear option,” as it would result in a radical change in how telecommunications firms view Internet connectivity. Title II would require them to behave more like utilities. Proponents of this idea say its potential upside would be increased competition in services provided over that connection. Critics, including the ISPs themselves, say the potential downside is that ISPs could lose a big incentive (profit maximization) to invest in our residential broadband connections, which are lagging behind other countries like South Korea.

In its own discussions of a National Broadband Plan, the FCC has avoided the Title I vs Title II debate. However, with this ruling, the appeals court has forced the commission’s hand. The best solution for the FCC could be to go before Congress for clarification of its role in regulating the internet. As our friend Brian Wingfield points out, it’ll be a tech lobbying fight, but the FCC would have a better chance with a Democratic Congress than it’s likely to have in the courts.

The appeals court has ruled that the FCC lacks the authority to regulate Internet, but it may also lack the ability. The communications sector is changing rapidly. Some ISPs are acquiring content creators, and others are providing mobile services only previously seen in Dick Tracy cartoons. The FCC was established to regulate what was then regarded as a “natural” telephone monopoly. What’s needed is either an FCC with a dramatically transformed mandate or — maybe better — a new entity dedicated to protecting the environment for continuous innovation on the Internet.

Speedy Elections

Posted on by The Progressive Policy Institute

As noted yesterday, the 2012 presidential election cycle is already informally underway, and will get very real the day after the midterm elections on November 2.

By comparison, check out our older cousins in the United Kingdom. Today Prime Minister Gordon Brown set the date for his country’s next general election: 30 days from now.

Now obviously, electioneering in Britain is not totally confined to the formal period of the campaign, but much of it actually does take place in the sprint to election day, and that’s the case in most other democracies as well. It helps illustrate one of the major drawbacks of our own system, in which constitutionally fixed general election dates allow campaigning for major offices to creep back through the calendar relentlessly.

As for the likely outcome of the UK elections, the Conservatives have long led in the polls, which is unsurprising given the long tenure of Labour control (13 years), and the condition of the economy. But the Tory gap over Labour has been shrinking lately, and if it continues to shrink, what looked like an almost certain Tory victory a year ago could turn into a narrow advantage producing a “hung parliament” — i.e., where no party has a majority in the House of Commons. That scenario could create a minority government in which either the Tories or Labour form a coalition with the third-party Liberal Democrats, or if negotiations with the LibDems fail, another quick election.

American Republicans looking to the British elections as a possible harbinger of good things to come here at home should take note of Tory leader David Cameron’s repeated pledged that protecting the National Health Service — a.k.a., “socialized medicine” in the real, not (as with ObamaCare) imaginary sense — will be his “top priority.” Tories have also been blasting Brown for exceesively austere fiscal policies. So a Tory victory, if it happens, wouldn’t exactly be transferable to the U.S.

This item is cross-posted at The Democratic Strategist.

Photo credit: https://www.flickr.com/photos/secretlondon/ / CC BY-SA 2.0

Airline Screening, See-I-Told-You-So Edition

Posted on by The Progressive Policy Institute

About two months ago, I wrote an opinion piece for the Cleveland Plain Dealer‘s website on the virtues of a “smart selectee list.” My point was that Americans are essentially programmed to throw money at terrorism, but that more effective and cheaper measures are available.

For example, following the Christmas Day bombing attempt, the Obama administration announced that it would spend some $700 million on full-body screening machines. Sure, they’ll be effective for a while, but it’s only a matter of time before someone somewhere finds a way to either beat the machine or to blow up an airline that doesn’t involve explosives smuggled onboard by a passenger. If terrorism over the last 20 years has taught us anything, it’s that terrorists adapt to beat new security measures.

Instead, here’s how my “smart selectee list” would work:

It’s time to construct a security apparatus that intelligently accounts for signs of potentially dangerous passengers while balancing risk, passenger inconvenience and privacy concerns — and saves money in the process.

Rather than purchase enough body scanners to take naked pictures of everyone boarding a flight, the TSA and National Counter Terrorism Center should review one of the least discussed but potentially most effective devices it already has on the books: the “selectee” list. …

It’s time to let the selectee list think for itself. With technological innovation, the list could be transformed into a “smart” anti-terrorism tool: Allegedly dangerous individuals would be added, but additional passenger screening is triggered only when an algorithm connects potential attackers to a suspect travel itinerary and during periods of elevated, if vague, threat levels. Individuals selected for additional screening must be shared with the airlines.

For example, if an allegedly dangerous Elizabeth Kennedy is set to travel from Dublin to the United States, her profile would trigger additional screening only when the list automatically connects her name, travel itinerary and an ongoing Ireland-based threat. If the threat is based out of, say, France, or once an analyst determines it has lapsed, she would undergo standard security procedures.

It seems like the administration is starting to come around:

Before Dec. 25, airlines were given the no-fly list of people to be barred from flights altogether and a second “selectee” list of passengers to be subjected to more thorough screening. Those lists have been expanded considerably this year and now contain about 6,000 and 20,000 names respectively, officials said.

The new system will send the airlines additional names of passengers not on either the no-fly or selectee list but identified as possible security risks because of intelligence about threats. Only the names of the passengers selected for extra screening, not the underlying intelligence, will be shared with airlines and foreign security personnel, officials said.

The details of this program remain a bit sketchy, but it would appear that the administration is linking threat-based information to travelers who share the same name as the potentially dangerous. Potentiality is an important concept in this process — the intelligence community was faulted for the Christmas attempt because it failed to “connect the dots” even though intelligence is designed to only link together credible dots. And I’d argue that in the case of that incident there weren’t credible dots to connect. There was a lot of possibly credible stuff out there, but none of it was ironclad.

This new system appears to trigger additional screening when information of unknown credibility is linked together at the point of attack. It’s a smart method that’s in stark contrast to the indiscriminate body screening of passengers. For passengers whose names come up under the new selectee process, undergoing additional screening would be a relatively minor inconvenience. But the targeted patdown would be an effective security measure that doesn’t trample civil liberties and minimizes the inconvenience for most passengers.

Presidential Field Hockey

Posted on by The Progressive Policy Institute

The 2012 presidential cycle doesn’t officially begin until November 3, but the Republican field will start being seriously shaped this week down in New Orleans, at the Southern Republican Leadership Conference. Confirmed speakers include no fewer than nine people who have been “mentioned” as possible presidential candidates: Sarah Palin, Mike Huckabee, Newt Gingrich, Rick Perry, Ron Paul, Mike Pence, Rick Santorum, Haley Barbour and Bobby Jindal. Tim Pawlenty will address the event by videotape. Mitt Romney, who may be playing the traditional front-runner’s game of avoiding appearances with his lilliputian rivals, will be missing; he’s off hawking copies of his book in — two guesses where! — New Hampshire.

Other than the usual straw poll of attendees (with the main question being whether Ron Paul’s young supporters will flood the event like they did at the CPAC conference in February), and the usual informal assessments of the speeches, here are some other sources of intrigue: (1) Will any or all of Mitt’s rivals blast him for prevarication on similaries between RomneyCare and ObamaCare? (2) How many of the presidentials will claim close kinship with the Tea Party Movement? (3) Will any of them formally disclaim candidacy? (4) How bloody will the rhetorical red meat get? (5) Who if any of them will try to get media plaudits for a calm, substantive approach? and (6) Will any new “true conservative” limus tests be laid down?

The New Orleans event could represent quite a presidential field hockey match. And in case you think it’s crazy to be talking about the 2012 presidential race, remember this: it’s just 21 months til the Iowa Caucuses!

This item is cross-posted at The Democratic Strategist.

End of a Delusion

Posted on by The Progressive Policy Institute

It’s certainly taken a while, but as we head towards the Tea Party Movement’s holy day of April 15, it seems to finally be sinking in among the commentariat that these people did not come out of nowhere or arise spontaneously from an aroused populace, but are instead simply the same old conservative Republicans who used to be so boring back in the day. A new poll of the Tea Folk by Gallup seems to have spurred this realization along, though some gabbers may persist in being baffled by the high number of Tea Partiers who self-identify as independents. The Atlantic‘s Marc Ambinder explains it to them:

[I]t’s true that just half of those Tea Partiers surveyed called themselves Republicans. Yes, the lion’s share of the other half say they’re independent. But they’re not: they’re Republican-oriented conservative voters who are dismayed by the direction of the GOP and who don’t want to identify with the party’s brand. That’s not surprising, given how tarnished that brand is. Only 8% identify as Democratic; 7% identify as liberal; 70% percent identify as conservative; two-thirds are pro-life; nearly 90% were opposed to the health care bill.

This is a very old story, one that arguably goes all the way back to the 1940s. At any given moment, a significant number of conservative Republicans don’t want to call themselves Republicans because their leadership is not, in their view, conservative enough. This is one reason why Republican self-identification numbers have chronically undershot Republican votes in actual elections. At particularly difficult moments, conservative Republicans have even threatened to form a third party — as in the mid-1970s, when National Review publisher William Rusher argued that conservatives should leave the GOP to it’s “elitist” establishment and make common cause with Wallacites and other social conservatives in a “producer’s party.” Such threats today are no more unusual, or credible, but do help encourage Republican office-holders to follow their own inclination to hew to the Right.

As the (apparent) novelty of the Tea Party wears off, its familiar outlines should become apparent, except to those with a strong bias in favor of misunderstanding the phenomenon. In an interesting column today, Mark Schmitt of The American Prospect discusses those left-progressives who persist in helplessly hoping for a “populist” alliance with the Tea Folk. Part of the allure, he suspects, involves some progressive self-loathing:

[F]inding allies among Tea Partiers is the equivalent of what finding a black friend was to liberals in the 1960s. It’s a way to get in touch with the real America, to feel a little superior, a little less elitist or isolated, less wimpy, less conformist.But the real America is at least as likely to be found in the 205 million voting age adults who aren’t Tea Partiers as the few hundred thousand who are. And the rest of that real America, with its own passions and anger and economic pain, is probably a more fruitful area to look for allies on real liberal goals that include inclusion and fairness.

In any event, I’m with Ambinder: If pollsters want to keep examining the Tea Folk, it’s time for them to drill a little deeper:

Next time, I’d love for Gallup, or any other pollster, really, to ask self-identified Tea Partiers for their vote histories, for their views on immigration and race, for their views on questions about Obama attributes (is he a socialist?), for their specific views on policy matters (do they support a “fair tax?”).

Moreover, instead of asking Republicans and independents over and over if they might be tempted to vote for a hypothetical Tea Third Party candidate, pollsters might want to focus on the actual major-party preferences of Tea Partiers, since in all but a few scattered contests, that’s what they are going to face at the polls. I say that mainly because of all the delusions surrounding the Tea Party Movement, the one that suggests Democrats will be saved by a mass of third-party candidates associated with said Movement is among the most fanciful. The Tea Folk are systematically dragging the GOP to the Right, and that’s the development that Democrats need to think about exploiting in November and beyond.

This item is cross-posted at The Democratic Strategist.

Photo credit: https://www.flickr.com/photos/theqspeaks/ / CC BY-NC-SA 2.0

Outlook for Russian Democracy: Not Pretty

Posted on by The Progressive Policy Institute

Last week, I wrote that the terrorist events in Moscow meant that Russia was about to choose between two distinct paths for its democratic aspirations. Either Vladimir Putin would reincarnate his 2004 persona and use the attacks to further retard Russian democracy, or new President Dmitri Medvedev would leverage the blasts as a catalyst that liberates him from Putin’s yoke and parries his attempts at a new power-grab. At the time, I was hopeful for the second outcome, but betting on the first.

Unfortunately, this op-ed in yesterday’s New York Times slid me more towards the Putin-power-grab outlook. I had failed to appreciate that, well, there’s a different political culture in Russia that protects the “czar” and blames his underlings:

In other countries, leaders might pay a political price for not preventing a startling attack like the suicide bombings in the Moscow subway last Monday. Not here, at least not so far. If anything, terrorism and unrest in Russia’s predominantly Muslim regions have long served to strengthen Mr. Putin’s hand.
[…]
He plays on a piece of Russian folk wisdom that is roughly translated as “the good czar, bad advisers” — the belief that, throughout history, a Russian leader with the right intentions is often betrayed by underlings. That is why Mr. Putin, the prime minister and former president, is often shown in public scowling and lecturing other officials.
[…]
“When it comes to terrorism, Putin knows how — and this is a very important aspect of his political mastery — to protect himself from what might otherwise be considered his responsibility,” said Sergey Parkhomenko, a political commentator and radio talk show host in Moscow.
[…]
On Thursday night, he headed to Venezuela to see President Hugo Chavez for a visit that was intended to display the Kremlin’s muscular foreign policy and its warm relations with an antagonist of the United States. It was less than two days after a Chechen extremist had claimed responsibility for the subway attacks, and had promised there would be more.

It’s an important reminder that learning what’s in the political DNA of our partners and rivals is essential if the U.S. is to craft effective long-term partnerships and exert its influence wisely on the global stage.

Why the New CAFE Standards Are Good – But Hardly the Best Climate Policy

Posted on by The Progressive Policy Institute

Cars and trucks sold in the U.S. will have to be a little more efficient, according to new Corporate Average Fuel Economy (CAFE) standards released last week by the Environmental Protection Agency (EPA) and the Department of Transportation.

The new standards are largely a product of a compromise between states, the federal government and auto manufacturers last year. (Is it still a compromise if one party—the feds—owns a big chunk of another—the U.S. auto industry—and has Supremacy Clause powers over another—the states? Just asking.) They are also the end product of the Supreme Court’s Massachusetts v. EPA decision requiring the EPA to address impacts of greenhouse gases under the Clean Air Act. The requirements appear relatively modest: the existing requirement of 35 mpg fleet average fuel economy by 2020 is moved up to 2016 and increased by 0.5 mpg.

That apparently small change can have a big impact when you consider how many cars and trucks there are in the U.S. and how long those vehicles will remain on the road. The EPA claims that the standards will reduce greenhouse gas emissions by 960 million metric tons and cut U.S. auto emissions by 21 percent over business as usual by 2030. The EPA also estimates that increased up-front vehicle costs of about $1,000 will be offset over the course of each vehicle’s life by reduced fuel costs, resulting in a savings of about $3,000.

That’s good news for the environment, and good news for consumers, right? The auto industry is (at least for now) OK with the new standards, and the environmental community is generally happy as well. I think the positive spin is broadly correct — we’re better off with stricter CAFE standards than we would be without them.

That said, I’m skeptical about the size of the benefits estimated by the EPA. Performance standards, and in particular efficiency standards, are flawed policy tools — emissions benefits may be lower, and costs higher, than with the best alternative: a carbon price.

The largest problem with efficiency standards is that they encourage increased use of whatever is being made more efficient. If your car is more efficient, it’s cheaper to drive it, and you’ll probably do so more often (and for longer distances). You might even move farther away from work or make other choices that increase your fuel consumption (but not your cost — remember, you’re more efficient now). This is great for you since you get increased utility from driving more, but your vehicle emissions won’t go down as much. Even if you “save” more money over the life of the car, the added cost per unit of emissions reduction goes up. Other social costs, like traffic congestion and increased risk of accidents, go up as well. This is called the “rebound effect,” and estimating its size is the subject of significant research among economists.

The EPA is aware of this effect and, as you might expect from an 837-page rule (with a 475-page regulatory impact analysis and 215-page technical support document), accounted for it in its analysis. Both the EPA estimates of emissions reductions and of costs to consumers assume that owners of new, more efficient vehicles will drive more. Good job by the EPA, right? Maybe.

Digging deeper suggests that while the EPA is accounting for the rebound effect, it might be underestimating it. The EPA assumes the effect will be 10 percent — that is, increased driving will erase 10 percent of the emissions reductions that would otherwise be achieved. This estimate, the EPA admits, is lower than that suggested by most studies of the effect for vehicle efficiency standards in the U.S. These studies give estimates from seven percent to 75 percent, with the average around 22 percent — more than double the 10 percent the EPA chose. The EPA bases its choice on other studies that suggest that the effect declines over time and then projects that trend into the future. It’s possible the EPA is right here (they are relying in part on the most recent and well-regarded work on the subject), but it still seems like a relatively optimistic estimate. Because of this, I think it’s more likely that the EPA will have overestimated the benefits of the new standards than underestimated them.*

The EPA’s analysis has other limitations as well. For example, fuel prices are projected to increase in the future due to rising global demand and other factors. This will lead to demand for more fuel-efficient cars independent of any standards, possibly making CAFE requirements superfluous. Emissions would still go down, but CAFE standards might not deserve the credit.

For me, the worst part isn’t that the EPA might have overplayed an obscure (but important) assumption, or taken credit for something that might happen anyway. Even if they haven’t done either of these things, none of this is necessary. Pricing carbon, whether through an economy-wide cap-and-trade system, a transportation-sector only cap, or (hide the children) a higher gasoline tax, could achieve emissions gains without these perverse effects and estimation problems. These policies would increase the cost of gas — which is the point. If your reason for buying a more efficient car is a higher fuel price, there’s no incentive to drive more — there would be no rebound effect. In fact, there is a powerful incentive to drive less, reducing carbon emissions even further and giving other benefits: less congestion, fewer accidents, better air quality, etc. A gas tax or trading scheme would also be simpler, easier to administer and more transparent. It need not even hurt consumers: the revenues from permit auctions or taxes can be returned to households through lower taxes elsewhere, rebates or investments in public goods.

The reason CAFE standards, with all their problems, are and have long been our only policy option for controlling vehicle emissions has nothing to do with efficiency or good government — it’s politics. It’s not politically possible (or politicians think it’s not politically possible) to support a policy that increases prices at the pump. Instead, we hide costs in suboptimal and inefficient programs like CAFE. While it’s true that our cities and in some ways our society are built around driving, often long distances, that doesn’t mean we should hide the costs of those choices, or use second-rate policy tools because we can’t handle the truth. The politics behind CAFE are a shame, whatever benefits last week’s regulations will have.

* If you’re interested in the EPA’s decisionmaking process on the rebound effect, it’s candidly explained in Section 4.2.4 of the Technical Support Document.

Photo credit: https://www.flickr.com/photos/joelogon/ / CC BY-SA 2.0

When Democrats Unite

Posted on by The Progressive Policy Institute

Despite the enduring popularity of the “Democrats In Disarray” meme in certain precincts of the chattering classes, the truth is that the enactment of health reform reflected a degree of Democratic unity, resolution, and yes, accomplishment that is becoming a bit hard to ignore. Ron Brownstein’s latest National Journal column gets it straight:

After Massachusetts Republican Scott Brown’s victory in January’s Senate special election, Democrats appeared shaken to the point of panic. But, from President Obama on down, the party has rapidly regrouped–enacting health care reform, virtually daring Senate Republicans to filibuster tougher regulation of financial institutions, and challenging the GOP with last weekend’s White House announcement of recess appointments for 15 nominees stalled in the Senate. Pundits may be pelting the party with predictions of doom in November, but Democrats have apparently decided that the best defense against a resolute Republican opposition is a good offense.

More importantly, improved Democratic morale has made it easier to get some perspective on the last turbulent year, when Democratic defections in Congress were largely limited to House Members from districts that Barack Obama lost in 2008 (defections that shouldn’t be that surprising).

The governing core of the party’s House majority has been members elected from districts that Obama carried in 2008. House Democrats who represent such districts voted 199-8 for final approval of the Senate health care bill last month. Last year, they voted 201-1 for Obama’s stimulus plan, 194-1 for federal tobacco regulation, 191-8 for financial reform, and 189-15 for climate-change legislation. The Democrats elected in districts that preferred Republican presidential nominee John McCain haven’t supported Obama nearly as reliably, but Pelosi has corralled enough of them each time to pass the president’s priorities.In the Senate, the governing core is the 33 Democratic senators elected from the 18 “blue wall” states that have supported the party’s presidential nominees in at least the past five elections. In 2009, these senators collectively recorded a stunning 97 percent party unity score on the index calculated by Congressional Quarterly. Around that axis, Democratic leaders have assembled shifting coalitions of Democrats from states that are more closely divided. On the most-momentous votes — the stimulus plan and the initial health care reform package — every Senate Democrat from either camp backed Obama.

Brownstein concludes that for all the strom and stress of the last year, Obama and congressional Democrats have put together the most impressive record of accomplishment by any Democratic administration since Lyndon Johnson’s, and a degree of party unity that rivals that of Republicans in the early years of George W. Bush’s presidency. Interestingly enough, a considerable proportion of Democratic criticism of Obama has been from those arguing that he is too committed to bipartisanship in the face of ever-more-radical Republican opposition to his entire agenda. This was not a criticism made very often of George W. Bush and his political guru Karl Rove.

The problem for Democrats this November is not so much disunity as it is distraction and disinterest among voters who don’t often show up for midterm elections and who in this difficult period of American history understandably have other fish to fry. That’s why upcoming fights like financial reform and a Supreme Court nomination could be especially important: not only adding to this administrations legacy, but providing relatively unmotivated Democratic and swing voters with a graphic illustration of what could happen to the country if the GOP returns to power.

This item is cross-posted at The Democratic Strategist.

Iran Sanctions, Round 4

Posted on by The Progressive Policy Institute

America’s hot-and-cold relationship with China just blew a little warmer. Last Wednesday, Beijing for the first time agreed to take part in drafting a UN Security Council resolution for new sanctions against Iran.

This would be the fourth round of UN sanctions aimed at pressuring Tehran to halt its nuclear program. So far, efforts to give those sanctions real bite have foundered on the implicit threat that China (and perhaps Russia) would veto them in the Security Council. Both countries have extensive economic ties with Iran, and China, invoking its own unhappy experience with European imperialism, traditionally has championed “non-interference” in other countries’ internal affairs.

So it may be significant that, having tried and largely failed to “engage” Iran on the nuclear standoff, the White House has apparently successfully engaged China to deepen Tehran’s international isolation. But there are already signs that Beijing is not quite ready to jump this particular Rubicon.

Iran’s nuclear negotiator, Saeed Jalili, wasted no time in jetting off to Beijing for meetings with Chinese officials. “Many issues came up in talks on which China accepted Iran’s position,” Jalili told reporters. “We jointly emphasized during our talks that these sanctions tools have lost their effectiveness.”

The Chinese Foreign Ministry issued a statement that offered no hint that Beijing has changed its attitude toward Iran’s drive for nuclear capabilities, instead calling on all parties to “step up diplomatic efforts, and show flexibility, to create the conditions to resolve the Iranian nuclear issue through dialogue and negotiation.”

All this suggests we’re in for protracted haggling in the Security Council over language that, in the end, probably won’t induce the Islamic Republic to stop enriching uranium in defiance of UN strictures. The fundamental problem is not that China is indifferent to nuclear proliferation or intent on “protecting” a valuable trading partner. The fundamental problem is that China doesn’t seem ready yet to assume the responsibilities of global leadership, as we would define them.

From Sudan to Iran, China puts the amoral pursuit of its own interests – in these cases, assuring access to the energy it needs to fuel its rapid growth – ahead of larger conceptions of international cooperation and order, or even its own undoubted interest in stemming nuclear proliferation. The idea of “enlightened self-interest” that underpins U.S. internationalism has an unnatural and vaguely sinister ring to officials in the Middle Kingdom. For now at least, it’s hard to imagine the historically self-contained and inward-looking Middle Kingdom spending trillions of renminbi, say, to support a Pacific analogue to NATO, or an architecture of international institutions dedicated to collective problem-solving.

The Obama administration nonetheless deserves credit for nudging Beijing toward an outward view of global obligations commensurate with its growing geopolitical weight. But in the crunch – pressuring Iran to forsake nuclear weapons – we’d do well to have realistic expectations of how far China is really prepared to go.

Lessons from New England on a Clean Economy

Posted on by The Progressive Policy Institute

On March 22, the Progressive Policy Institute’s E3 Initiative hosted an event in Boston, Massachusetts on New England’s best practices on stimulating and building a clean economy sector. At the event, Massachusetts Secretary of Energy and Environment Ian Bowles shared remarks on how state and federal governments and clean energy entrepreneurs can collaborate to build a vibrant clean economy.

Speakers:

The Honorable Ian Bowles
Massachusetts Secretary of Energy and Environmental Affairs

Will Marshall
President, Progressive Policy Institute

Mike Signer
E3 Initiative Chair and Senior Fellow, Progressive Policy Institute

New Fuel Efficiency Rules a Historic Turn for Climate Policy

Posted on by The Progressive Policy Institute

Energy and climate legislation may be stalled in Congress, but President Obama is pressing forward on another crucial, clean energy front.

In a historic first, the Environmental Protection Agency and the Department of Transportation yesterday issued rules regulating greenhouse gas emissions from cars and light trucks. In 2007, the Supreme Court had ruled in Massachusetts v. EPA that the EPA had the authority under the Clean Air Act to regulate greenhouse gases. That decision paved the way for last year’s determination by the agency that CO2 and other greenhouse gases were dangerous pollutants. The rules announced yesterday combine traditional efficiency standards with direct regulation of CO2 emissions from vehicles (a proxy for fuel consumption).

Under the new standards, by model year 2016 vehicles must get an average of 35.5 miles per gallon. The requirements — which represent the administration’s most significant achievement in reducing global warming pollution — are expected to reduce greenhouse gas emissions from cars by 21 percent by 2030. The announced rule was the final implementation of a deal made by the Obama administration with the auto manufacturers last year, whereby the industry would get the certainty of a national standard in exchange for dropping their extensive litigation meant to prevent California from mandating similar tailpipe emissions standards (and having a dozen or so states follow suit).

Not to take any credit, but back in 2004, Jan Mazurek and I wrote a paper for PPI titled “Clean Cars – Kicking America’s Oil Habit,” in which we argued for adopting a strong tailpipe emission approach to fuel economy. In addition to compelling environmental and national security arguments for stricter fuel efficiency rules, our motivation was to suggest a new framework beyond the broken and stale political battles over CAFE standards – the Corporate Average Fuel Economy rules that had not been raised in a generation in large part because of firm opposition from Detroit and its protectors on Capitol Hill.

We and others argued that by focusing capital and political resources on lawyers, lobbyists and the short-term political objective of defeating annual meager attempts by the environmental community to increase CAFE standards, Detroit was missing the larger vision that global automotive competiveness would be shaped in the future by innovation around fuel economy and environmental performance. We felt that the exigencies of climate change and the inevitable structural rise in fuel costs stemming from increasing global demand and the rising marginal costs of production meant that the “clean car innovators” would have an advantage in the global marketplace.

The Bush administration, after a costly “head fake” over hydrogen that caused many to take their eye off the fuel-economy ball, did propose some modest increases in CAFE standards, but they were far short of what was needed to restructure our national approach to competitiveness in the international auto marketplace, or to seriously address the economic, environmental and security threats posed by our addiction to oil.

Ultimately, it took a prostrate domestic auto industry and a high-flying new Democratic president to take serious action. The result should be seen by nearly all as a true win-win. Automakers get a national standard, we finally have a policy aimed squarely at both greenhouse gas emissions and oil dependence, and – we hope – Detroit will lay off some lobbyists while creating jobs for smart engineers.

Of course, nothing is so simple. We now see that the ultra-conservative attorney general from Virginia, in yet another pander to tea party types, has vowed to file a lawsuit challenging the new rules. (I thought it was liberals who were supposed like frivolous lawsuits?) God knows what his arguments will be, but let’s hope he comes up with a clever basis for being against jobs, innovation, increased national security and a more stable climate. Bring it on.

Iran’s Role in Iraq

Posted on by The Progressive Policy Institute

Tom Ricks, author of Fiasco and The Gamble, the two definitive contemporary histories of the Iraq War, has long said that Iran has been the biggest winner since Shock and Awe.

I’ve always been inclined to agree with him, even if there was scant overt evidence to support the claim. Sure, the U.S. military would parade allegedly Iranian-made explosives out to the media to “prove” Tehran’s support of Shi’ite Iraqi militias. And it has long been assumed that the leading figure of those Shi’ite militias, Muqtada al-Sadr, put his tail between his legs and decamped to Iran as soon as the U.S. figured out what it was doing in Baghdad. But for the first time, we have unquestionable evidence of Iran’s waxing influence on the new Iraqi government: They invited (almost all of) them over to play. Or their Shi’ite cousins anyway:

The ink was hardly dry on the polling results when three of the four major political alliances rushed delegations off to Tehran. Yet none of them sent anyone to the United States Embassy here, let alone to Washington. … The Iranians, however, have shown no such qualms, publicly urging the Shiite religious parties to bury their differences so they can use their superior numbers to choose the next prime minister. Their openness, and Washington’s reticence, is a measure of the changed political dynamic in Iraq.

The uninvited fourth major political party was Iraqiya, the largest vote-getter in last month’s election, a largely Sunni party (headed by Ayad Allawi, a secular Shia), which has the first crack at forming a government with Allawi as the new prime minister. This is, of course, provided they can stave off the latest round of politically motivated witch-hunting. Incumbent PM Nouri al-Maliki is fighting for his political life, and has come out swinging. He’s trying to make it as difficult as possible for Iraqiya to capitalize on its victory by having the national election commission — a body Maliki essentially controls — begin to disqualify other Iraqiya candidates on the shaky grounds that they were members of Saddam Hussein’s old Ba’ath Party. When combined with Iran’s efforts to broker peace between the Shi’ite parties, this is the best hope Tehran has of getting a large, friendly, Shi’ite majority and prime minister in Baghdad.

Will it work? It’s obviously way too early to say. The U.S. is trying to toe a razor thin line between respecting a democratic process they created and cultivating the new government (no matter who runs it) against Iranian influence. But while Tehran’s overtures are worrisome to say the least, the U.S. will continue to hold plenty of cards in the poker game of Iraqi politics. That’s because if Mr. Allawi isn’t the next prime minister, the current one will be.

That leads to two consoling final thoughts: the U.S. will continue to have strong pull with whoever is in charge, and is legally scheduled to get out anyway. In essence, Iran’s influence may be increasing, but that doesn’t mean it’s coming at the expense of America’s.

Photo credit: https://www.flickr.com/photos/soldiersmediacenter/ / CC BY 2.0

Exploding a Stimulus “Study”

Posted on by The Progressive Policy Institute

It’s considered gospel truth in many conservative circles that the American Recovery and Reinvestment Act of 2009, a.k.a. the “economic stimulus package,” was just a porkfest aimed at buying votes or rewarding Democratic constitutencies at the expense of good, virtuous taxpayers and their grandchirren. In support of this hypothesis, Veronique de Rugy of George Mason University’s Mercatus Center, and a regular contributor to conservative and libertarian magazines and web sites, recently wrote a “study” designed to show that ARRA dollars went disproportionately to districts represented by Democrats and/or that voted for Obama in 2008, regardless of their actual economic needs. De Rugy helpfully touted her study at National Review’s The Corner yesterday, for the edification of those who look to that blog for talking points.

Looks like she should probably have kept the paper to herself. Nate Silver of 538.com took a look at it, and pretty much demolished it today.

Turns out that de Rugy didn’t notice, or didn’t mention, that most of the “Democratic districts” that show up in her study as the top recipients of ARRA dollars happen to contain state capitals. Thus, ARRA spending designed to benefit states as a whole (the Medicaid super-match, school improvement incentives, state infrastructure grants, the state “flexibility” funds, etc.) are attributed by her to individual districts. She also ignored economic indicators showing poverty and local unemployment, which may or may not be correlated with Democratic voting habits, but which certainly indicate actual need.

I hear through the grapevine that de Rugy plans to respond to Nate’s demolition job at some point. If she manages to climb out of this crater, I’ll certainly be impressed.

The larger point, though, is that without Nate’s intervention (and perhaps even after it), conservatives would be gleefully citing de Rugy’s bottom line “findings” as “proof” that ARRA was what they always said it was. She is, after all, an academic thinker, and her “study” is impressive-looking, with lots of footnotes and scatter plot charts. I’m not saying that conservatives are alone in conducting this sort of skewed and deeply flawed “research,” or in citing it without examination. But that doesn’t excuse it for even a moment, particularly when the “researcher” is out there circulating the stuff as agitprop for the chattering classes before the ink is even dry.

This item is cross-posted at The Democratic Strategist.

Photo credit: https://www.flickr.com/photos/jbyoder/ / CC BY-NC 2.0

To Have and to Have Not

Posted on by The Progressive Policy Institute

Longtime political reporter Tom Edsall has a long and fascinating piece of analysis up at The Atlantic on the present and future shape of the two major party coalitions. While none of the data he discusses is terribly surprising, he does suggest some real internal problems with the emerging Republican coalition, which is increasingly made of up married white folks, but includes those who are “haves” only because they “have” government benefits that are perceived as vulnerable to budgetary competition from “have-nots”:

It’s entirely possible that, if the deficit forces continued zero-sum calculations, the definition of the center-right coalition of “haves” will be expanded beyond its original boundaries, stretching past the wealthy, the managerial and business class, the gun owners, the anti-taxers, the home schoolers, the property rights-ers, the Western ranchers, Christian evangelicals, and the self-employed to begin to include members of what conservative operative Grover Norquist called the “takings” coalition — men or women who get federal benefits. A Republican Party hungry for victory would welcome as new members Social Security and Medicare recipients  — “takers” who simultaneously consider themselves part of the universe of “haves” and of Norquist’s “leave us alone coalition.”

Add in people who are self-consciously dependent on federal defense spending, and you can see how a Republican coalition of public- and private-sector “haves” could be formidable if not terribly stable.

Demographic trends, though, are very dangerous for the GOP, as this Edsall nugget shows:

While there is no doubt that the increase in the number of racial and ethnic minority voters works to the advantage of the liberal coalition, white voters remain a wild card. In 2008, whites made up 74 percent of the electorate, and McCain carried them 55-43. There are precedents for much higher Republican margins: in 1972, Nixon carried 67 percent of the white vote, and in 1984 Reagan won 64 percent. Conversely, Bill Clinton only lost the white vote by one percentage point to George H. W. Bush in 1992. The one clear conclusion to draw from these figures is that if the GOP is unwilling to make major policy shifts, especially on immigration reform, a crucial issue to many Hispanics, the party will have to drive its margins among white voters back up to the Nixon-Reagan levels.

If anything, the current pressure on the GOP from its rank-and-file, including the Tea Party Movement, is in the opposite direction from any position on immigration policy that could attract Hispanics. So there will be a strong temptation on the Right for indulging heavily in what might be called White Identity Politics. In light of Edsall’s insight on the “haves” in the GOP coalition who are dependent on government spending, White Identity Politics could involve racially tinged distinctions between the “deserved” government benefits received by white middle-class retirees and the “undeserved” government benefits received or sought by poorer or darker folk. That’s a dynamic that’s already been abundantly apparent in the Republican assault on health reform.

Looks like today’s political turbulence will be with us for quite a while, particularly if relatively high unemployment and budget deficits persist, accentuating the zero-sum politics of group competition that Edsall sees in the data.

This item is cross-posted at The Democratic Strategist.