Daily Digest - January 28: Raising Rates is a Rising Challenge

Jan 28, 2015Rachel Goldfarb

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Hard Choices on Easy Money Lie Ahead for Fed Chief (WSJ)

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Hard Choices on Easy Money Lie Ahead for Fed Chief (WSJ)

Janet Yellen's second year as Federal Reserve Chair begins with the difficult task of creating consensus on raising interest rates, write Jon Hilsenrath and Pedro da Costa.

U.S. Companies Cut More Than 1m Jobs a Month. When Did Workers Stop Mattering? (The Guardian)

Suzanne McGee points at large-scale layoffs at big name companies that seek to raise their stock prices as a sign that the U.S. economy no longer sees workers as a worthwhile investment.

You're Probably Richer Than You Think You Are: How Inequality Screws With Our Perspective (The Week)

Jeff Spross says that arguments over proposed changes to college savings accounts demonstrate just how easily some Americans lose sight of how high they sit within the economy.

How Bernie Sanders, In New Role, Could Make Wall Streeters Very, Very Unhappy (TAP)

Ari Rabin-Havt explains how Senator Sanders plans to use his new role as ranking member of the Senate Budget Committee to take on too-big-to-fail and other financial regulatory issues.

Shutting Down New York’s Subways Is Very Expensive (NYT)

If only 10 percent of New York's workforce was unable to work because of the subway shutdown, Josh Barro estimates that the cost in lost labor would be around $160 million.

Al Franken’s Massive New Target: Why He’s Taking on Shady Credit Rating Agencies (Salon)

A major fine for Standard & Poor's shows that Senator Franken's proposal to base credit ratings agencies' compensation on the accuracy of their ratings is still needed, writes David Dayen.

Answering President Obama’s Call, House Introduces Paid Sick Leave Bill for Workers (In These Times)

Kevin Solari reports on the introduction of the Federal Employees Paid Parental Leave Act, one of many ways to expand paid leave in order to attract top talent to government jobs.

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Daily Digest - January 27: For Some Workers, A Snow Day Puts Jobs at Risk

Jan 27, 2015Rachel Goldfarb

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No Snow Days for Low-Wage Workers (AJAM)

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No Snow Days for Low-Wage Workers (AJAM)

Most low-wage workers don't have the option of missing work during snowstorms, writes E. Tammy Kim, and may risk being fired if lack of public transit prevents them from getting there.

Supreme Court Rules Against Retirees in Union Health Benefits Case (NYT)

Adam Liptak reports on the Court's decision in M&G Polymers USA v. Tackett, which holds that a contract that doesn't specify whether retiree health benefits are for life shouldn't be assumed to do so.

The Dark Side of ‘Sharing Economy’ Jobs (WaPo)

Catherine Rampell points out that companies like Uber are shifting much of the risk inherent in their businesses to workers who are defined as independent contractors and lack protection.

A Staggeringly Lopsided Economic Recovery (The Nation)

Zoë Carpenter looks at a new study from the Economic Policy Institute about the 1 percent's gains during the recovery, which shows that group captured at least half of growth in most states.

Why de Blasio Was Right to Take on Criminal Justice Reform (Slate)

Jamelle Bouie says that since excessive policing caused economic problems, like job loss, in communities of color, Mayor de Blasio's criminal justice reform has also served as economic populism.

New on Next New Deal

Did Ending Unemployment Insurance Extensions Really Create 1.8 Million Jobs?

Roosevelt Institute Fellow Mike Konczal says probably not, because the study making this claim has problematic models and technique, as well as "noisy" confusing data.

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Did Ending Unemployment Insurance Extensions Really Create 1.8 Million Jobs?

Jan 27, 2015Mike Konczal

According to a new study by Marcus Hagedorn, Iourii Manovskii and Kurt Mitman (HMM), Congress failing to reauthorized the extension of unemployment insurance (UI) resulted in 1.8 million additional people getting jobs. But wait, how does that happen when only 1.3 million people had their benefits expire?

The answer is by going off the normal path of these arguments in models, techniques and data. The paper has a nice write-up by Patrick Brennan here, but it’s one that doesn’t convey how different this paper is compared to the vast majority of the research. The authors made a well-criticized splash in 2013 by arguing that most of the rise in unemployment in the Great Recession was UI-driven; this new paper is a continuation of that approach.

Gold Standard Model. Before we go further, let’s understand what the general standard in UI research looks like. The model here is that UI makes it easier for workers to pass up job offers. As a result they’ll take a longer time to find a job, which creates a larger pool of unemployed people, raising unemployment. In order to test this, researchers use longitudinal data for individuals to compare the length of job searches for individuals who receive UI with those who do not.

This is the standard in the two biggest UI studies from the Great Recession. Both essentially use individuals not receiving UI as a control group to see what getting UI does for people’s job searches over time. Jesse Rothstein (2011) found that UI raised unemployment “by only about 0.1 to 0.5 percentage point.” Using a similar approach, Farber and Valletta (2013) later found “UI increased the overall unemployment rate by only about 0.4 percentage points.” These are generally accepted estimated.

And though small, they are real numbers. The question then becomes an analysis of the trade-offs between this higher unemployment and the positive effects of unemployment insurance, including income support, increased aggregate demand and the increased efficiency of people taking enough time to get the best job for them.

This is not what HMM do in their research. Either in terms of their data, which doesn’t look at any individuals, or their model, which tells a much different story than what we traditionally understand, or their techniques, which add additional problems. Let’s start with the model.

Model Problems. The results HMM get are radically higher than these other studies. They argue that this is because they look at the “macro” effects of unemployment insurance. Instead of just people searching for a job, they argue that labor-search models show that employers must boost the wages of workers and create fewer job openings as a result of unemployment insurance tightening the labor market.

But in their study HMM only look at aggregate employment. If these labor search dynamics were the mechanism, there should be something in the paper about actual wage data or job openings moving in response to this change. There is not. Indeed, their argument hinges entirely on the idea that the labor market was too tight, with workers having too much bargaining power, in 2010-2013. The end of UI finally relaxed this. If that’s the case, then where are the wage declines and corporate profit gains in 2014?

This isn’t an esoteric discussion. They are, in effect, taking a residual and calling it the “macro” effect of UI. But we shouldn’t take it for granted that search models can confirm these predictions without a lot of different types of evidence; as Marshall Steinbaum wrote in his appreciation of these models, when it comes to business cycles and wages predictions they are “an empirical disaster.”

Technique Problems. The model’s vagueness is amplified by the control issue. One of the nice things about the standard model is that people without UI make a nice control group for contrast. Here, HMM simply compare high-UI and low-UI duration states and then counties, without looking at individuals. They argue that since the expiration was done by Congress, it is essentially a random change.

But a quick glance shows their high benefits states group had an unemployment rate of 8.4 percent in 2012, while their low benefits states had an unemployment rate of 6.5 percent. Not random. As the economy recovers, we’d naturally expect to see the states with a higher initial unemployment rate recover faster. But that would just be “recovery”, not an argument about UI, much less workers' bargaining power.

Data Problems. Their county-by-county analysis is meant to cover for this, but this data is problematic here. As Dean Baker notes in an excellent post, the local area data they use is noisy, confusing based on whether the state is where one works versus lives, and is largely model driven. The fact that much of it is model-driven is problematic for their cross-state county comparisons.

Baker replaces their employment data with the more reliable CES employment data (the headline job creation number you hear every month) and finds the opposite headline result:

It's not encouraging that you can get the opposite result by changing from one data source to another. Baker isn’t the first to question the robustness of these results to even minor changes in the data. The Cleveland Fed, on an earlier version of their argument, found their results collapsed with a longer timeframe and excluding outliers. The fact that the paper doesn’t have robustness tests to a variety of data sources and measures also isn’t encouraging.

So data problems, control problems, and the vague sense that this is just them finding a residual and attribute all of it to their “macro” element without enough supporting evidence. Rather than turning over the vast research already done, I think it’s best to conclude as Robert Hall of Stanford and the Hoover Institute did for their earlier paper with a similar argument: “This paper has attracted a huge amount of attention, much of it skeptical. I think it is an imaginative and potentially important contribution, but needs a lot of work to convince a fair-minded skeptic (like me).” This newest version is no different.

 
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According to a new study by Marcus Hagedorn, Iourii Manovskii and Kurt Mitman (HMM), Congress failing to reauthorized the extension of unemployment insurance (UI) resulted in 1.8 million additional people getting jobs. But wait, how does that happen when only 1.3 million people had their benefits expire?

The answer is by going off the normal path of these arguments in models, techniques and data. The paper has a nice write-up by Patrick Brennan here, but it’s one that doesn’t convey how different this paper is compared to the vast majority of the research. The authors made a well-criticized splash in 2013 by arguing that most of the rise in unemployment in the Great Recession was UI-driven; this new paper is a continuation of that approach.

Gold Standard Model. Before we go further, let’s understand what the general standard in UI research looks like. The model here is that UI makes it easier for workers to pass up job offers. As a result they’ll take a longer time to find a job, which creates a larger pool of unemployed people, raising unemployment. In order to test this, researchers use longitudinal data for individuals to compare the length of job searches for individuals who receive UI with those who do not.

This is the standard in the two biggest UI studies from the Great Recession. Both essentially use individuals not receiving UI as a control group to see what getting UI does for people’s job searches over time. Jesse Rothstein (2011) found that UI raised unemployment “by only about 0.1 to 0.5 percentage point.” Using a similar approach, Farber and Valletta (2013) later found “UI increased the overall unemployment rate by only about 0.4 percentage points.” These are generally accepted estimated.

And though small, they are real numbers. The question then becomes an analysis of the trade-offs between this higher unemployment and the positive effects of unemployment insurance, including income support, increased aggregate demand and the increased efficiency of people taking enough time to get the best job for them.

This is not what HMM do in their research. Either in terms of their data, which doesn’t look at any individuals, or their model, which tells a much different story than what we traditionally understand, or their techniques, which add additional problems. Let’s start with the model.

Model Problems. The results HMM get are radically higher than these other studies. They argue that this is because they look at the “macro” effects of unemployment insurance. Instead of just people searching for a job, they argue that labor-search models show that employers must boost the wages of workers and create fewer job openings as a result of unemployment insurance tightening the labor market.

But in their study HMM only look at aggregate employment. If these labor search dynamics were the mechanism, there should be something in the paper about actual wage data or job openings moving in response to this change. There is not. Indeed, their argument hinges entirely on the idea that the labor market was too tight, with workers having too much bargaining power, in 2010-2013. The end of UI finally relaxed this. If that’s the case, then where are the wage declines and corporate profit gains in 2014?

This isn’t an esoteric discussion. They are, in effect, taking a residual and calling it the “macro” effect of UI. But we shouldn’t take it for granted that search models can confirm these predictions without a lot of different types of evidence; as Marshall Steinbaum wrote in his appreciation of these models, when it comes to business cycles and wages predictions they are “an empirical disaster.”

Technique Problems. The model’s vagueness is amplified by the control issue. One of the nice things about the standard model is that people without UI make a nice control group for contrast. Here, HMM simply compare high-UI and low-UI duration states and then counties, without looking at individuals. They argue that since the expiration was done by Congress, it is essentially a random change.

But a quick glance shows their high benefits states group had an unemployment rate of 8.4 percent in 2012, while their low benefits states had an unemployment rate of 6.5 percent. Not random. As the economy recovers, we’d naturally expect to see the states with a higher initial unemployment rate recover faster. But that would just be “recovery”, not an argument about UI, much less workers' bargaining power.

Data Problems. Their county-by-county analysis is meant to cover for this, but this data is problematic here. As Dean Baker notes in an excellent post, the local area data they use is noisy, confusing based on whether the state is where one works versus lives, and is largely model driven. The fact that much of it is model-driven is problematic for their cross-state county comparisons.

Baker replaces their employment data with the more reliable CES employment data (the headline job creation number you hear every month) and finds the opposite headline result:

It's not encouraging that you can get the opposite result by changing from one data source to another. Baker isn’t the first to question the robustness of these results to even minor changes in the data. The Cleveland Fed, on an earlier version of their argument, found their results collapsed with a longer timeframe and excluding outliers. The fact that the paper doesn’t have robustness tests to a variety of data sources and measures also isn’t encouraging.

So data problems, control problems, and the vague sense that this is just them finding a residual and attribute all of it to their “macro” element without enough supporting evidence. Rather than turning over the vast research already done, I think it’s best to conclude as Robert Hall of Stanford and the Hoover Institute did for their earlier paper with a similar argument: “This paper has attracted a huge amount of attention, much of it skeptical. I think it is an imaginative and potentially important contribution, but needs a lot of work to convince a fair-minded skeptic (like me).” This newest version is no different.

 
Follow or contact the Rortybomb blog:
 
  

 

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Daily Digest - January 26: Taxing for the Common Good

Jan 26, 2015Rachel Goldfarb

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Obama Declares Recovery of American Economy (UP with Steve Kornacki)

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Obama Declares Recovery of American Economy (UP with Steve Kornacki)

Roosevelt Institute Chief Economist Joseph Stiglitz discusses the tax proposals in the State of the Union address, and explains where they could have done more to promote prosperity.

McDonalds Workers File Civil Rights Lawsuit (NOW with Alex Wagner)

Roosevelt Institute Fellow Dorian Warren, Friday's guest host, ties this new racial discrimination case to broader patterns of poor labor practices at McDonald's.

Why Obama Took the Lead on High-Speed Internet Access Policy (Medium)

Roosevelt Institute Fellow Susan Crawford says the president's take on Internet access has shifted to better align with his discussion of middle-class economics.

Report: Fast Food Industry Could Survive $15 Minimum Wage (AJAM)

A new report from economists at the University of Massachusetts at Amherst explains how fast food companies could maintain their profit margin while raising wages, writes Ned Resnikoff.

Why Wealthy Americans’ Delusions About the Poor Are So Dangerous (Salon)

David Sirota says that reliance on regressive tax policies, such as sales taxes instead of state income taxes, are harming state economies by giving poor families higher effective tax rates than rich ones.

Middle Class Shrinks Further as More Fall Out Instead of Climbing Up (NYT)

Dionne Searcey and Robert Gebeloff examine the data on the shrinking middle class, noting that only in recent decades has the middle class shrunk because people were moving down the ladder.

New on Next New Deal

Roosevelt Reacts: What Else Did We Need from the 2015 State of the Union?

Roosevelt Institute | Campus Network students and alumni respond to the State of the Union address, with a particular focus on what the president left out or could have taken further.

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Roosevelt Reacts: What Else Did We Need From the 2015 State of the Union?

Jan 23, 2015

Roosevelt Institute | Campus Network members and alumni weigh in on President Obama's sixth State of the Union address.

Brett Dunn, University of Alabama '17:

Roosevelt Institute | Campus Network members and alumni weigh in on President Obama's sixth State of the Union address.

Brett Dunn, University of Alabama '17:

In the face of strong Republican opposition, President Obama made his stance on many controversial topics quite clear. He outlined his views on topics such as the minimum wage, equal pay for women, LGBTQ+ rights, tax reform and more. These bold and somewhat ambitious goals for change in 2015 will require bipartisan compromise in Congress. It is likely, however, that there will be little correlation between President Obama’s bold vision for the future of the United States and Congress’ actions in the final two years of his presidency. No matter how wonderful or ambitious President Obama’s plans are for the country, the likelihood of any these issues being independently addressed by a Republican controlled Congress is very slim. Yet the president’s plans do not fall on deaf ears. President Obama’s speech gives Democrats in Congress and, more importantly, the American public, ammunition against the Republican’s inevitable inaction, which could potentially help set the stage for the 2016 election.

Chisolm Allenlundy, University of Alabama '16:

It was difficult to miss the amount of politics that happened on Tuesday at President Obama’s next-to-last State of the Union address. What might have been easy to miss, however, was the meaning of it all.

President Obama knows that his days of passing game-changing progressive legislation are over. This is a common position for 4th-quarter presidents to find themselves in, and Obama did exactly what such presidents do when they can no longer effectively push for policy change: they push for culture change.

But most Americans don’t watch the political process so much as they hear about it from media sources, which put their own spin on material. According to consumer watch company Nielson, 31.7 million people tuned in for the SOTU, and even that figure is at a 15-year low. While the president has attempted to set the direction for progressive politics for the next year, policy change will be a struggle, and he needs to reach many more Americans to steer the course on our political culture. 

Tarsi Dunlop, Middlebury College '09:

Middle class economics played a key role in the President’s 2015 State of the Union. He explained that middle class economics is about the policies needed for average American families to get ahead. These policies aren’t handouts, but they make daily life better, easier, more fulfilling. For example, what if students could graduate from K-12 with good grades and know they had the option of going to community college without the staggering cost of debt? Granted, there are certain investments that must be made to make sure that community colleges are, as an institution, prepared for the role the President wants them to serve for our nation’s youth.

The President also touched on other elements of middle class economics: key policy proposals that will help young people, new families, and the elderly. He emphasized affordable day care (right now monthly costs can run higher than a mortgage payment), as well as paid family leave and sick leave. Families shouldn’t have to choose between time with new babies and paid work, nor between working and staying home with a sick child. We need a vision and a budget to help the middle class thrive and it was great to hear concrete proposals in the President’s speech.

Hayley Brundige, University of Tennessee, Knoxville '17:

Obama's State of the Union Address illustrated just how far we still have to go in the fight for gender equality. I was ecstatic when Obama asserted that the right to quality childcare and paid maternity and sick leave are not just “women's issues” — as they are often brushed aside as — but a “national economic priority.” But in the back of my mind, I was dismayed that this concept that is so obviously a human right is still so far from being obvious to our elected officials. 

Noticeably missing from the speech was any mention of preventing sexual assault, especially on college campuses. This was particularly surprising seeing as the administration has made this issue a point of focus recently, creating a White House task force on sexual assault and investigating colleges for Title IX violations. Obama even had a readily supplied anecdote, as campus activist and sexual assault survivor Emma Sulkowicz was literally in the audience. As a college student, I applaud Obama's efforts to make community college more accessible, but it's disheartening for him to not address the importance of keeping our campuses safe. No president on record has discussed sexual assault in a State of the Union address.

Zachary Agush, Wheaton College '12:

Over the years, President Obama has always integrated personal stories into his annual State of the Union addresses to paint a visual about the troubles individuals may be facing or to explain how a certain effort can help spark further growth and development for others. I have always considered that a major strength. This year’s speech focused in particular on young families. The President knows that the new generation is quickly becoming the majority of the nation's population and that the lingering inequalities and economic hardships will definitely make it increasingly difficult for them to have the quality of life they desire. This generation is also going to struggle to maintain Social Security and Medicare for those entering these safety net programs in the coming decade. I think those stories in particular hit some members of Congress, even those of the new Republican majority, that something needs to be done to at least give the next generation a chance at success. I am cautiously optimistic that something may happen - but it will only happen if this Congress can actually stop and think about how their gridlock is directly affecting the next generation. Maybe then, there can be progress.

Sarah Hilton, Wheaton College '16:

President Obama made huge strides for education policy on Tuesday night; even raising the issue of rising college tuition is a positive step forward. However, the President hardly mentioned the K-12 system. He praised rising graduation rates and higher test scores then ever before, but ignored the staggering inequality and lack of student performance when compared internationally. Obama’s two-year community college plan, while economically beneficial for the middle class, shows that our base expectations for education continue to require more time and expense.

The focus instead should be on improving the K-12 system we already have by creating more diverse programs that train students for a variety careers from academic to vocational. Today, about half of students begin community college in remedial classes. We should be making our high schools more effective at reaching students. Vocational training for profitable and interesting jobs can be done in high school, and academic programs should be strengthen to reduce the need for remedial classes in community colleges. Strengthening the underlying K-12 system and increasing vocational training would have an earlier impact on our students’ lives.

Jas Johl, University of California, Berkeley '08:

The main rhetorical touch point for the state of the union was 'middle class economics.' Throughout the address, Obama repeatedly turned to that concept, presenting policy ideas designed to bolster it.  Of paramount importance to the ongoing success of middle class, he argued, would be to make the first two years of community college free for all. This proposal does address some of the symptoms of growing economic inequality, namely rising student debt. Nonetheless, it overlooks the underlying, systemic issues at the core of the problem: the broken state of our current education system. 

As The Institute for College Access & Success and the Brookings Institute have both argued, the majority of those attending community college are already getting their tuition covered through Pell Grants and other means of financial support. I’d argue the more pressing issue is the fact that many of the students who enroll in community colleges are ill-prepared for 4-year universities, and spend the first two years of college taking remedial college (read: high school) courses that they didn't do well in or even pass the first time. Free college doesn’t help a student who isn’t ready for it.

Obama makes the very valid point that making those colleges free would assuage the financial burden of a large number of young adults, and likely precipitate a better-prepared workforce. But a glaring absence in the president's speech was acknowledgement of the fundamental cracks in our institutions, namely, our already free K-12 educational system. Real middle class economics necessitate not just free education, but better education for all.

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Daily Digest - January 23: Politics Broke the Economy

Jan 23, 2015Rachel Goldfarb

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The Politics of Economic Stupidity (Project Syndicate)

Click here to subscribe to Roosevelt First, our weekday morning email featuring the Daily Digest.

The Politics of Economic Stupidity (Project Syndicate)

Roosevelt Institute Chief Economist Joseph Stiglitz says the economy's "near-global stagnation" is the result of "stupid politics," meaning austerity policies that slow demand.

It's 'Pathetic' What Politicians Have To Do To Stay In Office (HuffPost Live)

Roosevelt Institute Senior Fellow Robert Johnson discusses the State of the Union and campaign financing, noting that fundraising makes our government less healthy.

The Most Dangerous Man In American Politics (Buzzfeed)

Ben Smith says that U.S. Attorney for the Southern District of New York Preet Bharara has proven he's willing to cross not just Wall Street but his own political party in pursuing justice.

The Government Just Took a Step Toward Ending Mass Homelessness (ThinkProgress)

Allowing Fannie Mae and Freddie Mac to contribute to the National Housing Trust Fund could mean a small but steady supply of cash for building affordable housing, reports Bryce Covert.

McDonald's Sued Over Claims Workers Were Fired From Store With 'Too Many Black People' (The Guardian)

Jana Kasperkevic reports on the lawsuit, filed by 10 former McDonald's employees in Virginia, which tries to hold the parent company accountable alongside the franchise owner.

Americans Overwhelmingly Want Paid Sick Time, Even if It Lowers Their Wages (WaPo)

Christopher Ingraham counters the common conservative argument that mandatory sick leave will lead to lower wages with data that shows workers support sick leave anyway.

New on Next New Deal

After Four Decades with Roe, U.S. Women Still Need Abortion Access, and So Much More

Roosevelt Institute Fellow Andrea Flynn and Shulie Eisen look at Kansas as an example of how economic inequality intersects with lack of access to reproductive care to create a crisis for women.

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After Four Decades with Roe, U.S. Women Still Need Abortion Access, and So Much More

Jan 23, 2015Andrea FlynnShulie Eisen

As economic inequality takes center stage in politics, it's important to remember that reproductive justice and bodily autonomy are just as essential for secure lives.

As economic inequality takes center stage in politics, it's important to remember that reproductive justice and bodily autonomy are just as essential for secure lives.

Yesterday’s 42nd anniversary of the Supreme Court’s Roe v. Wade decision prompted a week of stark contradictions. Thousands of anti-choice protesters descended on Washington yesterday while the House of Representatives passed HR7, a bill limiting insurance coverage for abortions (after a broader abortion ban was – for the time – abandoned). Yesterday, Congressional Democrats re-introduced the Women’s Health Protection Act, a bill meant to protect abortion access from the medically unnecessary restrictions that have already made the landmark decision meaningless in many parts of the country. And in his State of the Union address on Tuesday night, President Obama professed his support for abortion rights, along with equal pay, paid sick and family leave, a minimum wage hike, and expanded health coverage. It’s all been a reminder of what has been won and just how much there is left to fight for – from abortion rights to economic security.

Over the past four years we’ve seen an unprecedented number of attacks on reproductive health – more than 200 between 2011 and 2013 – leaving many states with a scant number of abortion providers. Scores of women are now required to travel long distances, at great cost, to access not just abortion, but a wide range of comprehensive health services.

While reproductive health has certainly been the obsession of choice of conservative lawmakers in recent years, it hasn’t been the only issue in their crosshairs. In many ways, the increasing hostility to abortion and family planning is reflective of a broader war against the poor that is sure to persist under the new Congress. It turns out the same lawmakers who have championed abortion restrictions in the name of protecting women’s health have done very little to actually help women and families. Indeed, a recent report from the Center for Reproductive Rights and Ibis Reproductive Health shows that states with the most abortion restrictions also have some of the worst indicators for women’s health and wellbeing. So lawmakers are restricting access to health services at the same time they are dismantling the social safety net on which so many women and families rely. The overall impact has been devastating.

In states across the country, women are struggling under the burden of intersecting health and economic injustices. Let’s look, for example, at Kansas, where conservative Governor Brownback slashed business regulations, cut taxes for the wealthy, nearly eliminated income taxes, and privatized Medicaid delivery, all with the goal of making the state a conservative utopia. In the meantime, Kansas women continue to struggle with high rates of poverty, a lack of health insurance, un- and underemployment, and a persistent wage gap. Kansas is one of the sixteen states that refuse to participate in Medicaid expansion under the Affordable Care Act, leaving nearly 80,000 adults (half of whom are women) uninsured. It is the only state in the country that actually experienced an increase in its uninsured rate last year.

To make matters worse for women in Kansas, lawmakers eliminated abortion access from 98 percent of the state’s counties – in which 74 percent of the state’s women live – and passed House Bill 2253, a 47-page law comprised of countless and senseless abortion restrictions. It included a 24-hour waiting period; medically inaccurate pre-abortion counseling; prohibiting abortion providers from working or volunteering in public schools; banning University of Kansas Medical School faculty members from teaching students and residents how to perform abortions; and eliminating public health insurance coverage of all abortion services. And the list goes on. Sadly these laws are not unique to Kansas and they have significantly diluted the initial promise Roe held four decades ago.

The economic injustices described above, and those being felt by low-income families throughout the country, are starting to get the attention they deserve, and the policy solutions to address them are gaining traction (see the recent support for raising the minimum wage and instituting paid sick and family leave). But while economists and policymakers are increasingly focused on the pernicious impacts of inequality and economic insecurity, they rarely acknowledge how these issues intersect with reproductive health and rights.

Let us use the anniversary of Roe to remember there can be no economic justice without reproductive justice. We can’t win on one front while losing on the other. Reproductive health – a cornerstone of which is family planning and abortion – is not a frill. It is a core component of comprehensive health care, which is a basic pillar of every individual’s personal, social, and economic wellbeing.

What good is better and more equal pay if we can’t plan the timing and size of our families? What good is paid sick and family leave if there are no quality, affordable, and accessible providers to give us the care we need when we need it? We need all of it. Now. That’s just demanding a basic – very basic – floor of wellbeing. And that shouldn’t be too much to ask. Roe has served as part of that foundation for the last 42 years. But conservatives have successfully chipped away at it and will continue to do so until there’s nothing left to stand on. Perhaps we can seize upon the new energy around closing the inequality gap to remind our leaders that without bodily autonomy, we will never be secure.  

Andrea Flynn is a Fellow at the Roosevelt Institute. Follow her on Twitter @dreaflynn.

Shulie Eisen is an independent reproductive health care consultant. Follow her on Twitter @shulieeisen.

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Obama’s Middle Class Economics Has to be About Fairness and Prosperity

Jan 22, 2015Richard Kirsch

The more-fair "middle-class economics" described in the State of the Union are also the right policies to help the economy grow.

The more-fair "middle-class economics" described in the State of the Union are also the right policies to help the economy grow.

In coining the new term “middle-class economics” and linking it to raising wages and taxing the rich and Wall Street to put money in the pockets of working families, President Obama used his State of the Union address to ask the public that most potent of political questions: “Which side are you on?” And as Republicans say no to improving wages and making college more affordable in order to defend the super-rich, Americans will get a clear answer. That’s a sure win for Democrats.

But the President’s explanation of middle class economics downplayed an important part of the story: it’s not just about fairness, it’s about how we create prosperity.

With the term “middle class economics,” the President is creating a contrast between economic programs aimed at boosting the middle-class and the Republican agenda of shrinking government and lowering taxes for corporations. But Obama’s use of the term missed an opportunity to drive home to the American public that middle class economics is not just about fairness, but also about moving the economy forward.

Obama defined middle class economics as “the idea that this country does best when everyone gets their fair shot, everyone does their fair share, and everyone plays by the same set of rules.” That is one of the President’s favorite phrases. But for all its appeal, it does not explain how middle-class economics drives economic progress and increases wealth. He fails to replace the Republican story that cutting government, taxes, and regulation are the keys to economic growth.

The President actually included such an explanation of what drives the economy in his 2013 State of the Union address, when he said: “It is our generation's task, then, to reignite the true engine of America's economic growth: a rising, thriving middle class."

Democrats need to firmly claim both the grounds of fairness and prosperity. As I recently wrote, “The policies that do the most to bolster fairness are in fact the most powerful policies to move the economy forward and create broadly shared prosperity.”

This is an easy case to make, as it’s true for most of the policies in the President’s middle class economic agenda.

To take just one example, raising the minimum wage is not just about basic fairness for low-wage workers. Raising wages is about creating economy-boosting jobs instead of economy-busting jobs. When wages are raised, workers have more money to spend, essential when 70 percent of the economy is made up of consumer spending.

The President’s tax proposals are also about more than just the unfairness of a tax code riddled, as he said, “with giveaways the superrich don't need, denying a break to middle class families who do.” His proposed taxes on risky bank speculation move that money to invest in vital infrastructure. When he proposes raising taxes on the rich, who already have more money than they can spend, and using those funds to make community colleges more affordable, he’s putting that money into the economy and investing in people’s skills to contribute to economic progress.

Fairness is a very powerful American value. That’s why the most successful Democratic candidates in 2014 made it clear that they were on the side of working families against Wall Street.

But the reason that fairness is so powerful is because of the contrast between the few with vast wealth and what Americans most want, to be able to care for and support their families. We value prosperity and security. That is why it is essential that Democrats can tell a clear story about how we move the economy forward. Middle-class economics is about more than fairness – it’s about how working families and the middle class drive the economy. 

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

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Daily Digest - January 22: Going Beyond the State of the Union

Jan 22, 2015Rachel Goldfarb

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Obama’s Proposal On Inequality: Is It Enough? (Here & Now)

Roosevelt Institute Chief Economist Joseph Stiglitz speaks to Jeremy Hobson about the State of the Union, emphasizing that the president's proposals don't go far enough.

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Obama’s Proposal On Inequality: Is It Enough? (Here & Now)

Roosevelt Institute Chief Economist Joseph Stiglitz speaks to Jeremy Hobson about the State of the Union, emphasizing that the president's proposals don't go far enough.

Is Net Neutrality the Real Issue? (Marketplace)

Roosevelt Institute Fellow Susan Crawford believes that monopoly control of Internet service providers, and the payments they extract from content providers, could be a larger concern.

Obama Says Family Leave Is an Economic Necessity, Not Just a Women’s Issue (NYT)

Claire Cain Miller praises the president for recognizing that child care and paid family leave should be treated as national economic priorities.

The Grand Old Party … for the Poor? (MSNBC)

Suzy Khimm points out how Republican responses to the State of the Union tried to tie the party to anti-poverty efforts, despite continued support for policies that cut the safety net.

First Thing We Do, Tax All the Banks: Why Obama's Middle-Class Economics Plan Makes Good Sense (The Guardian)

David Dayen says that the president's proposal to tax banks on their liabilities, or what they owe, is a potential first step toward additional financial reform needed post-Dodd-Frank.

New on Next New Deal

Obama’s Middle Class Economics Has to be About Fairness and Prosperity

Roosevelt Institute Senior Fellow Richard Kirsch says the president's speech left out an important story about middle-class economics: these policies are better for the economy than Republican austerity.

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Daily Digest - January 21: State of the Union Asks Congress to Actually Work on Policy

Jan 21, 2015Rachel Goldfarb

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The Problem With Obama's Bold SOTU (MoJo)

David Corn thinks President Obama needs to advance a stronger narrative about the GOP's obstructionism preventing his policy agenda from becoming reality.

Click here to subscribe to Roosevelt First, our weekday morning email featuring the Daily Digest.

The Problem With Obama's Bold SOTU (MoJo)

David Corn thinks President Obama needs to advance a stronger narrative about the GOP's obstructionism preventing his policy agenda from becoming reality.

In State of the Union Speech, Obama Defiantly Sets an Ambitious Agenda (NYT)

Michael D. Shear and Julie Hirschfeld Davis call the president's tone "defiant" as he called on Republicans to join him in an extensive domestic agenda.

Rebounding Economy Gives President Breathing Room at State of the Union (AJAM)

Naureen Khan says President Obama was able to make his ambitious proposals because the economy is in the best shape it's been in his six years in office.

The Economy Has Improved. The GOP's Talking Points Have Not. (TNR)

The five Republican responses to the State of the Union show that the GOP is still claiming the president's major achievements will crush the economy – but they aren't, writes Danny Vinik.

Toward a New Solidarity (TAP)

Rich Yeselson says that if the "labor question" is to return to the forefront of political thinking, the labor movement's best shot is to fight for all workers, not just its own members.

Debunking the Chatter: The Truth About Wall Street’s Volcker Rule Assault (Medium)

Alexis Goldstein breaks down the Wall Street public relations apparatus's push against the Volcker Rule, pointing out inaccurate data and straight-up falsehoods in their fact sheets.

New on Next New Deal

The 2003 Dividend Tax Cut Did Nothing to Help the Real Economy

Roosevelt Institute Fellow Mike Konczal looks at the data available on the 2003 dividend tax cut, which shows that the corporations affected disgorged more cash to shareholders, but didn't raise wages or investment.

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