After Labor Day, Dig In for the Fight Ahead

Between cookouts and last outings to the pool, Labor Day weekend provided all of us a chance to celebrate the end of summer. But Labor Day should also be cause for celebration of another kind: the very reason that we have weekends off, for example.  As we take stock after Labor Day, there’s much that we have accomplished, much to be grateful for, and yet so much work remains if we are to create a path to economic stability for all of us.

This Labor Day, nearly a quarter of Americans who work in the private sector couldn’t spend time with their families because they don’t have access to paid holiday time. This is just one symptom of an economic system that is out of whack—so much so that people working full-time, or two or even three jobs, can’t make ends meet. While well-connected, handsomely paid CEOs have the flexibility they need to spend time with their families and provide their children with resources well beyond the basics—too many of us are barely getting by (if that) and living to work, rather than working to live full lives.

For nearly 40 years, Americans have been working harder and more productively but aren’t seeing any change in how much they take home at the end of the week. A study from the Economic Policy Institute released this week found that many parents’ paychecks aren’t enough to cover their family’s most basic needs, and that working full-time at the federal minimum wage isn’t enough for a parent with one child to get by anywhere in the country.

Let’s celebrate the progress we’ve made together and dig in with resolve and determination for the fight ahead.

Even as the economy has turned around, most Americans have failed to see improvements in their pay, according to a recent study by the National Employment Law Project. This is especially true for those who work in the retail, food service, and home-care industries, which already are among the lowest paying sectors and have seen the greatest declines in take-home pay. All the while, more and more corporations are leaving the people who cook our food and stock our shelves without the right to stand together to demand better wages and working conditions. And, profitable corporations like McDonald’s and Walmart are keeping their employees from working enough hours to pay the bills and making their lives impossible to plan.

Despite our unbalanced economy and the reality of poverty – as well as all of the forces working against the stability families so desperately need – the past few months have demonstrated the enormous potential for change that has arrived.

Take the minimum wage wins in Los Angeles, Seattle, Kansas City, St. Louis and Birmingham; and the wage increases for home-care providers in Massachusetts and fast-food employees in New York. Or look at cities like San Francisco that have enacted measures to ensure that massive retailers provide more hours to the clerks and cooks who work for them so that they can better pay the bills. President Obama has moved to make sure nearly 5 million men and women will soon have access to stronger overtime pay, and federal contractors will have to provide paid sick leave. And recent legal decisions have made it possible for two million home-care providers to receive a minimum wage and overtime pay after relentless organizing by the women who care for our families and want to better care for their own families, too. Finally, the National Labor Relations Board has just ruled that contractors and franchise employees can organize and hold their employers accountable for unfair treatment.

The forces that keep working people living on the brink are beginning to fall apart, and it’s not a mystery as to why: People have been standing together and pressing for change. Still, there is so much work that remains. Coming off of Labor Day, let’s celebrate the progress we’ve made together – and dig in with resolve and determination for the fight ahead.



Why a Pro-Worker Agenda is an Anti-Poverty Agenda

Labor Day is a time to honor America’s workers and their contributions to our economy. It is also a time to reflect upon the state of workers’ economic position, and how that position has faltered in recent decades. Except for a short period of across-the-board wage growth in the late 1990s, 2015 marks a general 36-year trend of broad-based wage stagnation and rising inequality in our country, which has had real, adverse effects on low- and middle-income households. This anemic wage growth is closely tied to the stalled progress in reducing poverty since 1979, as many poor people work and their incomes are increasingly dependent upon work. Therefore, along with strengthening the safety net, the goals of anti-poverty advocates should be one in the same with pro-worker advocates: to reverse the decades-long trend of wage stagnation and promote real wage growth for all Americans.

Despite dramatic gains in educational attainment, wages have failed to grow for those at the bottom (and middle) over the last four decades. At the same time, low income household incomes have become increasingly dependent on wages. The figure below shows the major sources of income for non-elderly households in the bottom fifth of the income distribution from 1979 to 2011, using the CBO’s measure of comprehensive income. It shows that incomes of the bottom fifth are increasingly dependent on ties to the workforce. Wages, employer-provided benefits, and tax credits that are dependent on work (such as the EITC) made up 68.3 percent of non-elderly bottom-fifth incomes in 2011, compared with only 58.2 percent in 1979. While government in-kind benefits from sources such as the Supplemental Nutrition Assistance Program (formerly food stamps) and Medicaid increased from 13.2 percent of these bottom-fifth incomes in 1979, to 19.5 percent in 2011, cash transfers such as welfare payments have declined 9.2 percentage points (from 18.6 percent to 9.4 percent).

For better or worse, the safety-net system has become increasingly tied to work through programs such as the EITC and the child tax credit, which only benefit households with labor earnings. While other transfers and tax credits are clearly important to families in the bottom fifth and should be strengthened, it is crucial to recognize that this group depends on pay from the labor market for the majority of their income.

In addition, despite what some policymakers and pundits might have us believe, a significant share of poor people work. The figure below shows the population of those in poverty segmented into various labor status categories. The top bar shows that 35.2 percent of the poor between the ages of 18 and 64 in 2013 were considered not currently eligible to work because they are retired, going to school, or disabled. The other 64.8 percent of working-age poor are currently eligible to work. The second bar shows us that among these currently-eligible workers, 62.6 percent are working and 44.3 percent are working full-time. Of the working-age poor eligible for employment, 37.4 percent are not working—a share that includes the 3.3 million unemployed poor people seeking a job.

On Labor Day this year, it’s important to recognize the integral role of wage growth in poverty reduction. Although hourly wage growth has stagnated for the vast majority since 1979, this didn’t have to happen—there was room in the economy for all people to see wage growth, as economy-wide productivity continuously reached new heights. In fact, if all wages had grown at the same rate as productivity since 1979 (in other words, had economic gains been more widely shared with low- and moderate-wage workers), 7.1 million fewer people would be poor and the market-based non-elderly poverty rate would be 2.6 percentage points lower today, or 13.5 percent. If we had also targeted full employment through Federal Reserve policy, for instance, the non-elderly market-based poverty rate would be 4.2 percentage points less and 11.2 million fewer people would be poor.

Policies that boost employment and wages are vital and underappreciated tools for reducing poverty. To gain momentum in the fight against poverty, fiscal transfers that help low-income families almost surely need to be accompanied by policies that foster widely shared wage growth. Without wage gains, the tax-and-transfer system needs to work harder every year simply to keep poverty rates from increasing. This Labor Day, let’s focus on the things we can do that will both help workers and reduce poverty, such as strengthening workers’ bargaining rights, raising the minimum wage, eliminating the tipped minimum wage, making sure the new overtime threshold quickly gets into place, enforcing wage theft rules, fighting for wider access to paid sick and family leave, and urging the Fed to target full employment.

People in poverty are working, now we need to make the economy work for them.



New Research Documents Growth of Extreme Poverty

A new book by two of our nation’s foremost poverty researchers, Kathryn Edin and H. Luke Shaefer, reveals the desperate circumstances that hundreds of thousands of children and their parents increasingly face: living with virtually no cash income in an economy that requires it to meet nearly every human need.

In $2.00 a Day: Living on Almost Nothing in America, Edin and Shaefer trace this disturbing trend to the 1996 welfare law, which has gradually but inexorably gutted the cash assistance safety net for families with children. Attention to this often neglected side of our nation’s extreme economic inequality is especially timely as policymakers from both parties consider reauthorizing the 1996 welfare law. As the book vividly shows, we are long overdue to take a different path — one that upholds our nation’s values, including our responsibility to protect and empower the most vulnerable by eliminating extreme poverty.

Living on less than $2.00 per person per day is the World Bank’s standard for measuring poverty in developing countries. Through rigorous data analysis and in-depth interviews, Shaefer and Edin document the dramatic rise in extreme poverty since the 1996 welfare law. Similarly, research by the Center on Budget and Policy Priorities confirms a rise in “deep poverty” — income below half the poverty line, or below roughly $10 per person per day for a typical family — and shows that Temporary Assistance for Needy Families (TANF), created in 1996, reduces deep poverty far less than its predecessor, Aid to Families with Dependent Children. Research shows that early childhood poverty causes short- and long-term harm, in turn posing enormous costs to our economy.

To be sure, many experience $2.00-a-day poverty for months, not years. But trying to make ends meet with such minimal cash resources can be devastating even for the shortest periods. For many families, perilous work, unpredictable work schedules, and housing instability add up to much longer periods of destitution. Through story after story, Shaefer and Edin show how the inability to afford basics like personal hygiene items and transportation, combined with insufficient work and meager public benefits, can drive people towards abusive relationships, precarious housing, mistreatment by employers, and impossible choices between breaking the law and feeding a child.

Perilous work, unpredictable work schedules, and housing instability add up to much longer periods of destitution

How did we get here, and how do we get out?

First, when policymakers supposedly shifted to a work-based safety net in 1996, they didn’t ensure that there would be enough decent jobs for everyone who wants one. While President Clinton’s proposed welfare overhaul in 1992 guaranteed a public-sector job for anyone who couldn’t find one, the 1996 law had no such guarantee. Both the labor market since 2000 and the experience of the successful but short-lived TANF subsidized jobs program in the Great Recession have made clear that many more people want jobs than can find them, in good times and bad.

Second, changes in the structure and funding of welfare have given states incentives to keep people out of TANF and to kick off many of those who do manage to enroll. As much as other programs like the EITC and SNAP (formerly food stamps) have done more over the past two decades to help families in poverty, including deep poverty, these improvements have been little match for the continued underfunding of housing assistance and the huge hole blown in our cash assistance safety net by the 1996 law.

$2.00 a Day shows that charities and individuals provide some help to extremely poor families, often making the difference between spending the night on the street and having shelter. But Shaefer and Edin also observe that people with the greatest need often live the farthest from available assistance. And even the communities with the most resources can’t meet the need without government help.

Shaefer and Edin suggest a straightforward strategy to change the unacceptable status quo: create jobs and prepare the most disadvantaged adults for them; update labor standards to reflect the reality of work in America today; invest in affordable housing; and provide a real safety net for times when people who want to work simply don’t find work possible given their caregiving responsibilities and other challenges.

We hope that this new book forces us all to grapple with the destructive circumstances we have allowed to persist for our nation’s most vulnerable families. We must reform our public policies to ensure that nobody faces a poverty so deep that many of us wouldn’t even believe it exists in this wealthy nation. We can’t ignore the shortcomings of our safety net that are exposed by the growth of $2.00-a-day poverty in America.



First Person

Serving Time and Creating a Second Chance Economy

Americans believe in the idea that everyone should get a second chance—a chance to redeem ourselves and make things right. This is a guiding principle behind a “second chance economy”—one that would offer opportunity for approximately 650,000 people released from prison every year in America, and for tens of millions of others who have been arrested or convicted of a crime.

I’m one of those Americans who committed a crime and have a criminal conviction. At one point, I was just like the two-thirds of people who are released from prison or jail only to commit a crime again, be rearrested and convicted.

I know some people may say that I deserve to live in poverty because of my mistakes. But they don’t know my story. They don’t know that I was born to an abusive father and a mother with severe mental illness; or that I was given narcotics as a young child by a relative who was supposed to care for me, but instead molested me and sold my pictures through a child pornography ring. They don’t know that by the time I was 12, I was on the streets, on my way to a life of crime and addiction, and—with no adult to care for me or advocate for me—I was in and out of the juvenile justice system, never receiving the mental health care I needed.

Truth is, I don’t care if people know these things about me or not, because I love myself now and that is what matters. But I do care that people have another chance after their arrest or conviction.

I’m on the right track now, doing right by myself, my god, my family and my community. One of the ways I’m giving back to my community is by working to create an economy that includes me and others who have served our time and are following the rules of probation or parole.  A study released by the Vera Institute of Justice found that states across the country are giving people like me a second chance not just because it is the right thing to do, but because it will reduce crime and prison costs by preventing recidivism.

No one should go hungry for a crime that they have served time for, especially if they are following the rules now.

One obstacle to opportunity that many states are addressing is the lifetime ban on receiving public benefits and job assistance through Temporary Assistance to Needy Families (TANF) and the Supplemental Nutrition Assistance Program (SNAP) for people who have a prior drug-related felony conviction. Research has shown that this policy increases recidivism and crime and is also harmful to children as well as adults who are trying to start over.  In addition to causing hunger and hardship, it can also prevent people from getting the mental health or substance abuse treatment they need, as many of these programs rely on public assistance funding to pay individuals’ room and board. Repeal of this harmful policy has been supported by the New York Times and the Los Angeles Times, and is included in the REDEEM Act, bipartisan legislation co-sponsored by U.S. Senators Cory Booker and Rand Paul.

Federal law already allows states to waive or modify the ban, and many have done so. For example, this April, California lifted the lifetime ban on TANF and SNAP so that people with a felony drug conviction who are complying with their probation or parole are now eligible for nutrition assistance, income support, and job training. Approximately 6,000 families in the state now experience hunger less often, have access to job training and employment services, and their children are no longer denied child care. For me, the biggest change is the child care help that I am able to receive for the first time. After my release and getting sober, it was hard to build a new life with my son when he was denied childcare because of my conviction. Not only was it hard for me to find work—he missed out on the great opportunities offered through childcare programs.

In June, Texas modified its lifetime ban so that people with a felony drug conviction are now eligible for SNAP (although a parole violation would lead to a “two-year disqualification”, and a second felony drug conviction would result in a lifetime ban).  Last year, Missourians took similar action so that people with felony drug convictions are able to receive nutrition assistance while participating in substance abuse treatment, as long as they are following the rules of probation or parole.  While fourteen states including California have opted out of the lifetime ban entirely, two-thirds of states continue to enforce the ban—or a modified version of it, as in Texas and Missouri.

In my opinion, no one should go hungry for a crime that they have served time for, especially if they are following the rules now. I’ve gone hungry and it is an experience no human should have to go through—especially not in America, since we have the resources to prevent hunger. Being hungry also doesn’t help people who have had an addiction stay straight, or stay away from crime.

This is why I have worked with a whole bunch of people and organizations over the past couple of years to end this unfair and unsafe lifetime ban on assistance. It isn’t easy telling my story to others, but it has made a difference. Sometimes I forget how messed up my childhood was and how far I’ve come, but I will never forget this harmful policy, how it made me feel, and how it made me feel to end it.


First Person

Taking on My Bucket List (and Homelessness)

Before I was homeless, I had a good life. I wasn’t rich, but I was far from poor, with two fairly successful small businesses (Kai’s Mobile Auto Detailing and MerMaids Maid Service) and a rental house on Maui. I drove a Mercedes 300E and my wife had a Nissan Sentra. We had no debt.

So, how did I end up homeless? I keep wondering where I went wrong.

In December 2011, I had my first seizure. On top of that, I was having marital problems and losing clients left and right due to the bad economy. Over the next few months, I averaged 2 to 3 seizures a week and was in and out of the hospital. My wife split somewhere around that time. My businesses fell apart while I wasn’t there to run them, and I spent all my savings trying to hang on instead of cutting my losses and saving what I could. By the time I got evicted, I couldn’t even afford a storage unit. I left my house with what I could fit in a red wagon and a suitcase.

I managed to get a job as a maintenance man at the Maui Sunset, a timeshare condo complex, but I was still having seizures. My doctor was convinced that they were caused by heavy metal toxicity (due to a bullet that has been in my leg for twenty years), and he put me through chelation therapy twice a week for three months. But due to the horrible side effects, I wasn’t able to maintain my job. Shortly after that, I was diagnosed with cardiomyopathy (heart disease) and I was told that without a transplant I had two years.

Let’s face it – the chances for a homeless man with epilepsy getting on the donor list are pretty slim. My seizures are now followed by 12 hours of sight loss. And I had to wonder – is this what it comes down to? I die alone, on the streets? Nothing to leave behind? Very few people to grieve my passing?

In a weird moment of clarity that you get when you have nothing else to lose, I decided I wanted to take a bucket list tour of the United States with my little dog Savannah to see and do all of the things that I have always wanted to do.

First off, I had heard of this place in Eugene, Oregon called Opportunity Villagetiny homes for the homeless. It was touted as the city’s unique approach to solving the homeless problem. Originally I thought that I would make that a stop on my trip, pick up the plans, and bring them back to Maui to start a village there. But when I got there my impression was that it was a group of homeless people that kept taking over city property until the city just let them stay. No plans, and nothing to bring back to Maui.

Savannah and I have been on the road for more than a year now. We left Maui on June 19, 2014. We have visited just about all of the things on my bucket list: Disneyland, the Smithsonian museums in D.C. (still missing the Lemelson Center for the Study of Invention and Innovation and the National Postal Museum), and Jay and Silent Bob’s Secret Stash in Red Bank, New Jersey. I’m also a huge fan of the show Comic Book Men, and I got to spend time with the stars.

Right now, we are in Washington D.C. We have been harassing Senate staffers in order to find a Senator who will sponsor legislation for a national Homeless Bill of Rights but it’s just really hard to do without an address. I now have cards from the offices of all one hundred Senators. I even put them in alphabetical order by state. Since Rhode Island was the first state to pass a Homeless Bill of Rights, I have been able to get some response from Senator Jack Reed’s staff.

As time passes, I look more and more like just another “crazy homeless guy,” and who knows, maybe I am just another crazy homeless guy. I feel like no one is listening or taking me seriously. I have no resources or backing of any kind, and these people deal with the powerful and wealthy all day long. I wish this were like “Mr. Smith Goes to Washington.” But it feels more like Oliver Twist saying, “Please sir, may I have some rights?”