From the Dispatch

Arizona and the Nation: A Failing State Versus Positive Approaches to Immigrant Integration

Suman Raghunathan — Mon, 03 May 2010 14:33:14 -0400

As we highlighted two weeks ago, the Arizona legislature and Governor's decisions to pass a punitive, anti-immigrant bill - SB1070 - have unleashed a torrent of condemnations inside and outside of Arizona. Voices speaking up against the bill have come not only from civil rights organizations, but have also included public safety officials, constitutional legal scholars, and, significantly, Republican leaders and candidates from other states with significant immigrant populations.

While Arizona's extreme, draconian law is grabbing headlines, what's gotten less attention is how Arizona is an isolated case with increasingly anti-immigrant laws and policies advanced over the last few years. A handful of states have joined Arizona in its punitive approach to immigration, yet the often-ignored reality is that the vast majority of immigrants, including undocumented immigrants, live in states that have promoted far more humane and successful approaches emphasizing immigrant integration into local economies and communities.

As this Dispatch will detail, Arizona has blazed its own (misguided) path on immigration, which reflects dysfunctional right-wing politics that have driven the state into an economic disaster of low wages, mass-foreclosures and a punishing fiscal crisis. Grandstanding on race may be Arizona's substitute for grappling with its deep, systematic economic problems, but few other states have followed its lead in recent years, and even fewer seem likely to follow it on SB1070.

SB1070 highlights the need for more systematic campaigns to deepen immigrant integration policies in the states and for passage of federal comprehensive immigration reform to address the border and the need for legalization. The economic gains from positive reforms on immigration are too large to ignore at both the state and federal level.

We invite state legislators to join State Legislators for Progressive Immigration Policy (SLPIP) and other allies to sign up with PSN's State Immigration Project for updates on promoting progressive state immigration policy by emailing immigration@progressivestates.org.

Table of Contents:

- SB1070: Legalizing Racial Profiling, Violating Federalism

- Police, Civil Rights Groups and Republican Leaders Condemn SB1070

- SB1070: Symbol of Arizona's Failed Economy and Right-Wing Politics

- Arizona's Anti-Immigrant Politics Not the Norm for States with Immigrant Populations

- SB1070 Deepens the Need for Federal Comprehensive Immigration Reform

- The Economic Benefits of Legalization and Positive Immigration Integration Strategies

- Progressive Strategy to Address Immigration Policy

SB1070: Legalizing Racial Profiling, Violating Federalism

As we described two weeks ago, SB1070 is a radical anti-immigrant piece of legislation that will open the floodgates to racial profiling and abuses of civil liberties. The law will be challenged in court for both violating individual rights and being an illegal assertion of state authority given the federal government's primary responsibility for border and immigration matters. But in the meantime, the effects of its implementation will be sweeping, since the law:

Legalizes Racial Profiling: State and local government law enforcement officers are required to determine if a person is illegally in the United States based on a “reasonable suspicion,” an open ended approach that will encourage suspicions based on race. The law does little, if anything, to prohibit police officers from relying on race or ethnicity in deciding who to investigate.
Criminalizes immigration, which isn't a crime under federal law: Makes it a state crime to be in the country without legal status.
Undercuts Federalism: The law grants local police arrest authority for administrative violations of federal immigration law, even though the state police do not even have that authority under federal law.
Criminalizes Speech: The law criminalizes the solicitation of work even though courts have previously ruled that the solicitation of work is protected speech under the First Amendment.
Potentially Deters Enforcement of Other Laws: Since the law requires police officers responding to any city ordinance violation to automatically determine the immigration status of an individual they have reasonable suspicion of being an undocumented immigrant, many local violations won't be reported, consequently diverting law enforcement attention from violent crimes.

SB1070 Is a Product of a Racist, Anti-Immigrant National Network: The sweep of the law is hardly accidental, since it is the product of a national network of anti-immigrant groups tied to racist hate groups. As the Center for New Community noted in a recent email update:

[SB1070] was drafted by a lawyer for the legal arm of the Federation for American Immigration Reform (FAIR), whose founder has warned of a “Latin onslaught” and complained about Latinos’ alleged low “educability.” FAIR has accepted $1.2 million from the Pioneer Fund, a racist foundation that was set up by Nazi sympathizers to fund studies of eugenics, the science of selective breeding to produce a “better” race. The legislation was sponsored by state Senator Russell Pearce, who once e-mailed an anti-Semitic article from the neo-Nazi National Alliance website to supporters.

Kris Kobach, a Kansas law professor now running for Kansas Secretary of State, is the chief author of the bill, as emails recently revealed. Kobach was a top immigration advisor to John Ashcroft at the Justice Department who promoted national racial profiling of legal U.S. residents post-September 11th. He also drafted the local anti-immigrant ordinance for Hazelton, PA, which was struck down as unconstitutional by a federal judge in 2007.

With an eye on empowering allied groups like FAIR and related anti-immigrant groups, SB1070 is designed to allow them to sue local law enforcement agencies if they believe that are not adequately enforcing the new law, giving the right-wing new tools to control local police departments under threat of litigation.

Resources:
Progressive States Network - Arizona Risks Jeopardizing its Economic Future as it Contemplates Passing Anti-Immigrant Law
Center for American Progress - Fast Facts on Arizona’s Immigration Crack Down
Center for New Community - Fair Exposed, an online bi-weekly publication produced by the Center for New Community, a national civil rights organization. To subscribe email, fairexposed@newcomm.org.
Southern Poverty Law Center - Arizona Immigration Law Violates Constitution, Guarantees Racial Profiling
Wonk Room - The Group Behind The Harshest Immigration Bill In America
TalkingPointsMemo - AZ Immigration Bill Writer's Resume: GOP Activist, Ashcroft Aide, Arpaio Ally
The Rachel Maddow Show - Against Racial Profiling, Except When They're For It, Immigration Group President Addresses Racism Accusations, To Be FAIR: Following Dan Stein, Correcting the Record

Police, Civil Rights Groups and Republican Leaders Condemn SB1070

Unsurprisingly, a wide range of civil rights, labor, community and immigrant rights organizations within Arizona and the nation have condemned the law. The opposition to the bill has extended to law enforcement officers, legal experts and even Republican leaders in other states with large immigrant populations.

Former Florida Governor Jeb Bush noted, "I think it creates unintended consequences. It's difficult for me to imagine how you're going to enforce this law. It places a significant burden on local law enforcement and you have civil liberties issues that are significant as well." Even Republican strategist Karl Rove echoed, "I think there is going to be some constitutional problems with the bill. I wished they hadn't passed it, in a way."

Within Arizona, it is notable that the Arizona Association of Chiefs of Police has opposed the law on both fiscal and public safety grounds, since they worry that fear of government officials by immigrant populations will diminish the public’s willingness to cooperate with police in criminal investigations and will “negatively affect the ability of law enforcement agencies across the state to fulfill their many responsibilities in a timely manner.”

The President of the American Bar Association in a statement said, "It is, quite simply put, a law based on prejudice and fear, one whose purpose is to be divisive. This law encourages second-class treatment of individuals based on the color of their skin, and that is unacceptable."

Most telling for how out of step Arizona leaders have been are statements by Republican state leaders from states with large immigrant populations:

California Governor Arnold Schwarzenegger believes Arizona's approach is "as unconscionable as it is unconstitutional," and vowed to pull California's state pension funds invested in Arizona.
Florida Senatorial candidate, former Florida Speaker of the House and Tea Party darling Marco Rubio warned SB1070 will create a police state: "From what I have read in news reports, I do have concerns about this legislation... I think aspects of the law, especially that dealing with 'reasonable suspicion,' are going to put our law enforcement officers in an incredibly difficult position." He later told reporters, "That's not really something that Americans are comfortable with, the notion of a police state."
Texas Governor Rick Perry said in a statement that "some aspects of the law turn law enforcement officers into immigration officials by requiring them to determine immigration status during any lawful contact with a suspected alien, taking them away from their existing law enforcement duties, which are critical to keeping citizens safe." Perry's views parallel those of his corporate supporters, like the president of the right-wing Texas Association of Business, who recently called Arizona's law "blatantly unconstitutional," saying there was "little likelihood the Texas Legislature would pass anything so misguided as what they've done in Arizona."

When conservative stars like Marco Rubio and Rick Perry think a law is too extreme, it's clear Arizona's leaders have moved into their own corner of anti-immigrant extremism.

SB1070: Symbol of Arizona's Failed Economy and Right-Wing Politics

Click for larger image online.

If other state leaders, even conservative ones from border states like Texas, are not rushing to copy SB1070, it's because whatever their partisan politics, they don't share the peculiar brand of pathological right-wing politics and the hollow economy that has left Arizona such a political and economic basket case.

Other states have grappled with a range of programs to reform their economies and budgets during the current economic crisis. That Arizona's claim to fame in this crisis is immigrant bashing in the form of SB1070 is symbolic of years, even decades of failed political and economic policies. That Arizona politics has promoted low-wage jobs that have left state residents with falling individual incomes relative to the rest of the nation and conditions for the state's children that rank at the bottom of the nation. Since the current economic recession began in December 2007, Arizona has lost 265,000 jobs, or 9.9 percent of the state's employment. And with little else to offer the unemployed, scapegoating immigrants has become a substitute in Arizona for having a real solution to solving the economic needs of its residents.

Individual Incomes Fall Behind the Nation: For decades, Arizona's average wages and income have been falling behind other states. A University of Arizona business school study from 2005 noted that "over the long term, the real income of the average Arizonan has lagged behind the rest of the nation... Arizona slipped from 94 percent of the U.S. level in 1970 to 86 percent in 2003." While the bubble economy in the state of the mid-decade gave a slight bump to individual incomes in the state, per capita income fell 4 percent from 2008 to 2009 after having been stagnant for the previous two years, the U.S. Bureau of Economic Analysis recently reported. Arizona was tied for fourth place with Idaho in having the highest drop in personal incomes per capita. Nationally, the decline last year was 2.6 percent.

An Economy Built on a Construction Bubble: The Urban Land Institute has referred to Phoenix as the "poster child" for the housing downturn and bad mortgages. The average price paid for office space in the Phoenix metro area tumbled more than 50 percent one year in 2009. Back in 2006, when growth peaked, about 30 percent of the Phoenix area’s economic output was tied to real estate and construction; subtract that bubble economic engine and even the nominal job growth in the state during the last decade collapsed into unemployment and foreclosures.

Part of the problem is that state leaders encouraged a low-wage, bubble-based economic strategy that added a mirage of job and population growth during the last decade, but left the state with poor fundamentals for long-term growth when the financial bubble collapsed nationally. Highlighting the weak economic underpinnings of the state economy, the Arizona Phoenix-Mesa-Scottsdale metropolitan area ranked near the bottom, 192nd of 200 metro areas, for growth in high-tech gross domestic product from 2003 through 2008, according to the Milken Institute.

Fiscal Solutions More Irresponsible Than Any in Nation: Arizona's fiscal crisis is considered one of the worst in the country by the Pew Center on the States. Since 1992, the state has approved 42 tax cuts to its three major revenue sources -- personal and corporate income, and sales -- and eliminated statewide property taxes that accrued to the general fund-- and despite promises of right-wing economic nirvana, the results have been low personal income growth and a generally low-level of resources for human needs.

Arizona has some of the highest foreclosure rates in the country, 18.9 percent of the state lacks health insurance and 276,500 Arizona children do not have coverage. In the most recent Annie E. Casey Foundation's annual "Kids Count" report, Arizona ranked 40th in the nation in child well-being, one of the worst in the nation for its teen birth rate (46th), high-school dropout rate (46th) and percentage of children not attending school and not working (44th).

But what truly distinguishes Arizona is its right-wing, inhumane and short-sighted approaches to addressing its current fiscal problems:

State leaders passed a law to abolish the state's KidCare program providing children's health care to 40,000 kids, the only state in the country to take such a step, and only reversed themselves when they discovered they would forfeit billions in federal dollars if they did so.
Wide-ranging cuts in programs across the state, from eliminating full-day kindergarten to cutting state employee salaries to removing 10,000 families from TANF cash assistance.
Two-thirds of Arizona state parks will be closed.

And this has been combined with a whole range of other right-wing and just plain kooky laws promoted by the Arizona's legislature.

SB1070 Will Make Arizona's Economic Problems Worse: Passing SB1070 will simply deepen the state's economic crisis. As the National Employment Law Project points out, smaller-scale anti-immigrant ordinances have cost individual localities millions of dollars. And other studies estimate SB1070 will further decimate Arizona's economy by driving immigrant families, undocumented and legal residents alike, from the state, further depressing demands for goods and already vacant housing tracts.

The Arizona Republic detailed, "More than 100,000 undocumented immigrants have left Arizona in the past two years because of the bad economy and earlier enforcement crackdowns. Now, a new wave of Latinos is preparing to leave."

"So, rather than massive deportations, we are basically going to encourage them to leave on their own," said State Rep. John Kavanagh, R-Fountain Hills, who is also a criminal-justice professor at Scottsdale Community College. But even he admits that the law will likely drive legal residents and their families out of the state.

The Texas-based Perryman Group found if all unauthorized immigrants were removed from Arizona, the state would lose $26.4 billion in economic activity, $11.7 billion in gross state product, and approximately 140,324 jobs.

Phoenix Mayor Phil Gordon and other local leaders anticipate a drop in new business creation in the state because of the new hostile environment. Phoenix Vice Mayor Michael Nowakowski observed: “We’re the laughing stock of the country because of these crazy laws.”

Resources:
Think Progress - Arizona Expands Its Discrimination: Teachers With Heavy Accents Can’t Teach English, Ethnic Studies Are Banned
Rogue Columnist - Arizona's Continuing Crisis and Kookocracy Watch
Arizona State University W.B. Carey School of Business - Jobs, Income, And Growth In Arizona: Individual Versus Aggregate Measures Of Economic Performance
Progressive States Network - Eye on the Right: Arizona's Failed Experiment with Tax Cuts

Arizona's Anti-Immigrant Politics Not the Norm for States with Immigrant Populations

Despite much media hype, most states with high concentrations of undocumented and legal immigrants have rejected the punitive approach of Arizona and a handful of like-minded states. Most states have quietly been moving forward with positive, integrative approaches to new immigrants in their communities.

As PSN detailed in a report in 2008 -- and the basic numbers have changed little since then -- only 11% of undocumented immigrants live in states that have enacted comprehensive punitive policies or sanctions in private workplaces against undocumented workers.

Most Undocumented Residents Live in States with Integration Policies: Instead, a significant majority of undocumented immigrants live in states with positive integrative or somewhat integrative policies. As detailed in a section below, with the right state policies, new immigrants bring new skills, business startups and economic growth-- and most states with experience with new immigrants have promoted policies to tap that economic growth potential.

Many states, including many of those where most undocumented immigrants live such as Texas and California, now provide in-state tuition (so-called DREAM Acts) for undocumented immigrants going to public universities. Others are promoting policies to integrate immigrants through English language instruction and assistance in navigating the citizenship process. A number of states such as Illinois and New York are providing health insurance to undocumented children. And instead of trying to punish immigrant workers, states are increasingly working with native and immigrant workers to crack down on bad employers who are violating minimum wage, safety and workers compensation laws.

In fact, over 50% of undocumented immigrants live in states that provide in-state tuition for undocumented immigrant children and nearly the same majority of undocumented immigrants live in states that are promoting "New Americans" policies to better educate new immigrants and nearly a majority also live in states that have recently enacted new penalties for wage law violations in order to raise wages for all workers, native and immigrant alike. See the chart for a comparison of the more pervasive positive approaches to immigration compared to the minority punitive approach.

The media largely rewards the tactics of political opportunists who to use the issue of immigration as a "wedge" issue, but ignore the political and economic success of other states in integrating new immigrants into their state economies and communities.

A State Agenda for Progressive Immigration Policy: As we highlighted in our Dispatch, State Immigration Policy to Promote National Change, there are a range of positive state policies that can improve the lives of immigrants and raise living standards and public safety for everyone, native and immigrant alike. These include:

Wage Law Enforcement as Immigration Policy - Redirect anger at lawlessness in the workplace toward employers who violate wage and other worker rights laws -- an approach that unites all workers, immigrant and native alike.
Immigrant Integration and Naturalization - Highlight policies that help all immigrants to better integrate into society, a broadly popular policy and one that also unites the interests of legal and undocumented immigrants.
Address Debate on Immigrants and Public Benefits - Emphasize the benefits to the public from providing education and preventive care to immigrants. Support resolutions that demand that the federal government, which receives billions in taxes paid by undocumented workers, share those revenues with states to expand services for communities with heavy immigrant populations.
Voting Reform versus "Voter ID" Attacks - Challenge the voter ID requirements that are disenfranchising many legal voters and support anti-voter intimidation policies. Support reforms like same day registration and vote-by-mail to assist citizens forced to overcome any new barriers to voting.
Community Policing and Immigrant Outreach for Public Safety - Support community policing policies that encourage immigrants to work closely with the police when they either see a crime or are victims themselves. Encourage community policing efforts involving undocumented immigrant communities.

Smart state policy proposals that emphasize the areas where the public is supportive of immigrant integration into our communities are both smart policy and smart politics. By better controlling the debate at the local and state level, progressives can help build support for federal reforms to regularize the legal status of undocumented immigrants and build a path to citizenship. Such strategies can isolate those who promote the scapegoating of immigrants and instead emphasize the issues that will benefit everyone, from wage law enforcement to integrating new immigrants into our local economies.

Resources:
Progressive States Network - State Immigration Policy to Promote National Change
Progressive States Network - The Anti-Immigrant Movement that Failed: Positive Integration Policies by States Still Far Outweigh Punitive Policies

SB1070 Deepens the Need for Federal Comprehensive Immigration Reform

If SB1070 accomplishes anything, it will be to focus national attention on why it is critical to revamp and improve federal immigration laws. Those on both sides of the partisan aisle overwhelmingly agree the nation's immigration system is broken, and long overdue for an update.

While federal law essentially decides who can legally enter the US and determines immigrants' eligibility for most services and benefits (according to federal immigration law, undocumented immigrants are ineligible for most public benefits apart from emergency room medical care), states have considerable jurisdiction over immigrants' access to some basic services and programs - such as, for example, New York state's decision to provide basic prenatal health care for women -- regardless of their immigration status -- as well as how state and local government (including law enforcement officers) interact with immigrant residents.

As noted above, most states have engaged immigration in a more positive manner: for example, several states (including Utah and Texas) extend in-state tuition rates to undocumented students who attend state universities and colleges. But given the given the federal vacuum on immigration, some states like Arizona will inevitably take matters into their own hands in a punitive direction.

The last comprehensive immigration reform, enacted in 1986 by Republican President Ronald Reagan, included a large-scale legalization program that allowed roughly 3 million undocumented immigrants to obtain legal status. Despite attempts at immigration reform in 2001, 2006, and 2007, there has been no significant change in the status quo of immigration policy since 1986. The longer the nation is forced to wait for federal immigration reform, the more states will make patchwork attempts to address immigration at the state level and the more opportunities there are for states to take misguided and economically disastrous approaches to immigration policy such as Arizona's.

Proposed Federal Reforms Promote Compromise Solution: The most recent proposal, unveiled by Senators Menendez, Reid, and Schumer, outlines a number of provisions to address the crisis:

On the negative side, it introduces a national identity card and takes a 'zero tolerance' approach with plans to continue to increase deportations of undocumented immigrants who are suspected of committing crimes; it also significantly ramps up militarization of the US-Mexico border.
However, the proposal also dramatically expands the channels for legal immigration into the US and provides an (albeit lengthy) path to legalization, and ultimately citizenship, for the roughly 11 million undocumented immigrants currently in the US. The proposal grants provisional legal status (which includes work authorization) to undocumented residents who come forward, register with the federal government, pay a fine, and commit to learning English. After eight years, if border enforcement and surveillance programs are successfully implemented, these individuals are then eligible for permanent resident status, and five years later are eligible to apply for US citizenship.
The Menendez-Reid-Schumer proposal also would grant permanent resident status (known as a 'green card') to every immigrant who earns an advanced degree from an American university, and would end country-based quotas on the number of H1B visas extended to highly-skilled workers who seek to enter the US.
Finally, the proposal would streamline the process for spouses and immediate relatives of those with green cards to enter the US themselves, addressing a backlog of family-based immigration that often requires family members to wait a decade before they can legally join their relatives in the US.

Resource: American Immigration Lawyers Association - Analysis of Senate Democrats Immigration Reform Proposal

The Economic Benefits of Legalization and Positive Immigration Integration Strategies

Several recent academic studies have underscored the economic benefits that a large-scale legalization program would bring to the US economy and households, despite the current flawed conventional wisdom that legalization would cause already-high unemployment rates to rise.

A study by Dr. Raul Hinojosa-Oveda of the University of California - Los Angeles uses the economic impact of the 1986 legalization program (one that also occurred during an economic recession with high unemployment) to forecast how a legalization program would affect the current economy. His analysis found a legalization program would yield at least $1.5 trillion in gross domestic product over a ten-year period. Legalization would allow undocumented workers to emerge from the underground economy, and would, as a result, raise not only their wages but those of their native-born counterparts, raising the wage floor for many workers. Increased wages would, in turn, fuel increased purchasing power and homeownership among newly-legalized immigrants, injecting billions, if not trillions, of dollars into the US economy as a whole.

Libertarians also echo the belief that immigrants, even those working in low-wage sectors, expand the American economy. According to this commentary analysis from the libertarian CATO Institute, "the addition of low-skilled immigrants expands the size of the overall economy, creating higher-wage openings for managers, craftsmen, accountants, and the like." Undocumented immigrants are typically low-income, but they are almost all employed. According to estimates by the Pew Hispanic Center, male undocumented immigrants, ages 18 to 64, had a labor-force participation rate in 2004 of an amazing 92 percent.

Other studies have found wage levels of low-wage immigrant workers increase by as much as 30 percent when they improve their English fluency by just one level, because they are able to advocate for themselves more effectively in the workplace - a powerful testimony to increasing state and federal funding for English as a Second Language classes.

Finally, federal, state, and local tax bases would benefit significantly from the increased earnings and purchasing power of newly-legalized immigrants. The Social Security Administration estimates that roughly 75% of undocumented immigrants pay payroll taxes. In fact, the Drum Major Institute notes that undocumented workers already are largely responsible for the future viability of the Social Security system with their $7 billion in annual tax contributions - most which they will never be able to access. And the President's Council of Economic Advisors found that US natives gain an estimated $37 billion annually from immigrants' economic contributions as a whole.

Resources:
Immigration Policy Center - The Fiscal Bottom Line on Immigration Reform
Immigration Policy Center - Assessing the Economic Impact of Immigration and the State and Local Level
Immigration Policy Center & UCLA: Raising the Floor for American Workers: The Economic Benefits of Comprehensive Immigration Reform
Immigration Policy Center - Immigration Reform as Economic Stimulus
Commentary Magazine - Higher Immigration, Lower Crime
Drum Major Institute - Principles for an Immigration Policy to Strengthen and Expand the American Middle Class
America's Voice - Immigrants to Tea Party Protesters: We'll Pay!
America's Voice - Facts at a Glance on Comprehensive Immigration Reform

Progressive Strategy to Address Immigration Policy

To defeat anti-immigrant attacks, the key for progressives is to proactively use smart policy campaigns to change the public debate on immigration both at the state and national level. Globalization is driving economic changes, including immigration, that cause fear and uncertainty for many voters, but if progressives promote economic and social policies that address the broader needs of working families and propose a vision of how to effectively integrate new immigrants into our communities, there is no sustained majority for punitive measures against undocumented immigrants.

Beyond individual policy options, advocates and elected leaders need to emphasize that the coalition in support of humane policies involving new immigrants is diverse and cuts into even many seemingly conservative communities. Elected leaders can build on traditional support from many African-American leaders to labor unions to forge alliances with forward-looking business leaders and religious leaders, including many evangelicals, who recognize that smart, humane immigration policies for our communities is a source of both moral and social strength.

Anti-Immigrant Conservatives Playing a Losing Game: And the dangerous reality for anti-immigrant conservatives is that they are playing a losing demographic game, with new legal immigrants voting in increasing numbers that will punish any party or ideological group that promotes racist approaches to the immigration issue -- one reason many Republican leaders are denouncing SB1070 so quickly.

There were 10 million Latino voters in 2008, an increase of 4 million since 2000. And a May 2009 poll of Latino voters found that 82% of Latino voters felt immigration was important to them and their families. Punitive approaches like SB1070 will inevitably impel a negative reaction, with nearly six-in-ten (57%) Latinos in a 2008 Pew Hispanic Center survey, saying they worried that they themselves or a friend or family member would be deported as a result of similar policies.

Conclusion: Humane immigration politics are also smart politics in the long-term, since the present coalition for progressive immigration policy is rapidly being joined by new citizens who are unlikely to forgive politicians who vote for racial profiling or other attacks on their communities. Ultimately, in an increasingly diverse nation, there is no long-term political future for politicians pushing these anti-immigrant laws. Elected officials who step up with intelligent, humane policies on immigration will both build a stronger economy and society in their states and win politically in the long-term.

Resources:
Progressive States Network -State Policymakers Need to Respond to Growing Clout of Latino Voters Nationwide
Pew Hispanic Center - Hispanics and Arizona’s New Immigration Law
America's Voice - The Power of the Latino Vote in the 2010 Elections: They Tipped Elections in 2008; Where Will They Be in 2010?

Networking the Green Economy: How Broadband and Related Technologies Can Build a Green Economic Future

Fabiola Carrion — Mon, 08 Mar 2010 14:00:11 -0500

Deploying broadband and related communication technologies, including smart meters in the home and smart grids to upgrade our power grid, have the potential of revolutionizing energy management and economic development, according to a new report by the Progressive States Network released in association with our partners, Communications Workers of America, the Sierra Club and the Blue Green Alliance. Last Thursday, leaders from those organizations convened at a panel on Capitol Hill, hosted by U.S. Representative Edward Markey, Chairman of the U.S. House Select Committee on Energy Independence and Global Warming, and joined by Nick Sinai, Director of Energy and Environment for the FCC's Broadband Strategy Plan, to discuss the findings of the report entitled:

Networking the Green Economy: How Broadband & Related Technologies Can Build a Green Economic Future


"This report highlights a historic partnership between labor, technology and environmental groups needed to stop climate change and expand broadband access for all Americans" - Congressman Ed. Markey

PSN's Executive Director Nathan Newman was joined on the panel by Executive Director of the Blue Green Alliance David Foster, Sierra Club President Allison Chin, and Communications Workers of America Vice President Annie Hill. As Congressman Markey noted during his speech, this report heralds a new alliance of labor, technology and environmental groups in a "historic partnership" to take the next steps needed to stop climate change, expand broadband access for all Americans, and build towards energy independence for the nation.

The key conclusion of both the report and the panel was that investing in broadband and communication technologies cannot be seen as a distinct goal from the construction of a green economy. By the same token, failure to address the digital divide could result in the exclusion of poor and rural communities from the green economy as well. It is imperative that the environmental, technology, and labor communities work together in the construction of a smart economy since an additional $50 billion investment in the smart grid over the next five years would create or retain an average of 239,000 new jobs for each five years.

This Dispatch will outline some other critical findings of the report, including:

Upgrading the Grid: Information Communication Technologies is Key to More Efficient Coordination of Energy Supplies and Distribution
Smart Technologies to Reduce Energy Demand in the Home and Office
Broadband Applications to Reduce Travel and Fuel Costs

It will also highlight the pathway to networking the green economy, including the need to protect consumers and workers during the transition, the need for a plan that promotes deployment and adoption of broadband by all households, and the immediate policies states can begin to implement to move towards that future.

To download a copy of the report or the executive summary, please visit www.progressivestates.org/greeneconomy.

Resources:
Progressive States Network, Blue Green Alliance, Communications Workers of America and Sierra Club - Networking the Green Economy: How Broadband and Related Technologies can Build a Green Economic Future
Information Technology and Innovation Foundation - The Digital Road to Recovery: A Stimulus Plan to Create Jobs, Boost Productivity and Revitalize America

Table of Contents

- Upgrading the Grid: Information Communication Technologies Are Key to More Efficient Coordination of Energy Supplies and Distribution

- Smart Technologies that Reduce Energy Demand in the Home and Office

- Broadband Applications to Reduce Travel and Fuel Costs

- The Pathway to Networking the Green Economy

- Conclusion: States Moving Forward on Networking the Green Economy

Upgrading the Grid: Information Communication Technologies Are Key to More Efficient Coordination of Energy Supplies and Distribution


"Realizing the full potential and benefits of investments in efficiency and renewables will ... require a significant upgrade in our communications and transmission infrastructure" - Allison Chin, President of the Sierra Club President

Our present power grid, using outdated technologies, wastes massive amounts of energy during the transmission and distribution of electricity.

The Electric Power Research Institute (EPRI) estimates that power system disturbances cost 50 cents for every dollar spent for electricity, and that the smart grid has the potential to reduce this cost by 50 percent or more. States can no longer afford the estimated $80 billion and $150 billion costs that power outages incur annually. Energy savings equivalent to eliminating greenhouse gas emissions from 53 million cars could be achieved by improving the efficiency of the grid by just 5 percent and smart grid technologies could stop the power outages that cost the U.S. economy $49 billion per year.

Upgrading the electricity grid will produce more efficient energy, reduce greenhouse emissions, save costs to producers and consumers, as well as create sustainable jobs.

Managing a Better Distribution of Electricity: Integrating networked communications into the transmission system will help create a grid capable of better response time to large-scale and isolated-system failures, moving energy efficiently over long distances and addressing congestion issues. Increasing grid efficiency through re-automation and self-healing capabilities results in reduced energy generation and use. Power generation could be decreased by 3 to 5 percent by installing a smart grid capable of delivering only necessary electricity. Along with better building design, management and automation, the smart grid could save $20 to 25 billion in energy use. According to a study, consumers in the eastern United States pay $16.5 billion per year in higher electricity prices due to transmission congestion, a problem that would be largely resolved by an upgraded smart grid.


'The jobs of the future should all be good, green jobs, and by taking action now on broadband and other technologies, we are putting ourselves in a position to create jobs and lead the world in the race for a clean energy economy." - David Foster, Executive Director of the BlueGreen Alliance

Communications technology is essential to the functionality of the smart grid because it gathers the vast data generated by energy use and transforms this data into information for the consumer and the utility company. As such, the communication that is transmitted must be pervasive, rapid, scalable, secure, and robust at all times, especially during emergency situations.

Integration of Renewable Energy Resources During the Transmission of Electricity: Many renewable energy sources - such as wind, solar, and geothermal - are in isolated areas throughout the United States and are unable to connect effectively with our current power grid. A Department of Energy report found that it could be possible for 20 percent of the nation’s electricity demand to be met by wind sources in 2030 should these sources be all connected with a smart grid. Curently, one issue hindering wind energy is that a portion of these wind farms are located in remote areas, far from major centers of electricity demand.

By implementing advanced digital controls and technologies such as syncrophasors — precise grid measurements that indicate grid stress — throughout the transmission system, transmission operators will be able to use long-distance, high-voltage transmission lines to move energy from renewable energy source sites to distant distribution grids located at primary-use locations with far less energy loss than is currently possible.

In facilitating the integration of renewable energy resources into our energy distribution system, we can curtail the negative environmental side effects of our energy use. Smart grid improvements should be sequenced so that high-carbon resources are phased out as quickly as possible and replaced with a combination of lower carbon, renewable fuels. By enabling smart grid distribution, the United States can cut carbon dioxide emissions by 25 percent. On the demand side, the Department of Energy has maintained, there are numerous environmental benefits that take place when we reduce the emissions of generation plants during peak periods.

Resources:
GetSmartGrid.Org -Smart Grid Facts
The Climate Group - SMART2020: Enabling the low carbon economy in the information age
United States Department of Energy - Benefits of Demand Response in Electricity Market and Recommendations for Achieving Them
Joint System Coordination Plan 2008
The National Association of Regulatory Utility Commissioners - The Smart Grid: Frequently Asked Questions for State Commission

Smart Technologies that Reduce Energy Demand in the Home and Office


FCC Energy and Environment Director, Nick Sinai, who highlighted that consumers should be given "access and control of their digital energy information."

Since buildings in the United States account for approximately 39 percent of the nation’s total energy use, 72 percent of the electricity consumption and 38 percent of carbon dioxide emissions, smart technologies in the home are key to a greener future. By transforming the way people and businesses use technology, the United States can reduce carbon dioxide emissions by an estimated 13 to 22 percent by 2020 — and potentially see gross energy and fuel savings of $140-240 billion.

Smart meters and dynamic pricing could give consumers the ability to track their own power usage and then provide a financial incentive to alter their energy consumption either by shifting away from periods of peak demand, purchasing more environmentally friendly and energy efficient appliances, or simply decreasing overall energy usage. As highlighted by FCC Energy and Environment Director Nick Sinai, consumers should be given "access and control of their digital energy information."

Smart Meters and Net Metering: With the right type of consumer protection and technological metrics in place, smart meters can help individuals purchase energy more efficiently. If built to connect in real time with a utility and smart grid through high-speed broadband, networked homes and offices can provide large economic and environmental pay-offs. Pilot programs and studies have demonstrated that consumers who track their energy use in real time and consequently make simple behavioral changes can save 5 to 15 percent on their electricity consumption, which amount to savings of $60 to $180 per year. Dynamic pricing to shift demand can also lead to a more reliable grid and reduce the risk of outages that are often costly to the economy.

A smart grid that extends its communications network to homes and buildings can turn these traditionally large energy users into potential energy producers. Such a grid could allow energy consumers to sell solar-based and other renewable energy back to the power grid, making such investments more economical and further decreasing the dependence on fossil fuel based power plants. For example, a home could be powered by its own solar energy during the day and then the consumer could sell any extra energy produced back to the larger grid, an option called “net metering."

Smart Buildings and Networked Homes: Further, allowing various building systems, including appliances, heating and cooling systems, to communicate and interact with each other through smart technologies will also reduce energy use and buildings’ negative impact on the environment.

The incorporation of networked technology into buildings can optimize their energy consumption by controlling multiple devices, improving the ability to monitor buildings, giving building owners and occupants more information about and control over their energy use, and integrating that use into the new smart grid. By using specialized software and broadband, smart buildings can make their own efficient energy use decisions. For instance, a smart building could potentially adjust the amount of indoor light being used based on the amount of sunlight coming through a window.

The Center of American Progress estimates that integrating smart technology into new construction or in the renovation of existing buildings can make them more environmentally friendly, saving the U.S. $20-25 billion and reducing carbon dioxide emissions between 130-190MMT.

Using Broadband Protocols: To facilitate networking of homes and avoid their obsolescence, meters should incorporate high-bandwidth technology using Internet protocols and an open architecture. As the New York Public Service Commission argued in a recent order governing smart meters, smart meter systems "must be designed to meet future requirements of the smart grid."

Resources:
United States Department of Energy - The Smart Grid: An Introduction
The Climate Group - SMART2020: Enabling the low carbon economy in the information age
Pew Internet & American Life Project - Home Broadband Adoption 2009
U.S. Green Building Council - Green Building Research
Center for American Progress - It’s Easy Being Green: Smart Buildings for Future Skylines
State of New York Public Service Commission - Order Adopting Minimum Functional Requirements for Advanced Metering Infrastructure Systems and Initiating an Inquiry into the Benefit-Cost Methodologies

Broadband Applications to Reduce Travel and Fuel Costs


"The promise of the smart grid and fast broadband are applications, from telehealth to e-commerce, that will radically reduce energy costs by reducing both the need to travel and transport physical goods." - Nathan Newman, Executive Director of Progressive States Network

In addition to savings costs for homes and businesses, smart technologies provide a wide array of benefits for entrepreneurs, consumers, and workers. Congressman Markey stressed that information can be added to our home heaters, electricity suppliers, and vehicles. This Dispatch highlights a few of the smart technology applications that can be added to our work and life essentials:

Telehealth: Increased adoption of broadband technology and telehealth practices could decrease travel by allowing doctors to monitor and consult with patients remotely.

A Veterans Administration study reported a 40 percent cut in emergency room visits and a 63 percent reduction in hospital admissions resulting from its remote home monitoring system. Telehealth technologies could avoid 850,000 transports between emergency departments, resulting in transit cost savings of $537 million a year. For patients and doctors in rural areas, travel costs are being significantly reduced when they have access to high-speed broadband.

Aside from increased medical attention, telehealth improves the quality of care, facilitates a more dynamic interaction between medical provider and patient, and overall reduces the costs of the health care system. When telehealth reduces the need for or the distance related to medical attention, we inevitably reduce greenhouse gas emissions and fuel consumption.

Business and Long Distance Communication Technology: The emergence of a global economy has increased the need for business travel, in many cases for long distances, which negatively affects the environment. Recent technological advancements, such as advanced video-based teleconferencing, have become viable substitutes. For instance, video conferencing expends 500 times less energy than a 1000 km [620 mile] business flight.Conducting virtual meetings to replace remote in person interactions could reduce 20-30 MMT of carbon dioxide emissions and provide gross savings of $5-10 billion from reduced spending on fuel for airplanes.

Broadband-supported applications can also help reduce everyday travel associated with employment. Telecommuting or flex work, combined with labor protections to prevent unmonitored “electronic sweatshops” from arising, can potentially be a key contributor to a greener economy.

E-Commerce: Since the inception of the Internet, electronic commerce (e-commerce) has grown exponentially, and entrepreneurs, including those in rural areas, can reach out to the entire connected world as a potential consumer base. This new business frontier not only allows businesses to expand beyond their reach, but it can also benefit the environment by reducing negative emissions associated with traditional off-line shopping.

In a range of areas, broadband applications are allowing e-distribution to replace the fuel-intensive physical distribution of physical goods. According to the California Broadband Initiative, if half of today’s movie rentals were accessed by video-on-demand, the country could save the equivalent of 200,000 households’ annual electricity consumption.

Ultimately, especially in applications like telehealth, deploying high-speed broadband is ultimately required to achieve the full life-saving, environmental, and economic benefits of these applications.

Resources:
The Climate Group - SMART2020: Enabling the low carbon economy in the information age
Benton Foundation - Using Technology and Innovation to Address Our Nation’s Critical Challenges
Baller-Herbst Report - Bigger Vision, Bolder Action, Brighter Future: Capturing the Promise of Broadband for North Carolina and America
California Broadband Taskforce - Building Innovation through Broadband: Final Report of the California Broadband Task Force

The Pathway to Networking the Green Economy


"Every American family, business, and community must have access to affordable, world-class broadband networks but the U.S. unfortunately now ranks 16th in the world in broadband adoption." - Annie Hill, Executive Vice President of Communication Workers of America

In building the smart grid and using broadband technologies to green the economy, there are both challenges and opportunities. The opportunities are clear: investments made now will not only create immediate jobs in the economy but also build in long-term energy and economic savings that will pay back those investments many times over.

However, there are critical decisions to be made to assure that all members of our communities benefit from the transition, from eliminating the digital divide to protecting consumer interests to assuring that current workers in industries find new and better job opportunities. Any transition to smart grids and new energy management technologies should ensure that consumers and workers in the industry benefit from the economic savings and growth generated. So the following are a few key guidelines for policymakers:

Eliminate the Digital Divide: Despite the great potential to create jobs, lessen our dependency on foreign oil and save the environment, limited access to broadband is currently crippling the complex operations that the smart grid requires. Although broadband access has increased in recent years, broadband subscription rates still remain under 50 percent for some groups, including certain minority populations, rural communities, and households with incomes of less than $50,000 per year. To fully realize a robust green economic future, it will take a firm and long-standing commitment to extend transformative communication technologies, such as broadband, to all members of the community.
Invest in Infrastructure and Interoperability: While some industry interests would prefer proprietary systems to lock-in monopoly control and profits, the report stresses that both federal and state policy makers should place support networking infrastructure that is interoperable with existing broadband and Internet systems and where smart appliances and other technologies can work with each other without become obsolete.
Protect Consumers’ Interests: Smart meters and dynamic pricing that allow individuals to track their energy consumption and provide financial incentives for reduced energy use could result in savings for consumers. Nevertheless, consumer advocates worry that the costs of installing some current proprietary versions of smart meters could outweigh the savings that households would receive from reducing or shifting their energy usage, especially if those meters become technologically outdated and have to be replaced before any savings offset deployment costs. In addition, if the cost of electricity is dynamically priced throughout the day, this may not benefit, and could harm, consumers such as the elderly and ill, who are not able to alter their energy use. Thus, any smart meter deployment should be done in ways that do not increase costs for residents but instead ensure that any smart meters are deployed only when energy savings can fully cover costs for consumers.
Enhance Workers’ Rights: Annie Hill, Vice-President of the Communications Workers of America, confirmed, “Investments in the green economy — which includes more efficient use of resources and power — are the job creators of the 21^st Century." With more than 564,000 people working in the utility industry, the adoption of smart meters and smart grids will likely change the nature of the work for many front-line utility workers. Utility workers must receive training and other support necessary to learn the skills to work on new technologies and to build careers in the industry. As such, their employers should not use this transition to downgrade employment, outsource work, or evade union representation.
Preserve Existing Conservation Programs: States also need to learn from mistakes made during utility deregulation and in addition to investing in smart meters, maintain other energy efficiency programs that assist consumers in shifting towards less energy use and subsidize such shifts for low-income users. Between 1995 and 1999, driven by the deregulation of electricity markets, power companies in North America cut spending on energy efficiency programs by 42 percent. Any use of smart meters or dynamic pricing must be part of a broader regulated structure that maintains and expands those key energy-efficiency programs, especially for low-income families most in need of their support.

Resources:
Energy Efficiency.Net - Power Deregulation Fueled Pollution
The Center for American Progress - Smart Grid, Smart Broadband, Smart Infrastructure: Melding Federal Stimulus Programs to Ensure More Bang for the BuckUnited States Senate Committee on Energy & Natural Resources - Full Committee Oversight Hearing: to receive testimony on the process of smart grid initiatives and technologies
The Wall Street Journal - Smart Meter, Dumb Idea?

Conclusion: States Moving Forward on Networking the Green Economy


"With the smart grid, we partner the public utility with technology into something that builds jobs and brings costs down to consumers." - North Carolina State Senator Joe Sam Queen

Congressman Edward Markey could not sum it better, "broadband will revolutionize the way we communicate and generate electricity in this country." To achieve the environmental benefits associated with the digital infrastructure, devices, and applications, the United States needs to strengthen its broadband deployment and adoption. Broadband and information communication technologies have the potential of revolutionizing energy management and economic development.

Using Recovery Dollars for Deployment: The federal recovery plan included billions of dollars to encourage movement towards a smart grid in our nation. We have detailed a range of ways states are promoting Legislation to Promote Digital Leadership which has included both the creation of Broadband Strategy Councils to strengthen holistic planning and Digital Inclusion Policies to move towards universal adoption of broadband.
New Smart Grid Legislation: State legislators are introducing a range of legislation that support the deployment and funding of the smart grid, including bills in Kansas, California, Maine, New York, and Illinois.
Telehealth Policies: We've highlighted key policies to promote broadband applications like telehealth, including Reforming medical licensing rules to encourage long-distance medical consultations across state lines and changing Medicaid reimbursement rules to encourage its use. States should conduct studies and pilot programs to better estimate cost savings and the increased access to the quality care that telehealth provides.

In this vein, the panel last Thursday ended with the final remarks of North Carolina State Senator Joe Sam Queen, who is now working towards introducing smart grid legislation in his state. By bringing broadband players, utilities, consumers and other groups together, Senator Queen hopes to leverage the energy savings from building a smarter grid to help fund increasing broadband access -- a critical problem in a state with only 50% broadband adoption, particularly the rural communities which often have very low access to high-speed Internet.

Resources:
Progressive States Network - State Legislation to Promote Digital Leadership
Progressive States Network - Guiding Principles for Broadband Strategy Councils
Progressive States Network - Guiding Principles for Digital Inclusion Policies
Progressive States Network - Telehealth

Progressive States Network hosted a national conference call on Friday, March 12th at 1:00pm EST announcing the release of a new joint report, Networking the Green Economy: How Broadband & Related Technologies Can Build a Green Economic Future.

On the call, speakers from each organization discussed how smart buildings, smart grids, digital education, and other components of a highly-networked economy can reduce greenhouse gas emissions, conserve energy resources, and promote good green jobs.

Speakers included:

Allison Chin, President, Sierra Club
Debbie Goldman, Telecommunications Policy Director and Research Economist, Communications Workers of America
David Foster, Executive Director, Blue Green Alliance
Nathan Newman, Executive Director, Progressive States Network

To listen to the conference call, click here.

Boards of Education Rewriting History and Science

Altaf Rahamatulla — Thu, 25 Feb 2010 11:22:06 -0500

In January, members of the predominantly conservative Texas Board of Education discussed revising the state's social studies curriculum to include highly partisan perspectives on civil rights, the role of government, and American history in general. Some of the more divisive suggestions range from banning mention of activist and union organizer Cesar Chavez to citing Ronald Reagan’s "leadership in restoring national confidence' following Jimmy Carter’s presidency." The Board also discussed instructing students to "describe the causes and key organizations and individuals of the conservative resurgence of the 1980s and 1990s, including Phyllis Schlafly, the Contract With America, the Heritage Foundation, the Moral Majority and the National Rifle Association.” There were further proposals to reference the United States as a Christian nation with a divine mission in the world.

This is not a new trend. Just last year, the same Board urged schools to discuss the "weaknesses" of the scientific theory of evolution. Unfortunately, Texas' ultimate decision on its curriculum will likely reverberate throughout the country. The state's education fund is the largest in the nation, with $22 billion in resources. A sizable share goes to purchasing and distributing 48 million textbooks a year. Since Texas is one of the nation's largest consumers of textbooks, the educational standards the state Board of Education adopts not only impact Texas students, but can strongly influence the content of textbooks purchased in other states as well.

Attempts to input conservative ideology in the classroom: Just as troubling, there have been several attempts to insert socially conservative views in K-12 education across the country.

Back in 1999, the Oklahoma Textbook Committee required that publishers who did business in the state insert a disclaimer in biology textbooks stating that evolution is “a controversial theory which some scientists present as a scientific explanation for the origin of living things, such as plants and humans."
A similar effort was undertaken in Georgia in 2004, but public backlash forced the state's superintendent to restore references to evolution to middle and high school textbooks.
Following Dover, Pennsylvania school district's 2004 decision to require classroom discussion of intelligent design, opponents challenged the decision in court. In 2005, a federal court in Kitzmiller v. Dover Area School District ruled the district could not teach intelligent design, as the theory "cannot uncouple itself from its creationist, and thus religious, antecedents" and does not respect the constitutional separation of church and state.

Progressive Mobilization Against Censorship of Science: Fortunately, progressives have combated conservative censorship of issues like evolution for years. The Kansas Citizens for Science (KCFS) have consistently challenged extreme right views expressed on the state's Board of Education. The organization played a crucial role in challenging the Board's 1999 decision to remove aspects of the theory of evolution. The Board lost its conservative majority following the controversial vote, to only regain it a few years later and push to identify evolution as a flawed theory and require discussions of intelligent design. In 2006, conservatives again lost their majority, partly due to the work of advocacy groups like KCFS, which led to the adoption of new science-based education standards to replace the anti-evolution ideology.

There are several other gorups across the country working to promote and protect science education. Citizens for Science, a network of state-based groups, formed to push back against right-wing censorship of science textbooks.

Challenging the Texas Textbook Censors: Placing ideology over academics is an extremely troubling prospect that endangers the public education system. It is quite telling that last May, Texas Sen. Letica Van de Putte criticized the board as the “laughingstock of the nation” under the leadership of Don McLeroy, a dentist and self-identified Christian fundamentalist. That same month, the Texas Senate blocked the reconfirmation of McLeroy as head of the Board of Education due to concerns about his religious views. McLeroy, who does not support the separation between church and state and describes himself as a "'young earth' creationist who believes dinosaurs once co-existed with people," remains an outspoken advocate along with other conservative ideologues who hold seven out of fifteen seats on the Board.

Texas' March 2 primary includes eight seats on the Education Board. Accordingly, voters will have the opportunity to help shape the debate and decide whether they want rightwing zealots rewriting history.

Resources:
Kansas Citizens for Science
Citizens for Science
National Center for Science Education
Anti-Defamation League - Religious Doctrine in the Science Classroom; Putting Education & Religious Freedom at Risk
National Science Teachers Association - The Teaching of Evolution
The New York Times - How Christian Were the Founders?
The San Antonio Express-News - Texas Voters to Referee School "Culture War"

The FCC Extends E-Rate Broadband Access Program to the General Public

Fabiola Carrion — Thu, 25 Feb 2010 11:19:15 -0500

States and local governments may now use federal E-rate funds to provide the general public access to schools’ and public libraries’ Internet facilities, according to a recent Federal Communications Commission order. Schools receiving funding under the E-rate program may extend their services to the general public during non-operating hours, that is, after school, weekends, holidays, and summer vacation.

E-rate’s Role in Digital Inclusion: E-rate is part of the federal Universal Service Fund, which subsidizes communication services to poor and rural areas. Under the original program, school and libraries received federal funding for Internet access as long as it is used for “educational purposes” only. This meant that only students could gain access to E-rate based broadband during school hours. Under a waiver first issued to rural communities in Alaska, the FCC is now allowing the general public to use E-rate computers and access the Internet during hours that students are not in school.

Why this Waiver is So Important: The purpose of this extension is to facilitate access for community members that want to conduct job searches or submit job applications; this comes at a time when the nation faces a 9.7% unemployment rate. A report by the One Economy Corporation, cited by the FCC, indicates that 80% of all Fortune 500 companies only accept job applications online. Thanks to more online access, un-served and under-served community members will also be able to participate in digital literacy programs and obtain online access to governmental services and resources. As acknowledged by the FCC’s order, increasing community access to the Internet is critical in communities where residential adoption and use of broadband Internet access has historically lagged, especially in rural, minority, and tribal communities.

For those who are worried about costs, this new order does not allow schools to request more funding than what they were already getting from their in-school needs. FCC Commissioner Robert M. McDowell warned, “the change in our rules... should not provide a backdoor way for schools to request more funds than necessary to support their student populations…” Another important aspect is that schools have the freedom to determine their own polices about the specific use of their Internet facilities, including the hours of use for the general public.

A Small Step in the Grand Scheme: This initiative is a step in the right direction, but is not the ultimate solution to close the digital divide. Free Press, for example, advocates for an “e-rate@home” program where community institutions extend their wifi connections to local neighborhoods and suggests exploring programs that loan laptops to school children.

And that is precisely what two state legislators from Kentucky have proposed. They introduced a resolution with the purpose of providing laptops to middle school students. Other states have included legislative pieces in order to maximize participation in the E-rate program; the list includes New Jersey, California, Rhode Island, and Virginia. Furthermore, state legislators are proposing legislation to improve the connectivity in E-rate funded schools. In Minnesota, legislation has been introduced to construct fiber optic infrastructure to public schools to complement the funds already received by the E-Rate program. So while the FCC order is a step forward, states are already moving beyond it towards more comprehensive digital inclusion programs.

Resources:
Federal Communications Commission - Order and Notice on Proposed Rule Making - CC Docket No. 02-6
Benton Foundation - FCC Allows Community Use of E-Rate Supported Broadband
One Economy Corporation - Comments of One Economy Corporation: National Digital Literacy Initiative
Free Press - Free Press Welcomes E-Rate Improvement: Group Says Congress and FCC Still Must Do More to Close the Digital Divide
Broadcasting & Cable - FCC Votes to Allow Schools Receiving Broadband Funding to Open Service to Public

State Policymakers Need to Respond to Growing Clout of Latino Voters Nationwide

Suman Raghunathan — Thu, 18 Feb 2010 12:19:43 -0500

A recent report from the advocacy group America’s Voice highlighted the growing power of Latino voters in the upcoming 2010 elections. Latino voters played a critical role in 2008 to propel President Obama to victory in several key swing states that previously trended Republican, including Virginia. Latino voter registration and turnout rates have exploded over the past few years: roughly 10 million voted in the 2008 Presidential election alone, a 2.5 million increase from 2004 and 4 million person increase since 2000. Latino voter registration grew by over 54% between 2000 and 2008, and turnout grew 64% over the same time period.

The shifting composition of the electorate nationwide will increasingly affect state legislators and races. This trend is particularly evident in immigrant ‘new destination states’ in the South and Southwest, where growing numbers of immigrant residents are expected to translate into new Congressional districts after the 2010 Census. In response, progressive state leaders can take a few key steps:

Take Action on Immigrant Rights, a Defining Issue for Many Latinos: Immigration was not the number one issue for all Latino voters: like most Americans, the economy remains critical for them. Nevertheless, immigration reform remains important to a broad majority of Latinos as they make voting decisions. According to a May 2009 poll of Latino voters, 82% felt the issue was important to them and their families. Foreign-born Latinos (many of whom still have friends or family members who are documented residents but aren’t yet US citizens or who are undocumented) often feel comprehensive immigration reform and immigration policy is a top issue. State leaders can join State Legislators for Progressive Immigration Policy to promote state policies that support immigrants and add their voices to those of other state legislators calling for comprehensive federal immigration reform.
Address Other Key Concerns of Latino Voters: Latino voters need to see progressive state leaders standing up for other key concerns as well, such as health care. A survey last November found Latino registered voters' top concern was health care reform, with 61% saying the government should ensure that all people have health insurance, even if it means raising taxes. Addressing core issues for working families is also key to cementing support from Latino voters.
Support Latino Voter Participation: State leaders can respond to increased Latino voter engagement by continuing to protect their voting rights. State leaders can encourage this trend by introducing and supporting measures to encourage voting such as vote-by-mail, same-day registration and reforms, as well as strengthening civic engagement overall.
Support State-Level Policies and Programs that Integrate Immigrant Residents: Funding immigrant integration measures such as expanded ESL classes is critical for immigrant residents to fully participate in their community, yet demand continues to far outweigh supply for free or low-cost ESL classes. Waiting lists for ESL programs, which often receive some federal funding, remain long nationwide. English proficiency also translates to better wages for immigrant workers, as they can speak up for their rights at the workplace: one academic study found low-wage workers who moved up one English proficiency level saw a 30% increase in their wages.
Reach Spanish-Dominant Latinos: Foreign-born Latinos who predominantly speak Spanish are emerging as swing voters, and are a sizeable share of the Latino electorate: 40% were born outside the US and are naturalized US citizens. According to the New Democrat Network, the GOP more than doubled its share of the Latino vote from 1996 to 2004 by prioritizing outreach to Spanish-dominant Latinos. Both parties are well aware of this dynamic, and continue to step up their outreach: nearly 70% of 2008 immigration-related Presidential campaign ads were in Spanish.

Raising state voices in support of immigration reform is critical, especially in the wake of Congressional inaction on the issue. Despite repeated promises from White House and Congressional leaders to enact comprehensive immigration reform during President Obama's first year in office, momentum on comprehensive immigration reform has slowed in recent months. Yet the current federal vacuum on immigration reform presents an opportunity for states to craft progressive policies that support immigrant integration, such as English as a Second Language (ESL) classes, and protect the rights of immigrant workers. Meanwhile, efforts continue toward comprehensive immigration reform: in an interview last week with Los Angeles’ Spanish-language newspaper La Opinión, US House of Representatives Majority Leader Nancy Pelosi reiterated her commitment to enacting comprehensive immigration reform this year – a message she notably has not broadcast in the mainstream media. Pelosi noted she recently raised the issue with President Obama, who said he would work with Congress to develop a bill this year.

Resources:
America's Voice - The Power of the Latino Vote in the 2010 Elections: They Tipped Elections in 2008; Where Will They Be in 2010?
Latino Decisions/UNM RWJF Center/impreMedia - Survey of Latino Registered Voters
Progressive States Network - State Legislators for Progressive Immigration Policy
Progressive States Network - State Immigration Policy to Promote National Change

Job Creation and State Fiscal Relief Resolutions Moving in the States

Altaf Rahamatulla — Thu, 11 Feb 2010 12:12:03 -0500

In the State of the Union speech, President Barack Obama stated:

"The devastation remains. One in 10 Americans still cannot find work. Many businesses have shuttered. Home values have declined. Small towns and rural communities have been hit especially hard. And for those who'd already known poverty, life has become that much harder... That is why jobs must be our number-one focus in 2010, and that's why I'm calling for a new jobs bill."

With the fiscal crisis forcing states to layoff hundreds of thousands of teachers, nurses and police officers, the need for more federal job creation and state fiscal relief support is clear. And there is substantial momentum building around this issue in the states.

New Mexico Rep. Eleanor Chavez introduced HJM39, a joint memorial calling on the federal government to pass a jobs creation plan. The memorial passed the House of Representatives last Saturday and will now be considered by the state Senate.
Similar resolutions are likely to be introduced in Illinois, Nevada and Vermont. Members of the Tax Fairness Organizing Collaborative (TFOC), including New Yorkers for Fiscal Fairness (NYFF) and the Progressive Leadership Alliance of Nevada (PLAN), are working with lawmakers in their states to highlight the acute need for increased federal support.
Along with Maine Senate President Libby Mitchell, House Speaker Hannah Pingree held a press conference this past Tuesday to garner awareness of Maine's economic and fiscal situation and highlight the need for another round of federal aid.

If you are a lawmaker interested in introducing a resolution requesting the federal government to move a jobs bill, PSN can assist you in that effort. Please contact us at jobcreation@progressivestates.org for support. General resolution language can be found here.

Additionally, over one hundred legislators from thirty-one states have signed on to Progressive States Network's letter calling on the President and Congress to move swiftly on job creation and state fiscal relief. State lawmakers can sign onto the letter here, while citizens and advocates can use this online tool to contact their state legislators and ask them to add their signature.

The Need and Public Support for Action: As we discussed in January, the passage of the American Recovery and Reinvestment Act (ARRA) in early 2009 was critical in preventing a full collapse of the national economy and helping states address huge budget gaps. The Congressional Budget Office (CBO) estimates that the ARRA created or maintained 600,000 to 1.6 million jobs as of September 2009 and found it decreased the unemployment rate by almost one percentage point. Unfortunately, millions of Americans are still out of work and states are struggling to find ways to deal with enormous deficits and plummeting revenue. Projected governors' budgets could lead to layoffs amounting to an additional 900,000 jobs lost in the economy.

There is extensive bipartisan support for federal funding for job creation and aid to states. Winthrop University conducted a poll in late 2009 and found that 71.6 percent of respondents favor funding for jobs (94.5 percent identify as Democrats, 53.4 percent Republican, 68.9 percent Independent) and 62.7 percent support "giving aid to states in serious financial trouble" (80.6 percent Democrat, 50.9 percent Republican, 63.6 percent Independent).

As the U.S. Senate moves on a jobs package within the next few weeks, timing is crucial. State lawmakers must send a strong message to Washington that the country needs jobs and states need relief.

Resources:
Center on Budget and Policy Priorities - Additional Federal Fiscal Relief Needed to Help States Address Recession's Impact
Center on Budget and Policy Priorities - Recession Continues to Batter State Budgets; State Responses Could Slow Recovery
Stateline.org - Economist Mark Zandi: On stimulus, jobs, state finances, inflation and the year ahead
Moody's Analytics - The Case for Another Round of Federal Aid to State & Local Govt
WhiteHouse.Gov - Remarks by the President of the United States in State of the Union Address
Winthrop University - Winthrop Poll Results - November 2009 Findings
Center on Budget and Policy Priorities - Governors’ New Budgets Indicate Loss of Many Jobs if Federal Aid Expires

Broadband and Recovery - the ARRA and State Policies in 2010

Fabiola Carrion — Tue, 09 Feb 2010 12:02:05 -0500

The American Recovery and Reinvestment Act (ARRA) apportioned $7.2 billion to stimulate the development of broadband infrastructure and services. As the U.S. is now ranked only 17th in global use of broadband and information technology, the ARRA is not only considered a job creator, but also key to regaining long-term economic competitiveness for the nation. Moreover, as a recent study documents, broadband is becoming a significant determinant of economic vitality at the local level.

Although a limited number of grant applications have been awarded, the ARRA promises to still spin the wheels of innovation as the Administration starts evaluating the next wave of applications for the second round of funding. In the meantime, states have been moving forward on laying the policy groundwork for using advanced communication technologies to strengthen both economic opportunity and local job creation.

This Dispatch will highlight the trends in the initial grants when it comes to mapping, deployment and adoption broadband, outline broadband policies that states have been pursuing (using federal and state funding), and why these broadband investments are so critical to the long-term economy of our states.

Resources
CBC News - Canada drops in UN communications technology ranking
Public Policy Institute of California - Does Broadband Boost Local Economic Development?
Department of Commerce’s National Telecommunications and Information Administration - Commerce Awards Recovery Act Broadband Expansion Grants Totaling $63 Million

Table of Contents:

- Innovation in the States Under Initial ARRA Grants

- State Legislation to Promote Digital Leadership

- How Broadband Delivers Economic Growth

- The Next Round of ARRA Grants

Innovation in the States Under Initial ARRA Grants

Under ARRA, priority is given to initiatives that encourage broadband deployment adoption in low-income and rural communities, expand public community centers’ capacity, and fund the development of a national broadband map. Almost $5 billion in grants are to be distributed by the National Telecommunication and Information Administration (NTIA) to deploy broadband infrastructure through its Broadband Technology Opportunities Program (BTOP), and $2.5 billion will be distributed by the Agriculture Department through its Rural Utilities Services' (RUS) Broadband Initiative Program.

Mapping the Digital Divide: A key ARRA mandate is the collection of information on areas covered by broadband service. To this end, the NTIA has set aside federal funding to create state maps in order to show the availability, speed, and location of broadband access across the country. Mapping is critical for consumers and voters - who can learn where broadband service is available - to anchor community institutions such as schools, libraries, and hospitals, as well as for businesses that can benefit from this information and make investments accordingly. A comprehensive map of broadband availability is therefore critical to help policymakers determine where to allocate resources.

As part of the recent funding round, the NTIA has approved several mapping initiatives, most notably in Iowa where a $2.2 million grant will be dedicated to broadband Internet mapping and planning. Other states and territories that have benefited from the NTIA's broadband mapping and data collection grants include Florida, Kansas, Illinois, Michigan, Montana, New Hampshire, Utah, the U.S. Virgin Islands, Minnesota, Nevada, Ohio, Puerto Rico, South Carolina, and Tennessee.

Deploying Broadband in Underserved Communities: The NTIA and RUS are concentrating most of their funds on providing broadband access to unserved and underserved areas increasingly left behind in the global information economy. Some examples are listed below:

Alabama is receiving a $3.8 million grant to provide high speed DSL broadband service to its rural territory.
The Broadband Infrastructure Project in Bretton Woods, New Hampshire will receive $985,000 in funding to provide two-way broadband service to 400 households, anchor institutions, and businesses. The tourism industry is strong in Bretton Woods and having access to broadband will encourage tourists to visit more often and for longer periods of time.
Maine was selected to receive a grant of $498,222 to purchase video conferencing equipment to link 22 schools; Michigan State University received similar funding to create more public computer centers targeting the under-served and the unemployed.
South Dakota was also selected to receive a $306,693 grant to provide video-conferencing as well as telemedicine service to connect 16 rural hospitals and clinics.
Morehouse Parish, Northeast Louisiana Telephone Co. is receiving a $4.3 million grant and $8 million loan for an active ethernet system with symmetrical speeds of 20 Mbps.
Other states such as California, North Dakota, Oregon, Virginia, Iowa, Michigan, and Missouri are receiving grants for a fiber-based broadband infrastructure.

Computer Literacy to Promote Digital Inclusion: Beyond physical support, funds are being aimed to encourage computer literacy and the skills needed to take advantage of communication technologies. One of these few digital inclusion grants in the early round of ARRA funding was given to the University of Massachusetts-Lowell, which is receiving a $780,000 broadband adoption grant with an additional $196,000 in applicant-provided matching funds to promote broadband awareness and computer literacy among vulnerable populations, including the nation’s second largest Cambodian population, low-income and at-risk youth, the unemployed, residents without college degrees, and seniors in the Lowell and Merrimack Valleys. As part of the program, University of Massachusetts–Lowell students will work in local computer centers with at-risk youth and seniors to develop appropriate training and outreach materials.

The University of Massachusetts grant is an example of broadband investment going beyond infrastructure, through actual implementation and continued commitment. It is important to invest in deployment, but it is equally, and arguably, more important, to make sure that gains from broadband are distributed equally among communities and their residents. Various studies confirm that only a third of the population who has access to broadband actually uses it, so the digital divide and job creation can only occur when deployment of broadband infrastructure is accompanied by training and awareness.

Resources:
The National Telecommunications and Information Administration
The Department of Agriculture's Rural Utilities Services
Business Record - Iowa Gets Broadband Boost with Aid of Grant
Connected Nation
United States Department of Agriculture - Secretary Vilsack Announces Almost $35 million in Funding for Distance Learning and Telemedicine Projects
BroadbandBreakfast.com - Rural Utilities Service Unveils $310 Million in Stimulus Funds for 14 Projects

State Legislation to Promote Digital Leadership

In order to strengthen their ability to receive federal funding and to better manage their existing digital resources, state legislatures have been proposing and enacting a wide range of policies to promote their states' digital leadership.

Commissions to Oversee State Broadband Efforts: In an effort to either receive funding or support ARRA broadband goals, states are introducing and passing bills to adopt or deploy broadband, or map its availability throughout their jurisdictions.

With Oregon's HB 2168 creating a state goal to support the rapid deployment of broadband telecommunications services in areas where the services do not exist, HB 3158 established the Oregon Broadband Advisory Council (OBAC) and the Oregon Broadband Advisory Council Fund to implement these goals and designate representatives from the education, health care, public safety, telecommunications, and government sectors to report on the affordability and accessibility of broadband and the extent of broadband technology use in energy management, education, government, and the telehealth industries.

Other similar efforts include:

Indiana (HB 1561), Maine (HB 700), Rhode Island (HB 5975/ SB 968), and Virginia (HB 2423 and SB 1336) all created commissions to advise Governors and other state officials on broadband opportunities, including available funding under the ARRA, and to better plan long-term technology goals for those states.
Hawaii has followed in their footsteps by introducing HB 2698, which also requires the Hawaii broadband commissioner to promote and maximize availability of broadband services in the State.
Other efforts in Iowa (SF 372) and Colorado (SB 162) are more specifically focused on mapping access in those states.
New Hampshire (SB 159) established the position of Director of Broadband Technology Planning, who is now in charge of developing a comprehensive state broadband plan.
Virginia (SB 1456, HB 2201, and SB 236) created the Innovation and Entrepreneurship Investment Authority (IEIA) to monitor trends in the availability and deployment of and access to broadband communications services with its Chief Information Officer developing a comprehensive strategic plan to identify the unmet needs for access to technology.

For states looking to create or enhance commissions in their own states, the Progressive States Network laid out best practices for such commissions in our Guiding Principles for Broadband Strategy Councils.

Supporting Deployment in Underserved Communities: A few states are working to move beyond planning to directly encourage broadband expansion.

With a heavily rural population, Maine has been a leader in working with private entities to maximize broadband deployment. Maine's HP 585 gave the Public Utilities Commission the authority to require a communications service provider that is providing broadband coverage within at least 50% of a municipality's geographic area to expand its broadband coverage to all of the geographic area within that municipality. HB 700 required the Broadband Commission to advise the University of Maine System on how to lease or sell excess broadband capacity and negotiate lease or sales agreements with service providers to ensure they benefit the educational system and meet the goal of broadband access for everyone in the State. Recently, HP 1174 has been introduced to establish a Broadband policy: promoting sustainable private investment to increase broadband service that exceeds the minimum levels throughout the state, and developing target prices and competitively neutral discounts to customers in areas where services are more expensive than the average metropolitan rates.

Other examples of state action on deployment include:

Using federal funds, Massachusetts' HB 4158 authorizes the Massachusetts Technology Park Corporation to develop, lease, or otherwise acquire conduit, fiber, towers, and other personal property related to broadband infrastructure.
Tennessee's SB 2355 expands rural broadband connectivity in the state with rural assistance grants.
Washington's HB 1701 authorized the Department of Information Services to use federal grants to target and deploy broadband services.
In Virginia, HB 988 allows the Governor's Development Opportunity Fund to provide grants for projects related to capacity development of broadband Internet access.
Minnesota's SF 2254 sets a universal and high-speed goal, for no later than 2015, that all residents and businesses acquire access to high-speed broadband that provides minimum download and upload speeds.
To encourage more access to utility poles in Georgia, SB 328 has been introduced to prohibit electric suppliers from discriminating cable companies who want to have access to electricity poles.

Promoting Digital Inclusion: Online training and education is particularly needed for communities that currently have limited access to the Internet: African Americans and Latinos, the elderly and disabled, and residents of rural areas - who can explore educational and professional opportunities and find resources for entrepreneurial assistance. In an era where entry-level jobs require a familiarity with the Internet, access to and knowledge of broadband applications is essential to economic survival. As advocated by the Joint Center for Political and Economic Studies, state legislators must ensure that broadband is accessible to consumers, through anchors institutions, community based organizations, and within the home - in addition to being coupled with digital literacy training.

As we noted last year, Washington has been a leader in digital inclusion programs with HB 1701, creating a menu of digital inclusion programs through its Community Technology Opportunity Program, which will promote Internet adoption, training, and skill-building opportunities; access to hardware and software; digital inclusion and digital media literacy; development of locally relevant content; and organizational and capacity building support to community technology programs throughout the state.

See also PSN's Guiding Principles for Digital Inclusion Policies for other best practices.

Connecting Job Creation to Broadband Efforts: States are increasingly creating complementary job creation programs connected to their broadband efforts:

Iowa's SF 376 instituted the Iowa Jobs Program, authorizing the creation of jobs related to broadband.
Vermont's HB 711 proposes to provide economic incentives for businesses and farms to create and preserve jobs and improve the state's technological infrastructure and economic environment. Under the provisions of this bill, Vermont will distribute $3.7 million from the $8.67 million it received under the ARRA's fiscal stabilization general services fund. HB 711 also establishes the Broadband Adoption Program for the purposes of accelerating the subscription to and use of broadband Internet access by the public, thereby increasing the sustainability of broadband networks in Vermont, especially in rural and underserved communities.
Virginia's HB 1660 established the Office of Telework Promotion and Broadband Assistance, which aims to encourage telework as a public policy in order to promote workplace efficiency and reduce strains on the transportation infrastructure.
Recently introduced, Hawaii's SB 2543 establishes an office of telework promotion and broadband assistance.

Resources:
Progressive States Network - Guiding Principles for Broadband Strategy Councils
Progressive States Network - Guiding Principles for Digital Inclusion Policies
Progressive States Network - Washington State Legislature Passes Legislation Aimed at Increasing both Access and Adoption of Broadband
Joint Center for Political and Economic Studies - Broadband Imperatives for African Americans: Policy Recommendations to Increase Digital Adoption for Minorities and Their Communities

How Broadband Delivers Economic Growth

Before we even mark the ARRA's first anniversary, states have already found that mapping, deployment, and adoption efforts lead to economic development. For instance, Kentucky's HB 204 concludes that its ConnectKentucky project to promote deployment and adoption of broadband services has resulted in enhanced economic development and public safety for Kentucky communities, improved health care and educational opportunities, and a better quality of life for Kentucky citizens.

A recent report from the Public Policy Institute of California found that areas with broadband saw employment growth 6.4 percent higher than areas without it in the period from 1999 to 2006, with the highest employment growth where technology services represent a larger share of local industry’s inputs. Careful analysis in the report indicates that this relationship is not incidental but a causal relationship between deployment and subsequent economic growth.

This report confirms findings by earlier studies from such organizations as the Brookings Institution, which estimated that for every one percentage point increase in broadband penetration in a state, employment increases by 0.2 to 0.3 percent per year. Other studies estimate that in the early stages of the Internet, information technologies were responsible for two-thirds of total growth in productivity and that for every dollar invested in broadband, the economy sees a ten-fold return on that investment. In a report to the Federal Communications Commission, the U.S. Broadband Coalition - representing more than 160 organizations that include communication providers, labor unions, consumer groups, educational institutions, and units of state and local government - estimated that investment in broadband can create or retain 1 million to 2.5 million jobs.

Among broadband's greatest advantages is its intersection with various sectors of the economy: with energy through smart grid technologies, health care through telehealth, agriculture through crop and irrigation management, transportation through traffic management, and homeland security through mobile detention systems.

The Need to Address Economic Inequality: One important finding in the recent Public Policy Institute study is that while broadband leads to job growth, the benefits are not equally distributed within communities. Wages do not always increase and the concentration of workers in a few high-tech enclaves may retain local tax revenues in municipalities that host information technology companies.

Broadband expansion needs to be encouraged, the study concludes, but to address the digital divide, funds invested in its expansion "might have a large effect on economic or social outcomes if the funds were allocated instead toward subsidizing broadband adoption or other needs of disadvantaged households." This highlights again why digital inclusion and training programs are important as a complement to paying for the physical wiring of our nation, as very few state or federal funds have been apportioned to such broadband use and training programs.

Resources:
U.S. Broadband Coalition - Report of the U.S. Broadband Coalition on a National Broadband Strategy
The Brookings Institution - The Effects of Broadband Deployment on Output and Employment: A Cross-sectional Analysis of U.S. Data
Public Policy Institute of California - Does Broadband Boost Local Economic Development?

The Next Round of ARRA Grants

With the intention to increase efficiency in the next application review process, the NTIA and RUS announced in January the availability of $4.8 billion for the second round of ARRA funding. As the NTIA and RUS are ready to implement their new standards, the agencies plan to accept applications from February 16, 2010, to March 15, 2010, and will announce all awards by September 30, 2010.

Lessons Learned: Among its most fundamental changes is the NTIA’s plan to award at least $150 million for Public Computer Center projects that expand access to broadband service and enhance broadband capacity in public libraries, community colleges, and other institutions that service the general public. Additionally, the NTIA is prepared to award at least $100 million for Sustainable Broadband Adoption, which includes projects to provide broadband education, training, and equipment, particularly to vulnerable population groups where broadband technology has traditionally been underutilized. In an effort to expand more funding to unserved and under-served communities, the NTIA is adopting a “comprehensive community approach” as the way that it will evaluate applications, focusing in middle mile broadband projects that connect key community anchor institutions. These are great steps toward digital inclusion.

A series of workshops on grant and loan writing for ARRA applications are being held in various states by Broadband USA.

The Role of States: States are the advisors to the federal agencies that approve broadband program applications. As mandated by the ARRA, the NTIA and USDA must consult with state governments in order to determine which programs would best serve underprivileged areas, knowledge that state officials uniquely posses. The advisory role of states begins with their knowledge of communities that are un-served and underserved. This understanding continues with their assessment of which communities would benefit the most from the stimulus and would receive the actual funding.

Not only do states understand the immediate benefits that loans and grants would provide, but also they can assess the long-term effects in their communities and how these can be disseminated throughout their states. With every incentive to make the money work, states know which ARRA funded programs would best compliment already existing programs, and how the benefits can be shared by nearby communities that are not receiving direct ARRA funding.

As we wrote in our Dispatch Making Broadband a Key Part of States' Economic Recovery, the Progressive States Network encourages grassroots organizations and other groups to seek the advice of their state legislators before submitting any application for ARRA funding. State legislators can provide knowledge of the results in the approval of an ARRA grant or loan. An example of direct state participation took place in Massachusetts where Governor Deval Patrick played a crucial role in the approval of $2 million in funding for the development of broadband data requisition and mapping across the 351 communities of the state. Specifically, the funding will be directed towards building new broadband infrastructure that will bring high-speed Internet access to tens of thousands of households, businesses, and community anchor institutions, including the un-served and under-served communities of western Massachusetts and Cape Cod.

State legislators can provide vital information and recommendations for ARRA applications and they will also act as inevitable monitors of the implementation of the funded programs. We anticipate that state legislators will continue to act as watchdogs of ARRA program implementation. Furthermore, their participation is imperative as many of these federal grants will simultaneously go towards private companies, non-government entities, and ad hoc projects. It is important that state officials ensure that selected projects reach the intended populations and are implemented in the public interest.

Resources:
United States Department of Agriculture - Commerce Department's NTIA and USDA's RUS Announce Availability of $4.8 Billion in Recovery Act Funding to Bring Broadband to More Americans
Broadband USA
Progressive States Network - Making Broadband a Key Part of States' Economic Recovery

State Job Creation Strategies Part I: Finding the Money and Investing in Human Capital and Physical Infrastructure

Nathan Newman — Tue, 19 Jan 2010 12:59:28 -0500

The fundamental challenge in this recession is that the growth that preceded it was a mirage. Bubble era borrowing created a network of financial jobs, real estate jobs and construction jobs that collapsed with the end of the bubble. Many of those jobs will never return.

An extremely high proportion (75%) of job losses in this recession are permanent rather than temporary. States will need to nurture completely new industry sectors and the infrastructure to support those jobs, while the jobless will need retraining in new skills to participate in those sectors.

The Private Sector Can't Do it Alone: As the Economic Policy Institute wrote recently, "it is likely that unemployment will remain above 8% even two years from now in the absence of bold and decisive action to create jobs." With the credit crunch and the reduction in consumer demand, small businesses are experiencing tough times. In 2008, for example, 43,500 businesses filed for bankruptcy, up from 28,300 businesses in 2007 and more than double the 19,700 filings in 2006.

What's needed: As this Dispatch will highlight, the first step is to fund jobs that support long-term economic competitiveness, notably by investing in people and physical infrastructure. While the economic climate for profit-making business opportunities is more limited, investments in education, health care, transit and energy efficiency can create immediate jobs while strengthening building blocks for long-term growth.

Next week's Dispatch will be a second part of this series on how states can nurture startups, strengthen existing industry sectors, and promote green jobs in their states.

Mobilizing for a Federal Support for Jobs and State Fiscal Relief: As we highlighted two weeks ago, a critical part of job creation will be a new round of federal job creation and state fiscal relief. We are asking state legislators to sign onto a letter to promote this job creation plan at www.progressivestates.org/jobcreation or by emailing jobcreation@progressivestates.org. Advocates can sign onto a similar letter for organizations or use our handy online tool to contact their state legislators to let them know about the job creation letter and to encourage them to sign.

Resources:
Progressive States Network - Take Action: Additional Federal Job Creation and State Fiscal Relief Needed
Economic Policy Institute - American Jobs Plan: A Five Point Plan to Stem the U.S. Jobs Crisis
Center for Labor Market Studies (Northeastern Univ.) - The Great Recession of 2007-2009: Its Post-World War II Record Impacts on Rising Unemployment and Underutilization Problems Among U.S. Workers

Direct Public Money to Investments in Economic Growth

In the current economic and fiscal crisis, finding the funds for long-term investments is a challenge, but those investments will deliver both short-term jobs and long-term economic growth to turn state economies around. States need a balanced approach of revenue increases, bonds for long-term investments and tapping existing sources of state capital like state pension funds to marshal the capital needed for economic recovery.

Raise Revenues, Don't Cut Public Investments: The recession has made clear the hollowness of the bubble economy in many states, especially in some of the low-tax, low-investment Sunbelt states touted by anti-tax forces as exemplars of economic growth.

When measuring long-term economic competitiveness, states with some of the highest marginal tax rates on individuals -- from New York to Maryland -- were supporting some of the most innovative "new economy" industries in the country, according to a 2008 analysis by the Information Technology & Innovation Foundation. As we detailed last year, progressive tax increases to fund economic recovery are the better alternative to budget cuts. Many needed investments are in the fundamentals of education and infrastructure as well as in the nurturing of new sectors where private capital is unlikely to effectively step in. Increased tax revenue to fill in government and private sector gaps in investment is clearly needed.

Use State Bonding Authority: One obvious source for funding long-term growth projects are new bonds that can be paid back with the tax revenue yielded by greater economic growth. Especially where tolls or energy savings will directly return revenue to the state from bonded investments, legislative leaders are aggressively pursuing new bond investments.

The federal ARRA recovery plan provides a two-year 35% tax credit for state Build America Bonds, which is yielding record low interest rates for states that are issuing bonds. For example, Washington state received an interest rate equivalent to 3.52 percent on $500 million in bonds issued in October. To help municipal governments take advantage of lower interest rates and lower issuance costs, nearly a dozen states have created "state bond banks" to pool the loans of local governments.

A few examples of recent state bond discussions around the country include:

The Ohio House of Representatives has approved placing a $950 million bond issue on the May 4th ballot to renew for another five years the state’s largest economic development project, the Third Frontier, which invests in research and commercialization of technology in five industries sectors and created 41,300 jobs from 2003-2008.
Last week, the Washington State House Capital Budget Committee approved sending $861 million Jobs Act Bonds to voters in November to fund schools and colleges to fund energy upgrades. The sponsor, Rep. Hans Dunshee, estimates it would create 38,000 jobs and generate energy savings that will cover much of the interest costs.
Minnesota legislative leaders are proposing $1 billion in bonds to build and repair facilities around the state.

Use Pensions Funds for In-State Investments: Unwilling to rely on uncertain global investment markets to fuel economic growth, states are increasingly choosing to directly invest in local state businesses. Instead of giving away corporate welfare and subsidies, states can offer needed capital to create a financial stake in firms. If these businesses are successful, they return equity to taxpayers that can be reinvested in other projects.

One study found that the California Public Employees' Retirement System's in-state investments fed an estimated $15.1 billion into in-state economic activity in 2006 and created 124,000 jobs-- more jobs than the construction or motion picture industries. Other examples of in-state pension investments include:

Florida Governor Charlie Crist recently signed an economic stimulus plan for the state that redirects $1.95 billion of the state's pension fund into direct investments in Florida's economy.
Washington state held $1.4 billion in Washington-based investments at the end of 2008, using the money to leverage additional capital from other sources to invest in the state.
New York held $403.6 million as of March 2009 through its Common Retirement Fund with another $500 million available to invest in New York-based businesses.
The Invest Michigan! Fund features The Michigan Opportunities Fund and the Growth Capital Fund and is capitalized with $300 million from the state's pension fund.
In Indiana, the public pension funds collaborated with state universities and various health-based companies to launch the Indiana Future Fund, an investment fund designed to benefit Indiana companies, especially in the life sciences and high technology arena.

Avoid Privatization as a Funding Source: Given budget deficits, some states are being lured by the supposed "free lunch" offered by selling or leasing public assets to private firms with the promise of upfront private investment. Unfortunately, as we have detailed repeatedly (see here and here and here), privatization of public assets are inherently likely to ripoff the public to the benefit of private interests.

As detailed in a U.S. PIRG report last year, since governments can issue tax-free bonds at lower rates than private investors, "deals based on private capital are inherently more expensive than public financing." In 2008, Missouri was planning to use some form of privatization with investors to fund an ambitious plan to repair or replace 802 bridges. Now, the Missouri DOT is funding the entire project through the sale of government bonds.

Don't Waste Money on Direct Subsidies to Businesses: One general caution for states is to limit grants, tax credits and other giveaways to business. Instead use either direct equity investments or loans that are repaid in order to replenish the supply of public capital over the long-term.

States waste money competing for firms to cross the border from another state, rather than on fostering entrepreneurship and new jobs. A recent Good Jobs First report on high-tech deals by states notes that many are extremely costly. The poster children for bad deals are North Carolina's large subsidies to Dell Corporation, who took the money, but then sent the 900 jobs off-shore four years later and New York giving microchip maker AMD (later Global Foundries) $1 million in taxpayer funds for each job being created by the firm upstate. As the report states:

Tax reductions, exemption or credits “exert a very small marginal influence on corporate investment decisions because other cost factors such as labor, occupancy and other key inputs are far larger than taxes (or tax breaks)… For the vast majority of companies, tax breaks are windfalls, not determinants, and are therefore wasted.

Redeploy Wasted Corporate Giveaways to Real Public Investments: If states do a thorough review of ineffectual subsidies, costly contracting out, and tax credits, they can generate additional revenue that can be used for more effective job creation efforts. Progressive States Network has worked with allies to outline model Corporate Transparency in the State Budget legislation and set up a supporting campaign webpage to help achieve that goal.

As the rest of this Dispatch emphasizes, states can better invest scarce public dollars in upgrading the quality of the workforce and infrastructure, rather than engaging in costly bidding wars with other states for jobs.

Resources:
Information Technology & Innovation Foundation - The 2008 State New Economy Index: Benchmarking Economic Transformation in the States
U.S. PIRG - Private Roads, Public Costs: The Facts About Toll Road Privatization and How to Protect the Public
Council of Development Finance Agencies - State Bond Banks: Municipal Borrowing Made Easy
CALPERS - CalPERS - An Economic Engine
Good Jobs First - Growing Pennsylvania's High-Tech Economy: Choosing Effective Investments
Progressive States Network - Corporate Transparency in State Budgets

Invest in People- the Key Engine of Growth

In a global economy where the quality of the workforce increasingly determines the standard of living, investing in an educated and healthy population is key to promoting state economic growth.

Invest in Education: One of the largest successes of the recovery plan has been preventing massive teacher layoffs and creating or preserving 250,000 education positions. Additional federal help will be needed to stave off reductions in the coming years, but it is a marked success that despite the largest downturn in post-war history, the core educational infrastructure of our nation has been preserved.

Why this is so important is highlighted by a number of recent studies that emphasize that investments in education have clear dollar returns to state governments.

Each new high school graduate yields a net public benefit of $127,000 or 2.5 times the cost of needed public investments, according to a Columbia Teachers College report. In fact, cutting in half the number of high school dropouts would yield $45 billion in extra tax revenues. High school graduates themselves will earn $117,000-$322,000 more in their lifetimes than dropouts, with female college graduates, for example, earning $800,000 more than dropouts.
As we detailed last spring, early education investments in particular show long-term economic payoffs. A recent Cornell University study found that funds spent in the early education sector have more stimulative effect on the economy than most other spending. Early education programs help parents take advantage of opportunities in the workforce and child care improves parents' productivity at work. One study by the business-backed Committee for Economic Development, estimated that for every dollar invested in preschool, there was an expected return of $2 to $4 in future societal benefits.

Part of youth education is giving them entry-level job training. The federal recovery plan helped revive summer youth job programs across the country, offsetting massive youth unemployment in the private sector. The Idaho Labor Department sponsored its first youth employment program in over a decade.

Support Worker Retraining: While training can't create jobs, it can ensure that workers who are unlikely to be reemployed in their old industry sectors have a chance to be reemployed somewhere else -- and that vibrant industries have the skilled workforce needed to expand in a state.

A Michigan Council for Labor and Economic Growth study found that a five percent increase in college-educated adults would boost economic growth by 2.5% over ten years and real wages by 5.5%. Similarly, studies show that just helping workers get their GED significantly boosts their employment in the long-term. Notably, a study by the National Skills Coalition (formerly the Workforce Alliance) found that even as unemployment mounted in summer 2009, 60% of employers still had trouble finding qualified applicants for the vacancies they did have -- emphasizing the lack of fit in skills between those laid off and the sectors where growth is likely to occur.

In our Dispatch Averting Layoffs and Revitalizing the Manufacturing Economy, we highlighted a range of best practices through which states can both work to avert impending layoffs and use rapid-response to help employees get new jobs or enter retraining programs as quickly as possible. These include Rapid Response programs used by some states to on-site contact with employees before layoffs, accessing training programs like Trade Adjustment Aid, working with communities to tailor training and placement programs, as well as promoting Peer Networks to train groups of workers during layoffs to collect information from fellow workers, help connect them with community services, promote job referrals, and work with community leaders.

Fund Health Care and Support the Safety Net: Health care and other safety net spending is not just a public expense; it is also itself an investment in economic growth. A healthier workforce means greater economic productivity and more years of productive labor. And the health care industry is itself a source of good quality jobs.

A few years ago, a Commonwealth Fund study estimated that labor time lost due to health reasons totalled $260 billion per year. And unhealthy workers often have lower productivity at work. In fact, because people are living and working longer, long-term economic growth is likely to be far higher than many current government projections, according to a recent study by North Carolina State University. "Spending on health care productivity, biomedical research and universal health care should be considered an investment that will eventually lead to increased economic growth," argues co-author Dr. Al Headen. The payoffs are likely to be more taxes paid, more consumer spending and far lower public expenditures on programs like Medicare than currently assumed.

Another remarkable accomplishment of the federal-state partnership in the last year has been not only preservation of basic health care spending for low-income families, but the expansion of SCHIP programs for children and COBRA subsidies for the unemployed. This is in sharp contrast to the recession in the early part of this decade when literally millions of people lost publicly funded health coverage. Maintaining health programs will continue to be a challenge for states -- and new federal funds are a key part of that solution -- but it should be considered a key part of long-term investments in a healthy workforce.

Integrate New Immigrants into the Economy: As we emphasized last week, keeping an estimated 12 million people in the shadows of the economy is bad for them, bad for native workers and bad for the U.S. economy. A recent report estimated that immigration reform that integrates new immigrants into the U.S. economy would create $1.5 trillion in added GDP over ten years and newly legalized workers would increase tax revenues by up to $5.4 billion in the first three years. Another study by the CATO Institute found that legalization would boost the incomes of U.S. households by $180 billion annually by 2019.

Across the board, the goal should be to maximize the productivity of all workers in our economy and produce the most economically competitive workforce in the world.

Resources:
Progressive States Network - Early Education Investments: Economic Importance and Policy Implementation
Columbia Teachers College Center for Benefit-Cost Studies of Education - An Excellent Education for All of America's Children
Workforce Alliance - Job Training is Key to Success of Jobs Bill: Analysis and Recommendations
Progressive States Network - State Action for the Unemployed
National Employment Law Project - Rapid Response Training Overview
Michigan's Human Resource Development Institute - Peer Networks
Commonwealth Fund - Health and Productivity Among U.S. Workers
Council for Labor and Economic Growth - Transforming Michigan’s Adult Learning Infrastructure
Center for American Progress and the Immigration Policy Center - Raising the Floor for American Workers: The Economic Benefits of Comprehensive Immigration Reform
Cato Institute - Restriction or Legalization? Measuring the Economic Benefits of Immigration Reform
North Carolina State University - Study shows health care spending spurs economic growth

Creating a 21st Century Infrastructure in the States

“As a country, we’re deluding ourselves if we think we have put enough into infrastructure," notes the Urban Land Institute. "We’ve been under-investing for 30 years.” As a percentage of gross domestic product, infrastructure spending actually has been declining since 1959. A 2009 American Society of Civil Engineers (ASCE) assessment calculates that $2.2 trillion is needed for infrastructure repairs and upgrades just in the next five years. In contrast, China has committed $259 billion to its plans for building the world's largest high-speed rail system -- with trains going up to 218mph -- and plans to add another half trillion dollars in the next few years for a total investment to $730 billion by 2012. That's more than the entire 2009 federal recovery plan.

The federal recovery plan had $132 billion for infrastructure of all kinds, from roads to transit to smart energy grids, but that's a tiny part of what is needed for the U.S. to retain global competitiveness.

More and Better State Transit: Focus on repairing existing infrastructure, strengthen gateway infrastructure in ports and cities which are the focus of global shipping and travel, and reconfigure suburbs to better integrate regional economies.

Public Transit Investments are a Key Job Creator: One clear lesson from the recovery plan, according to a recent report, is that money spent on public transit yields nearly twice the jobs compared to similar amounts spent on highway projects. This result is due to the fact that public transit spends less money on real land costs and supports vehicle manufacturing and maintenance jobs. It also especially helps low-income workers save money in getting access to jobs where transit integrates communities. One innovative, lower-cost transit approach is bus rapid transit (BRT), which builds separated lanes for larger buses that can move at speeds approaching subway lines. Pioneered in Ottawa, Canada and Adelaide, Australia, similar systems are spreading to Latin America, China, India and Mexico. In the U.S., Los Angeles and Boston have adopted BRT principles and Chicago will be inaugurating BRT service in 2010.
Integrate transit with land use planning: Building transit in the middle of sprawl does little to ease congestion; instead transit funding needs to be linked to development planning that integrates transit with access to jobs and retail. The Denver region is a notable success story in using transit and land use zoning to reclaim its urban downtown, adding a 122-mile light rail system, instituting a Bus Rapid Transit system to link to nearby Boulder, and linking the urban core to multiple town centers in the surrounding suburbs.
Strategically Apply User Fees to Fund Infrastructure: The Urban Land Institute emphasizes that more of the costs of transit infrastructure will inevitably need to be borne by consumers in the form of higher gas taxes, tolls and congestion pricing in urban areas. This needs to be combined with targeted tax relief to ease the burden on low-income families. The reality is that gas taxes in the U.S. are far smaller than European economic competitors, who use those revenues to fund far more robust transit upgrades across their continent.

Broadband and Smart Grid Investments: Despite the U.S. playing a key role in creation of the Internet, a study by the International Telecommunications Union found that the United States now ranks 17th in global broadband penetration. Lack of affordable broadband access undermines the international competitiveness of our communities and workforce. The $7.2 billion of direct broadband funding in the federal recovery plan and pockets of other funding for digital infrastructure throughout the ARRA also emphasized broadband as a catalyst for spurring job creation and economic growth.

A number of state legislators have created Broadband Strategy Councils to focus on using those and internal state funds to increase access to and adoption of affordable broadband. Beyond investing in physical infrastructure, increasing digital literacy is a key investment as well. During the 2008 legislative session Washington state passed SB 6438, which created a statewide high-speed Internet development process and established the Community Technology Opportunity Program (CTOP) that will provide resources for capacity-building and grant-giving to Community Technology programs that provide hands-on technology access and training to residents.

Water Systems: Many cities and regions are using old water systems desperately in need of repairs and upgrading. Nationwide, the U.S. Environmental Protection Agency (EPA) projects a $224 billion funding gap between 2000 and 2019 between what states are spending and federal requirements for water quality. Part of the solution are new policies to reduce wasteful water use, since per capita domestic water consumption in the U.S. is more than twice as much as most global competitors-- and more than four times the use by citizens of Great Britain and China.

In California, where some water bills can approach $500 a month, jurisdictions began to require retrofitting homes on resale. Development needs to be restricted in areas lacking water systems, since such growth just dumps costs on government and leads to underfunding water systems in established areas.

Infrastructure Projects already approved: Some notable examples of integrated infrastructure investment programs around the country include:

Illinois Department of Transportation has $3.1 billion in committed projects in 2009. In addition, Illinois is creating a major “inland port” with the development of Union Pacific's new intermodal facility in Joliet that will create an estimated 7,000 jobs.
Iowa's I-Jobs program approved last year has created a three-year, $830 million investment in Iowa’s infrastructure using existing gaming revenue including public improvements, community colleges, veterans homes ($285 million), disaster recovery and prevention ($165 million), improving transportation infrastructure ($115 million), rebuilding universities ($115 million), improving environment and water quality ($80 million), and enhancing telecommunications and renewable energy ($35 million).
Oregon's Job and Transportation Act invests more than $1 billion to address all sectors of Oregon's transportation system, including roads, bridges, bike and pedestrian facilities, mass transit, railroads, ports and airports. Green aspects of the bill included multi-modal transportation, increased transit funding, planning for greenhouse gas reduction scenarios, a congestion pricing pilot project, and an urban trail fund for non-motorized vehicles and pedestrians.

The key to long-term growth is moving infrastructure investments from one-off projects towards integrated investments that connect them into a holistic plan for growth. As Robert Puentes of the Brookings Institution said this past year at a Congressional hearing, "the problem is that there is too little integrated decision making that crosses disciplines and joins-up solutions in infrastructure investments." To achieve maximum effectiveness, transit and other infrastructure investments need to be coordinated not only with each other, but also with land use and housing decisions.

Next Week: State Job Creation Strategies Part II: Supporting Innovation, Industrial Clusters & Green Job Creation

Resources:
Urban Land Institute - Infrastructure 2009: Pivot Point
American Society of Civil Engineers - Report Card for America's Infrastructure with State and Local Report Cards
U.S. PIRG, Smart Growth America, CNT - What We Learned from the Stimulus: And how to use what we learned to speed job creation in the 2010 jobs bill
Progressive States Network - Making Broadband a Key Part of States' Economic Recovery

Take Action: Additional Federal Job Creation and State Fiscal Relief Needed

Altaf Rahamatulla — Tue, 05 Jan 2010 14:34:38 -0500

With the new year, Progressive States Network is working with allies to launch a campaign to demand a new, federal job creation plan that includes fiscal relief to state and local governments in order to foster economic growth and create and maintain jobs. We are asking state legislators to sign onto a letter to promote this job creation plan, the full text of which can be seen at www.progressivestates.org/jobcreation. Legislators can sign the letter at www.progressivestates.org/jobcreation or by emailing jobcreation@progressivestates.org.

We are also asking advocates to sign onto a similar letter for organizations in support of additional federal action on job creation and state fiscal relief. Activists, too, can also take action by using our handy online tool to contact their state legislators to let them know about the job creation letter and to encourage them to sign.

The passage of the American Recovery and Reinvestment Act (ARRA) in early 2009 was critical for staving off a full collapse of the national economy, helping states create and maintain jobs and addressing gaping state budget deficits. By directing a substantial portion of funds towards education and Medicaid, the Recovery Act kept teachers in our classrooms, nurses employed in our clinics and hospitals, and public safety officers protecting our streets.

Nevertheless, economic uncertainty persists. Although the national recession may have technically ended, millions of Americans are out of work and states are struggling to find ways to deal with enormous deficits. High unemployment, a record number of foreclosures, huge cuts to public services, and decreased quality of educational systems threaten long-term recovery.

The gravity of this crisis demands swift and bold action by federal lawmakers on job creation. Accordingly, Progressive States Network is working to highlight state voices advocating for additional action on jobs. PSN encourages legislators to sign on to our letter calling on President Barack Obama and Congress to enact a new, broad-based job plan, including fiscal relief to states and local governments to foster growth and create jobs across the nation.

TAKE ACTION: www.progressivestates.org/jobcreation

Table of Contents:

- 2009 Recovery Plan Provided Significant Support to the Ailing Economy

- Why More Federal Job Creation Funding is Needed

- Economic Benefits of Public Programs: Why Federal Dollars Should Be Invested in the States

- The Need for Federal Action

- TAKE ACTION: Sign on to PSN's Job Creation Letter

2009 Recovery Plan Provided Significant Support to the Ailing Economy

The core of the Obama administration's response to the economic downturn was the passage of the American Recovery and Reinvestment Act (ARRA) last February. In a speech to the Federal Reserve Bank of Chicago in September 2009, Christina Romer, Chair of the Council of Economic Advisers, confirmed that, "[p]roviding $787 billion of tax cuts and spending increases [is] the boldest counter-cyclical fiscal expansion in American history....the key reason that we begin this fall with a sense of hope rather than dread of a second Great Depression is because the policy response in 2008 and 2009 has been fast, bold, and effective."

Indeed, the rapid implementation of the Recovery Act has alleviated the severity of the recession. After four consecutive quarters of decline, the country posted a 2.2 percent increase in gross domestic product (GDP) in the third quarter of 2009. The Council of Economic Advisers finds that the ARRA has had an immense impact on national economic performance and added up to 4 percent to growth in the third quarter. The Congressional Budget Office (CBO) estimates that the ARRA created or maintained 600,000 to 1.6 million jobs as of September 2009 and found it decreased the unemployment rate by almost one percentage point. With large portions of the stimulus funding public education and health care programs in the states, a key part of that job creation program was to keep teachers in the classroom and medical professionals caring for patients across the country. It is estimated that there would be 250,000 fewer education professionals employed across the country without the ARRA funds.

The Recovery Act has not only assisted national economic performance, but has also provided relief to families. The Center on Budget and Policy Priorities (CBPP) analyzed the affect of several provisions of the ARRA, including the expansion of tax credits for working families, temporary strengthening of unemployment insurance benefits, increasing food stamps, and a "one-time payment for retirees, veterans, and people with disabilities," and discovered that the recovery efforts are responsible for keeping over 6 million Americans above the poverty line and alleviating the severity of poverty for almost 33 million.

Why More Federal Job Creation Funding is Needed

Yet, federal action did not go far enough. In fact, several economists called for a much larger recovery package at the time of its passage.

An analysis by the Economic Policy Institute (EPI) entitled Jobs Crisis Fact Sheet provides a somber analysis of the current situation: 15.4 million Americans are unemployed; 38.3 percent of unemployed have not had a job in over six months; 8 million jobs were lost during the recession, which includes 1.6 million lost in construction and 2.1 million lost in manufacturing; 1 in 10 Americans are unemployed; 1 in 6 Americans are underemployed; and 15 states are experiencing double-digit unemployment.

Two recent reports, the Pew Center for the States' Beyond California: States in Fiscal Peril and the National Governors Association and the National Association of State Budget Officers' joint publication, Fiscal Survey of States, both highlight burgeoning budget gaps, precarious economic circumstances, enormous declines in tax revenue, and generally reveal a poor fiscal outlook for states in the upcoming years. Currently, 48 states confront deficits in the upcoming years. In fact, CBPP estimates that states will face cumulative budget deficits of approximately $350 billion in 2010 and 2011. The downturn has additionally taken an enormous toll on tax revenue. Mark Zandi, Chief Economist at Moody's Economy.com, reports that state and local tax revenues have dropped 9 percent from last year, "the largest decline on record going back to just after World War II."

Source: Center on Budget and Policy Priorities - Recession Continues to Batter State Budgets; State Responses Could Slow Recovery

The ARRA played a significant role as a buffer against larger budget cuts this fiscal year, which would have severely hampered economic recovery even further. However, states will again be forced to consider drastic fiscal measures to alleviate budgetary strain that will likely result in enormous cuts to vital social programs, like education and health care. CBPP examined the states' response to shortfalls and notes that to date:

28 states instituted cuts that will limit low-income children's access to health care
24 states have slashed services for the elderly and disabled
36 states have reduced funding for higher education
42 states implemented cuts that affect state employees, including 26 that have hiring freezes, 14 that have announced layoffs, 26 that have decreased wages

Since August 2008, state and local governments have eliminated 132,000 positions from their workforces. Teachers, nurses, public safety officers, and many other state and local employees face the dire prospect of job loss during a time of economic uncertainty. At the same time, families will have to deal with the reality of budget cuts: larger class sizes, an inferior educational system, reduced health care services, and generally diminished quality of vital public programs. Furthermore, as EPI indicates, budget cuts have a detrimental impact on private employment and performance. About half of the economic activity and jobs lost due to budget cuts will occur in the private sector.

Economic Benefits of Public Programs: Why Federal Dollars Should Be Invested in the States

As federal aid to states has a very high economic multiplier effect or "bang for the buck," states are some of the most effective vehicles for job creation. Moody's Analytics finds that every federal dollar spent on extending unemployment insurance benefits fosters $1.61 in economic activity. Similarly, a federal dollar spent on:

Temporarily increasing food stamps creates $1.74 in economic activity
Aiding state governments creates $1.41 in economic activity
Investing in infrastructure creates $1.57 in economic activity

On the other hand, tax cuts and credits generally do not produce similar economic benefits as assisting families or state governments. For instance, a dollar spent on cutting the corporate income tax only results in $0.32 of economic activity. As a result, direct relief to states and a concerted effort to create and sustain jobs for Americans on Main Street is the most prudent course of action.On the flip side, EPI provides the following chart illustrating the unique danger of state budget cuts, which can ripple through the economy as teachers, nurses and police are laid off, state funds supporting private sector activity are reduced, and individuals receiving state support stop spending in their local communities.

Source: Economic Policy Institute - Dire states--State and local budget relief needed

The Need for Federal Action

For these reasons, the federal government must take proactive steps to create jobs and enact further fiscal relief for state and local governments. This includes extending the federal medical assistance percentages (FMAP) increase for Medicaid, providing additional support for education, boosting funding for infrastructure projects and public transportation investments, supporting the long-term unemployed to sustain them until they reenter the workforce, and providing direct and comprehensive financial assistance to state and local governments to perform the vital services needed to maintain growth in local communities.

There is abundant bipartisan support for federal funding for job creation and aid to states. Winthrop University conducted a poll in November 2009 and found that 71.6 percent of respondents favor funding for jobs (94.5 percent identify as Democrats, 53.4 percent Republican, 68.9 percent Independent) and 62.7 percent support "giving aid to states in serious financial trouble" (80.6 percent Democrat, 50.9 percent Republican, 63.6 percent Independent).

Congress has begun taking action. On Wednesday, December 16, 2009, the House passed H.R. 2847, the Jobs for Main Street Act of 2010, which would redirect money from the Wall Street bailout to fund environmental and infrastructure projects, extend FMAP, support education jobs, and provide small business loans. Some of the major provisions include:

$23.5 billion to extend the higher federal match for Medicaid through June 2011
$27.5 billion for highway improvements
$8.4 billion investment for public transportation investments
$23 billion to create and maintain 250,000 education jobs to modernize public education facilities
$1.18 billion to support 5,500 law enforcement positions
$2 billion for clean and safe drinking water projects
$2 billion to address public housing needs
$500 million to retain and hire firefighters

This is a good start, but Congress should go further. The federal government must act boldly to ensure a robust economic recovery and provide relief to working families across the nation. Moreover, federal lawmakers should include provisions for the highest level of transparency in any jobs bill to guarantee that recovery efforts are equitable and efficient. To that end, PSN is a member of States for a Transparent and Accountable Recovery (STAR), a network of groups that work at state and local levels to ensure that the implementation of ARRA is transparent, accountable, fair and effective.

TAKE ACTION: Sign on to PSN's Job Creation Letter

If you are a state or local lawmaker, please sign onto a letter calling on the President and Congress to enact a comprehensive jobs plan, including fiscal relief to states and local governments to foster economic growth and create and maintain jobs. Organizations can sign onto a similar letter as well. Activists are invited to contact their state legislators and ask them to sign on to this letter.

PSN looks forward to working with lawmakers and advocates on this issue. If you are a lawmaker interested in introducing a resolution requesting the federal government to move a jobs bill, PSN would like to assist you in that effort. Please contact us at jobcreation@progressivestates.org.

Resources

2009 Recovery Plan Provided Significant Support to the Ailing Economy

Bureau of Economic Analysis - Gross Domestic Product: Third Quarter 2009
Center on Budget and Policy Priorities - State-Level Data Show Recovery Act Protecting Millions From Poverty
Center on Budget and Policy Priorities - New CBO Report Finds Recovery Act has Preserved or Created up to 1.6 Million Jobs
Congressional Budget Office - Estimated Impact of the American Recovery and Reinvestment Act on Employment and Economic Output as of September 2009
Christina D. Romer, Chair, Council of Economic Advisers - Back from the Brink
Christina D. Romer, Chair, Council of Economic Advisers - On Today's GDP Numbers
Government Accountability Office - Status of States' and Localities' Use of Funds and Efforts to Ensure Accountability
The New York Times - U.S. Economy Started to Grow Again in the Third Quarter

Economic Benefits of Public Programs: Why Federal Dollars Should Be Invested in the States

Center on Budget and Policy Priorities - Additional Federal Fiscal Relief Needed to Help States Address Recession's Impact
Center on Budget and Policy Priorities - Recession Continues to Batter State Budgets; State Responses Could Slow Recovery
Center on Budget and Policy Priorities - An Update on State Budget Cuts
Economic Policy Institute - Dire states--State and local budget relief needed
Economic Policy Institute - Jobs Crisis Fact Sheet
National Governors Association and the National Association of State Budget Officers - Fiscal Survey of States
The New York Times - New Consensus Sees Stimulus Package as Worthy Step
Pew Center for the States - Beyond California: States in Fiscal Peril
Stateline.org - Economist Mark Zandi: On stimulus, jobs, state finances, inflation and the year ahead
Mark Zandi - The Impact of the Recovery Act on Economic Growth
Moody's Analytics - The Case for Another Round of Federal Aid to State & Local Govt

The Need for Federal Action

AFSCME - Legislative Report
Winthrop University - Winthrop Poll Results - November 2009 Findings

Focus on Jobs: The Next Step in National Economic Recovery and State Fiscal Relief

Altaf Rahamatulla — Thu, 10 Dec 2009 13:01:45 -0500

On Tuesday, December 8th, President Barack Obama delivered an address to the Brookings Institution on the need for increased focus on the job crisis that is affecting so many working families across the country. His proposals included key programs administered by the states, such as investments in infrastructure, clean energy investments, the extension of unemployment insurance, and ensuring that states are not forced to lay off teachers, police, and other vital service providers. This would be complemented by direct federal help such as tax breaks for small businesses and extension of COBRA subsidies for the unemployed.

The President stated, "[f]or even though we've reduced the deluge of job losses to a relative trickle, we are not yet creating jobs at a pace to help all those families who've been swept up in the flood. There are more than 7 million fewer Americans with jobs today than when this recession began. That's a staggering figure, and one that reflects not only the depths of the hole from which we must ascend, but also a continuing human tragedy." The speech followed a job summit the President convened last week that featured CEOs, small business owners, labor leaders, and nonprofits sharing insights on methods to foster economic growth.

Reports Detail the Jobs Crisis and the Need for Expanded Recovery Programs: While a new Congressional Budget Office (CBO) study documents that the recovery plan has created or saved as many as 1.6 million jobs, millions of unemployed Americans are still in need of help.

This need for new jobs highlighted by the President is echoed by a recent analysis by the Economic Policy Institute (EPI), entitled Jobs Crisis Fact Sheet. Among their findings:

15.4 million Americans are unemployed;
38.3 percent of unemployed have not had a job in over six months;
8 million jobs were lost during the recession, which includes 1.6 million lost in construction and 2.1 million lost in manufacturing;
1 in 10 Americans are unemployed;
1 in 6 Americans are underemployed;
15 states are experiencing double-digit unemployment.

These bleak figures are exacerbated by state fiscal uncertainty that is forcing lawmakers to consider cuts to vital programs, such as education and health care. As the Center on Budget and Policy Priorities (CBPP) indicates in Additional Federal Fiscal Relief Needed to Help States Address Recession's Impact, total state deficits in FY2011 and 2012 will likely exceed what can be covered by ARRA funding by over $260 billion. Furthermore, "[p]resuming they will get no more fiscal relief, states will have to take steps to eliminate deficits for state fiscal year 2011that will likely take nearly a full percentage point off the Gross Domestic Product. That, in turn, could cost the economy 900,000 jobs next year."

Mark Zandi, chief economist at Moody's Economy.com, expressed a similar sentiment in an interview with Stateline.org: "I think it’s vital states get additional stimulus. If no more aid is forthcoming, then (states will) be cutting jobs, programs and raising taxes… because their fiscal situation continues to deteriorate more rapidly. Tax revenues are still falling at a very rapid clip. So states are going to have a huge hole beginning in 2011 when the current stimulus runs out. I suspect they’ll be cutting spending and raising taxes long before reaching that cliff."

For the unemployed specifically, the National Employment Law Project and the Center for American Progress highlighted in their report Keeping a First Line of Defense for the Jobless that benefits for the unemployed provided by the ARRA recovery plan, from extended unemployment benefits to COBRA health care premium subsidies, have been critical in providing help to jobless individuals and injecting cash into communities hardest hit by unemployment. The report outlines how these programs have helped the economy and why the programs should be renewed.

Renewed Support for States and the Unemployed Needed: Accordingly, any federal job creation and economic growth plan must be accompanied by further fiscal relief for states. Progressive States Network, along with a wide range of allies, have called for a second round of federal stimulus to assist burgeoning state budget gaps.

Resources:
Center on Budget and Policy Priorities - Additional Federal Fiscal Relief Needed to Help States Address Recession's Impact
Center on Budget and Policy Priorities - New CBO Report Finds Recovery Act has Preserved or Created up to 1.6 Million Jobs
The Economic Policy Institute - Jobs Crisis Fact Sheet
The Economic Policy Institute - Plenty of need for a second stimulus
NELP and Center for American Progress - Keeping a First Line of Defense for the Jobless
Progressive States Network - Job Losses and State Fiscal Crises: Time for More Federal Stimulus Spending
Stateline.org - Economist Mark Zandi: On stimulus, jobs, state finances, inflation, and the year ahead
The White House - The Big Picture and Some Next Steps on Jobs
The White House - President Obama Announces Proposals to Accelerate Job Growth and Lay the Foundation for Robust Economic Growth