(Nati Harnik/AP)
June 18, 2013

White House Threatens Veto Of House Farm Bill

The White House is threatening to veto the House version of a massive, five-year farm bill, saying food stamp cuts included in the legislation could leave some Americans hungry.

The House is preparing to consider the bill this week. The legislation would cut $2 billion annually from food stamps and make it harder for some people to qualify for the program. That is around 3 percent of current spending.

The Obama administration said in a statement that food stamps are "a cornerstone of our nation's food assistance safety net.'' The White House argued that the House should make deeper cuts to farm subsidies like crop insurance instead. The bill, which costs nearly $100 billion a year, would save a total of about $4 billion annually, including the food stamp cuts.

June 17, 2013

Visa Exchange Program Draws Scrutiny Under Immigration Bill

Landing a job at a summer camp or at an amusement park is a rite of passage for many young Americans. Those jobs also appeal to foreigners participating in a cultural exchange using J-1 visas. But with U.S. youth unemployment at 25 percent, Congress is now taking a close look at the J-1 visa exchange program.

This visa category was created decades ago to promote cultural exchange. Overseas applicants go through an American company that sponsors, screens and places them in jobs. Most work as camp counselors, au pairs or at amusement parks. Participants must return home afterward.

Joe Davies, one of more than 170,000 such workers who are in the U.S. at any given time on a J-1 visa, came from the United Kingdom to learn about a new culture.

"I wanted to travel when I left education," he says. "I wasn't too sure on what I wanted to do, and at the time I didn't have much money to go out and just work my way around the world. So I looked into the Camp America program."

Now, he works as a lifeguard at a performing arts camp called French Woods in upstate New York. Beth Schaefer, part owner of French Woods, says the camp hires about half of its 400 employees from other countries. Foreign workers don't take jobs away from Americans, Schaefer says. In fact, they are helping to make the camp a success, she says, and that helps preserve jobs for everyone.

"We hire a lot of American staff," Schaefer says. "But, for us, we're able to have people who come in who are really engaged in a different sort of way."

The idea behind the J-1 visa is to bring different cultural perspectives to the U.S. And unlike U.S. teens, foreign workers are motivated less by money and more by adventure — which can be a nice spirit to add to a camp.

Last summer, Davies made only about $1,000 for three months' work. Still, he says he enjoyed the experience and shared his British perspective with American kids.

But critics of the current immigration laws think the J-1 program is not well regulated and can hurt U.S. job seekers. Joe Hanstine, a 17-year-old from Lakewood, Pa., sees the point of the J-1 program but wants it to be more in tune with the local community.

Antonio Basualdo Solorzano has worked at the Ladder Ranch in south-central Wyoming for eight years. On his wages as a guest worker, he's supported seven children back home in Peru.

"Maybe since our unemployment rate is so high and people are always wanting jobs, they should cut back on the foreigners for awhile," Hanstine says.

A provision in the immigration bill now being considered by Congress could change things. Bill Gertz, CEO of the American Institute for Foreign Study, the organization that sponsored Davies, says the proposed legislation could kill these exchange programs.

"If these students do not come into this country, this is the soft diplomacy that the U.S. really needs," he says


Pat Quinn
(Seth Perlman/AP)
June 15, 2013

Illinois Pension Crisis: This Is What Rock Bottom Looks Like

Lawmakers in Illinois are headed back to work next week to address the state's $100 billion pension crisis, the worst unfunded pension liability in the nation.

While almost all states faced pension funding issues during the recession, none of them are looking at a predicament as severe as in Illinois. Every day it doesn't get fixed, the burden on taxpayers grows larger.

"They are in the most dire situation of all the states," says David Draine, a senior researcher at the Pew Center on the States. "Illinois is facing a growing bill that it hasn't figured out how to pay for. The other poorly funded states have at least some sort of plan."

Illinois Stands Alone

The pension issue boils down to simple math. States failed to put away enough money to pay what they've promised their employees for their golden years. Since many public sector employees aren't covered by Social Security, their pensions are often their only retirement safety nets.

When the recession hit, dozens of states saw hits to their pension investments and found themselves overburdened. The National Conference of State Legislatures says that since 2009, 48 states have passed what they consider "significant" reforms to commit themselves to pension payments going forward.

Not Illinois.

Just how dire is the situation now? Each day without a fix digs the Illinois pension hole at least another $17 million deeper. After two recent downgrades, Illinois' bonds are only a few steps above junk status. S&P say that only three states — California, Louisiana and Massachusetts — have ever had ratings as low as Illinois' current level in the last half century. The low rating makes the fiscal situation even more grim, as the state will see its borrowing costs, already among the highest in the nation, rise yet again.

"Every time they want to build a bridge or new school, it's going to make it more expensive, and possibly a lot more expensive," Draine says.

Less Money For Schools, Roads, Seniors

The news doesn't get better from here. The longer action is delayed, the heavier the burden on the Illinois taxpayer. If costs keep rising at the current rate, balancing a budget would require crowding out funding for core government services. "That leaves less money for schools and roads and bridges and prisons and everything the state should be doing," says Draine.

Already, public university debt grows steadily, prison populations are at all-time highs, and nonprofits serving the needy are experiencing delays in getting state payments.

Since the state constitution says public employee pension benefits "cannot be diminished," that means any changes to the way benefits are calculated will likely be met with a slew of lawsuits. Worse, workers may have to delay retirement in order to make ends meet.

And then there's an extreme consideration: "In theory, if it gets bad enough, the money won't be there for retirees," says Draine. If the pension fund becomes insolvent and that state really can't pay up someday, today's middle-class public servants could wind up tomorrow's impoverished seniors.

Failed Efforts At Reform

The specter of these situations hasn't yet moved leaders to agree on a path to reform. Since last summer, Illinois leaders have failed three times to pass pension reform bills. The most recent blown chance came just weeks ago, when the Legislature adjourned without getting a bill passed.

"Their inaction was the equivalent of tying a 32,000-pound weight around the neck of every taxpayer in Illinois," Madeleine Doubek of Reboot Illinois, a digital effort to engage citizens in the fiscal crisis, told NPR's David Shaper. She said $32,000 is what every Illinois taxpayer would be responsible for in order to cover the pension shortfall and pay off a backlog of bills.

To try to resolve the crisis, Illinois Gov. Pat Quinn, a Democrat, called lawmakers back to work for a special session of the state Legislature. "This is an alarm bell for the speaker of the House, the president of the Senate, all the members of the Legislature, to come together and get the job done. The job is, put a bill on my desk so I can sign it into law," Quinn said.

Political Paralysis

It's unclear whether that job will get done. The reform plans previously put forth by the Democratic-led House and Senate differ widely. While both proposals made up some money, the House plan was significantly more aggressive and would dig the state out of debt faster. But no compromise is in sight, even in a state where one party holds all the levers of power. During the regular session, political infighting between leaders in the two chambers kept the House bill from getting a vote in the Senate.

"I'm not sure what dynamics have changed in this pension reform discussion," Illinois Senate Republican Leader Christine Radogno said in a statement. She's not the only one unconvinced.

"The Democrats control everything in Illinois, but they are not unified. They are beneficiaries of labor support, and labor is not very happy because of the pensions proposals," J. Fred Giertz, an economist at the University of Illinois, Urbana-Champaign, told The Christian Science Monitor. "I don't see any end in sight to the problem. I see them muddling through."

The clock's ticking. Researchers at Boston College say without a fix, Illinois could run out of money to pay its retired state employees within the next 15 years.

June 13, 2013

Livingston Co. Eyes Part Of Closed Dwight Prison To House Inmates

The Livingston County sheriff is hoping to convince state and local officials to re-open a portion of the closed Dwight prison for housing inmates from other counties.

Marty Meredith still needs permission from the state and Livingston County Board. The plan would mean housing up to 300 prisoners from the federal prison system, Cook County, and elsewhere - and hiring up to 40 people with prior correctional experience.

The maximum-security women’s facility closed in May as part of a series of cuts made by Gov. Pat Quinn. Meredith said the move will require a roughly $1-million investment from the county, but could generate up to $1.5 million.

He is meeting with state officials next week, and expects to bring his plan before the Livingston County Board by July.

“But before I do that, I want to take it to the people – and let the people of Livingston County – let them make the decision," he said. "I want to put something in the newspaper and even the Associated Press – let people know that please, voice your opinions, because we want to do what’s best for Livingston County, and your voice does have a say here.”

Meredith’s plan would use two portions of the prison: a newer area called the ‘X-House’ because of its shape, and a port where inmates are dropped off.

He said county inmates staying in the prison could be anyone awaiting trial, and those sentenced for less than a year from neighboring counties.

Meredith said he has been working with State Sen. Jason Barickman (R-Bloomington) and Rep. Josh Harms (R-Watseka) on this plan, and the state is working with him as well.

Harms said there's a limit to his efforts, but backs the proposal.  "If the sheriff can get it up and running, you know, you're talking about lots of jobs, revenue for the county, I think it would be a postive," he said. 

Barickman said he's been working to connect Meredith with the Department of Corrections, who knows the cost of running the prison.  "They know what it means to operate the facilty," he said.  "If the county is to take some role in this, they obviously need to learn from the state agencies who have the experience there."  Barickman says all legislators can do is provide local leaders with the information they need to make this decision.

"Once I made contact with state, dealing with (Central Management Services), they've been nothing but great to us," said Meredith, who envisions a day the prison is once again a state facilty. "There's always a hope that we could get DOC back, but we want to be able to use the facility to generate money for Livingston County."

Department of Corrections spokesman Tom Shaer said the agency is always looking for ways to preserve public safety, including re-use of closed prison facilities.

a man being interviewed for a job
(Paul Sancya/AP)
May 26, 2013

Job Searching While Black: What's Behind The Unemployment Gap?

The unemployment rate for black Americans is about double that for whites.

In the classic American story, opportunity is always in front of you. You finish school, find a job, buy a home and start a family; it's a rosy dreamscape.

But that world is one-dimensional. Income inequality is just about as American as baseball and apple pie. And though the economy has improved in the past few years, the unemployment rate for black Americans, now 13.2 percent, is about double that for white Americans.

Persistent unemployment and difficulty getting a job cumulatively impact the so-called wealth gap. Wealth or net worth is defined as a person's total assets — such as bank and retirement accounts, stocks and home value — minus debt. It's what families lean on in a downturn.

In 1984, the wealth gap between blacks and whites was less than $100,000, according to a study out of Brandeis University. That number has since tripled.

"The wealth gap is really where history shows up in your wallet," says Heather McGhee, vice president of policy and outreach at the public policy group Demos. McGhee has spent a lot of time looking at these numbers and what it means for families.

While student loan debt is at record numbers across the board, McGhee says, black college graduates are twice as likely to have student loan debt as their white counterparts, who often use their statistically higher wealth to pay for college and take on less debt.

"It means a difference between the African-American graduate coming out, graduating into a recession ... [and] having to start paying down her student loans," McGhee tells NPR's Jacki Lyden. "Whereas her white classmate actually doesn't and is able to get a job faster."

While it is hard for anyone to educate or work their way into the middle class these days, McGhee says, it is twice as hard for blacks.

She says an uptick in GDP growth doesn't mean that working- and middle-class families are struggling to get by any less. She advocates for something more substantial, like going back to a debt-free college system.

"We created the greatest middle class the world has ever seen ... but by saying, 'We as a country are investing in you,' " she says. "That's what we have to do for today's young generation that is more diverse and is less likely to come from inherited wealth."

Tough Times In Great Lakes State

Michigan has the highest rate of unemployment among black Americans in the country. Nearly 1 in 5 blacks there — 18.7 percent — is out of work.

That's about more than twice the rate for whites in the state, according to the Economic Policy Institute.

On a recent day, 58-year-old Joan Knox was at the Urban League of Detroit, taking part in the group's Mature Worker Program. There she gets computer training while earning a small wage.

Even that small wage has been a godsend for Knox, who has been out of full-time work for more than a decade. At one time she ran her own small business, providing housekeeping and catering services. Then the auto industry collapsed and factories started laying off workers and closing.

"I lost a lot of my clients — the majority — so there went my business because they couldn't afford me," Knox says.

Since then, Knox has subsisted on some small jobs here and there, mostly part-time work. Even when she landed a job at one of the local stadiums, she says, she never got more than 20 hours a week.

"It was quite frustrating," she says.

Knox says she gained a lot of weight and her hair started falling out because she was worried she was "going to be on the streets or knocking on the doors of the shelters."

The mature worker program ends soon, and Knox, who lives with her sister, still desperately needs a job. She'd like to be an executive assistant so she can apply her skills.

"I'm great at multitasking [and] I'm great at making people feel good about themselves," she says. "You know I've gone through it. I didn't know I had it in me, so now I'm finding it's something I can market."

Knox has been trying to spread the word to make that happen. Even if she's just chatting with people on a bus, she lets them know she's looking for a job, what she can do and gives them her contact information in the hope she'll hear from them.

"Each time a door gets closed or the phone never rings or you never get a response back to an email, it's quite frustrating," she says. "And emotionally, it does sort of tear you down and keep you down a bit."

Out Of The Network

Even a hustle like Joan Knox's may not be enough to make up the enduring unemployment gap for black Americans.

"Whites disproportionally hold the best jobs, the jobs with the highest incomes, and we still live in a quite segregated society," says Rutgers Business School professor Nancy DiTomaso. She says deep-seated and unconscious favoritism plays a strong role.

In research for her book The American Non-Dilemma: Racial Inequality Without Racism, DiTomaso began by interviewing several hundred white people from across the country about their job histories.

She found that about 70 percent of the jobs they had held over their lives were obtained thanks to some kind of inside edge or outside help, like a friend tipping them off to an open position or putting in a good word for them.

"It raises questions about people who may not be part of those kinds of networks," DiTomaso tells Lyden. "So when there are opportunities to pass along they are passed along primarily to whites."

DiTomaso says that one of the consequences of people finding a job this way is that they do not think of themselves as participating or contributing to the reproduction of racial inequality. Many of those whom she interviewed, despite receiving significant help in their careers, felt they'd gotten where they were from hard work alone.

"It does seem that there is a public policy issue to be addressed when people are passing along jobs that really don't belong to them," she says.

The Economic Policy Institute finds that the black unemployment rate is projected to remain higher than the overall rate at least through the end of the year.


May 20, 2013

Danville Considers Plan to Keep Jobs from Going to Indiana

The Danville City Council meets Tuesday night to vote on a plan to keep about a hundred local jobs from going to Indiana.

The proposal looks at giving $250,000 in property tax revenue to Danville-based Steel Grip, which designs and produces protective clothing.

The money would help the business re-locate to a new site in Danville.

Mayor Scott Eisenhauer said Steel Grip has already started expanding to Indiana, and it’s considering moving its entire operation to that state.

“It’s even more difficult for us because we are right on the state line and we’re constantly competing to retain or gain businesses against the state of Indiana," Eisenhauer said. "So, this is nothing new. It’s just a matter that we have set aside dollars through different programs to try to keep these business, and more importantly these jobs.”

In the last year, other states, including Indiana, Wisconsin, and Texas, have pointed to Illinois' economic troubles and massive pension debt to lure businesses across state lines.

As an additional incentive to keep Steel Grip in Danville, Eisenhauer also wants to offer the company $350,000 from a fund used to support economic development projects.

Volunteers sort donated food into barrels at the Manna Food Center in Gaithersburg in Montgomery County, Md. Poverty in the county, just outside of Washington, D.C., has grown by two-thirds since 2007.
(Gabriella Demczuk/NPR)
May 20, 2013

Advocates Struggle to Reach Growing Ranks Of Suburban Poor

Poverty has grown everywhere in the U.S. in recent years, but mostly in the suburbs.

During the 2000s, it grew twice as fast in suburban areas as in cities, with more than 16 million poor people now living in the nation's suburbs — more than in urban or rural areas.

Elizabeth Kneebone, a fellow with the Metropolitan Policy Program at the Brookings Institution, says this shift in poverty can be seen in Montgomery County, Md., right outside the nation's capital.

"Montgomery County is one of the wealthiest counties in the country," she says, noting the streets lined with luxury apartments, big homes and crowded restaurants. "But it also has a rapidly growing poor population."

Kneebone, co-author with Alan Berube, of a new book from Brookings, Confronting Suburban Poverty in America, says poverty in Montgomery County has grown by two-thirds since the recent recession. That means 30,000 more residents living below the federal poverty line — about $23,000 for a family of four.

That doesn't buy much in a suburban area with a high cost of living. By some estimates, a family of four in Montgomery County needs more than $80,000 a year to meet basic needs.

Hidden Among Affluence

Kneebone says, around the country, the suburban poor live in low-income and working-class neighborhoods. "But it's also occurring in places we think of as more affluent," she says. "And, in fact, it may be even more hidden there because we don't expect to find poverty in those communities."

On a tour of Montgomery County, Kneebone stops at one place where the growth in poverty is not a surprise: Manna Food Center in Gaithersburg, where about two dozen people are lined up for food.

One of them is Polly Maxwell, 64, who walks with the help of a cane. Maxwell says she started coming here a couple of years ago. After working 38 years at a local hospital, mostly in medical records, she now lives on disability checks.

But Maxwell says things have gotten way too expensive. She spends half of her income on the $800 a month rent for her efficiency apartment.

"What you were making in two weeks when I was working, that's what I make a month," Maxwell says. "I mean, it's hard. And I just never thought it would be like that. So, you have to get used to that, you know. Some of your money lasts a month, sometimes it doesn't."

And she's hardly alone. This center, like food pantries across the country, has seen its caseload double since the recession.

Kneebone says Montgomery County is fairly typical. Suburban poverty has grown nationally because low-income families moved from cities — or other countries — in search of better schools, affordable housing and jobs. But she says it's also about people like Polly Maxwell — long-time suburbanites who have gotten poorer.

"And the Great Recession was particularly severe — widespread job losses, many of them concentrated in suburban communities hit hard by the collapse of the housing market and the loss of construction jobs and related services," Kneebone says. And even though jobs are coming back to the suburbs, she says many pay too little to make ends meet.

Kneebone says even social services and charities have been slow to recognize the shift in need. Most of their resources still go to the nation's cities, where there's a long history of serving the poor.

Shifting Focus Beyond The City

The nonprofit Mary's Center has been providing medical and other help to the poor for 25 years in the Washington, D.C. area. But until recently, all of its facilities were located in the city. That changed in 2008, when it opened a site in Montgomery County, in an area that serves many immigrants. It opened another suburban center last year.

"We were figuring out that when we were over there at the other sites that we have in D.C., there was a lot of population from Maryland who were traveling from here to there," says Zulma Aparicio, site director of the two suburban locations. "And they were paying fares for the bus, metro and all of this. And now they continue paying, but it's closer."

Brookings' Elizabeth Kneebone says that transportation is a big issue for the suburban poor. Everything is so spread out, it can be hard to get where you need to go to meet basic needs, especially if you don't own a car.

But Montgomery County is trying to take steps to address the problem. The county's Neighborhood Opportunity Network operates three one-stop shops for struggling families. Pearline Tyson, the network's program manager, says the county opened the three centers in neighborhoods it knew had been especially hard-hit by the recession.

"They knew that some people would be intimidated by going to a [bigger] regional center to apply for benefits. Especially people who had never received benefits before or who were not familiar with government services," Tyson says.

Instead, the neighborhood centers are intimate and accessible. One is located in Gaithersburg, in what looks like a typical suburban office park. But it's filled with non-profits and social service agencies, instead of businesses. People who come to the center are assigned a county worker who helps them navigate what can be a labyrinth of benefit programs and charitable services.

Geography Matters

For Akouavi Davi and her husband, who came here from West Africa, it's been a godsend. I'm so happy, because I know I have someone to help me now," she says.

The family had been getting by on its own until a back injury forced Davi to give up her job at Wal-Mart. Then their daughter left their small grandson, Joshua, in their care, and now, only her husband works, as a security guard.

"We have electricity problem. We have apartment problem. I have health problem, I don't have insurance," Davi says.

And to complicate matters, she doesn't drive. The family recently moved from a neighborhood further out in the county, where there are no buses, to a place near the center, where there are plenty.

Kneebone says when you're poor, geography matters. Low-income residents can spend long hours trying to get services — time that might be better spent working, or going to school. She says at least this county is trying to adjust. Many have yet to do so.

"We're still thinking about poverty where it was in 1964 when President Johnson launched the War on Poverty. The reality on the ground today is just very different," Kneebone says.

And that reality, she says, is unlikely to change if people don't know that it's there.


May 17, 2013

AFSCME Gives Final OK to State Contract

Illinois' largest union has given the final go ahead on a three-year contract with the state.

The American Federation of State, County and Municipal Employees Council 31 announced Friday that a second ratification is complete. The union and Gov. Pat Quinn reached agreement in February after negotiating 15 months.

The union gets salary increases in the last two years, but members pay more for health care.

AFSCME took a second vote because Attorney General Lisa Madigan hasn't dropped a lawsuit Quinn pressed over raises due in 2011 and 2012. The first vote was based on Quinn's promise to drop it. 

In the contract, Quinn agreed to pay the back wages. He needs a $140 million appropriation from lawmakers.   

Madigan says she won't drop the lawsuit until the money is approved.

May 16, 2013

Illinois Jobless Rate Dips to 9.3 Percent in April

Illinois' unemployment rate improved slightly in April, dipping to 9.3 percent compared to 9.5 percent in March.

Preliminary data released Thursday by the Illinois Department of Employment Security shows that there were 2,000 fewer jobs in April, despite the improved unemployment rate.

IDES spokesman Greg Rivara says that could indicate that fewer people were looking for work in April, possibly because of bad weather. There were 40,300 more jobs in Illinois than there were last April and 216,000 more private-sector jobs than in January 2010.

Even so, Illinois' unemployment rate remains well above the national average of 7.5 percent.

IDES Director Jay Rowell says the April data reflect the unevenness of the state's economic recovery.

He says that's like to continue until consumer and business confidence can be sustained nationally.

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