Bush’s Jobs Policy, Short on Spending, Dismays Liberals
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
WASHINGTON – In what sounded like a centrist, almost Clintonian moment in his convention speech last week, President Bush declared the government must “take the side” of workers who face a “dramatically changing” work environment.
Mr. Bush also promised to do more to retrain adult workers and equip them with “higher-level skills,” and packaged the policy in conservative, individualistic, pull-yourself-up-by-the-bootstrap terms.
“We seek to provide not just a government program, but a path, a path to greater opportunity, more freedom and more control over your own life,” Mr. Bush said at the time.
But much to the dismay of liberal policy advocates, the guts of his plan do not involve major spending increases to government programs, some of which he recently cut. They involve restructuring some existing programs that conservatives say should be eliminated as a waste of money.
The proposal getting the warmest response from across the political spectrum was not stressed in his speech. It involves opening up student loans and federal educational Pell grants to adult workers who want to gain new skills and industrial certifications.
Rather than limiting the $12.9 billion program to college students, the president wants to make the grants, which run up to $4,050, as well as low-interest loans, available to anyone who wants to earn credentials such as software certifications recognized by companies like Oracle, Cisco, or Microsoft.
“The president has always wanted to help people become self-sustainable,” said the Bush campaign’s deputy policy director, John Bailey.
The notion is that the government can support “lifelong learning” through loans, grants, and a promised $250 million funding increase for community colleges that craft job-training programs in concert with local employers.
“The time when people were educated for a certain portion of their life and then went to work has changed. People have to repeatedly keep getting new skills to keep current,” Mr. Bailey said.
The grants and loans are “a potentially large change,” said an economist at American University and the Urban Institute, a non-partisan social policy think tank, Robert Lerman. “That could open up training to a large number of people who aren’t necessarily enrolled in community college, but want more training and have low incomes right now,” he said.
The idea has “a lot of merit,” agreed Krista Kafer, an education policy analyst for the conservative Heritage Foundation, who compares Pell grants to higher-education “vouchers.”
“Private entities have always done a more effective job of training that government entities. This really would put the power into the hands of the workers to go to the operator or provider that best meets their needs,” she said.
Listening to his speech, it was easy to conclude that Mr. Bush also plans to expand the government’s job-training program under the $4 billion program called the Workforce Investment Act. But a close read of his comments shows he instead promised to “double the number of people served by our principal job-training program.”
The plan is not to increase funding for the program but to cap the administrative costs by consolidating various programs that serve groups such as recently unemployed people, young people, and migrant workers.
The Labor Department predicts it could save $300 million to pay for the training of another 200,000 workers per year by streamlining and “cutting red tape.”
“I don’t see any additional money. They say they will cut red tape to save money. I don’t know what that means exactly,” shrugged Mr. Lerman.
Part of the theory behind job training is that, unlike subsidies or tax breaks for a particular firm, the workers themselves will become employable and form a skilled labor pool that will draw numerous employers.
Conservatives say there is little evidence the federal program works.
“A number of studies done on other government training programs and have found they don’t result in any significant improvement in incomes. They don’t hurt, but they don’t seem to help much,” said a fellow in labor policy at the Heritage Foundation, Paul Kersey.
“Tax cuts would be the better approach to stimulate investment and allow jobs to be created,” he said.
According to the Labor Department, 202,844 people “exited” various federal job-training programs in 2002. The department said 74.4% found employment, and of those,82.8% still had a job six months later. Their average increase in income was $3,045 per year.
“We think it’s a good starting point and we want to improve upon that,” Mr. Bailey said.
The president also announced he would increase funding for community colleges by $250 million to work with businesses to train workers in skills that are in demand.
The announcement drew a chilly reception from critics, who pointed out that $300 million was cut from programs that fund community colleges in the last budget.
“There is a consistent and recurring pattern where he promises progressive reforms and then he doesn’t fund them,” said the director of the technology and new economy project at Progressive Policy Institute, Paul Atkinson.
In his speech, Mr. Bush also proposed creating “American opportunity zones” in communities that have lost manufacturing, textile, and other jobs.
Such “zones” offering tax breaks to businesses and social spending for residents have been used to help impoverished communities under the administrations of Presidents Clinton and George H.W.Bush. The new twist is that rather than using poverty as the main criteria, officials will look at large recent job losses.
“We are expanding the concept of enterprise zones to focus on communities transitioning from old economy to the new economy,” Mr. Bailey said.
The plan is to designate 28 urban and 12 rural zones that will receive tax incentives for businesses, as well as priority access to money for affordable housing and telecommunications projects, education grants for schools, and grants to community college for job training.
The zones draw mixed reviews.
“What I find odd about all these things is they are run against the grain of historical economic development. The whole history of opportunity is of people moving to economic opportunity, not opportunity moving to people,” said a fellow in economic studies at the Heritage Foundation, Ronald Utt. One 1999 study has shown that property values in the zones have not increased, a signal that they are not improving matters in a measurable way.
“But that is not a particularly politically attractive thing to tell people in Ohio – that there is opportunity in Texas,” he said.
Mr. Bailey said the president has been impressed with zones in Michigan and Pennsylvania that have been shown to be “effective in attracting and keeping jobs.”
Overall, Mr. Bush’s proposals are “moderately, potentially helpful,” said the Urban Institute’s Mr. Lerman, “but neither candidate is really attacking the problem,” of worker training because vocation-skills training remains an after-thought in American society.
“We have developed this college-for-all-policy in the U.S., and it doesn’t serve us as well as having a broader array of quality career options,” he said.