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Putting America Back to Work

The United States is facing its worst unemployment crisis in 70 years. Nearly 16 million Americans are jobless. One third of them have been without a job for more than six months.

By Gonzalo Baeza

AFSCME has launced a campaign to save jobs and secure billions in fiscal relief for states. Our efforts are beginning to pay off.

By Gonzalo Baeza

The United States is facing its worst unemployment crisis in 70 years. Nearly 16 million Americans are jobless. One third of them have been without a job for more than six months. At the same time, states face unprecedented budget shortfalls and have begun to put more services — and jobs — on the chopping block. If Congress doesn’t act immediately, the situation is bound to get worse. After all, how can the nation gain jobs at the same time they are being cut?

In these troubled times, we need to create jobs with targeted support for states and local governments that will put people back to work, pave the way for economic recovery and help provide the public services that protect our communities.

Our First Victories

This is why in early February President McEntee announced a campaign to support a jobs bill and secure new investment in state and local governments. We must look for the most effective ways to bring down unemployment.

This unprecedented effort by AFSCME started off with a national “call-in day” on February 10. Thousands of AFSCME activists from across the country called U.S. senators asking them to fight for a jobs bill. Affiliates are also reaching out to senators and senior congressional staff to secure support for state and local aid.

Since then, AFSCME members have held dozens of press events across the country to bring home the fact that jobs must be Congress’ number one priority. At the same time, AFSCME has issued comprehensive state-by-state reports on the jobs picture and how the legislation we support could help the economy. This information has been shared with governors and local elected officials as well as released to the press. These ongoing activities are part of our union’s Make America Happen campaign to strengthen the middle class and jumpstart the economy.

The hard work of AFSCME members is starting to pay off. As we went to press, the U.S. Senate passed a $140 billion jobs bill including one-year extensions of unemployment insurance and COBRA benefits (health insurance) for unemployed workers. The legislation also extends the Federal Medical Assistance Percentages or FMAP, the percentage rates used to determine the amount of matching funds for state medical and social service programs. Through FMAP, states will now get an additional $26 billion in funding to help pay for Medicaid.

As President McEntee said upon the bill’s passage, “With the vote in the Senate, every state’s fiscal year 2011 budget will now have additional dollars available for many of the jobs our members do.” As a matter of fact, it includes enough investment to save more than 300,000 public jobs in the second half of fiscal year 2011. The bill is one in a series of legislative initiatives by Congress to boost employment.

It passed despite receiving a “nay” vote from a majority of Republicans, who seem determined to obstruct every major piece of legislation that would alleviate the jobs crisis. This political posturing, to reap short-term political benefits, was most evident in a recent statement by Sen. John Kyl (R-Ariz.) regarding his opposition to extending unemployment insurance. According to the Republican Senate whip, “Continuing to pay people unemployment compensation is a disincentive for them to seek new work.” This attitude has become common among Republican members of Congress and it is bound to be a major hurdle for working families in the future.

The Fight Has Just Begun

Whether it’s clearing the roads of snow and ice, providing health care services or ensuring public safety, the vital services that AFSCME members provide make America happen. Nonetheless, nearly a million of these public and private sector jobs could be lost this year. To make matters worse, states are facing an estimated $260 billion shortfall in 2011 and 2012.

Economists on the left and right agree that investing in public services is one of the best ways to save and create jobs. According to Mark Zandi, chief economist of Moody’s Economy.com and former advisor to Sen. John McCain (R-Ariz.), the most effective way to stimulate local economies and increase job creation is to inject federal assistance into the state programs that are having problems. Zandi has found that every dollar invested in public services grows the economy by $1.41.

AFSCME is also supporting the Local Jobs for America Act (LJAA), a bill introduced by Rep. George Miller (D-Calif.) seeking to create or save up to one million jobs in both the public and private sectors. LJAA will provide local communities nearly $75 billion over two years to stop planned cuts or hire back public workers previously laid-off because of budget constraints. It also includes $24 billion — already approved by the House in December — to help states support 250,000 education jobs, put 5,500 law enforcement officers on the beat, and retain and hire firefighters.

Likewise, our union is fighting to secure emergency funding for the State Fiscal Stabilization Fund, money that can be used flexibly for government services and state aid to localities.

Jobs for Main Street

In 2009, Congress passed the American Reinvest-ment and Recovery Act (ARRA), a stimulus bill that was an invaluable first step toward economic recovery. The investments in the bill pulled us back from the brink of economic collapse and injected desperately needed funds into local economies. A recent report by the nonpartisan Congressional Budget Office (CBO) indicates that by the end of 2009 the economic stimulus law had created as many as 2.1 million new jobs. The study also states that the bill grew the economy by as much as 3.5 percent last year. The CBO projects the measure to have an even stronger impact in 2010, increasing gross domestic product by as much as 4 percent and reducing unemployment by as much as 1.8 percent.

The figures reflect a consensus from economists across the board that the initiative was effective in boosting the economy. Before Congress passed ARRA in February 2009, the recession had been going on for over a year and the country was shedding 20,000 jobs each day. By the time ARRA became law, 5.9 million jobs had already been lost. It is hard to determine how much more damage the stimulus bill prevented considering how the national unemployment rate stands at slightly under 10 percent. According to a report by the Economic Policy Institute, without the 2 million jobs generated by the Recovery Act, unemployment would easily exceed 11 percent.

While ARRA saved thousands of AFSCME jobs by helping states and cities avoid even bigger budget cuts, this recession is worse than anyone imagined, and state and local governments need more help. The bulk of ARRA’s aid is set to expire by the end of 2010, including key items such as additional funds for Medicaid and education. Without an additional boost, states will be forced to continue pulling the plug on the services that are the foundation of the nation’s economy.

AFSCME has been waging the fight for jobs on multiple fronts. Thanks to our efforts, the U.S. House of Representatives passed in December the Jobs for Main Street Act of 2010, an initiative that would redirect unspent funds from the 2008 Wall Street bailout to create jobs and stabilize employment. The money would be used for infrastructure investment, saving public service jobs and continuing emergency funding for families hurt by the economy.

We have started to pull our economy from the brink. It’s time for everyone to get involved in this effort. With the strength of 1.6 million members, we can put America back to work.

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