Assuring opportunity for all Iowans

New Census data highlight the need for Iowa policymakers to ensure that all can fully contribute to Iowa’s economy

New Census data highlights a slight decline in Iowa’s overall poverty rate, though not all racial groups benefited from this advance. Stagnating household incomes and poverty rates among working Iowa families of color over the past 10 years mean that economic gains aren’t broadly shared among racial groups in Iowa.[i]

180915-MedianIncome_Race_IA

Ways that the Iowa Legislature could strengthen economic security for families of color include:

  • expanding the Earned Income Tax Credit (EITC);
  • ensuring that high-income Iowans and corporations pay their fair share of taxes;
  • raising the minimum wage; and
  • investing in preschool and K-12 education.[ii]

In recent days, the U.S. Census Bureau released new 2017 data covering poverty, income, and health insurance coverage.

Iowa showed a slight decrease in family and child poverty rates and an increase in household incomes. The outdated poverty guidelines fail to capture what it really takes to get by in Iowa.[iii] Our Cost of Living in Iowa research builds basic needs budgets for multiple family types across Iowa. Our 2018 analysis found that 30 percent of black working households and 28 percent of Latino households were unable to meet basic needs. This compares to 16 percent of white households.[iv]

The median household income for black Iowa families was about half of white family household incomes in 2017. White households are the only group who saw a statistically significant increase in household income over the past 10 years. Poverty rates declined for white and Latino Iowans between 2016 and 2017. However, poverty rates for black, Asian, Pacific Islander, and Native American Iowans have remained the same.[v]

Communities of color in Iowa continue to face barriers to economic prosperity. These include structural factors such as hiring discrimination and a lack access to quality jobs, great schools, and convenient transportation. Latino and Black families are disproportionately low-income. Further, they pay a larger portion of their income in sales and property taxes relative to more affluent Iowans.[vi]

Moving to a less regressive statewide tax system for families while closing corporate tax loopholes to assure stronger investments for all Iowans would work to dismantle some of the barriers to economic success for all Iowans and particularly families of color, who the latest data show are disproportionately impacted.

Expanding the EITC and raising the minimum wage would contribute to more broadly shared prosperity, as would restoring Iowa’s traditional commitment to education. Education funding in Iowa has lagged in K-12 and opportunities to advance in college are threatened by state cuts in support. Iowans and their leaders should be looking to solutions that improve equity and opportunity for a new generation of Iowans.[vii]

[i] U.S. Census Bureau, “Poverty Status in the Past 12 Months.” September 2018. American Community Survey 1-year estimates. factfinder.census.gov/

[ii] Erica Williams, “States Should Adopt Policies to Help Dismantle Racial Barriers to Broader Prosperity.” September 2018. The Center on Budget and Policy Priorities. https://www.cbpp.org/blog/states-should-adopt-policies-to-help-dismantle-racial-barriers-to-broader-prosperity

[iii] Ibid.

[iv] Peter Fisher and Natalie Veldhouse, “The Cost of Living in Iowa 2018 Edition Part 2: Many Iowa Households Struggle to Meet Basic Needs.” July 2018. Iowa Policy Project. http://iowapolicyproject.org/2018docs/180702-COL2018-Part2.pdf

[v] Ibid.

[vi] Ibid.

[vii] Ibid.

2018-NV-6w_3497(1)Natalie Veldhouse is a research associate at the nonpartisan Iowa Policy Project. nveldhouse@iowapolicyproject.org

Labor Day: Celebrating what was, and what could be

This Labor Day could be the low-road benchmark for celebrations of improvements to be seen in the future, reversing current trends against working families.

As always, Labor Day is a day to celebrate Americans’ work ethic and spirit — things that hold promise for better times ahead.

But it is not a time to celebrate what has been happening in Iowa.

A look at the landscape for working families shows this Labor Day could be the low-road benchmark for celebrations of improvements to be seen a year, two years, maybe 10 years from now.

Iowa lawmakers repealed local minimum-wage increases in four counties that acted when state and federal leaders refused. Iowa’s minimum wage is a measly $7.25 an hour and has been held there for 10 1/2 years; some 400,000 workers — and their families — could gain with a raise to $12. (IPP report, 2016) Twenty-nine other states have acted, including all but two of Iowa’s neighbors.

In the middle, Iowa as usual lags the region and the nation, as IPP Senior Research Consultant Colin Gordon showed in a wage update for The State of Working Iowa.

Even at higher wage levels, Iowans are falling short. As Gordon noted:

Colin Gordon

“(T)he wage structure in Iowa is more compressed than it is nationally or in the Midwest. Low-wage workers in Iowa make about the same as low-wage workers everywhere else, but at the higher wages, Iowa workers fall further and further behind. Higher wage jobs are scarcer in Iowa than in most states. And wages in many professions — such as nursing or teaching — trail national and regional peers by wide margins.

“The key point here is not just that wages have stagnated, but they have done so over an era in which the productivity and educational attainment of Iowa workers have improved dramatically.”

If the wage levels weren’t lagging enough already, policy makers have utterly failed Iowa workers by refusing to assure that wages owed are actually paid. Wage theft — refusing to pay wages owed, or violating overtime and employee classification rules — is winked at by a state system that devotes too few resources to enforcement. Lawmakers have refused to act.

Lawmakers deliberately smacked working people with significant legislation in the last General Assembly in at least two other areas:

•   They curtailed collective bargaining rights of public employees, making it tougher for them to organize, and tougher for them to negotiate. In the arena where the state, counties, cities and schools should be leading by example on how to treat employees, the Legislature has chosen to push Iowa toward a race to the bottom. And make no mistake about the impact on the economy: Public-sector jobs are 1 in 6 of all jobs in the state.

•   They also passed legislation to erode workers’ protection and financial security long provided through Iowa’s workers’ compensation law. A study of the effects of one change, reclassifying shoulder injuries, found that the typical worker with such an injury could expect to receive 75 percent less under the new rules.

On top of these, we see the University of Iowa unilaterally acting to eliminate, or eliminate funding for, its own Labor Center that serves thousands and helps Iowans understand what rights they have in the workplace.

And we can count on a continuing assault on Iowa’s strong and accountable public employees’ retirement plans — not to help employees or actually save money, but to feed the ideological drive against public services that is illustrated in examples above. How better to damage those services than to lessen the attraction of jobs that provide them?

Celebrate Labor Day for the people who work to make our nation great. Keep in mind throughout the day that forces are trying to undermine the security of working families — and that Iowans can come together behind policies to support all.

Think of how much better that Labor Day burger off the grill will taste — in some future year — with a side of responsible minimum wage and workplace protection laws, topped off with a stronger economy that will result as more Americans prosper.

Mike Owen is executive director of the nonpartisan Iowa Policy Project. mikeowen@iowapolicyproject.org

 

Labor Center: Inviting public discussion

These Labor Center public hearings are an example of what the University of Iowa should have done, on its own — before the decisions were made.

One of the most unsavory parts of the threats to the University of Iowa Labor Center — though not the only one — was the lack of public input into the decision by university officials.

The decision was “announced” under the public radar. Only after the word started spreading about the decision already made, the university decided to go public.

Increasingly, this is how decisions are being made in Iowa by government institutions — the Legislature has been a great example of it in the last two years with attacks on protections for working families and on equity in the tax code. The UI handling of the Labor Center decision is right in line.

These approaches defy Iowa values of transparency and public spirit once treasured in a state once proud of its openness. As we shall see in the coming days, there is an alternative: A reintroduction to the concept of a public hearing.

The “Save Our Labor Center” coalition will hold four such hearings in the coming days in various locations around the state. Each is an hourlong event starting at 6 p.m. Here are the dates and locations:

  • Tuesday, Aug. 14, Des Moines — UAW Local 450 Hall, 4589 NW 6th Drive.
  • Thursday, Aug. 16, Cedar Rapids — IBEW Local 405 Hall, 1211 Wiley Blvd SW.
  • Wednesday, Aug. 22, Bettendorf — USW Local 105 Hall, 880 Devils Glen Road.
  • Tuesday, Aug. 28, Sioux City — UFCW Local 222 Hall, 3038 S. Lakeport St.

As the group notes in flyers it has produced for these hearings:

“University leaders took NO INPUT from any of the workers, students, faculty, or community members who rely on the Labor Center’s education and research prior to announcing their decision. Iowa’s public universities must hear from the public before making major decisions with significant, permanent impact on students, working Iowans, and communities across the state.”

For more information, you can contact saveourlaborcenter@gmail.com.

The Iowa Policy Project works with the University of Iowa Labor Center at times to enhance an understanding of public policy issues, and our staff has found the center to be a tremendous resource for Iowans.

A public university has a fundamental responsibility to the public and to public decision making that is being lost. These hearings are an example of what the University of Iowa should have done, on its own, well in advance of a backroom decision being dumped in the laps of Labor Center staff and the many Iowans who benefit from its work.

It might be interesting to see if anyone from the University of Iowa administration or the Board of Regents shows up at any of these hearings. It would be to their credit to do so, and to listen.

Mike Owen is executive director of the nonpartisan Iowa Policy Project. mikeowen@iowapolicyproject.org

The weekend Iowans fool themselves

Think about it: How often do you rush off to a ‘7-percent off’ sale?

It’s here again — the weekend when Iowans buy into some really bad political spin, but leave happy about it because they don’t pay tax on the purchase.

Today and Saturday are the dates of Iowa’s sales tax holiday, which we have noted many times — including here, here and here — is a shopping bag full of nonsense.

As IPP’s Peter Fisher noted in 2014, the third link above, “Who’s to say a retailer, with this officially sanctioned ‘holiday’ marketing, won’t bump prices by 10 percent or call off a 20 Percent Off sale that might have been in place?” Instead of revenue for schools, it’s a recipe for a retailer’s windfall.

Iowa media quite often play along, with rarely a discouraging word challenging the notion of the break, questioning whether any break actually results, and, importantly, how much it costs public services. (It was $1.6 million in its first year, 2000, and by 2015 the break was valued at $3.6 million lost to services.)

Neither does the Iowa Department of Revenue shed light on these issues, which are at least as important as a list it offers of what you can and cannot buy tax-exempt on these hallowed anti-tax days.

Certainly, the sales tax is one that disproportionately hits lower-income people harder than high-income people. The evidence is clear on that. And reducing the impact of the sales tax year-round would be a sensible step if paired with an income-tax increase affecting higher-income people — same revenue, fairer approach.

But this break goes to anyone, so those very wealthy Iowans who are the largest beneficiaries of the income-tax cuts passed in 2018 also get an extra break here.

And there we have the two largest problems with Iowa tax policy: It is inequitable, and it is based on political spin that ultimately harms the public services we depend upon.
Mike Owen is executive director of the nonpartisan Iowa Policy Project in Iowa City. mikeowen@iowapolicyproject.org

Eye on the ball: Wages and the cost of living

Public policy debates now and on into 2019 should keep this fact in focus: Working families in Iowa must earn substantially above the official poverty threshold just to get by.

 

 

 

Our 6th edition of The Cost of Living in Iowa finds that roughly 100,000 Iowa working households are unable to make basic needs.[1] Put another way, about 17 percent — or 1 in 6 — households cannot get by on their income alone. It is a critical number that should inform countless public policy discussions for the remainder of 2018 and on into the next legislative session.

Part One of this report details how much working families must earn in order to meet their basic needs, while Part Two estimates the number and proportion of Iowa working households able to earn enough. This latest edition adds new analysis by race, Hispanic origin, and gender.

These pieces provide the foundation for Part Three, which is forthcoming and will connect the dots further illustrate the importance of public work support programs for many Iowans, who despite their work efforts, are not able to pay for the most basic living expenses.

We construct basic needs budgets that represent what it takes to survive rather than thrive in the state of Iowa. These budgets include allowances for rent, utilities, food prepared at home, child care, health care, transportation, clothing and other household necessities. The basic budget does not include savings, loan payments, education expenses, any entertainment or vacation, social or recreational travel, or meals outside the home.

In Part One, we find statewide that a single parent with two children needs to earn a wage of $23.91 per hour in order to meet basic needs. A two-parent household with one child and one parent working need an hourly wage of $13.29, compared to $16.30 for the same family type with two workers. Differences in cost from one county to another can be dramatic. The total annual basic needs budget for a family with two working parents and two children was $10,600 higher in the highest cost county compared to the lowest cost county. No family type is able to meet basic needs on Iowa’s $7.25 minimum wage.

Part Two uses census data to estimate the number of Iowa working households that are able to meet the basic needs without public assistance. In 2018 we find that 17 percent of households or 227,000 Iowans live below this threshold.[2] Broken down further, fully 62 percent of single-parent working households are unable to meet basic needs. For this family type, there is an average gap of $20,000 between after-tax income and basic needs expenses. A larger share of African American (30 percent), Hispanic (28 percent), and female-headed (19 percent) households are unable to meet basic needs in Iowa.

The cost of living in Iowa continues to rise. Working families and individuals in Iowa must earn substantially above the official poverty threshold — in some cases nearly three times the poverty level — to achieve a very basic standard of living in Iowa without the help of public supports. Part Three of The Cost of Living in Iowa 2018 will show the role of work support programs in bridging this gap.

[1] The Cost of Living in Iowa, 2018 Edition, Part 1: Basic Family Budgets. Peter S. Fisher & Natalie Veldhouse, July 2018, the Iowa Policy Project. 

[2] The Cost of Living in Iowa, 2018 Edition, Part 2: Many Iowa Households Struggle to Meet Basic Needs. Peter S. Fisher & Natalie Veldhouse, July 2018, the Iowa Policy Project. 

Posted by Natalie Veldhouse, research associate for the nonpartisan Iowa Policy Project. She and IPP Research Director Peter Fisher are the authors of the latest edition of The Cost of Living in Iowa. nveldhouse@iowapolicyproject.org

A University ‘for’ Iowa, or just ‘in’ Iowa

If the University of Iowa is serious about its strategic plan, it would recognize that jewels like the Labor Center demonstrate a commitment to the mission of a flagship public institution.

There are lots of good reasons not to shutter the University of Iowa’s Labor Center.

For starters, any such move would be rash, shortsighted, and wasteful. The Labor Center’s core continuing education mission teaches labor leaders about workers’ rights, about civil rights in the workplace, and about occupational health and safety. Those who have benefited from these courses over the years credit the Labor Center with helping them — and their local unions — sustain workplaces which are safer and more equitable.

For the pittance in state funds (about $500,000) devoted to the Center, the returns the state — in fewer harassment claims, fewer workers’ compensation settlements, fewer cases of wage theft — are incalculable.  Closing the Labor Center, in this respect, is like taking down the stoplights at an intersection: you could claim savings in signage and electricity as a result, but at what cost?

In turn, the threat to the future of the Labor Center — the only academic center in the Regents system devoted to work and workers in Iowa — sends a terrible message to the state’s working families. In an era of spiraling inequality, when the combination of stagnant incomes and rising tuition are putting a college education increasingly out of reach, do we really want to harden the perception that the state’s universities only serve the interests of the upper classes? There are about 1.6 million wage earners in Iowa, a quarter of whom do not earn a wage sufficient to climb above the poverty line.  These Iowans — as citizens, voters, taxpayers, and parents — should know that the state’s public institutions are for them too.

And finally, the University’s claim that the Labor Center is peripheral to its academic mission is simply not true. The University’s current strategic plan sits on three pillars: student success, research, and engagement. The Labor Center contributes on all of these fronts, and especially on engagement and outreach to the rest of the state. On this score, the strategic plan argues that the University should “enhance UI’s statewide visibility and increase access to UI expertise,” “support the translation of intellectual work into applications to enhance economic development,” and “create lifelong learning opportunities that broaden UI’s reach across Iowa.”

The Labor Center does all of this and more. It is one of the few arms of the University with a sustained and serious “extension” mission to the rest of the state. If the University is serious about its strategic plan, and about proving its value to those outside Johnson County, its best option is to nurture such forms of engagement with off-campus Iowa constituencies rather than abandon them. It is jewels like the Labor Center that demonstrate a commitment to the mission of a flagship public institution; which demonstrate that UI can and should be The University FOR Iowa and not just a University IN Iowa. 

Colin Gordon is the F. Wendell Miller Professor of History at the University of Iowa and a senior research consultant with the Iowa Policy Project. He is the recipient of the Regents Award for Faculty Excellence (2016) and the UI’s Distinguished Achievement in Publicly-Engaged Research Award (2015).

Hit ‘reset’ on center closings

The Labor Center is critical to all three elements of the university’s mission.

Editor’s Note: These are the remarks of Professor Elizabeth Heineman, chair of the History Department at the University of Iowa, prepared for a news conference Wednesday about the planned closing of the UI Labor Center. Professor Heineman was one of several speakers at the news conference.

elizabeth-heineman_0My name is Elizabeth Heineman. I’m a member of the History faculty at the University of Iowa, where I’ve taught for almost 20 years.

The announcement of the closure of the Labor Center and many other centers and programs complemented them on their good work, but said they weren’t critical to the university’s academic mission and student success. I’d like to talk about the university’s mission and the Labor Center’s role in fulfilling it.

The university’s mission is a three-legged stool: teaching, research/scholarship, and public engagement/community service. We’ve heard a great deal about the Center’s public engagement and community service, so I want to talk about the other two legs of the university’s mission: teaching, and research/scholarship. I’m here to say that the Labor Center — in addition to everything you’ve already heard — is also critical to these elements of the university’s mission.

Let me start with some information about the Labor Center’s research activity.

  • The Labor Center is a major recipient of nationally-competitive grants, which have totaled some $950,000 since 2002 — almost a million dollars. These attest to the Labor Center’s outstanding role in the research mission of the university. In fact, far from losing steam during the current stringent budgetary environment, the Center won a grant of nearly $200,000 from the National Endowment for the Humanities just this spring. The NEH doesn’t throw money around. This kind of grant from the National Endowment for the Humanities means that the Labor Center is on the map in the research world. This is exactly the kind of activity that helps to establish UI as a major research university.
  • Why does the Labor Center keep winning these major grants? One reason is the Iowa Labor History Oral Project, nationally recognized as one of the country’s most important collections in labor history. It has been used for cutting-edge research by Iowa faculty, staff, and PhD students as well as scholars nationally and internationally — and every time someone travels from far away to use our collections, it enhances the University’s reputation as a hot spot for research activity.
  • Perhaps most important: the Labor Center is an integral part of the university’s teaching mission. We’ve heard a bit about graduate education, but the Labor Center is perhaps even more crucial to undergraduate education.
    • Labor Center staff teach courses: not just in communities and on the shop floor, but in the undergraduate classroom. Their courses on labor history in the US and internationally are a crucial part of any basic education in both US and global history.
    • In those courses, students aren’t just reading textbooks and listening to lectures. Rather, they’re using the Center’s oral history collection and performing their own oral histories, gaining experience in public history, not just academic history. Often, they choose to research their own hometowns. When they go home to do interviews, when they talk with their families and neighbors about their assignments, it helps to send the message that the University is committed to preserving the history of working Iowans and Iowa communities – and engaging our young people in the process.
    • Finally, the Labor Center is very important in facilitating internships with community organizations. Those internships help students to gain jobs skills, and they provide fresh perspectives and energy for the host organizations.

It’s possible that those who made the decision for closure weren’t aware of all these aspects of the Labor Center’s activity. No one can be in command of all detail. This is why a process of consultation and input is necessary — consultation with the people on the ground who work closely with the Center and who are aware of all aspects of its activity and its contribution to the university’s three-legged mission: teaching, scholarship, and public engagement.

I would like to see such a process. Let’s hit reset, gather the information we need about what, exactly, would be lost if the Labor Center were to close. Otherwise, we risk losing a resource that is invaluable to the state and to the university alike.