The hope for nonpartisan dialogue to practical strategies on issues

Editor’s Note: This post ran on Charles Bruner’s blog as “Light at the end of the party conventions.” Bruner is a former co-director of the Iowa Fiscal Partnership, the fiscal policy analysis collaboration of the Iowa Policy Project and the Child and Family Policy Center, two Iowa-based nonprofit, nonpartisan organizations.

By Charlie Bruner

America needs every one of us to lend our energy, our talents, our ambition to making our nation better and stronger —where you can get a good job and send your kids to a good school, no matter what zip code you live in, where all our children can dream, and those dreams are within reach.

When I am President, I will work to ensure that all of our kids are treated equally and protected equally. Every action I take, I will ask myself: Does this make life better for young Americans in Baltimore, in Chicago, in Detroit, in Ferguson who have in every way the same right to live out their dreams as any other child in America?

There is an old saw that says: “I went to a hockey fight and, lo and behold, a game broke out.” I watched much of both political party conventions – and, lo and behold, amidst all the partisan rhetoric and campaigning, at least one common “issue/concern” was raised.

The above are direct quotes from Hillary Clinton and Donald Trump as they accepted their party’s nomination for President. The first paragraph is from Clinton’s speech, the second from Trump’s. Taking them at face value, the challenge is now for a public dialogue to “break out” that begins to build consensus around responses.

The common sentiments these statements express require actions that cannot be achieved by whoever is elected President, through the power of that office alone. Ultimately, as an electorate and as stewards of our future, we need to insist on a dialogue that goes beyond expressing these sentiments to developing practical and proximate strategies — public and private, professional and voluntary — that will enable us to realize them.

In such a dialogue, Democrats may stress the need for public responses that provide additional income and service supports and a proactive government that ensures a living wage to reduce material poverty. Republicans may stress the need for greater personal responsibility and community initiative based upon indigenous leadership that fosters more points of light within poor communities to enhance personal efficacy. In the end, the solution (for reasons of achievable politics and most effective policy) is not a matter of either/or, but of both/and.

These statements should be seen and used as an opportunity for us to insist on further, deliberative dialogue — dialogue that goes beyond sound bite proclamations mapping out a partisan political position. It is incumbent, for our children and our nation, that this dialogue does “break out” in ways that lead to that action, not only at the Presidential campaign level but in our states, communities, and neighborhoods.

At least that’s my story, and I’m sticking to it.

08-Bruner-5464 Charlie Bruner is Director Emeritus of the Child and Family Policy Center, which he founded as he completed 12 years as an elected Iowa state legislator. Prior to that, he received his Ph.D. in political science from Stanford University and has had different stints at both teaching and research. Thus, he brings three dubious backgrounds — academic, politician, and advocate — to his current work as a co-principal investigator for the Learning Collaborative on Health Equity and Young Children (see: childequity.org for his website).

Join us Sept. 15 to celebrate IPP’s 15th anniversary

The Iowa Policy Project is 15 years old and we’re having a party. Join us for our anniversary reception and help us move forward to the next 15!

Bill Stowe on clean water • Peter Fisher on work supports •
and more!

THURSDAY, SEPT. 15 • 6 P.M. • RECEPTION
PRAIRIE MEADOWS CONVENTION CENTER • ALTOONA

Hors d’oeuvres, cash bar — 6 p.m. • Program — 6:45 p.m. to 7:30 p.m.
Tickets $50 per person • Sponsorships available • RSVP TODAY!

Featuring: Bill Stowe, Des Moines Water Works
Hear from the CEO and General Manager of Des Moines Water Works, one of Iowa’s most prominent advocates of clean water stewardship.

Sneak Preview: The Cost of Living in Iowa Part 3 — Work Supports
IPP Research Director Peter Fisher will offer a peek at upcoming analysis of how Iowa can enhance eligibility for child care assistance so that working families are not penalized if they work more or achieve a slight boost in pay.

Special recognition by co-founder David Osterberg of early IPP supporters
Mark L. Smith, G. David Hurd and Fred and Charlotte Hubbell

And a silent auction you won’t want to miss!

RSVP today — download this response form to order tickets or become a sponsor.

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Fix both ‘cliff effect’ and low minimum wage

Past failures to improve both the minimum wage and child care eligibility should not end up as an excuse to fix neither.

As the debate over a Polk County minimum wage continues, the so-called “cliff effect” is being cited as a reason to limit the increase in the wage. This is unfortunate. Capping the wage at a low level would hurt thousands of families, including many with burdensome child care costs.

cliffs3The “cliff effect” results from the design of Iowa’s Child Care Assistance program (CCA), which pays a portion of the cost of care for low-income families. Iowa has one of the lowest eligibility ceilings in the country: 145 percent of poverty. When a family’s income hits that level ($29,120 for a single mother with two children), benefits disappear.

While most work support programs, such as food assistance, taper off gradually, with CCA you just fall off a financial cliff — the “cliff effect.”

We do need to fix that program. But the failure of state lawmakers and the governor to address the CCA cliff effect is not a good reason to forgo needed wage increases for thousands of working families. An estimated 60,000 workers would benefit from an increase to $12 an hour in Polk County; 88,000 by an increase to $15 (phased in over several years).

Of those who would benefit from a higher minimum, 36 to 38 percent are in families with children. To put the CCA cliff in context, recognize:

•     Thousands have high child care costs and incomes below 145 percent of poverty but do not receive CCA. A 2007 study estimated that only about 1 in 3 Iowa families eligible for CCA were actually receiving it. The two-thirds with low wages but without assistance still need higher wages.

•     Second, a low wage cap would not help many families barely above 145 percent of poverty, but still facing child care costs of $4,000 to $5,000 a year per child. These families, in many cases married couples with one or both working at a low wage, can’t make ends meet.

•     Third, the other 62 to 64 percent of low-wage workers do not have children, and many families whose children are older do not need child care. A cap on the minimum wage hurts all of them.

Moreover, we need to keep in mind that the cliff is not as sudden as it appears. Because Iowa moved to one-year eligibility, a family whose income rises enough to push them above 145 percent of poverty can continue to receive assistance for another year. In that time, they may find ways to adjust, such as quitting the second or third job or reducing hours or overtime, to stay eligible for CCA but have more time with their children. This is surely a benefit from a higher minimum wage.

Policies that move families toward self-sufficiency are widely supported. We want workers to increase their earnings by furthering their education, finding higher paying jobs, gaining experience that earns them promotions — and have time to care for their families.

Yes, we should fix our child care assistance program, which can penalize all of those efforts. But we should also fix a minimum wage stuck at a level well below what even a single person needs to get by. Past failures to fix one problem should not end up as an excuse to fix neither.

2010-PFw5464Posted by Peter Fisher, Research Director of the Iowa Policy Project

pfisher@iowapolicyproject.org

Related:

“Reducing Cliff Effects in Child Care Assistance,” Peter Fisher and Lily French, Iowa Policy Project, March 2014, PDF

Enriching the minimum wage discussion

History shows the minimum wage was meant to be a meaningful policy tool to help working families, not limited to “entry level” work or teens. In fact, efforts to establish the wage came as policy makers were trying to remove young teenagers from the workforce.

The spin against any minimum wage increase — or even having a minimum wage — has become predictable. This should surprise no one. Policy makers since President Franklin D. Roosevelt have battled the same stuff.

A little relevant history might be just what is needed as Iowans consider the arguments for a national, state or even local increase, which passed in Johnson County.

History shows the minimum wage was meant to be a meaningful policy tool to help working families, not limited to “entry level” work or teen wages. In fact, efforts to establish the wage came at the same time policy makers were trying to remove young teenagers from the workforce.

The U.S. Department of Labor website has an interesting paper published almost 40 years ago by a DOL historian, Jonathan Grossman: Fair Labor Standards Act of 1938: Maximum Struggle for a Minimum Wage In it, Grossman relates a story about a young girl’s note to Roosevelt, telling of pay being cut from $11 a week to between $4 and $6 a week. 

To a reporter’s question, the President replied, “Something has to be done about the elimination of child labor and long hours and starvation wages.”

“Starvation wages” are your concern if you expect the wage to be meaningful to a household budget.

Interestingly, Iowa Policy Project research shows what is needed for a household budget. In Linn County, where a very low $8.25 has been suggested by a split task force, a single parent needs to make between $21 and $25 an hour to support a household on a bare-bones, basic-needs budget without public supports. In Polk County, it takes between $22 and $27 for a parent in similar circumstances.

IPP and Economic Policy Institute analysis also show this issue is scarcely about teens. Statewide, more than 4 out of 5 workers affected by an increase to $12 are 20 years old or older. A quarter of them have children. Over half of them work full time. On average, they account for over half of their family’s total income.

County supervisors in Johnson County have taken the baton across generations from FDR, to assure families have a chance. They acted last year to raise the local wage in three steps to $10.10 by next January 1, and they have already taken two steps, to $9.15.

Discussions are moving ahead in Polk County, Linn County and Lee County. Passing a local wage is a significant signal to state leaders that they are through waiting for action. Any county must consider whether the content of its action is significant as well — however bold it may seem to pass local law on this issue, the amount does matter.

And for those who say, “Let the market handle it,” just wake up. Clearly, it does not. As FDR stated in 1937:

The truth of the matter, of course, is that the exponents of the theory of private initiative as the cure for deep-seated national ills want in most cases to improve the lot of mankind. But, well intentioned as they may be, they fail…. (T)hey have no power to bind the inevitable minority of chiselers within their own ranks.

Though we may go far in admitting the innate decency of this small minority, the whole story of our Nation proves that social progress has too often been fought by them. In actual practice it has been effectively advanced only by the passage of laws by state legislatures or the National Congress. [1]

Do we value history? Do we value work? Do we value families? Do we value practical solutions through public policy? We are about to see.

[1] Franklin D. Roosevelt: “Message to Congress on Establishing Minimum Wages and Maximum Hours.,” May 24, 1937. Online by Gerhard Peters and John T. Woolley, The American Presidency Project. http://www.presidency.ucsb.edu/ws/?pid=15405.

owen-2013-57By Mike Owen, Executive Director of the Iowa Policy Project.

Contact: mikeowen@iowapolicyproject.org

Ignore ideologues — IPERS sound, stronger

Time seems to be running out on those who do not want a stable, secure and sustainable retirement program for public employees. IPERS, the Iowa Public Employment Retirement System, is well on the way to recovery before its opponents can kill it. But they’re still trying.

The criticism this time comes in a Des Moines Register opinion piece, from a familiar source, the Public Interest Institute (PII) in Mount Pleasant.

In its latest ideological attack on IPERS, PII offers no data — not a single financial indicator — to demonstrate a problem. In fact, IPERS is rebounding from troubles brought on by the Great Recession and inadequate state contributions in the latter half of the last decade.

According to the latest IPERS annual report, IPERS’s ratio of funded actuarial assets to liabilities — which had dropped from 89.1 percent in FY2008 to a low of 79.9 percent in FY2011 — has continued to rebound, rising in FY2015 from 82.7 percent to 83.7 percent.

In an Iowa Policy Project report in late 2013, Imran Farooqi, Peter Fisher and David Osterberg showed that contrary to high-profile examples of public pension problems with the city of Detroit and the state of Illinois, the public employee pension systems in Iowa and most states were generally healthy and well-managed for the long term.

“Iowa’s public pension plans have sufficient assets to pay benefits now and well into the future. And recent improvement in the plans’ designs have already enabled them to begin recouping losses incurred during the recessionary stock market decline,” they wrote. Now, 2 1/2 years later, there is no indication of a change in that positive trend.

That report did recommend ways to strengthen IPERS and other public employee retirement plans in Iowa, such as increasing contributions and meeting actuarial recommendations for those contributions.

What we need to remember is that the purpose of IPERS is not to see how little we can pay public employees, but to attract good employees partly with a promise of a secure retirement. It is to “improve public employment within the state, reduce excessive personnel turnover, and offer suitable attraction to high-grade men and women to enter public service in the state.” This is the stated purpose of the law, Chapter 97B.2.

The biggest problem for PII is that IPERS may fully recover before PII gets the law changed to a less secure “defined contribution” system. A defined benefit system provides financial security by pooling risk in the group — more efficient than having everyone on their own based on defined contributions that they might outlive.

So let’s be clear: Shifting from a defined benefit plan like IPERS to a defined contribution plan, such as a 401(k), is a way to cut benefits and reduce retirement security.

We can spend our time better addressing real concerns to assure our public employees can deliver on public education, overseeing human services, policing our streets and guarding prisoners — and making sure they can retire securely when they are done working for us.

owen-2013-57Posted by Mike Owen, Executive Director of the nonpartisan Iowa Policy Project
mikeowen@iowapolicyproject.org

Minimum wage: When leaders won’t wait

When state lawmakers won’t act, local officials may well take matters into their own hands.

The Iowa Legislature adjourned the 2016 session 10 days past its target, but the timing could not have been much better.

Two days after adjournment — with no action on the state’s long-outdated $7.25 minimum wage — the second step of Johnson County’s local minimum-wage increase took effect Sunday.

The minimum wage in Johnson County moved from $8.20 to $9.15, with the final step to $10.10 scheduled for Jan. 1, 2017.

Johnson County supervisors acted last year because the state Legislature and U.S. Congress had not. Other counties in Iowa may see a need to follow suit if the state cannot move off the $7.25 level established on Jan. 1, 2008.

Working Iowans are trying to support families on minimum wage or slightly above because employers can get away with paying that below-poverty amount. Someone has to look out for low-wage workers when their employers refuse to do so.

Those employers benefit immensely from taxpayer support of education, law enforcement, roads and other public structures, not to mention direct subsidies or tax breaks.

The minimum wage is one way to establish accountability — and not just for business but for our political leadership as well. When state lawmakers won’t act, local officials may well take matters into their own hands.

Owen-2013-57Posted by Mike Owen, Executive Director of the nonpartisan Iowa Policy Project
mikeowen@iowapolicyproject.org

A squeaky wheel is heard — but not fixed​

The weak House attempt to satisfy Davenport on school funding inequities is a sign that a squeaky wheel is being heard. But the whole statewide axle is rusty.

Davenport has been the squeaky wheel on school funding inequity in Iowa, and the Iowa House this week tried to apply a drop of oil. Problem is, the whole axle is rusty, and cracked.

By law, 164 school districts — about half of Iowa’s 330 districts — are held $175 below the maximum per-pupil spending amount used to set local school budgets. In fact, almost 84 percent of school districts in the state are $100 or more below the maximum (graph below).

Basic RGB

On Tuesday, the House passed an amendment, H8291, that dealt only with the squeakiest wheel — Davenport — and only for a one-year fix.

Davenport is not buying. In a Quad-City Times story, Davenport lawmakers were not happy. Their school superintendent, Art Tate, called it “no help at all,” and for good measure, put the focus where it needs to be.

Wrote Tate in an email to the Times: “It does not address the moral imperative to make every student worth the same in Iowa.”

The larger question, given that moral imperative, is why more districts aren’t more active on this issue. One reason could be that Iowa’s inequities, while real, do not rise to the level of what might be found in other states.

Another reason might be that just fighting for basic school funding is hard enough, when the Legislature is setting a seven-year pace of funding growth below 2 percent despite faster growth in district costs, strong state revenues and approval of more business tax breaks.

160324-AG-SSA-history

We’re in the closing days, perhaps the closing hours, of the 2016 legislative session, with exceedingly few successes for education and working families. It’s too late in this session to expect real reform of the school funding system, pleas for which have come for many years — and focus on more than the per-pupil cost. There are other equity problems, the largest of which is in funding transportation services.

The weak House attempt at a one-year fix for Davenport, however, is a sign that the squeaky wheel is being heard. Think of what might happen if more wheels squeaked.

Owen-2013-57Posted by Mike Owen, Executive Director of the nonpartisan Iowa Policy Project.
mikeowen@iowapolicyproject.org