Aaron Regunberg: RI Needs a Modern Day Works Progress Administration

Friday, August 10, 2012

Aaron Regunberg, GoLocalProv MINDSETTER™

 

A few news channels ran a minor story this week about how bronze plaques in Roger Williams Park have been disappearing recently, pried from sidewalks and curbs, maybe to be sold for scrap, maybe to be kept as souvenirs. The plaques have a short message written on them: “Built by Works Progress Administration,” and are identical to similar plaques on thousands of roads, sidewalks, public buildings, parks, and other infrastructure projects in every state and nearly every city around the country. We’ve all probably seen them (many, many times) even if we haven’t registered having seen them—I myself have prominent memories of cleaning off the Works Progress Administration plaque at the dam outside of Chicago where I’d go fishing as a kid.

So what was the Works Progress Administration (or WPA, for short)? It was a direct job creation program implemented by Franklin Roosevelt’s administration during the Great Depression to provide employment opportunities to American workers on public projects. The basic idea was pretty simple—there were all these roads and bridges and projects that needed building, and all these out-of-work Americans that needed work. Why not put the two together to lower the unemployment rate, improve the economy, and get a bunch of great things (like a beautified Roger Williams Park) out of the mix?

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The WPA was an incredibly effective program on all three of these levels, directly helping many millions of Americans and indirectly helping countless more. It began in 1935, over right-wing objections that it was a government takeover of some sort or another, and continued until it was no longer necessary (when World War II ended the Great Depression), at which point it was terminated.

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Fast-forward to the present. The United States, and particularly Rhode Island, is still mired in a Great Recession. When you factor in all the workers that the official unemployment rate fails to capture, there are 20-30 million people in the U.S. who cannot find work. This is not because the private sector doesn’t have the money to hire. In fact, large corporations have recovered from the recession—they are making record-breaking profits and sitting on trillions of dollars. Yet businesses are still reluctant to begin hiring or investing in major capital improvements. We need millions and millions of jobs nationally, and thousands and thousands here in Rhode Island, and it’s pretty clear that the private sector isn’t going to be providing them in the near- or medium-term.

So why not take a clue from the successes of the WPA and have the public sector fill the gap? A temporary direct job creation program would increase unemployment quickly while serving vital community needs. A state-level public works initiative with on-the-job training would ensure Rhode Islanders without employment could get meaningful work until a real recovery takes place, while also allowing communities to make urgent and long-ignored improvements to their infrastructure—improvements that we need to make if we’re ever going to achieve a real economic recovery.

Take, for example, transportation. Multiple reports rank Rhode Island as among the worst states in the nation for transportation infrastructure and public transit, two factors that are widely accepted as essential foundations of a strong economy. Why in the world wouldn’t we want to invest in public transportation projects that put Rhode Islanders to work while repairing our roads, bridges, and rail systems in ways that improve our long-term economic fundamentals?

Or look at many of our communities’ crumbling schools. As my fellow Mindsetter Dan Lawlor consistently points out, thousands of our children in Rhode Island go to schools that were built a century ago and are literally falling apart around them. We could rebuild these ancient structures while providing unemployed Rhode Islanders work (work which, in turn, provides their families with disposable incomes that will be spent on Main Street and recycled throughout our economy).

Clean-energy investments. Green retrofitting to decrease fuel consumption. The list of important projects goes on and on. And—just as the WPA was disbanded after the U.S. economy recovered in the 1940s—so too could this program be liquidated once our Great Recession is finally over.

Best of all, direct job creation is actually the most cost-effective government recovery strategy on a dollar-to-jobs ratio. At the national level, studies of economic stimulus methods—of which there were a bunch back in 2009—have shown that, while $100 billion spent on tax cuts would indirectly generate 136,000 full time jobs within two years, and $100 billion spent on extended benefits programs like food stamps would indirectly generate 714,000 jobs, $100 billion spent to directly employ American workers would create 2.6 million full time jobs over two years (2.1 million directly and half a million indirectly). In comparison, the Bush-era tax cuts cost about $295 billion in lost revenue each year, most of which goes directly to the bank accounts of the nation’s wealthiest families.

These lessons apply here in the Ocean State, as well. Our most recently instituted tax break for the wealthiest Rhode Islanders (you know, the one that was promised to reduce unemployment and bring us all these jobs into our state…) has been estimated to cost Rhode Island $50-70 million each year. And that’s just the latest in a series of regressive tax cuts for the wealthy that have given us a top marginal income tax rate that is currently just one-fourth as high as the top rate was in 1996, when our unemployment rate was less than 5%. And that’s not even mentioning the 38 Studios handout or the money we spend on other foolish economic development strategies that could be redirected to a direct job creation program that is guaranteed to create employment opportunities and valuable public projects. Meanwhile, our failure to provide jobs for people who want them isn’t cheap, either (unemployment is, after all, the biggest cause of our deficit). The money to implement a WPA-like program is out there, and the need for such a program is clear. So it’s quite a shame that nobody, anywhere seems to be considering this option.
 

 

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