Anderson@Large

The Recovery Act: One Year Later

Today marks the one year anniversary of the American Recovery and Reinvestment Act. President Barack Obama will commemorate the milestone with remarks on the economy later this morning.

In the meantime, Obama has dispatched administration officials to over 35 communities across the country “to survey Recovery Act progress to-date and continue the Administration’s push for additional job creation measures to put more people back to work.”

In his report to the President, Vice President Joe Biden says “approximately 2 million jobs have been created or saved thanks to the Act’s impact on hiring in the private sector, by local and state governments and by non-profits.”

Nearly departed Sen. Evan Bayh isn’t as sanguine. When asked about his future plans, Bayh said:

If I could create one job in the private sector by helping to grow a business, that would be one more than Congress has created in the last six months.

Bayh’s parting shot must hurt, but his view is shared by 94 percent of Americans. A CBS News/New York Times poll found that only six percent of Americans think the stimulus package has created any jobs.

Job creation, or more accurately, joblessness is a sore point for African Americans. A new report from the Kirwan Institute for the Study of Race and Ethnicity, “ARRA and the Economic Crisis: One Year Later,” found the impact of stimulus spending is even. The Recovery Act has had mixed results in assisting those most impacted by the Great Recession:

White unemployment has started to decrease (from a peak of 9.4% in October 2009 to 8.7% in January 2010), while Black unemployment rates continues to rise (from 15.5% to 16.5% during the same time period).

ARRA has done little for minority business enterprises’ bottom line:

Contracting and procurement are the primary ways ARRA can directly benefit private businesses and employers. Minority and disadvantaged business contracting is a critical source of job and wealth creation for marginalized groups and communities. Many concerns have been raised about the ability of minority firms to successfully compete for contracts. Although consistent state level data on ARRA contracting to minority firms is not widely available, figures from federal procurement indicate troubling and disparate contracting patterns. While Black‐, Latino‐, and Women‐ owned businesses represent 5.2%, 6.8%, and 28.2% of all businesses respectively, as of February 1, 2010, they had only received 1.1%, 1.6%, and 2.4% of all federally contracted ARRA funds.13 Of the $45 billion in direct federal contracts allocated by February 1st 2010, less than $2.4 billion (5% of the total) were allocated to Black‐, Latino‐, and Women‐ owned businesses.

So on the first anniversary of the Recovery Act, black folks are more likely to pop a gasket than pop a cork.

Stimulating Equity

It’s time again for states to submit their quarterly Section 1512 reports on how they spent stimulus funds and the number of jobs “saved or created” funded by the American Recovery and Reinvestment Act.

The reports will be posted to Recovery.gov on Jan. 30. But there will not be much to report on the impact of stimulus spending on the African American community. As the Rev. Jesse Jackson Sr. observed during the opening sessions of the Wall Street Project Economic Summit:

We need a Stimulus II that’s bottom up.

[...]

The first stimulus prioritized bailing out the banks but did so without linkages or obligations to reinvest ... Harlem and Wall Street are on the same island. Wall Street riding the tide does not lift Harlem or any other part of the country.

Jackson continued:

Small businesses last and big businesses first. Bail out the big banks and small businesses get what’s left. But there’s nothing left.

Jackson said minority entrepreneurs must engage in a sustained struggle. He observed that the business of the Wall Street banksters is not small businesses:

They’re making money off of foreclosures.

He noted that the bailed-out banksters did not have to comply with Title VI:

We want a radical thing -- the law enforced. We want the government to enforce the laws to protect the people.

We want a measure of justice ... When there’s inclusion, there’s growth. When there’s growth, everyone wins.

Jackson plans to buy stock in the leading predatory lenders that got us into this financial mess and go to their shareholders’ meetings, where he will ask them to follow the law.

He also plans to launch a multi-city campaign to push for “reconstruction banks” to provide access to capital for small businesses and homeowners. The reconstruction banks would be modeled after the Reconstruction Finance Corporation of the Great Depression.

To stay informed, join the Coalition to Empower Minority Business Enterprises on Facebook or LinkedIn.

‘Shovel Ready’ and Shoved Aside

Later today, the House of Representatives is expected to vote on the “Jobs for Main Street Act,” which includes $50 billion in spending for highways, mass transit, affordable housing and school renovation. The bill provides that “priority shall be given to projects that are projected for completion within a 3-year time frame, and are located in economically distressed areas.”

House Speaker Nancy Pelosi said:

It is a bill that creates jobs, that meets the needs of those who are unemployed, and puts us on a path to prosperity.

House Appropriations Committee Chairman David Obey added:

We want to redirect $75 billion which had been focused on the needs of Wall Street – we want to redirect that to Main Street and use it in order to preserve the jobs of teachers, firemen, policemen, prison guards, you name it, and at the same time provide another boost to construction of infrastructure projects around the country. If we don’t do this, we are going to see unemployment in the construction industry in some states approaching 30 and 35 percent.

Nice work if you can get it, but studies show that stimulus-funded jobs did not go to the people most in need. Minority workers and minority-owned businesses have been shoved aside.

A new report from the Transportation Equity Network shows infrastructure stimulus spending has bypassed the hardest-hit communities .

Inequities in Transportation Stimulus Spending 

During a teleconference call, Laura Barrett, executive director of Transportation Equity Network, said:

Funds from ARRA are not reaching into our community and creating jobs. It seems that minorities and women are getting fewer jobs than they have in the past.

Barrett’s concerns about the inequities in infrastructure spending were echoed by Richard Copeland, founder and chairman of THOR Construction Inc., the largest African American-owned construction firm in the nation. Copeland observed:

We have been fighting this fight for inclusion in the mainstream of the economy for the last 20 years… Our communities have been systematically excluded… Once stimulus money comes in, it goes into the same grind mill. So it stands to reason that we would be excluded from stimulus projects. It’s not trickling down so that disadvantaged business firms are benefiting from the stimulus dollars.

Julie A. Cunningham, president and CEO of the Conference Of Minority Transportation Officials, noted:

Instead of offering a hand up, ARRA is continuing the bad pattern of segregation that has long plagued federal programs.

Greg LeRoy, executive director of Good Jobs First, said that in order to fix the problem “we must understand how big the problem is and then develop innovative strategies.” LeRoy is pushing for Recovery.gov to add demographic data fields to the reports recipients are required to file. The data would include the race, gender and residential zip code of workers, as well as disadvantaged business contracting data.

Rev. Paul Slack of ISAIAH/New Creation Church cut to the chase:

There is too much focus on good faith when our focus should be on good results.

Can I get an Amen?!

Clinton Pollster Got $6 Million from Stimulus

The Obama administration is the most transparent in history. As Recovery.gov data are reviewed, some stimulus-funded projects are stimulating outrage.

Recovery.gov reports that Burson-Marsteller, a global public relations and communications firm, received $5,966,260 in stimulus funds to “educate and advertise the congressionally mandated switch to digital television.” The PR campaign targeted “difficult to reach communities.”

Mark Penn, the, um, brains behind Hillary Clinton’s presidential campaign, is CEO of Burson-Marsteller. With nearly $6 million in hand, Penn awarded a $2,797,377 subcontract to his “sister company,” Penn, Schoen and Berland Associates.

Burson-Marsteller claims Penn’s firm only received $142,000.00. Hey, tell it to Recovery.gov, which lists two subrecipients.

By the way, the number of jobs created: Zero:

This project preserved 3 full-time jobs (on an annualized basis) at Burson-Marsteller that would have been eliminated without the benefit of this assignment and the revenue earned from it.

Perhaps one of the jobs Penn preserved was his own.

In further Recovery news, ProPublica found that 2,500 recipients have not filed the required report. The missing reports account for at least $2 billion in stimulus funds.

Folks, if you’re not angry, you’re not paying attention.

Forum on Jobs and Economic Growth

President Barack Obama is holding the White House Forum on Jobs and Economic Growth today. The White House says:

The forum will be an opportunity for the President and the economic team to hear from some of the leading CEOs, small business owners, labor leaders, nonprofit heads and thinkers about ideas for continuing to grow the economy and put Americans back to work. Following the opening session, senior administration officials will host discussions on job creation and expanding the economy.

I’m getting ready for a business trip to Pittsburgh so I will post my modest proposal for job creation next week. While creating jobs is a "political imperative" for Obama and congressional Democrats, I don’t think much more than talk will come out of the jobs summit.

Rep. Marcy Kaptur, co-chairman of the bipartisan Jobs Now! Caucus, told the Washington Post:

What's a bit ironic to me is they were able to figure out how to help the big banks without any summit, but now that they are talking about helping people, it is a year later and they need a summit. What is that all about?

It's about symbolism (Message: I care).

Consider: Treasury Secretary Timothy Geithner is co-moderator of the breakout session on "Paving the Road for Small Business Job Growth." Geithner is a BFF of Wall Street banksters.

But, hey, you can judge for yourself.  The opening and closing sessions, and some of the breakout sessions will be streamed live, beginning at 1:30 p.m. ET.

Meanwhile, for the millions of Americans who are unemployed or underemployed, there still ain’t nothing going on but the rent -- or underwater mortgage.

Happy Thanksgiving

I’m off for the next few days. Before I go, I want to wish everyone a safe and happy Thanksgiving.

Yes, times are tough, particularly for young black men and women. The Washington Post reports:

Joblessness for 16-to-24-year-old black men has reached Great Depression proportions, 34.5 percent in October, more than three times the rate for the general U.S. population.

Young black women have an unemployment rate of 26.5 percent, while the rate for all 16-to-24-year-old women is 15.4 percent.

If you’re “young, gifted and black,” you’re still the last hired and the first fired:

For young blacks, race statistically appears to be a bigger factor in their unemployment than age, income or even education. Lower-income white teens were more likely to find work than upper-income black teens. Even blacks who graduate from college suffer from joblessness at twice the rate of their white peers.

For the moment, be thankful for what you got. And don’t let the turkey get you down.

Since I can’t “pass the peas,” I want to share one of my favorite songs, “Sinner’s Prayer.”

Help Wanted: Recovery.gov Auditors

The job-counters at Recovery.gov need help. The Government Accountability Office reports the stimulus jobs numbers don’t add up.

Concerns about the accuracy of the data is not a “side issue.” The issue is accountability.

In his opening statement before the House Committee on Oversight and Government Reform hearing, Chairman Edolphus Towns said:

I am gravely concerned that the unemployment rate is now 10.2 percent – the highest in 26 years. It is even higher for African Americans and Hispanic Americans. For people who have lost their jobs, it is not very comforting to say we are making progress.

Towns continued:

The truth of the matter is that while recipient reports provided for an unprecedented level of transparency, we must be able to rely on the reported data. At this point it is clear that errors found by GAO and others should be corrected immediately, not months later, no matter how difficult. Recipient reporting should be subject to strict quality control.

The American taxpayer expects reporting to be done, and done well. And $787 Billion weighing in the balance is certainly far from pocket change.

Those errors include:

• 3,978 reports that showed no dollar amount received or expended but included more than 50,000 jobs created or retained, and
• 9,247 reports that showed no jobs but included expended amounts approaching $1 billion.

The 50,000 jobs represent nearly 10 percent of the 640,329 jobs posted to Recovery.gov.

Just think how many jobs would have been created if a fraction of the $1 billion had been awarded to minority business owners with a track record of “making a way out of no way.”

Earl Devaney, chairman of the Recovery Accountability and Transparency Board, told the Committee the jobs reports are “riddled with inaccuracies and contradictions.”

So the question remains: How many jobs have been created?