New America Blogs - New Voices, Innovative Ideas, Post-Partisan Policy

Clemons: America's Effective Unemployment Rate at 18.7%?

The Washington Note — Thu, 02 Jul 2009 16:16:00 -0400

Each month, I receive from Leo Hindery an update on "America's effective unemployment rate" which includes not only the official unemployment figures but other data points showing off-the-books unemployed or underemployed people.

The numbers are staggering and are aggregates of official data. They matter because various Obama administration officials including the President himself started off calling for huge stimulus packages to help generate "jobs, jobs, jobs!"...

California 2.0: One Stop Shopping

Blair Bobier — Thu, 02 Jul 2009 02:06:00 -0400

The likelihood of a California Constitutional Convention actually taking place in the near future seems to grow daily.

The notion of fixing California's infamously dysfunctional state government has generated more and more serious political, philosophical and pragmatic discussion about the future governance of this sprawling and diverse nation-state.

The New America Foundation and the Political Reform Program have been at the forefront of this initiative, from co-sponsoring the initial Summit which served as the launching of this public conversation, to producing policy papers and commentary that describe what reform in California might look like and how we get from here to there. Most recently, New America sponsored "California v 2.0: The Roads to Fundamental Reform," an event which brought together experts in law, finance and political reform to outline a vision for California's future as well as the nuts and bolts of such an ambitious undertaking.

Step inside the Political Reform Program's new website, Reform California, dedicated to this particular discussion about California's future, as a one-stop shopping resource for information about the Constitutional Convention. You'll find links to radio interviews, video recordings of New America events, and ideas to fix the budget mess and improve the functioning of state government.

HEALTH REFORM: Faith Based Groups: "America Can Do Better"

Paul Testa — Wed, 01 Jul 2009 20:34:00 -0400

Industry groups may be holding their ad fireworks until after the Fourth of July, but a coalition of a faith-based groups will take to the airwaves this Independence Day weekend with ads presenting health care reform as a moral and ethical imperative.

The spots will run in Arkansas, Colorado, Louisiana, Nebraska, and North Carolina (states which just happen to be home to potential swing senators like Ben Nelson and Mary Landrieu...). Sponsored by a coalition of religious groups, including PICO National Network, Faith in Public Life, Faithful America, Sojourners, Gamaliel, and Catholics in Alliance for the Common Good, the ads feature local preachers from each state. Using passages from Scripture, they argue that the status quo on health care is "not who we are as a nation" and that "America can do better." You can listen to ads here. Dan Gilgof, writing on U.S. News and World Report's God & Country, has the text of an ad to be run in North Carolina:

It's a vision first proclaimed by Isaiah: No more shall there be an infant that lives but a few days, or an old person who does not live out a lifetime.

This is Rev. Joe Harvard from Durham, and we've got work to do.

In North Carolina, people are being denied the care they need because of their age or an illness they had years ago. Or getting sick because they can't afford preventive care.

This is not who we are as a nation. America can do better.

The challenge is great, but God has not given us a spirit of fear, but of power and love. And our love must be a thing of action.

This Independence Day, join thousands of people of faith in asking Senators Hagan and Burr to rise to the challenge by supporting reform that makes quality health care choices affordable for all families.

Please add your voice, and learn more at www.coverallfamilies.org. Paid for by Faithful America.

In addition to the ads the groups are also calling on local pastors to hold health care Sabbaths and encourage measures of their congregations to call their congresspersons to urge them to support reform.

New America's Len Nichols has been one of the leading voices arguing that health care reform is a not just an economic necessity but also a moral imperative. In a recent essay, Len addresses the issues of stewardship and health care as they relate to the kind of society do we want to live. Showing the core definitions of society remain the same from Thomas Jefferson to Leviticus, Len asks:

What does the right to life mean if one does not also have access to known and widely available life-preserving and life-enhancing diagnoses and treatments? How can one meaningfully pursue any individual definition of happiness if one cannot afford essential care for a sick child, a breadwinner, or a disabled spouse or parent? In short, what is life and happiness without health?

To hear more on the moral case for reform check out this video below:

Doherty: Honduras and Cuba: Ending the Hypocrisy

The Havana Note — Wed, 01 Jul 2009 18:42:00 -0400

President Eisenhower and Cuban President Batista meet in Panama.

One of the most difficult communications challenges for President Obama will be overcoming America's history of ideological hypocrisy. In his speech in Cairo, Mr. Obama started down this path, recognizing that our own history in the Middle East, such as the invasion of Iraq and the coup against the popularly-elected Iranian government of Mossadegh, was less than stellar. Indeed, whenever the United States has intervened on behalf of democracy and everyday human rights, our efforts have generally made things worse. Iraq, Grenada and Vietnam come readily to mind. The premature elections in Palestine and the failed 50-year old embargo on Cuba are also examples. Democracy is an organic and indigenous political condition and cannot be imposed by intervention or isolation...

Fixes Needed for Federal Program Promoting Public Service

Stephen Burd — Wed, 01 Jul 2009 16:30:00 -0400

In 2007, Congress created two new programs aimed at making it easier for students to repay their federal student loans and encouraging them to pursue careers in the public service. As we wrote yesterday, one of those programs -- Income-Based Repayment -- goes into effect today. The other one -- Public Service Loan Forgiveness -- is already up and running but may not live up to its full potential unless changes are made to the regulations governing it.

Under the loan forgiveness program, which Congress included in the College Cost Reduction and Access Act, the federal government will forgive the remaining debt of Direct Student Loan borrowers who have made 120 payments on their loans while working in a public service occupation. Borrowers with loans through the Federal Family Education Loan (FFEL) program can take advantage of this benefit by consolidating their debt into Direct Lending.

Lawmakers created the program in reaction to reports that student loan borrowers were increasingly shying away from pursuing public-service careers, such as teaching and social work, because of their heavy debt loads. By providing loan forgiveness, the bill's authors hoped to provide incentives to college graduates to enter these fields and reward them for their service.

Sounds pretty straightforward, right? Unfortunately, the program is not operating in the way lawmakers envisioned. That's because the U.S. Department of Education, under its previous leadership, decided to keep people in the dark about whether their chosen jobs qualify them for the benefit. Under regulations the Department issued in October, student loan borrowers will not know whether they qualify for the loan forgiveness until after they have made all 120 required payments.

Last year, at Higher Ed Watch, we questioned the Department's decision -- asking why borrowers working at low-paying jobs should have to face this type of uncertainty. We joined the Project on Student Debt in calling for the Department to develop a system that allows borrowers to confirm and track their eligibility over time for this benefit. But Department officials refused to budge, saying that tracking borrowers' eligibility status would be "a costly and complex" undertaking. Maybe so, but doesn't the Department have the obligation to carry out the will of Congress?

Now that there are new leaders at the Department, we would hope that they would revisit this regulation. They should make it a topic of the negotiated rulemaking sessions they plan to hold in the fall.

Our friends at the Institute for College Access and Success (TICAS), which runs the Project on Student Debt, have asked the Department to revise the rule to allow borrowers who have made at least 12 payments on their loans "request a confirmation of eligible payments and employment on a form provided by the [Education] Secretary." [Disclosure: Higher Ed Watchis supported in part by TICAS.

"Giving borrowers clear information upfront, and periodic confirmation of how many more years of eligible work and payments are required before they qualify for forgiveness, will provide an incentive to continue in public service and ultimately meet the forgiveness requirements," Pauline Abernathy, the acting director of policy and strategy at TICAS, recently wrote in testimony she provided the Department. "It will also reduce the number of borrowers applying to the Department for loan forgiveness before it is appropriate for them to do so."

We wholeheartedly agree. Borrowers who devote themselves to public service should not be left in the dark about whether they qualify for help from this worthy program.

HEALTH REFORM: Wal-mart Supports Employer Mandates and Cost Control

Len Nichols — Wed, 01 Jul 2009 14:25:00 -0400

I applaud Wal-Mart's embrace of shared responsibility for health care financing and its support for an "employer mandate." Their recent letter (also signed by SEIU and CAP) to President Obama represents the kind of leadership we will need to finally achieve quality, affordable health care for every American.

As critical (if not more so) is their emphasis on cost control. Time and time again we reiterate that rising health care costs threaten not just households, but also employers and governments. To shore up our nation's fiscal future and sustainably finance reform, we must guarantee that health care reform will slow the rate of health care cost growth.

In their letter, Wal-Mart, SEIU, and CAP identify one possible solution outlined by former majority leaders Howard Baker, Tom Daschle, and Bob Dole. In addition, I would point you to the ideas put forth by Health CEOs for Health Reform at our recent event. Their paper, Aligning U.S. Health Care Incentives to Better Serve Patients and Taxpayers, not only calls for providers to be held to cost and quality standards by a specified date to achieve cost control goals, but also outlines a pathway toward high-value, coordinated care that will make patients healthier and save money.

Wal-Mart's support of the employer mandate proves rising health care costs are a serious threat to even the most efficient business models. Health CEOs for Health Reform's willingness to embrace provider accountability and move away from volume-driven, fee-for-service medicine proves it is possible to improve quality, while controlling the costs that hamper households, employers, and governments.

A successful health reform effort will demand extraordinary leadership from lawmakers, but it will also require forward-thinking support from key stakeholder constituencies. Wal-Mart should be congratulated and other business leaders should echo their call.

(PS. If you want to know more about Wal-Mart's path in terms of covering its own workers and looking for value in health care, read this February piece from the Washington Post.)

HEALTH REFORM: Help For Older Americans

Alex Mazerov — Tue, 30 Jun 2009 15:36:00 -0400

A new message coming from the anti-health reform chorus is telling older Americans that they have a lot to lose under comprehensive health reform. For instance, Senate Minority Leader Mitch McConnell took to the airwaves on Sunday to proclaim, “When you get to the question of paying for [health reform], it appears as if they want to pay for it on the backs of seniors through Medicare cuts.” It’s not surprising, then, that recent polls have found some seniors more nervous about health care reform.

Older Americans, age 65 and up, are the only segment of the U.S. population that has coverage for all under Medicare. Nobody is talking about taking it away from them; some of the changes to Medicare contemplated in reform plans are actually designed to change incentives so that they get more appropriate care for their multiple chronic diseases. The status quo is also failing millions of older Americans, age 50-64, and reform proposals would lend an urgently needed hand to that segment of the population, which is vulnerable, often-overlooked, and growing. “They are uninsured people ages 50 to 64 who are caught in a frightening twilight zone of health care—old enough to be facing more medical problems but too young for Medicare,” Patricia Barry wrote recently in AARP Bulletin Today. “And this is the age when chronic health conditions such as diabetes and heart problems most often begin to show up.”

Because insurance companies often refuse to cover individuals with pre-existing conditions—and charge much higher premiums to those they do accept—Americans in this age bracket without employer-sponsored insurance often have tremendous difficulty obtaining affordable coverage. The problem is only getting worse as the economic downtown forces many middle-aged workers into early retirement.

More than 7 million adults aged 50 to 64 were uninsured in 2007, a 36 percent increase over 2000 levels, according to an AARP analysis. Nearly one in six individuals applying for individual insurance are rejected at age 50. The number rises to one in four at age 60.

Insurance market reforms that require insurers to take all comers regardless of preexisting conditions and ban them from setting premiums based on personal medical history will help Americans 50 to 64 years old get the health care they need. These changes will also save the federal government money down the road since patients will be healthier when they become eligible for Medicare.

AARP The Magazine has an instructive piece in its current issue debunking eight other health care reform myths that might be particularly scary for older people. First and foremost: “Health reform won't benefit people like me, who have insurance.”

Just because you have health insurance today doesn't mean you'll have it tomorrow. According to the National Coalition on Healthcare, nearly 266,000 companies dropped their employees' health care coverage from 2000 to 2005. "People with insurance have a tremendous stake, because their insurance is at risk," says Judy Feder, a professor of public policy at Georgetown University and a senior fellow at the Center for American Progress…

Comparing health reform to buying an Energy Star appliance—pay a little now to save a lot later—the article also cites a recent Commonwealth Fund study that estimated that “health care reform will cost roughly $600 billion to implement but by 2020 could save us approximately $3 trillion.”

What’s more, the recent deal the White House brokered with the pharmaceutical industry will save America’s seniors billions in out-of-pocket payments for prescription drugs.

The truth is that all of us—young and old—stand to gain a great deal as Congress moves to overhaul our nation’s ailing health care system. Failing to act is what should worry us the most.

A Good Day for Student Aid

Ed Policy — Tue, 30 Jun 2009 15:00:00 -0400

Some big changes are coming to the federal student aid programs tomorrow that will save students money and make it easier for struggling borrowers to repay their government-backed student loan debt.

Most of these changes are the result of three pieces of legislation that have been enacted over the last several years: the Deficit Reduction Act of 2005, the College Cost Reduction and Access Act of 2007, and the American Recovery and Reinvestment Act of 2009. All contain provisions that go into effect on July 1. These include:

A $619 increase in the maximum Pell Grant, to $5,350 for the 2009-10 academic year.

A 0.4 percentage point reduction in the fixed interest rate charged on new federally subsidized Stafford loans to 5.6 percent.

A one-half percentage point decrease in the origination fees that borrowers must pay on their federal student loans to 1.5 percent of total amount borrowed.

Meanwhile, borrowers with variable-rate Stafford Loans originated before July 1, 2006 will see their rates drop to 2.48 percent on Wednesday. That's two percentage points lower than the current 4.21 rate on these loans. Members of the Class of 2009 can lock in an even lower rate of 1.88 percent if they consolidate their variable rate loans during the sixth month grace period before they enter repaym

But the most significant change that will go into effect on Wednesday is the introduction of the Income-Based Repayment (IBR) program, which is aimed at helping borrowers with low incomes who have taken on too much federal student loan debt. Under the new program, borrowers who have a pre-tax income below 150 percent of the poverty line will not have to make any payments until their incomes rise over those levels. Those with higher pay will not be asked to devote more than 15 percent of the portion of their income above that threshold to student-loan repayment until they are earning enough to make regular payments. Any debt remaining after 25 years of payment through the IBR program will be forgiven by the federal government. (Unfortunately, private student loans do not qualify for the reduced payments.)

According to our friends at the Project on Student Debt, who have championed the program, a single person making $30,000 a year with $30,000 in debt will see his or her monthly payments cut in half under IBR. The project has developed a calculator at www.ibrinfo.org to help borrowers determine their eligibility for the plan.

"In this tough economic climate, Income-Based Repayment will be a godsend for so many people, helping to guarantee that [federal] student loan payments won't be the thing that breaks the bank," says Lauren Asher, the president of the Institute for College Access and Success (TICAS), which runs the Project on Student Debt. [Disclosure: Higher Ed Watch is supported in part by TICAS.]

Independence Day is still a few days away. But with these new benefits, students already have a reason to celebrate.

Youth Savings: The Birth of a Stake in the Future

Jamie Zimmerman — Mon, 29 Jun 2009 19:24:00 -0400

Since the inception of the Global Assets Project in 2006, I have advocated that having opportunities to save and accumulate assets earlier in life will lead to a more economically and socially secure future. Now, as I write my last blog post before beginning maternity leave to care for my first child, this assets "perspective" has transformed into much more of "reality." Now more than ever, I am sensitive to the fact that we all need a fair and decent shot at success in life. Yet such success, all over the world, is often hindered by exclusion from a financial identity; from opportunities to save and grow assets, or from the policies and products that the better-off take for granted that allow them to accumulate wealth and pass it along from generation to generation.

And the research has shown that asset effects will have greater impact the earlier in life they begin. And this is true from Oklahoma to Uganda. In fact, New America Senior Research Fellow and Columbia Professor Fred Ssewamala's research continues to show that even small amounts of savings can have large impacts on a child, not only economically, but socially and psychologically. That is why the Global Assets Project has and continues to study, advocate and support policies, products and programs that enable savings among children and youth.

More recently, we've announced the launch of a MasterCard Foundation-funded effort to design a pilot program to test and implement savings products for young people in developing countries. Led by Save the Children, the Global Assets Project will provide research (through CSD at Washington University in St. Louis), policy analysis and communications (at the New America Foundation) for this program. The Consultative Group to Assist the Poor rounds out this global consortium, as a key partner in product development and regulatory policy research.

We're working together to understand specific savings needs of this special population, and hopefully find ways to provide them with effective tools to save, building a foundation for a more prosperous future than they could have previously envisioned. Yet, financial institutions have yet to discover a universally accepted business case for providing specialized accounts to children or youth. And where they exist, they generally do not benefit the poor or very poor. So that is our goal: to find that "sweet spot" where "effectiveness" of the product relates to the client and the bank, not one or the other. We have our work cut out for us, but I'm optimistic by nature.

As I bring my own child into this economically uncertain and financially fragile world, I reflect with pride and gratitude on my role in a Project that has a vision of one day, accounts for all. And for all, a stake in the future.

Cohen: The Other War

Michael Cohen — Fri, 26 Jun 2009 17:18:00 -0400

With all the attention this week focused on the extraordinary events occurring in Iran, events next door in Iraq are barely registering (in fact Iraq has virtually dropped off the radar screen of the blogosphere). Perhaps folks should be paying attention, because it's a very bloody week and one that does not bode well for the country's future.

First there is the violence. And as is so often the case in Iraq, it's been horrific.Yesterday, a car bomb exploded in Sadr City killing more than 70 people and injuring 135. On Saturday, a massive truck bomb exploded in Northern Iraq killing 68 people and wounding 200. While other scattered bombings might be chalked up to score settling and revenge, these attacks seem intended to undermine the government in Baghdad...