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To remedy this, we have been long-time advocates of the permanent establishment of a federal job guarantee to eliminate working poverty and involuntary unemployment. Our plan constitutes a genuine public option for employment that enables existing workers, particularly those confined to the low end of the labor market, to bargain and obtain higher wages, greater benefits and better working conditions. The job guarantee would offer a permanent, viable alternative to low pay, low benefits and poor working conditions for all Americans. It would produce a structural transformation of the American labor market and the American economy.

A federal jobs guarantee is as simple as it sounds on the surface: everyone in the country will be guaranteed a job by the US government should they desire one. There are two versions right now gaining attention. One plan is written by academics Mark Paul, Sandy Darity, and Darrick Hamilton. The other was written by Pavlina Tcherneva.

The job guarantee (JG) is a public option for jobs. It is a permanent, federally funded, and locally administered program that supplies voluntary employment opportunities on demand for all who are ready and willing to work at a living wage. While it is first and foremost a jobs program, it has the potential to be transformative by advancing the public purpose and improving working conditions, people’s everyday lives, and the economy as a whole.

Constitutional review has spread around the world in recent decades, and various theories have arisen to account for this development. We have canvassed several different types of theories: (1) ideational theories which view constitutional review adoption as a product of a growing consciousness of the rule-of-law and protection of individual liberties; (2) coordination and commitment theories that draw on functional political logics of federalism and economic growth; (3) electoral market theories that hold that constitutional review is adopted when constitutionmakers envision themselves out of power after the adoption of the constitution; and (4) diffusion theories that posit that constitutional review is adopted in response to international audiences and constitutional developments in foreign states. Drawing on a new and unique quantitative dataset that documents the development of this institution across the globe since 1781, we used a fixed effects spatial lag model to develop the most extensive empirical test so far of these alternative accounts. Our results provide strong support for the insurance-based theory, and less support for the alternative accounts. The adoption of constitutional review is above all a response to domestic political incentives, rather than ideas, the demands of federalism, or diffusion pressures. The lack of support for diffusion-based accounts is particularly important, given that other work has demonstrated the role of diffusion with regard to constitutional provisions on human rights. We suggest that this reflects the relatively low cost of adopting rights provisions relative to institutional structures in national constitutions. Rights may represent “cheap talk,” while institutions are likely to develop a self-enforcing quality so that constitutional designers must treat them as involving higher stakes.

B. Which Level of Government Should Redistribute Wealth? Working from the core insights of the Tiebout hypothesis, public finance economists have traditionally asserted that all redistributive policies should be concentrated at the most centralized level of government.7 The reasons behind this central canon of fiscal federalism are straightforward. One concern is that redistribution undertaken by state and local governments creates pecuniary incentives for strategic migration. Where state and local governments redistribute wealth, there is a fear that both the rich and the poor will relocate to escape or take advantage of redistribution. From an efficiency perspective, the costs incurred in these movements represent a deadweight loss. 2 Another concern is that relying on subnational governments to redistribute wealth will result in too little redistribution. In effect, redistributive policies undertaken by state or local governments are likely to create spillover benefits for other jurisdictions, causing the redistributing jurisdiction, which is unable to internalize all of the policy's benefits, to provide too little redistribution. 3 These problems may be avoided by centralizing redistributive policies at the highest level of government. This federal assumption of redistributive policies, centralists argue, would not only avoid the pitfalls described above but would also help to foster a more efficient provision of local public goods.

Unfortunately, the cry for “states’ rights” today often ends up endangering health, just as it did by perpetuating the systematic racial oppression that underlies so many of today’s health inequities. To see how federalism threatens health, consider the early days of the COVID pandemic. Although states could and did implement many measures that slowed the coronavirus in 2020, they could not prevent the transmission of the microbe across state lines. One state’s lax policies invariably led to increases in cases in other states. The divergent approaches by different state governments in 2020 and 2021 also muddied the public health message. (To be fair, the poor messaging from the federal government did not help.) For example, it was hard to know in the summer and fall of 2020 if masking was beneficial when only some states required it. Worse, the variation in policies among states created a type of race to the bottom in which the economic competition from states with looser regulations pushed other states to rescind their own health orders. (Interestingly, states that kept restrictions in place longer had better health outcomes, but faced worse economic conditions). Travelers at Miami International Airport in Miami, Florida, in February 2021. President Joe Biden had signed an executive order the week before mandating mask-wearing on public transportation to prevent the spread of COVID-19. Credit: Joe Raedle/Getty Images The need for a national response has also been evident during the monkeypox outbreak. One of the major stumbling blocks to containing the disease last summer was a shortfall of reliable data. But due to constitutional limitations and the norms that have grown up around them, the federal government depends on the states, territories and tribal authorities to gather and share data about disease outbreaks, as well as for much of the frontline response, as Secretary of Health and Human Services Xavier Becerra noted in excusing the federal government’s inability to get on top of the escalating outbreak. While Becerra’s statement was largely self-serving, he was correct in stating that the federal government’s capacity to respond to a pandemic depends, in large measure, on the cooperation of the states, territories, and tribal authorities.

These inefficiencies have been amplified by more than two decades of Supreme Court decisions that, in the name of states’ rights, have handcuffed the federal government’s ability to protect the public’s health. For example, in 1997, the Supreme Court ruled that the federal government could not command state officials to conduct background checks before gun sales. That decision explains why the federal government could not require the states to open or close schools during the pandemic, or require states to impose vaccination requirements. While the federal government can use its spending powers to induce states to comply with its policy goals, states can reject the money and refuse to cooperate. The Supreme Court underscored that point, while emphasizing states’ rights in its 2012 decision in NFIB v. Sebelius, which blocked the federal government’s efforts through the Affordable Care Act to expand Medicaid. The result: more than two million more Americans were left uninsured. The goal of preserving the states’ primary role over health also played a crucial rule in the Supreme Court’s 2021 ruling striking CDC’s eviction moratorium, a policy the agency had intended to prevent people from losing their homes during the pandemic. The Supreme Court later relied on that case to block the Occupational Safety and Health Administration’s rule mandating that large employers require their employees to be vaccinated or wear a mask and be tested. A few months later, the Court cited those decisions to strike down EPA’s Clean Power Plan rule. Lower courts have relied on these cases to enjoin federal COVID vaccine mandates for federal contractors, federal employees and even Head Start childcare programs. The impact of the Court’s decisions is magnified in our current polarized and often dysfunctional political landscape in which Congress and the states often choose not to cooperate with the federal government, or even sister states, regardless of the health consequences. Indeed, the various structural limits that the Court has erected to protect states’ rights have come to serve as a tool that partisans use to attack the policies of federal leaders from the opposing party. Hence, we have the increasingly frequent practice of red states rushing to court to challenge the policies of Democratic presidents, and blue states bringing lawsuits against Republican presidents. How else to explain the fact that 22 states brought lawsuits challenging a vaccine mandate for federal contractors? With the courts’ assent, if not invitation, federalism has become but another weapon for partisan warriors. With that, health policies languish and public well-being declines. The deleterious impact of our polarized environment has also spurred battles among the states. During the early days of the pandemic, several states threatened to block travel from residents of other states. States also engaged in a bidding war for the procurement of critical supplies in spring 2020. Such intrastate strife has only escalated since the Supreme Court issued its decision in Dobbs v. Jackson Women’s Health Center, overturning Roe v. Wade. In theory, the Supreme Court’s decision should allow each state to go its own way. But this live-and-let-live attitude may not be viable with an issue as deeply contentious as abortion (as it was not with slavery or Jim Crow). Predictably, in the months since Dobbs was decided, we have seen the type of interstate battles that we have not seen since the Civil War, as states banning abortion have threatened to block interstate travel and criminalize procedures done in other states, while states permitting abortion rushed to pass laws protecting their clinicians from out-of-state prosecution. Meanwhile, the federal government and the states are also engaged in litigation about whether federal protections for patients in emergency departments supersedes state bans on abortion. And advocates on both sides of the issue seek a federal law codifying their position. In short, despite frequent paeans to federalism, neither side is willing to accept the diversity of approaches that federalism should entail. For more than a century, our federalism enabled the governmental units that were then best equipped to respond to health threats to do so. Even today, federalism need not be fatal, as the experience of other federal nations, such Germany and Canada, show. Both countries grant their states or provinces significant authority over health. But both nations were able to weather the COVID pandemic far more successfully than the U.S. And the citizens of both countries enjoy significantly longer life expectancies than Americans. Federalism is not, of course, the only reason why the U.S. fares so poorly as compared to other wealthy nations on a wide range of health measures. But in today’s increasingly polarized political environment, legal doctrines that once supported the states’ ability to protect the health of their residents are diminishing the capacity of both our national and local governments to do so. Unless the courts stop enabling this political weaponization of federalism, our federalism will remain uncooperative. And deadly.

But in today’s public health, political and legal environment, our federalism has become deadly. Rather than permitting the governmental units that can best tackle health problems to do so, federalism invites partisan litigation and thwarts interstate cooperation. As a result, both the states and the federal government are increasingly unable to meet the nation’s health threats, even as those threats become ever more complex and dangerous. This is not the first time our federalism has harmed health. Despite its many benefits, from the Constitution’s founding until the Civil War, federalism served to support slavery. Even after the Civil War and abolition, it perpetuated racial oppression, providing a rationale and legal defense for state laws that enforced segregation and imposed racial discrimination. By so doing, federalism helped to sow and maintain the racial inequities in health that continue to this day.

Congress singled out California for special treatment because of its history of smog, particularly in the Los Angeles region. The Biden administration has now employed this waiver authority to greenlight Mr. Newsom’s radical climate mandates for the auto industry, even though those mandates are motivated by a desire to advance global climate goals, not to address air-quality conditions unique to California. In the American system of federalism, all 50 states are supposed to be equal in sovereignty and dignity. True federalism means that each state has an equal ability to experiment with different rules in its own local markets, and unless Congress prescribes a national solution, each state can choose to adopt rules that are stricter or looser than those that apply in other states. That’s not what’s happening here. Contrary to Congress’ judgment that the auto industry requires uniform federal standards, the Biden administration has used the Clean Air Act waiver process to empower one single state in the Union, California, to dictate a revolutionary new industrial policy for the people of every other state. And the policy mandates Mr. Newsom is handing down are far stricter than anything the residents in most states would find acceptable — if they ever got the chance to decide the question for themselves. What Mr. Biden has unleashed with his California climate waiver is the antithesis of true federalism.

Both states and the federal government have tools that can influence inequality. Explicit redistribution via taxes and transfers is the mechanism that typically comes to mind when thinking about government’s influence on inequality, and this may have caused analysts to discount the role of states in the distributional process since state tax systems are less progressive and states maintain little or no independent welfare state. The activity of the federal and inactivity of state governments in explicit redistribution has been explained from a functional or competitive federal-ism standpoint. The two main economic activities of government are development and redistribution(Peterson 1995). Because the federal government is relatively inefficient at providing developmental policies, and the states are inefficient at providing redistribution, the federal government does more of the latter and subnational governments more of the former (Peterson 1995). This perspective on differing policy responsibilities is seen in studies of competitive federalism, with states limiting redistribution to avoid being a ‘‘welfare magnet’’ (Bailey and Rom2004). Perhaps not surprisingly then, studies find that state welfare effort has little impact on inequality(Barrilleaux and Davis 2003).If redistribution were the only mechanism avail-able to influence distributional outcomes, then the states would likely play a minor role in shaping income inequality. Kelly (2005, 2009) argues, how-ever, that government influences the distribution of income via ‘‘market conditioning,’’ by affecting a variety of decisions made in a market context, prior to redistribution, including the decisions that employers make about how much to pay their employees. For example, governments can make it easier to form unions, enabling workers to capture more corporate profits, reducing inequality. So it is mistaken to think that there is an abstract ‘‘market,’’ separate from government, producing an income distribution to which the government must then respond. There is evidence that national inequality is affected by government via both redistribution and market conditioning (Hacker and Pierson 2010; Kelly2005, 2009). Thus, it is important to consider the ability of state-level politics and policy to influence market outcomes. States have the authority to make policies in education and economic development (Witko and Newmark) and share responsibility in other areas, like labor regulations, that can condition the market. Previous studies at the state level do not distinguish between pre- and post-redistribution income, but this distinction may be important since state redistributive efforts appear to have little ability to reduce inequality(Barrilleaux and Davis 2003), and some policies examined in previous studies probably condition the market rather than redistribute income (e.g., Langer2001). Also, though states may have a limited will to redistribute, they do have some authority in federalized welfare programs (Bailey and Rom 2004;Plotnick and Winters 1985; Soss et al. 2001), and federalism and American inequality415managers can use discretion to expand or contract the scope of programs (Jacoby and Schneider 1996).Despite these important tools, the federal government appears to have a greater capacity to influence distributional outcomes. The major post-War reduction in inequality in the United States was spurred by changes in national policies and politics, not through the policies of individual states. The ability to create uniform policies affecting all citizens, the superior ability to tax and spend, and control over monetary and trade policy are just some of the tools not available to states. From a functional federalism perspective, then, the federal government should take the lead in fighting economic inequality, and between the New Deal and Great Society it clearly did. By the early 1980s, however, explicit federal government efforts to reduce economic inequality began to wane.

The majority of Americans secure their livelihoods, and those of their dependents, through paid employment, yet a job at non-poverty wages is out of reach for millions of Americans. Since most people must live by work, a first objective of an economic-security program must be to reach and maintain full employment. Thus, it is the purpose of the NIEC to provide employment for all persons seeking a job and to perform the work necessary to maintain and expand the nation’s physical and human infrastructure. The establishment of the NIEC will provide a direct mechanism for achieving permanent full employment in the U.S. economy. The NIEC would be administered by the Department of Labor and overseen by the Secretary of Labor.[33] The Secretary would administer employment grants to eligible entities, including state, county, and local governments, as well as Indian Nations, to engage in direct employment projects. These projects should be designed to address community needs and provide socially beneficial goods and services to communities and society at large. In addition, the Secretary shall work with federal agencies to identify areas of needed investment in the U.S. economy, including goods (examples: infrastructure, energy efficiency retrofitting) and services (examples: elder care, child care, job training, education, and health services). If projects at the local, county, or state level are inadequate to maintain full employment in the region, the Secretary shall intervene in the locality to provide adequate employment opportunities. Projects will be designed to assure full employment in all localities. The NIEC can be deployed to cover a wide scope of activities including, but not limited to, the repair, maintenance, and expansion of the nation's infrastructure, housing stock, and public buildings; energy efficiency upgrades to public and private buildings; assistance with ecological restoration and services to reduce the country’s carbon footprint; engagement in community development projects; provision of high-quality preschool and afterschool services; provision of teachers’ aids; provision of high-quality elder care and companionship; rejuvenation of the nation’s defunded postal service; support for the arts; and other activities that shall support the public good.[34] Because of the vital role of state and local governments in providing public workers and services, it is essential that federal agencies and the NIEC are empowered to work closely with these governments. Local and state governments will be encouraged to develop employment proposals in conjunction with community leaders, local government officials, labor organizations, and local residents to ensure the proposals will serve the needs of the constituents and available pool of labor. The employment proposals may not be used to employ individuals who will replace or speed the displacement of existing employees or individuals who would otherwise perform similar work.[35] The program will cover wage, benefits, and material expenses.[36] This structure will largely parallel the direct employment programs under the New Deal, whose projects were developed and proposed by local and state governments. Fostering partnerships and buy-in from local and state partners is critical to the success of the program, as localities may be most aware of the skills of their available workers as well as projects that will provide the greatest benefit to their communities.

 Direct government hiring by federal agencies would be essential for many reasons. First, in a polarized political environment, it is quite possible that some states may obstruct cooperation with federal government employment. Having a robust program of federal hiring, including directly in uncooperative states, would broaden the distribution of benefits and mechanize the mandate for guaranteed employment. The federal government has a well-established personnel system that has expanded before: witness the mobilization of government employment after the September 11th, 2001 terrorist attacks, including the creation of a new Cabinet-level department and the launching of new agencies such as the Transportation Security Agency (TSA).

Congress should both create new federal programs and fund federal agencies to expand existing programs. The kinds of programs can and should be shaped by the imperative social, political, and economic needs of the American republic.

1. Jobs to support state and local governments. State and local governments account for most of the government employment in the United States, and they comprise an important part of our federalist system. In a range of policy domains – public health, education and job training, infrastructure, health provision and conservation – it is state and local governments that have the legal authorities and historical capacities to act. Yet state governments also have the weakest capacity to respond to an economic crisis. First, state governments have nothing like the Federal Reserve to back their debt (this is one among several reasons that the Federal Reserve has recently been looking into mass purchases of municipal bonds). They cannot print money. Second, state governments lack the expansive revenue-generating capacity of the federal government. Beyond this, state governments have in recent decades constrained their powers with balanced budget amendments, while a number of states (Illinois and Connecticut are two examples) have badly underfunded pension systems, and still others have tethered their income to commodity (especially petroleum) sales, which are at historically low prices and whose price declines have damaged state revenues.

Workers and some capital costs for projects at the local, county, or state levels can be funded in a way to provide regional full employment and infrastructure needs. The projects and areas with the greatest needs could be cued to receive the federal intervention sooner. The Department of Labor would work closely with local governments. Local and state governments would, in conjunction with community organizations, develop project proposals to address local infrastructure needs, similar to the local, state, and federal collaborations in the design of direct government employment programs of the New Deal. Localities are likely most aware of the infrastructure needs to offer the greatest benefit to their communities.

Black Americans have been excluded from receiving benefits many times since the United States started offering social services decades ago. When the nation’s first federal health care program was created by the Freedman’s Bureau, Black Americans affected by a post-Civil War smallpox outbreak were largely ignored and given minimal assistance, which caused high mortality rates.[1] In the 1930s, New Deal antipoverty efforts sought to bring relief to Americans during and after the Great Depression, but southern states had enough congressional power to ensure that Black people were excluded from benefits like Social Security, minimum wage, and the G.I. Bill through selective work restrictions.[2] While many laws that fueled more explicit racial discrimination were repealed after the civil rights movement and other welfare rights efforts, current rules and processes often still perpetuate racial bias.

A more recent example is the social welfare reform of the 1990s. During this time, the Temporary Assistance to Needy Families (TANF) program was established as a block grant to replace the Aid to Families with Dependent Children (AFDC) program, and states were given more discretion to decide who receives benefits and how funds are spent. Cash assistance was no longer an entitlement available to anyone who met eligibility requirements. With no standard federal definition for what makes a family “needy,” states had broad freedom to choose eligibility criteria and income thresholds, mandate work requirements, and impose time limits for how long families can receive assistance. One study examined the level of inequality in the provision of safety-net programs across states from 1994 through 2014, measuring “generosity of benefits and inclusiveness of receipt.”[3] The authors found that the level of inequality in how generous or inclusive a state’s program was were highest in TANF-related programs and lowest in food assistance and health insurance, as the latter two programs have more oversight from the federal government.

Kogan 18 [Richard Kogan, 3-16-2018, Constitutional Balanced Budget Amendment Poses Serious Risks, Center on Budget and Policy Priorities, https://www.cbpp.org/research/federal-budget/constitutional-balanced-budget-amendment-poses-serious-risks] laura

A balanced budget amendment to the U.S. Constitution would be an unusual and economically dangerous way to address the nation’s long-term fiscal problems. It would threaten significant economic harm, as explained below. It also would raise a host of problems for the operation of Social Security and other vital federal programs. It’s striking that the House Republican leadership intends to schedule a vote on a balanced budget amendment just a few months after the President and Congress enacted a tax cut that will increase deficits by as much as $2 trillion over the next decade.[1] The economic problems with such an amendment are the most serious. By requiring a balanced budget every year, no matter the state of the economy, such an amendment would raise serious risks of tipping weak economies into recession and making recessions longer and deeper, causing very large job losses. That’s because the amendment would force policymakers to cut federal programs, raise taxes, or both when the economy is weak or already in recession — the exact opposite of what good economic policy would advise. When the economy slows, federal revenues decline or grow more slowly and the cost of unemployment insurance and other social programs increases, causing deficits to rise. Rather than allowing the “automatic stabilizers” of lower tax collections and higher unemployment and other benefits to cushion a weak economy, the amendment would force policymakers to cut programs, raise taxes, or both. That would launch a damaging spiral of bad economic and fiscal policy: a weaker economy would lead to higher deficits, which would force policymakers to cut programs or raise taxes more, which would further weaken the economy. If a such an amendment had been ratified when Congress last voted on these proposals and had been enforced for fiscal year 2012, “the effect on the economy would be catastrophic,” Macroeconomic Advisers, one of the nation’s preeminent private economic forecasting firms, concluded at the time. It would have caused the unemployment rate to double from 9 percent in that year to 18 percent by throwing an additional 15 million people out of work, according to the firm. Not only that, “recessions would be deeper and longer” under a constitutional balanced budget amendment, and uncertainty would be cast over the economy that could retard economic growth even in normal economic times, the analysis concluded.[2] The fact that states must balance their budgets every year — no matter how the economy is performing — makes it even more important that the federal government not also face this requirement and thus further impair a faltering economy. And while most constitutional balanced budget amendments introduced in Congress would allow Congress to waive the balanced budget requirement with a supermajority vote in both chambers, that hardly solves the problem. Recent experience shows the difficulty of securing a supermajority vote in both chambers for almost any major legislation. Moreover, data showing that the economy is in recession do not become available until the economy has already begun to weaken; it could well take many months before sufficient data are available to convince a congressional supermajority to waive the balanced budget requirement, if it were possible to do so at all. In the meantime, substantial economic damage — and large job losses — would have occurred. Beyond the economy, a balanced budget amendment would raise other problems. That’s because of its requirement that federal expenditures in any year must be offset by revenues collected in that same year. Social Security could not draw down the balances it has accumulated in previous years to pay benefits in a later year but, instead, could be forced to cut benefits even if it had ample balances in its trust funds; currently, those balances approach $2.9 trillion. The same would be true for the military retirement and civil service retirement programs, whose balances sum to $1.7 trillion. Nor could the Federal Deposit Insurance Corporation or the Pension Benefit Guaranty Corporation respond quickly to bank or pension fund failures by using their assets to pay deposit or pension insurance, unless they could do so without causing the budget to slip out of balance.

The balanced-budget amendment would force unthinkable spending cuts and threaten Social Security, Medicare, Medicaid, and other critical priorities No program would be protected from these severe cuts, including bulwarks such as Social Security, Medicare, and Medicaid. Under the proposed amendment, Social Security and Medicare to maintain benefits if the government, as a whole, were running a deficit. What might this look like in practice? The proposed amendment would take effect in the fifth fiscal year after its ratification. For example, if it were enacted in FY 2018, it would take effect in FY 2023. That year, the that government revenues will fall 23 percent short of government outlays. This means that without tax increases, reaching a balanced budget would require slashing the government budget by nearly one-quarter. If done across the board, without exempting the military or any other function, that would slash Social Security by $308 billion, Medicare by $239 billion, and Medicaid by $114 billion in a single year alone. And cuts would be even more drastic if the economy falls into a recession. Federal government revenues can be volatile during economic downturns. For example, in less than a year following the collapse of Lehman Brothers in September 2008, the federal government’s projected revenue for FY 2009 dropped by 15 percent—and this is not even counting the effect of tax cuts Congress passed in response to the economic crisis. If that kind of scenario repeats itself, Social Security benefits and other government spending would have to be cut by 35 percent, if done across the board. That would be devastating for those who rely on Social Security and other government programs and, as discussed below, potentially catastrophic for the economy. With a constitutional balanced-budget requirement and many lawmakers to oppose tax increases under any circumstances, there is no realistic scenario where Social Security, Medicare, and Medicaid escape unscathed.

The House is set to take up a balanced budget amendment this week, which would limit federal spending in each fiscal year to federal receipts in that year. Putting aside for a moment the chutzpah of House Republicans trying to pass a balanced budget amendment (BBA) just a few months removed from their passage of a $1.5 trillion tax cut that went largely to the richest households and big corporations, the simple fact is that the economic consequences of a balanced budget amendment range from extremely bad to catastrophic. The reason for this is that a BBA would amplify any negative economic shock to the economy and would thereby turn run-of-the-mill recessions into disasters. When the economy enters a recession, government deficits increase as tax revenues decline and government spending on programs such as unemployment insurance increase. These “automatic stabilizers” are incredibly important as they cushion the blow to the economy from a recession. For example, researchers at Goldman Sachs found that the shock to private sector spending from the bursting of the housing bubble was larger than the shock that led to the Great Depression of the 1930s. Given this larger initial shock, why didn’t we have another Great Depression, with unemployment rates approaching 20 percent and beyond, in 2009–10? The simple reason is that the mechanical increase in the deficit from tax reductions and increased transfer payments absorbed a lot (not enough, but a lot) of this shock, and automatic stabilizers were either non-existent or a lot smaller in the 1930s. Having these programs in place to absorb recessionary shocks is one of the great economic advances of the past 80 years—and getting rid of them by imposing a BBA makes as much sense as outlawing computers or antibiotics. To comply with a BBA as a recession approached, Congress would have to offset any mechanical increase in the deficit by raising taxes or cutting spending. The increased taxes or spending cuts would further drag on the economy, raising the deficit again and requiring still further tax increases or spending cuts. This vicious cycle would amplify the damage to the economy. Essentially this vicious cycle would lead to a large increase in the fiscal multiplier, with each dollar in spending cuts leading to output losses of about $2.50. The Federal Reserve could try to counteract this drag on the economy by cutting interest rates. But the extent to which they would be able to mitigate the damage may be extremely limited, for a couple of reasons. First, while the Fed can certainly restrain growth by raising interest rates, spurring growth by cutting rates is often ineffective; a dynamic often referred to as rate cuts akin to “pushing on a string.” Further, with current chronic downward pressure on aggregate demand, so-called “secular stagnation,” characterizing the U.S. economy in recent decades, it is likely that the Federal Reserve would be constrained by the zero-lower bound (ZLB) on interest rates—as it was during the Great Recession. Since interest rates cannot be moved (for too long or too far) below zero, when the Federal Reserve hits the ZLB they will be unable to offset any further drag on the economy through conventional monetary policy.

When an economic crisis hits, our state and local governments are in a bind. Revenue goes down. When consumers stop spending, the state stops collecting sales tax revenue. When businesses stop selling things, they stop sending in business and occupation tax payments.

Even as revenue plummets, the state’s need to spend goes up. State assistance — in the form of unemployment benefits, AppleCare and other supports — could literally be a matter of life or death for families in an hour of great need.

The passage of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (PRWORA) devolved responsibility for the design and implementation of welfare programs from the federal to state governments in the U.S. The motivation was to prompt states to create effective and innovative programs in order to promote higher levels of labor participation and decreasing levels of welfare dependency. As states were given more capacity to design their programs, the reform produced some kind of ‘laboratories of democracy’, using the phrase popularized by U.S. Supreme Court Justice Louis Brandeis. Two decades later, considerable evidence has accumulated showing that in the process of welfare reform state and local governments have followed differing strategies and ended enacting very different programs. We have also learned that some states and localities have been more responsive to the new framework than others as they have taken more advantage of the opportunity to change the design of the programs. This diverse response became more evident with the Great Recession, renewing discussion about the potential social welfare costs in terms of the resulting differences in benefit levels across states. While the success of the programs should be measured mainly according to their initial objectives –promoting higher levels of labor participation and decreasing levels of welfare dependency– some of the strategies implemented might have had the effect of severely reducing the protection received by the most vulnerable households in some states. Inequality arising from the increasing differences of cash benefit levels across states has been also perceived as an additional distributional concern with potential welfare implications. There are several avenues through which PRWORA can potentially increase differences in welfare benefits across states. States have broad discretion to determine policies while 2 complying with three federal requirements: fostering labor transitions through work requirements, imposing sanctions to those who fail to comply with the work requirements, and setting time limits on the receipt of benefits. States can also modify eligibility requirements, including asset and earnings disregards. Additionally, states have the ability to choose the intensity of benefits provided through the program. A key issue is whether this increase in discretion for state governments has led to more generous welfare programs providing better protection or, in contrast, to more punitive welfare programs that offer lower level of benefits, stringer eligibility criteria and more restrictive work requirements. A second, less investigated, set of issues is whether decentralization has given rise to a substantial divergence in the level of benefits across states and what are the distributional consequences of this process. An important concern is whether higher levels of labor participation and decreasing levels of welfare dependency might have been obtained at the same time that benefits became lower and distributed more unequally across states. These potential outcomes may have relevant implications in terms of inequality. First, higher adequacy in welfare benefits can be crucial to improve the situation of the most disadvantaged households and to some extent can represent the gains in social welfare resulting from public intervention. Some previous studies have proposed social welfare indices characterized in terms of the level of welfare embodied in a given distribution of adequacy rates (Ayala and BárcenaMartín, 2018). Second, other studies looking at variation in the decentralized social safety net have found that it fosters new forms and dimensions of inequality and have used inequality indicators to measure these differences (Bruch et al., 2016; Meni and Wiseman, 2017). Unevenness across states in adequacy rates have important distributional consequences for economically-vulnerable families. If we assume that the sufficiency of economic resources 3 provides to a certain extent an overall judgement of social welfare in a given country or region, we can look at the distribution of adequacy rates across states in a similar way to the standard analysis of inequality. According to the intensive literature on abbreviated social welfare functions (Sen, 1973; Chakravarty, 2009), a lower mean –in this case decreasing adequacy rates– and higher inequality –larger differences across states– yield lower levels of social welfare. In this way, social welfare does not only depend on the level of adequacy in each state but also on differences across states. Decentralization might also give rise to a ‘race to the bottom’ with lower benefit levels and higher differences across states (Peterson and Rom, 1989; Shroder, 1995; Rom et al., 1998; Figlio et al., 1999; Brueckner, 2000; Saavedra, 2000; Berry et al., 2003; Bailey and Rom, 2004; Baicker, 2005a, b), and, as a consequence, lead to considerable welfare under-provision (Gramlich et al., 1982; Brown and Oates, 1987; Wheaton, 2000; McKinnish, 2005; Toolsema and Allers, 2014). While the evidence is somewhat mixed regarding the size and causes of the ‘race to the bottom’ effect, most studies confirm it. The empirical importance of such differences across jurisdictions has also been addressed in studies of some European countries with decentralized welfare related policies, such as personal social services in the UK (Revelli, 2006), local welfare benefits in Norway (Fiva and Rattsø, 2006), and the refugee placement program in Sweden (Dahlberg and Edmark, 2008) As the evidence on lower benefits in real terms with respect to the levels before the reform in many states is increasingly robust, there has been renewed academic discussion over how a more decentralized system of welfare provision can lead to higher differences in welfare levels across states. As stressed by Chernick (2000), if more fiscal responsibility for redistribution is left to subnational levels of government, then states with weak fiscal capacity or limited preferences for 4 redistributions might choose benefits and levels of access that fall below some supposed minimum national standards of adequacy.

Families experiencing poverty need access to cash assistance to help them afford their basic needs and maintain stability, particularly during the ongoing COVID-19 pandemic. Families use assistance provided by the Temporary Assistance for Needy Families (TANF) program to pay for rent, utilities, diapers, food, transportation, and other necessities. Yet too few families struggling to make ends meet can access the program, and TANF’s history of racism means that it fails to reach many families in states where Black children are likelier to live. If TANF had the same reach in 2020 as its predecessor, Aid to Families with Dependent Child (AFDC), did in 1996, 2.38 million more families nationwide would have received cash assistance. Instead, in 2020, for every 100 families in poverty nationwide, only 21 received TANF cash assistance — down from 68 families in 1996. At an economically precarious time for families, this “TANF-to-poverty ratio” (TPR) is the lowest in the program’s history. (See Figure 1.) This paper analyzes TANF caseload and poverty data from 2020, the most recent year available. The official U.S. poverty rate rose from 2019 to 2020 — the first rise in poverty after five years of decline — due to the COVID-19 pandemic and the resulting economic crisis.[1] Widespread hardship has created instability for millions of families with children, some of whom have turned to TANF, among other public programs, for relief.[2] But as this paper illustrates, TANF does not reach many families in need.[3] Access is worst for Black families, who have been especially hard hit by the pandemic’s impacts.[4] Further, though TANF caseloads grew in many states in 2020, the program’s benefit levels are extremely low in many states, falling far short of what families need to meet their basic needs.[5] Access to TANF largely depends on where a family lives. There are no federal minimum eligibility standards and states have the power to erect barriers or create pathways to TANF cash assistance. This has led to wide variation among state TPRs, which range from 71 in California and Vermont to just 4 in Arkansas, Louisiana, Mississippi, and Texas (see Appendix B, Figure 1). In 14 states, for every 100 families living in poverty, 10 or fewer receive TANF cash assistance. These geographic disparities reflect racial inequities in TANF: compared to white children, Latinx children are somewhat more likely, and Black children even more likely, to live in states with the lowest TPRs. The history of racism in cash assistance programs in the United States lives on in policies that impact access to TANF today, from strict work requirements and time limits to invasive behavioral requirements, exacerbating the barriers Black and Latinx families still face to economic stability.[6] More income during early childhood can improve children’s futures, research continues to find.[7] But TANF’s limited reach means that when families hit hard times because they have lost a job, are fleeing domestic violence, or are facing a health or mental health crisis, they may have no access to cash assistance. Blocking families from assistance to meet their basic needs often puts them on a downward spiral, making it even harder to get back on their feet, and may have long-term negative consequences for children. State and federal policymakers can change these trends. States should remove barriers to assistance and ease policies that cut off families who are still struggling. At the federal level, policymakers should hold states accountable for serving families experiencing poverty and provide the resources to help them do so. Amid the nationwide hardship in 2020 that resulted from the pandemic, the number of families receiving TANF benefits increased in some states but stayed the same or fell in others over the course of the year. Nationally, the average monthly TANF caseload declined between 2019 and 2020, but that metric misses the rise and fall of the caseload during the year. In fact, caseloads rose at the beginning of the pandemic in early 2020 and fell by the end of the year. Some of this decline likely is attributed to the availability of pandemic federal unemployment benefits and other financial assistance, such as Economic Impact Payments. Most states made temporary TANF policy changes at the start of the pandemic due to public health precautions, limited opportunities for residents to find work, and staff safety. These changes, which reduced the burden of applying for or maintaining benefits, ranged from extending eligibility recertifications and halting in-person interview requirements to suspending work requirements and providing expanded time limit exemptions. At the start of the pandemic, applications for TANF soared nationwide, from about 170,000 in February to 316,000 in April, then plummeted to 174,000 in July. Applications modestly rose over the remainder of the year, ending at 233,000 in December. At the start of the pandemic, caseloads rose in 35 states. By the end of 2020, they had fallen in 34, though not all states with a drop had seen a rise earlier in the year. Caseloads remained higher than January and February 2020 in only 12 states. (See Figure 2.) In some states, policy and administrative changes may have contributed to a sustained increased caseload. For example, Indiana suspended requirements that applicants complete job search activities before receiving benefits and redeterminations, and Maryland suspended work requirements and extended eligibility recertifications and verifications. Caseloads rose substantially in both states during the spring and stayed high for the rest of the year. TANF would help many more families in poverty had it maintained AFDC’s reach in 1996. Instead, its reach has fallen dramatically. If TANF had maintained the same reach to families in poverty as AFDC had in 1996, 3.44 million families would have received TANF in 2020, about 2.38 million more than reported for that year. (See Figure 3.) In the average month in 2020, TANF reached the fewest number of families since TANF’s start, even as the number of families in poverty increased. This pattern of reaching few families living in poverty has persisted. Before 2020, the TPR declined because TANF caseloads had fallen much more than the number of families experiencing poverty. In 2020, the TPR declined because the average monthly TANF caseload fell while the number of families in poverty increased.The national TANF-to-poverty ratio misses the extreme — and growing — variation among states. In 2020 the TPR ranged from 71 in California and Vermont to just 4 in Arkansas, Louisiana, Mississippi, and Texas. (See Figure 4.) (To improve the reliability of the state-level poverty data, we created two-year averages of the poverty numbers; we also converted the caseload data into two-year averages to calculate the TPRs. The years cited here are for the latter of the two years.) The TPR fell in most states between 2006 (the last time TANF was reauthorized) and 2020 for several reasons: state responses to federal policy changes when TANF was reauthorized and in response to the pandemic, adoption of more restrictive policies as part of a broader attack on economic security programs, and policy changes to restrict access and reduce costs during the Great Recession of 2007-2009, among other factors. (See Appendix B, Table 1.) The TPR dropped by 10 or more points in 25 states over this period; in 14 of those states, it dropped by 20 points or more. Though TPRs have fallen both nationally and in every state since 1996, some states’ TPRs have risen in recent years. In 2020, the TPR increased in 15 states from the prior year. TANF caseloads increased in eight of these states in 2020: Illinois, Maine, Maryland, Massachusetts, Minnesota, Nebraska, New Mexico, and Washington. In the seven other states, the TPR rose because the number of families in poverty fell more than caseloads. An especially troubling trend is the number of states with TPRs of 10 or less. In 2006, only three states (Idaho, Louisiana, and Wyoming) had such low ratios, and in 1996, none did. In 2020, 14 states had TPRs of 10 or less: Alabama, Arizona, Arkansas, Georgia, Indiana, Kansas, Louisiana, Mississippi, North Carolina, Oklahoma, South Carolina, Texas, Utah, and Wyoming. Three of these states have had especially large drops in their TPRs since 2006: Indiana (29 points), Kansas (23 points), and Arizona (21 points). All have made significant policy or administrative changes that have made it harder for families to receive benefits. (See Figure 5.) In 2020, more than one-third (37 percent) of families with children in poverty lived in states with TPRs of 10 or less. A history of racist policies that aimed to limit Black mothers’ access to family cash assistance programs continues to contribute to racial disparities in access to TANF today.[8] Forty-one percent of the nation’s Black children live in states with TPRs of 10 or less, compared to 34 percent of Latinx children and 29 percent of white children.[9] Nationally, therefore, Black children are less likely than white children and somewhat less likely than Latinx children to have access to TANF assistance when their families fall into crisis. Moreover, if Black families do manage to receive TANF cash benefits, they are likelier to live in states with the lowest benefit levels, which do little to help families meet their basic needs.[10] Disparate access has persisted over decades: averaged together, the 14 states with the lowest TPRs today consistently had ratios lower than the national average every year between 1979, the earliest year of our state analysis, and 2020. Individually, a few of these states had ratios above the national average for some years, but generally, they had lower ratios than the national average even before TANF was implemented (see Appendix B, Table 4). From its roots, the public cash assistance system has excluded Black families in need.[11] In the early 20th century, supporting people in need was typically the responsibility of private organizations, which had full discretion to exclude individuals based on race, nationality, or religion. Some of the earliest public cash assistance programs, mothers’ pension programs, provided small benefits to widows and their children. Yet many mothers’ pension programs refused to serve Black women or other women of color; in 1931 only 3 percent of mothers’ pension program recipients were Black or “non-white.”[12] In 1935, as part of that year’s Social Security Act, the United States established the first federal cash aid program for children, Aid to Dependent Children (ADC), which provided federal support to states for family cash assistance programs. The Southern congressional delegation (a crucial bloc in both chambers) successfully insisted on provisions that gave control of the program to state and local officials, thus protecting the white supremacist socioeconomic order of the Jim Crow South from the perceived threat of an expanded federal government.[13] One way Southern officials tried to keep Black mothers available for work was to simply reject or ignore their applications for aid.[14] Even if a Black family’s application was accepted, officials could coerce them to work by deliberately paying out lower benefits or with so-called “farm policies” where benefits were lowered or cut off during the planting or harvesting seasons to force parents and children as young as 7 into the fields for extremely low wages. In Louisiana and Arkansas, for example, benefits would be lowered or halted completely regardless of whether the family had secured such employment during planting or harvesting seasons.[15] States also restricted access to benefits for Black families through “suitable home” policies; 23 states passed such laws between the late 1940s and the early 1960s.[16] Though they appeared throughout the country, the most punitive of these policies were in the South, where most Black people lived, and they often targeted Black families. In 1960, Louisiana legislators passed two laws with a suitable home definition that cut off more than 6,000 families in the span of three months; 95 percent of the children in those families were Black. Later that year about half of the families who were cut off had their reapplications rejected or did not reapply. Some of the families who did not reapply did not know they could.[17] “Man-in-the-house”[18] rules also disproportionally affected Black women.[19] Caseworkers often cut off families with little evidence of a romantic relationship or whether the partner was providing support to the family. After Georgia enacted a policy package in 1952 that included a man-in-the-house provision, the growth of Black families on the state’s ADC rolls slowed for several years.[20] The ADC (renamed AFDC in 1962) caseload grew through the 1960s and 1970s and, despite states’ efforts to limit Black families’ participation in the program, their numbers grew as well.[21] To ensure that Black families could access assistance, the National Welfare Rights Organization (NWRO), led by Black mothers and their allies, sought to end discriminatory practices. They educated parents about AFDC policy and advocated for more benefits to families.[22] NWRO also partnered with legal aid lawyers to push for greater enforcement of federal eligibility standards.[23] Their efforts led to several Supreme Court decisions that contributed to ending some of the most harmful state eligibility rules. In particular, the ruling in King v. Smith invalidated man-in-the-house policies and precluded states from adding eligibility restrictions on participants.[24] During that period, an increased federal role in AFDC helped the program reach more families in poverty. The program boosted the federal contribution to state programs and expanded eligibility in other ways, such as extending the child age of eligibility to 18 and allowing children with two parents in the home, one of whom was unemployed, to participate in the program. Between 1961 and 1979, the number of families on AFDC nearly tripled and the number of Black families on the program more than tripled.[25] The AFDC-to-poverty ratio grew in the 1970s and remained around or above 60 between 1979 until AFDC ended in 1996. (See Appendix B, Table 2.) Despite gains made in the 1960s and 1970s, the access to and adequacy of benefits under AFDC remained limited. During this time, policymakers increased their attention on mothers’ work effort while participating in AFDC. In 1967, the Work Incentive Program (WIN) required states to establish work and training programs; it later required participants to register for a work program. In 1988, the Job Opportunities and Basic Skills Training program replaced WIN and required states to engage mothers with children over the age of 3 in work and work-preparation activities.[26] Still, under the AFDC law, states could only reduce benefits by removing the needs of a parent and could not terminate or deny benefits to the entire family. Then, under a proliferation of waivers in the 1990s, states were allowed to bypass federal eligibility restrictions and began implementing policies to cut the whole family off if a parent did not meet work requirements.[27] Further ground has been lost under TANF. With its creation in 1996, the federal government eliminated federal minimum eligibility standards, granting states broad flexibility with respect to eligibility requirements and sanctions. States have taken advantage of this considerable freedom to implement policies that restrict access to the program, including upfront work requirements, full-family sanctions, time limits, family caps, drug testing requirements, and felony drug bans, among others. The 1996 law set a lifetime limit of 60 months on receipt of federally funded benefits, and many states have opted for even shorter time limits, cutting thousands of families off from benefits.[28] And further, TANF created financial incentives for states to reduce caseloads.[29] These changes have led to a decline in the TPR nearly every year since TANF’s start. Leading policymakers have continued to advance proposals to restrict access to benefits based on racist stereotypes: in 2014, then-House Budget Committee Chairman Paul Ryan argued that work requirements were needed in TANF because people in “inner cities” do not value work, referring through coded language to Black people.[30] These changes disproportionately impact Black families. For example, research consistently finds that African American recipients are significantly more likely to be sanctioned than white recipients.[31] Black and Indigenous families were likelier than other families to be cut off due to time limit changes, research in Washington State found.[32] And research finds that all else equal, states with larger African American populations have less generous and more restrictive TANF policies.[33] These policies impact everyone, regardless of race: today, states that historically denied Black families have simply opted to help few families at all. The decline in access to TANF benefits has left many of the families experiencing the deepest poverty without resources to meet their basic needs. TANF does far worse than AFDC did in lifting families out of deep poverty (incomes below half of the poverty line). In the decade following the creation of TANF, deep poverty actually rose, largely among the families impacted by the law, with the greatest impact on Black and Latinx children, when using an assessment of poverty that includes more forms of income from public benefits than the official poverty measure.[35] Today, TANF benefits alone are insufficient to help families move out of poverty in any state, and are sufficient to keep families out of deep poverty in only New Hampshire.[36] While AFDC helped more than 2.9 million children out of deep poverty in 1995, TANF helped only 260,000 children out of deep poverty in 2017, one analysis found.[37] In 1995, only three states had more families living in deep poverty than receiving AFDC. By 2020, most states had more families living in deep poverty than receiving TANF. Income support programs can improve children’s academic, health, and economic outcomes, the National Academies of Sciences’ report on reducing childhood poverty finds.[38] Even relatively small amounts of income make a difference. Among families with incomes below $25,000, children whose families received a $3,000 annual income boost when the children were under age 6 earned 17 percent more as adults and worked 135 more hours per year after age 25 than otherwise-similar children whose families didn’t receive the income boost, research finds.[39] More recently, a major study found that cash assistance directly improves infant brain development associated with higher language, cognitive scores, and better social skills.[40] These research studies suggest that TANF policy changes that cut families’ income, such as harsher sanctions, shorter time limits, or significantly reduced benefits, could harm young children now and in the future. TANF Should Do More to Help Families Meet Basic Needs Federal policymakers have not increased the TANF block grant since its inception; as a result, it has lost nearly 40 percent of its value due to inflation. That fixed block grant funding and erosion, combined with TANF’s nearly unfettered state flexibility, narrowly defined work requirements, and time limits, have created a system in which very few families in need receive cash assistance or help preparing for success in today’s labor market. The lack of minimum federal standards has allowed states to enact extremely restrictive eligibility policies, leaving the families with the greatest needs — including, disproportionately, Black families — unable to cover the basic essentials through either employment or cash assistance. Other anti-poverty programs cannot fill TANF’s role. Even though the Earned Income Tax Credit and Child Tax Credit increase families’ incomes and reduce poverty, they do not provide families with enough income to meet their basic needs. Other cash assistance programs, such as Unemployment Insurance and Supplemental Security Income, have eligibility standards that make them unavailable to the wider share of families who fall on hard times and need cash to meet their basic needs. Many families not receiving TANF benefits may receive food assistance from SNAP (formerly food stamps), but SNAP benefits cannot help families pay rent or buy personal hygiene items or diapers or clothes for their children.[41] While the temporary pandemic measures helped alleviate severe hardship for many families, TANF is overdue for significant, permanent improvements.[42] State and federal policy changes should focus on serving more families who need assistance, alleviating the program’s deep racial disparities, and ensuring that adequate resources are available to achieve these goals. For example, states should: Remove barriers to access for those seeking cash assistance. States have too many requirements that create challenges for people applying to TANF while in crisis. States should remove requirements like applicant job search and other hurdles that make it harder to get assistance and should take steps to make applying for benefits more accessible. States should also eliminate burdensome requirements on families such as school attendance and immunization requirements. Stop cutting off families who are struggling to meet their basic needs. Two of the main causes of TANF’s dramatic caseload decline are full-family sanctions that end benefits to the entire family and arbitrary time limits. As noted above, families cut off by sanctions and time limits are more likely to have greater barriers to employment and to be families of color. States should ensure that their programs have adequate protections for families with significant barriers to work before imposing sanctions and time limits. Children should continue to receive benefits if the state imposes a sanction or a family reaches a time limit. Lift income thresholds and asset tests for applicants. In many states, eligible TANF applicants must be so destitute that few families in poverty even qualify. States should lift income thresholds and eliminate asset tests to broaden eligibility to more families. Additionally, federal policymakers should: Hold states accountable to serving families in need. States focus on what they are incentivized to do. To expand TANF’s reach, Congress should remove incentives that encourage states not to assist families and should create a state accountability measure that focuses on serving families in need (such as the TPR). States that fail to meet a specified standard could be required to spend additional resources on cash assistance or work activities. Require states to direct a specified share of federal and state resources to families receiving cash assistance. TANF’s purposes are broad, which has given states the flexibility to spread program funds throughout their budgets and allowed them to shift resources away from assistance to families. To better target resources, Congress should require states to spend a specific share of their state and federal TANF funds on basic assistance. Provide more resources for states to provide cash assistance. The TANF block grant is worth 40 percent less than when it was created in 1996. Without additional funds, states are unlikely to adopt policies that would reach more families as this would increase the costs of providing cash assistance to families. With a fixed block grant, providing cash to more families means taking money away from other activities that use TANF funds. Any additional funds should be restricted to TANF’s core purposes: cash assistance, employment assistance, and work supports.

Newsom’s proposal would not create a statewide guaranteed income program. Instead, it would help pay for local governments to start their own programs. Local governments would have to help pay for it — either using local taxpayer money or finding private donors — and the programs must target low-income families.

The state proposal is a milestone for Tubbs, who has said guaranteed income programs will only work long-term if they are run by the federal government. His goal has been to demonstrate that these programs work in the hopes of convincing Congress to pay for one nationwide.