Perm do both – States alone fail due to weak pension plans, balanced budget amendments, and weak economic response. Prefer Federal employment working at the state level.
Carpenter and Hamilton ’20 (1) Daniel Carpenter is Allie S. Freed Professor of Government and Chair of the Department of Government in the Faculty of Arts and Sciences at Harvard University. He taught previously at Princeton University (1995-1998) and the University of Michigan (1998-2002). (2) Darrick Hamilton is a university professor, the Henry Cohen Professor of Economics and Urban Policy, and the founding director of the institute on Race, Power and Political Economy at The New School. “A FEDERAL JOB GUARANTEE: ANTI-POVERTY AND INFRASTRUCTURE POLICY FOR A BETTER FUTURE.” Scholars Strategy Network, 4/30/20, https://scholars.org/contribution/federal-job-guarantee, (WA)
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.
In order to minimize inequality across states and reduce the burden of discrimination, the workers under this program would be federally employed but would be tasked or apportioned (perhaps by formula, to reduce near-term political discretion) to states according to their economic, public health, and infrastructure needs. Even if the work occurs at the state and local level, the federal government needs to step in to provide the jobs, and there are a range of tools it has to do so. The traditional tool consists of program-specific block grants that have been an important feature of American government since the New Deal and especially the Nixon era. The problem with these grants is that they often permit state and local officials to withhold important resources from populations in need, as occurred with so many states’ refusal to take Medicaid expansions under the Affordable Care Act. Our proposal would build upon the strengths of grants by making the jobs available to states and local governments, but would address the inequality-related weakness of these programs by making the employees federal workers who, as such, are made available to state and local governments.
In order to avoid potentially unconstitutional imposition of requirements upon state governments (which were declared unconstitutional in NFIB v. Sebelius (2012)), the federal government could offer these jobs as an option, as it did with Medicaid expansion in the Affordable Care Act. Another alternative is to allow state and localities to develop a bank of proposals for physical and human infrastructure from which a federal authority (operating under formulaic or discretionary procedures) can prioritize with regards to urgent and useful needs. The state and localities can even administer the program with federal oversight, however, the workers would be ultimately employed by the federal government, as opposed to state or local employees by way of a federal grant.