NEWSBYKATHRYN BAER

When I last wrote about the proposed time limit on TANF benefits in the District, I thought it was dead — at least for awhile. But it's come to life again, though in a different form.

Here's the new chapter — and a new opportunity to act.

Mayor Fenty has produced a plan (pdf) to close the immediate budget gap the District faces— now an estimated $12 million more than a few months ago.

He's decided to hold fast to his pledge not to raise taxes, even though it didn't get him reelected. Also decided not to substitute a battery of new and higher fees, as he has in the past.

So he's got to find about $160 million in savings within a budget that's already been cut to the bone to close previous gaps.

Among the savings he's come up with are more than $4.6 million in TANF benefits. These would be achieved by a 20 percent reduction in the maximum available to all families who've participated in the program for more than five years — whether five years running or intermittently over a long period of time.

The gap-closing plan says the change is "to more closely align with federal policy." Sounds like the District is in noncompliance, doesn't it? But the truth is quite different.

It's rare when an elected official formally renounces his own legislation, but that's what's happened with the proposed time limits on public assistance in the District of Columbia. So let's take a moment to celebrate this victory and see how it happened.

As I recently wrote, Councilmember Marion Barry, joined by Councilmember Yvette Alexander, introduced a bill that would have imposed a five-year lifetime limit on all forms of public assistance in the District.

I suspected -- and rightly -- that the Councilmembers didn't understand their bill. When interviewed by a Washington Post reporter, both spoke only about the District's TANF program. Perhaps other Councilmembers originally understood the bill this way as well.

But then the D.C. Legal Aid Society produced a detailed analysis for a large network of local organizations that work together as the Fair Budget Coalition.

A diverse group of them -- policy research, advocacy and direct service organizations -- signed on to a letter presenting the analysis to Councilmembers. Joining them were several national organizations and the University of the District of Columbia's law school.

A number of you signed the petition here urging the Council to reject the proposed law. Your voices surely helped make a difference.

One thing I like about living in the District of Columbia is that we have a progressive local government. Have had ever since Congress granted us a limited degree of autonomy.

A case in point is the Homeless Services Reform Act (pdf), which among other things gives everyone in the District a right to shelter in severe weather. Severe weather means a temperature, including wind chill factor or heat index, below 32 degrees and above 95 degrees.

The HRSA establishes a multi-stakeholder group -- the Interagency Council on Homelessness -- to plan and oversee homeless services in the District. One of its major tasks is to develop a detailed annual plan for ensuring that the District can in fact provide adequate shelter during the winter season.

Last year, the plan proved woefully inadequate to protect homeless families. As a result, DC General, the emergency shelter for families, was filled to overflowing for several months.

Many families sleeping on cots in what was supposed to be the recreation room. Families sleeping in hallways. Some in closets. Other extraordinarily unhealthy conditions due at least in part to the overcrowding -- rats, roaches, mold, etc.

Councilmember Tommy Wells, who chairs the DC Council committee that oversees homeless services, was outraged. He's bound and determined that this year will be different.

Also bound and determined that the solution won't be expanded space at DC General. It is, as he's said, "an awful place for children to be." A major reason is that the existing space fails to comply with the HRSA, which requires apartment-style shelter units for families.

The triumphant Republican leadership views the election results as a mandate to slash federal spending. But a substantial majority of voters don't want Congress to end funding for the expiring federal unemployment benefits programs.

The American people, says soon-to-be House Majority Leader John Boehner, have repudiated "big government." He implies that they've endorsed his party's pledge to roll back federal spending to the pre-Recovery Act level — part of its plan to bring down the deficit.

A recent survey by a major polling firm shows this isn't so — at least not when it comes to extending the expanded unemployment benefits initiated during the Bush administration. Here's one issue where voters don't decisively split on the basis of party, geographic region, education level or race/ethnicity.

A recent online briefing hosted by Half in Ten and the Coalition on Human Needs gave me a chance to see the survey results in detail. I was most struck by the responses to a couple of drill-down questions.

When asked whether they would support continuing the current federal unemployment benefits for workers who've exhausted their state unemployment benefits, 60 percent of voters said they would, while only 37 percent said they wouldn't.

This in itself is significant. But look what happens when the policy choice is fleshed out.

Voters were asked which of two statements they agreed with more. The first said it was too early to end unemployment benefits because the unemployment rate is 9.6 percent and millions are out of work. The second said that it's time for the government to start cutting back on employment benefits because the federal deficit is over $1 trillion.

Now 73 percent of voters support a continuation, 47 percent very strongly.

Like state and local governments across the country, the District of Columbia is facing a budget shortfall.

We've got a $175 million gap that's got to be closed right now. And our total local budget (pdf) is only somewhat over $6.1 billion.

There's nothing unique about the main cause of the shortfall. The recession has resulted in a sharp drop in tax revenues — even greater than the loss projected at the time the budget was passed.

Add to this the fact that the District, like 30 states (pdf), budgeted on the assumption that Congress would fully extend the higher match on state Medicaid costs. Congress instead enacted a penny-pinching, phased-down extension, leaving the District with $34 million less than it expected.

So we're once again plunged into controversy. How should the budget gap be closed?

The D.C. Council has addressed budget gaps before. It's leaned heavily toward spending cuts, sometimes combined with a modest admixture of revenue raisers. This approach has delivered a double whammy to low-income residents.

On the one hand, programs that serve their needs have been cut back — or in the case of some already under-funded programs, denied overdue increases.

Last year, for example, these programs took a $49 million hit (pdf), notwithstanding rising recession-driven needs. TANF cash benefits (pdf) were again level-funded, leaving a participating family of three at 28 percent of the federal poverty line.

At the same time, sales and excise taxes were increased. And the personal exemption and standard deduction in the income tax were frozen, as was a property tax deduction that can be claimed by residents who live in the houses they own. All these revenue raisers were disproportionately costly for low-income residents.

For the last two years, the Food Research and Action Center has been tracking food hardship in the U.S. Its latest food hardship report (pdf) delivers some good news — and a warning.

First a bit of explanation. Food hardship is similar to the food insecurity (pdf) tracked by the U.S. Department of Agriculture. People are counted as food hardship cases when there have been times during the year that they didn't have enough money to buy enough food for themselves or their family.

Now the good news. The food stamp program is working. Program participation continues to set record levels, as it should during this deep recession. It was up to more than 42.3 million people in August — 17 percent more (pdf) than just a year ago.

At the same time, the percent of households experiencing food hardship has declined somewhat since the early phase of the recession. In January 2008, the food hardship rate was 16.5 percent. By the end of the year, it had risen to 19.4 percent.

Then Congress approved a 13.6 percent boost in maximum food stamp benefits as part of the Recovery Act. And the food hardship rate began to go down. The average rate for the last four months of 2009 was 18.5 percent.

For the current year thus far, the rate has averaged 17.7 percent — still disturbingly high, but considerably below the November 2008 peak of 20.3 percent.

It's also a fairly encouraging number, given the ongoing jobs crisis. In fact, says Deborah Weinstein, Executive Director of the Coalition on Human Needs, "given continued unemployment and underemployment, the food hardship rates should actually be much higher."

And now the warning.

Two D.C. Councilmembers have introduced a bill (pdf) that would set a five-year lifetime limit on all forms of public assistance in the District. We're reading a lot about cuts in state and local programs that serve low-income people, but this is, by far and away, the most drastic I've seen.

Among other things, the proposed District of Columbia Public Assistance Amendment Act isn't targeting one program or several. It's across the board.

Health insurance through Medicaid and the District's own health care program for low-income people, child care subsidies, housing vouchers, shelter and other services for homeless people, TANF cash benefits, education and job training. All these and more cut off at the end of five years — no matter why an individual or family has needed them, no matter if those five years were spaced out over, say, 50.

Another big difference is that the bill is not a proposed funding cut for one budget year like, for example, California Governor Schwarzenegger's planned cut in child care assistance. It would be a permanent limit embedded in the District's basic laws.

One of the sponsors, Councilmember Marion Barry, represents the poorest ward in the District. Even before the recession set in, more than one in three of his constituents (pdf) lived below the very low federal poverty line.

Yet he's decided to pull the safety net out from under them because, he says, he wants to "break the generational cycle of poverty." Nothing so good for that as plunging parents and their vulnerable children into destitution.

Why the other Councilmember, Yvette Alexander, decided to go along is also perplexing. Her ward is the second poorest. According to an analysis (pdf) of the latest Census figures, 41 percent of her constituents have incomes at or below 150 percent of the poverty line.

People across the country are facing threats of foreclosure or eviction, some legally justified, others not. People are running into roadblocks when they seek housing vouchers, food stamps or other public assistance. People are overwhelmed by debt and need to work out something with their creditors. And as always, people (mostly women) are experiencing domestic violence, difficulties securing child support and conflicts over visitation, custody rights and the like.

These people need a lawyer. But, as everyone knows, private legal services are costly. And just as the recession is driving up both need for legal services and the number of people who can't afford them, it's creating a huge budget crunch for the non-profits that provide free legal services.

Even before the recession set in, there was a nationwide justice gap, i.e., a big difference between the level of legal assistance low-income people need and the capacity of non-profits to provide it.

In 2005, the Legal Services Corporation, which channels federal funds to nonprofit legal aid providers, reported (pdf) that half the people who sought help from a program it funded were turned away because of insufficient resources. That's about a million cases a year where our system failed to provide equal justice under the law.

Though Congress increased LCS funding for Fiscal Year 2008, the corporation reported (pdf) as broad a justice gap in 2009. Looking back over a longer period, we can see the gap has actually widened.

In 1980, Congress provided enough funding to meet a specific minimum access standard — two lawyers, with appropriate support, for every 10,000 poor people. In 2009, LCS found, on average, only one legal aid lawyer for every 6,415 poor people. There were nearly 15 times as many private-practice lawyers for people above the federal poverty line.

What's the opposite of a boycott? A Carrotmob.

The carrot here is the opposite of the boycott stick like the one that forced the Mott Corporation to back off its planned cuts in worker wages and benefits. It's a reward for companies that are doing something that's socially responsible — and an incentive to others to follow suit. The mob is the collectivity of consumers that gives the incentive force.

The Carrotmob movement started about two years ago in that incubator of so many activist innovations, the San Francisco Bay Area. Carrotmob is now a non-profit that provides sources for local grassroots campaigns. There have already been more than 90 of them in countries around the world.

In the Carrotmob model, businesses are invited to bid for a rush of consumer spending and some good publicity by committing to some specified type of social action. The extra cash is supposed to help pay for it. The theory here is that businesses respond to money-making prospects. So why not give them a financial incentive to do the right thing?

I first learned about the model a couple of months ago when I got an announcement of an upcoming Carrotmob jointly organized by the DC Employment Justice Center and the local affiliate of the Restaurant Opportunities Center in my hometown, Washington, D.C.

This Carrotmob focuses on paid sick leave for restaurant workers, though restaurants could compete on the basis of a broader range of socially responsible practices.

Blogger Taylor Leake has already introduced us to the sick leave issue in the restaurant industry nationwide. Only 12.3 percent of the restaurant workers surveyed in eight major metropolitan areas got any paid sick leave at all. Nearly two-thirds reported that they'd cooked or served food while sick.

Things are somewhat different in the District of Columbia. Hence a very particular type of Carrotmob.

Last week, the U.S. Commerce Department issued its quarterly advance estimate (pdf) for real gross domestic product, i.e., our economy's total output of goods and services. The GDP is the most commonly used indicator of economic growth.

Let's just say the figure was underwhelming — an annualized growth rate of two percent. Better than the negative growth rates we saw in 2008-2009, but not nearly big enough to get the economy out of the trough. Washington Post blogger Ezra Klein says that would take a growth rate of five percent over some period of time.

What's even more disturbing is the trend in final sales. Chad Stone, the chief economist at the Center on Budget and Policy Priorities, says that they're growing even more slowly than the GDP — not because businesses are building up inventories because they think sales will increase, but because they've got unsold goods piling up.

Meanwhile, corporations are sitting on a vast amount of cash — now about $1.8 trillion for non-financial companies. This is about a quarter more than they held at the beginning of the recession. Many economists say they're hoarding cash in part because they've got little incentive to spend their profits on expansion when consumer spending remains so low.

A recent survey (pdf) of chief financial officers found that they project increases in both earnings and capital spending, i.e., investments in assets like buildings and equipment. But nearly half say they don't think they can maintain the same level of growth for more than six months unless the economy improves. And only 22 percent of them expect the new capital spending to lead to hiring.

The CFOs expect to increase full-time employment by only 0.7 percent next year. Not enough, says Julia Homer, an executive at CFO Publishing, to put a dent in the unemployment rate because the increase will be overwhelmed by growth in the labor force.

In short, as Stone at the CBPP says, "the economic recovery is losing steam." Josh Bivens at the Economic Policy Institute also finds the new GDP figure gloomy. Look at the underlying measures and the very low inflation rate, he concludes that "the economy remains starved for aggregate demand."

So what do these wonkish figures and analyses tell us everyday folks?