vox--2020-09-23--We can end America’s unemployment nightmare

Part of The Great Rebuild Issue of The Highlight , our home for ambitious stories that explain our world .
Erin Suggs applied for unemployment in March as soon as the California salon she works at shut down .
She figured her case would be pretty straightforward — she works on commission , meaning she ’ s counted as a regular employee , not self-employed .
But it took the 50-year-old mother of two more than two months to get her benefits , during which time she estimates she and her husband called California ’ s Employment Development Department , @ @ @ @ @ @ @ system , upward of 3,000 times .
It turned out that in filling out the forms , she checked one box wrong .
“ It just put me in pending hell for 10 weeks , ” she says .
“ There was no way of fixing it.
” Her experience is hardly unique .
In California alone , more than 6 million people , or one-third of the state ’ s workers , have filed for unemployment benefits , and hundreds of thousands of them have been stuck in a weeks- or even @ @ @ @ @ @ @ million people across the United States continue to file new unemployment claims each week , and some 29 million people are receiving some sort of unemployment assistance .
And for many of them , navigating the system has been a nightmare .
The coronavirus has brought home the many shortcomings of the American unemployment insurance system and revealed it to be fundamentally — and often intentionally — broken , chipped away over time to ensure that the jobless don ’ t use it too much , lest anyone get used to it .
@ @ @ @ @ @ @ setup that has resulted in an awkward push-and-pull between the federal government , state governments , and employers .
No one quite wants to take full responsibility of it , but everyone wants a say .
However , the federal government ’ s response to the pandemic — namely , the expansions to unemployment put in place under the CARES Act — has demonstrated what a more robust and generous program might be able to do .
A reimagined unemployment system would treat the jobless like customers , not criminals , while helping @ @ @ @ @ @ @ next gig .
“ People are right to be upset about the delays and the backlogs and the problems , but I think the promise of unemployment insurance is definitely here , which is , you can stabilize incomes through a very harsh business cycle , ” said Mike Konczal , the director of progressive thought at the Roosevelt Institute .
“ It ’ s quite remarkable the amount of money that has been able to get out to workers to replace their wages.
” Still , the system leaves those workers without @ @ @ @ @ @ @ , when Suggs certifies that she continues to be unemployed , she says a little prayer .
“ One mistake and I ’ m going to get thrown back into that , ” she says .
It ’ s been more than 80 years since unemployment insurance was codified in federal law , and it ’ s worth asking how it became the system we know today , and how it could work better .
In order to help employed Americans , we have to help unemployed Americans , too .
It ’ @ @ @ @ @ @ @ reimagined unemployment system would treat the jobless like customers , not criminals , while helping them stay afloat as they find their next gig .
It would be easier to navigate , pay people more consistently , regardless of where they live , and take into account the wage stagnation of decades past .
It would be easier to ramp up in times of crisis and better serve the modern workforce — groups such as gig workers , short-term employees , and people looking for jobs .
As Darrick Hamilton , the executive @ @ @ @ @ @ @ Study of Race and Ethnicity at Ohio State University , puts it : “ The nature of work has changed in America , and so should unemployment insurance.
” Suggs filed for unemployment the first day she didn ’ t work .
In theory , her case is a simple one : She ’ s held the same full-time job for a long time and will return to work as soon as she gets the go-ahead .
She is the type of person the system is supposed to work for in a progressive @ @ @ @ @ @ @ supposed to be pretty robust .
But unemployment insurance has never worked super smoothly in the US .
The first state in the country to put an unemployment insurance program in place was Wisconsin in 1932 , and the federal program became law under the Social Security Act of 1935 .
It was set up as a mixed federal-state endeavor for reasons that wouldn ’ t surprise the average political observer today : There was disagreement over what level of government should be in charge of running the program , and proponents of @ @ @ @ @ @ @ undone by the Supreme Court , which had struck down multiple pieces of legislation .
The hope was that this model would give it a better chance with the court , and even if the federal component were struck down , the state components could live on .
“ It was designed to have this very broken and fractured structure , ” Konczal said .
The point of unemployment insurance is to replace income for people who have lost their jobs and keep them attached to the labor market .
It is also @ @ @ @ @ @ @ in times of economic downturn and support consumer spending ; an unemployed worker being unable to pay their rent isn ’ t just bad for the tenant , it ’ s bad for the landlord .
In the US , unemployment insurance is meant to work by replacing about half of a worker ’ s wages ( up to a certain cap ) for about 26 weeks .
It is intended for those who involuntarily lost their jobs , meaning they were laid off or fired , and not people who quit .
@ @ @ @ @ @ @ up collecting benefits , namely if they can explain that they did so for good cause , such as experiencing sexual harassment , but it often winds up being a battle adjudicated by the state .
The program is financed through state and federal payroll taxes that are supposed to fund administrative systems and the benefits themselves .
Many states have kept those taxes pretty low , resulting in a system that is chronically underfunded .
And during periods of stress , the impact of that underfunding really shows .
State unemployment trusts @ @ @ @ @ @ @ during the Great Recession , about three dozen states had to borrow federal money to keep payments going .
Years of disinvestment in technology and administration led to problems like those now affecting Suggs and millions of unemployed workers across the country .
You make one mistake , or your case has one little quirk , and you ’ re sucked into a bureaucratic black box disaster with no clear end in sight .
And then , once the economy gets better , everyone moves on and forgets , and the political impetus @ @ @ @ @ @ @ It ’ s almost impossible to make repairs during the bad times , but that ’ s the only time anyone pays attention , ” said Sara Flocks , policy coordinator with the California Labor Federation .
In 2010 , the California state Assembly had a hearing to look into problems with the state ’ s unemployment technology and backlogs during the recession .
“ I ’ m shocked at how bad this situation has become , ” then-Assembly member Charles Calderon said at the time .
A decade later , it ’ @ @ @ @ @ @ @ is spearheading a charge to overhaul the still broken system .
“ This is a problem long coming , ” he said .
“ The system broke down during the Great Recession , with many of the dysfunctional elements that we ’ re seeing today.
” “ The administrative systems are pretty broken , or at least pretty frayed , or at least not up to this , ” said University of California Berkeley economist Jesse Rothstein .
“ We haven ’ t invested in them over a long time.
” The fragmented @ @ @ @ @ @ @ and distorted unemployment insurance system The federal government sets the bar for states to design their systems , but the bar is pretty low , and states are largely left to their own devices when it comes to how much they want to tax employers , how generous they want to be with benefits and for how long , and who gets deemed eligible for collecting benefits .
The fragmented state-federal system has resulted in an uneven and distorted unemployment insurance system .
According to the Center on Budget and Policy Priorities , @ @ @ @ @ @ @ were $ 333 as of April 2020 , but that ranged from $ 101 in Oklahoma to $ 531 in Massachusetts .
The length of unemployment varies significantly per state , as does the number of unemployed people who collect benefits .
Pew Research Center estimates that just 29 percent of unemployed Americans received benefits in March , and in states like Florida , Arizona , and North Carolina , less than 10 percent did .
At the state level , employers have more control over the unemployment system as well , explained @ @ @ @ @ @ @ the Urban Institute .
Employers want low costs — as in taxes — and they don ’ t want employees claiming benefits they feel are undeserved .
“ The balance of power between labor and business has moved in the direction of business , so the programming increasingly reflects business concerns , ” Vroman said .
Given the recent troubles with unemployment , there has been a lot of attention on the outdated technologies being used .
But new technology does not always translate to a more effective system .
Some states that @ @ @ @ @ @ @ with a focus on fraud and making them harsher on the unemployed , said Michele Evermore , a senior policy analyst at the National Employment Law Project ( NELP ) .
“ Florida is technically a modernized system , but they changed the system with the absolute aim of making it harder for people to get benefits , ” she said .
While experts acknowledge that fraud exists , they say there ’ s been too much attention on it , overshadowing concerns about getting money to people in need .
“ They @ @ @ @ @ @ @ guys rather than helping the good guys get through , ” said Andrew Stettner , a senior fellow at the Century Foundation .
And because the system is so onerous and the benefits often so low , many people don ’ t even bother applying for unemployment , or they eventually stop trying .
When Suggs started running into problems with her unemployment claim , she went to Facebook to try to find answers and see what others in the same situation were doing .
Eventually , she started her own group for @ @ @ @ @ @ @ talk to one another .
“ I wanted people to be able to post their frustrations and come and get support , ” she said .
Members ask for advice , swap stories , and even share phone numbers they ’ ve used that have helped them finally get through .
The EDD ’ s phone line for people who need help with a specific claim is only open from 8 am to noon , Monday through Friday .
The Coronavirus Aid , Relief , and Economic Security Act , or the CARES @ @ @ @ @ @ @ package signed into law by President Trump in March , was supposed to make life for the unemployed during the pandemic better .
It tacked on an additional $ 600-a-week federal benefit through July 31 , extended the amount of time people can collect benefits , and expanded the pool of workers who can apply for unemployment to independent contractors , gig workers , and others who are usually ineligible , such as artists and musicians .
But many people could not actually access the system .
When Suggs finally got through to @ @ @ @ @ @ @ unemployment office , the woman she spoke with told her she was lucky , because she actually knew what she was doing .
The department had staffed up , but most of the new staff hadn ’ t received a ton of training .
“ They basically hired … people to just kind of answer the phones , hang up on people , and tell people they couldn ’ t help them , ” Suggs says she was told .
“ Not to be hyperbolic , but everywhere you look in our unemployment @ @ @ @ @ @ @ ” said Jennifer Kwart , a staffer for Assembly member Chiu .
A small error , such as an extra digit in a Social Security number , can put a claim in flux for weeks , and even with benefits being slow to go out , states ’ unemployment trusts are already being tapped out .
In May , California became the first state to borrow from the federal government to pay benefits during the current downturn .
It took till 2018 to finish paying off what it owed the government in unemployment @ @ @ @ @ @ @ source familiar with California ’ s EDD put it , a lot of the issue comes down to the complexity of how federal funding is handled and the fact that no governor is eager to raise taxes to fix things , Democrat or Republican .
It ’ s just not politically popular , especially when employers are powerful and there isn ’ t exactly a union of the unemployed .
“ The power of our labor unions is pretty strong , but at the same time , it ’ s really hard when @ @ @ @ @ @ @ people when times are really good to focus in on it , ” the source said .
“ But the problem is when you don ’ t focus on it when times are really good is that when stuff is tough , like it is now , it ’ s the most important department in the state.
” All of this adds up to real consequences in people ’ s everyday lives , consequences that are even more stressful in moments of crisis like now .
Still , Suggs considers herself lucky — @ @ @ @ @ @ @ and her family had recently sold a home they inherited .
“ If it wasn ’ t for him working , I don ’ t know what we would have done .
We probably would have ended up homeless , ” she said .
Yvonne Garcia , a member of Suggs ’ s Facebook group , is also thankful for her family ’ s support as she tries to work through the unemployment system after being laid off from the poker room she works for in March .
She ’ s experienced the @ @ @ @ @ @ @ .
When she was unemployed in 2018 , Garcia was paid an extra $ 172 in benefits she wasn ’ t supposed to receive .
It happened during three days of training for a new job that she didn ’ t realize she was supposed to report .
“ I was just so embarrassed , ” she said .
Garcia has paid back the money she owed , but even so , she was penalized five weeks of benefits this time around for the mishap after being furloughed .
She successfully appealed her @ @ @ @ @ @ @ just $ 167 a week .
It ’ s enough for her to get by , for now .
Garcia waited to request forbearance on her mortgage until August , when the extra $ 600 in federal benefits ended , to buy herself time .
She hopes the poker room will reopen in January and in the meantime plans to pick up a part-time job at Costco .
“ When somebody says you ’ re making more than what you make at work , I say , no I ’ m not , @ @ @ @ @ @ @ d much rather be at work.
” “ The $ 600 got us into a different conversation that acknowledges that wages are really , really low to begin with ” Personal incomes did rise about 10 percent in April , and poverty didn ’ t increase — it actually might have gone down .
According to one recent paper from the IZA Institute of Labor Economics , between March and July 2020 , expanded unemployment insurance under the CARES Act offset earnings inequality the country would have otherwise seen , particularly for low-income @ @ @ @ @ @ @ decline in aggregate demand in the broader economy by putting money in people ’ s pockets .
And despite concerns that generous benefits would discourage people from working during the pandemic ( which , one could argue , is at least partially the point ) , research for Yale found that didn ’ t happen .
“ The $ 600 boost made a huge difference to families that are unemployed to no fault of their own , ” said Liz Watson , executive director of the progressive nonprofit the Congressional Progressive Caucus Center @ @ @ @ @ @ @ benefit has been set at a level that is completely unlivable.
” One estimate recently released by the group and put together by Center for American Progress researchers Justin Schweitzer and Lily Roberts made the case that typical single-parent households fall thousands of dollars short when trying to meet basic needs on typical unemployment insurance .
“ The $ 600 got us into a different conversation that acknowledges that wages are really , really low to begin with , and anything that ’ s a proportional replacement of those wages will just reinforce @ @ @ @ @ @ @ said .
“ We have an opportunity to now create permanent structural change to this program , ” said Rebecca Dixon , executive director of National Employment Law Project , at a recent panel hosted by Vox .
“ We often say that something is not working as designed , and I would just encourage us to realize it is working as designed , and we need to change that design.
” So how do we change it for the better ?
So that it works in the good times and the bad @ @ @ @ @ @ @ with said that if the US got a real do-over , it would be much better to go with a federal system — which the vast majority of countries that have unemployment benefits use — instead of a hybrid federal-state one .
It could run much like the Social Security benefits program and would be a way to make the program more uniform in terms of benefit amounts and time frames across states .
“ Having a 50-state system , and having them really underfunded by their states and by the federal government @ @ @ @ @ @ @ a good position , ” Stettner , from the Century Foundation , said .
While that might be the ideal situation ( which would also ideally entail the federal government adequately funding the program ’ s administration and the benefits ) , it ’ s not super likely .
Employers and state governments would likely oppose it .
So then it ’ s time to start looking for overhauls to make where the states still get a role .
“ If you take the existing state systems as here and impossible to get @ @ @ @ @ @ @ a minimum standard for benefits payment , ” Vroman said .
It ’ s a way to make sure that if you lose your job in Mississippi , you ’ re not in a much worse spot than if you lost your job in Massachusetts .
“ That could be legislated , and that ’ s a less radical change because it still keeps the states as the first line of administering the program.
” There are multiple proposals , both big and small , for how to improve and modernize unemployment insurance @ @ @ @ @ @ @ the Obama administration laid out a series of proposals on that front , including expanding access to part-time , temporary , and low-income workers .
More recently , Sen. Michael Bennet ( D-CO ) put out a series of proposals for the unemployment system , including automatic stabilizers that would ramp up the program when the economy falters and unemployment rises .
Instead of waiting on Congress to decide to help out when unemployment is at 10 percent , as it is now , extra benefits would kick in automatically .
There is @ @ @ @ @ @ @ activists around the issue .
After decades of wage stagnation , the government should increase the amount of benefits paid in proportion to someone ’ s salary to make sure it actually helps , especially for people on the low end of the income spectrum , including people of color and women , who often aren ’ t even in a position to save in normal times .
It should invest in administrative and technological infrastructures so that they are designed for moments of stress .
It should expand the pool of workers @ @ @ @ @ @ @ , including those who change jobs a lot and especially those lowest earners who are not covered .
And it should provide job-seekers some sort of benefits as well .
That way , recent graduates or people reentering the workforce aren ’ t scrambling .
Some of these workers have been added into the mix under the CARES Act , such as independent contractors .
Others , such as those without a long work history and recent graduates , are left out .
The government should also examine and encourage innovative programs , @ @ @ @ @ @ @ employers temporarily reduce work hours for their employees and that reduced income is supplemented with unemployment insurance .
“ It ’ s not perfect , but for a lot of employers , it means the difference between layoffs and no layoffs , and for workers , it means keeping not only their jobs but also their health care , ” Flocks , with the California Labor Federation , said .
It ’ s the type of idea that could perhaps help someone like Suggs and her employer , because even when open , @ @ @ @ @ @ @ .
When the salon reopened for a while in the spring , things were pretty slow .
People weren ’ t rushing to get their hair done .
“ I was having cancellations all over the place , ” Suggs said .
To be sure , addressing the real shortfalls of unemployment is easier said than done , and there are real philosophical questions about how the program should work .
What amount of benefit is the right amount is not a simple issue .
In the current crisis , arguments that benefits @ @ @ @ @ @ @ you ’ ve got four or five job-seekers for every job , the government being too nice to them isn ’ t really the problem , let alone in a pandemic .
But in normal times , economists and experts don ’ t agree on how much is the right amount of income to replace .
“ The best kind of insurance from the perspective of a worker would make them whole , ” said Michael Stepner , an economist and postdoctoral fellow at the Harvard research project Opportunity Insights .
“ But @ @ @ @ @ @ @ people completely whole , there ’ s a concern that they just won ’ t bother to search for a job.
” Vroman said there is evidence of disincentive effects , and some people are more prone to follow those effects than others .
Jeffrey Miron , a libertarian economist at Harvard , said part of the issue is making sure people don ’ t wait on unemployment insurance forever while also waiting for a job that ’ s not coming back .
“ There is an inevitable trade-off between trying to protect @ @ @ @ @ @ @ face bad opportunities versus creating a perverse incentive for people to stay unemployed , ” he said .
But given how scarce benefits are and how hard the system is to navigate , the real disincentive for people to apply for unemployment insurance at all is coming from state unemployment offices and poor systems no one ’ s entirely in charge of .
“ The idea at least should be to give everyone , not just higher earners , the ability to feel secure after a layoff knowing they aren ’ t going @ @ @ @ @ @ @ meals while they take the proper time needed to look for a new job , ” Schweitzer , the CAP researcher , said in an email , pointing out that even when things are normal , finding a job isn ’ t always easy .
“ The more desperate workers are to find a job fast , the more leverage employers have , especially in low-wage industries , to underpay them.
” That is especially harmful to workers of color and , in particular , Black workers , who typically have higher rates @ @ @ @ @ @ @ have been hit especially hard during the pandemic .
They also overall have less savings to fall back on and less wealth .
There are , of course , those who argue that the social safety net , whether unemployment insurance or otherwise , is a waste of money for the federal government and that even in the current crisis , such generous benefits are unwarranted .
The US Chamber of Commerce , a private organization that represents businesses , has lobbied against expanding the $ 600 in CARES Act benefits , arguing @ @ @ @ @ @ @ in the labor market and hurting the economic recovery.
” Another read : It ’ s drawing attention to how little some companies pay their workers .
While Suggs says her situation is under control for now , she still sees people in the Facebook group every day talking about their troubles .
“ There are people out there that are really , really struggling , ” she said , and even she remains frustrated .
The government has made it “ as difficult as possible for people to work or not work.
@ @ @ @ @ @ @ stay home , why don ’ t you make it easier and fix the system somehow ?
We ’ re the tech state , and we couldn ’ t do it , ” Suggs said .
“ It was a nightmare .
It is a nightmare.
” Emily Stewart is a business and politics reporter for Vox , covering the ways people are affected by the forces of capitalism and money .
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Part of The Great Rebuild Issue of The Highlight, our home for ambitious stories that explain our world.
Erin Suggs applied for unemployment in March as soon as the California salon she works at shut down. She figured her case would be pretty straightforward — she works on commission, meaning she’s counted as a regular employee, not self-employed.
But it took the 50-year-old mother of two more than two months to get her benefits, during which time she estimates she and her husband called California’s Employment Development Department, which administers the state’s unemployment system, upward of 3,000 times. It turned out that in filling out the forms, she checked one box wrong. “It just put me in pending hell for 10 weeks,” she says. “There was no way of fixing it.”
Her experience is hardly unique. In California alone, more than 6 million people, or one-third of the state’s workers, have filed for unemployment benefits, and hundreds of thousands of them have been stuck in a weeks- or even months-long backlog. Meanwhile, nearly 1 million people across the United States continue to file new unemployment claims each week, and some 29 million people are receiving some sort of unemployment assistance. And for many of them, navigating the system has been a nightmare.
The coronavirus has brought home the many shortcomings of the American unemployment insurance system and revealed it to be fundamentally — and often intentionally — broken, chipped away over time to ensure that the jobless don’t use it too much, lest anyone get used to it. Unemployment insurance operates under a hybrid state-federal setup that has resulted in an awkward push-and-pull between the federal government, state governments, and employers. No one quite wants to take full responsibility of it, but everyone wants a say.
However, the federal government’s response to the pandemic — namely, the expansions to unemployment put in place under the CARES Act — has demonstrated what a more robust and generous program might be able to do.
A reimagined unemployment system would treat the jobless like customers, not criminals, while helping them stay afloat as they find their next gig
“People are right to be upset about the delays and the backlogs and the problems, but I think the promise of unemployment insurance is definitely here, which is, you can stabilize incomes through a very harsh business cycle,” said Mike Konczal, the director of progressive thought at the Roosevelt Institute. “It’s quite remarkable the amount of money that has been able to get out to workers to replace their wages.”
Still, the system leaves those workers without much of a voice. Every week, when Suggs certifies that she continues to be unemployed, she says a little prayer. “One mistake and I’m going to get thrown back into that,” she says.
It’s been more than 80 years since unemployment insurance was codified in federal law, and it’s worth asking how it became the system we know today, and how it could work better. In order to help employed Americans, we have to help unemployed Americans, too. It’s good for the economy.
A reimagined unemployment system would treat the jobless like customers, not criminals, while helping them stay afloat as they find their next gig. It would be easier to navigate, pay people more consistently, regardless of where they live, and take into account the wage stagnation of decades past. It would be easier to ramp up in times of crisis and better serve the modern workforce — groups such as gig workers, short-term employees, and people looking for jobs.
As Darrick Hamilton, the executive director of the Kirwan Institute for the Study of Race and Ethnicity at Ohio State University, puts it: “The nature of work has changed in America, and so should unemployment insurance.”
Suggs filed for unemployment the first day she didn’t work. In theory, her case is a simple one: She’s held the same full-time job for a long time and will return to work as soon as she gets the go-ahead. She is the type of person the system is supposed to work for in a progressive state where the social safety net is supposed to be pretty robust.
But unemployment insurance has never worked super smoothly in the US. The first state in the country to put an unemployment insurance program in place was Wisconsin in 1932, and the federal program became law under the Social Security Act of 1935. It was set up as a mixed federal-state endeavor for reasons that wouldn’t surprise the average political observer today: There was disagreement over what level of government should be in charge of running the program, and proponents of unemployment insurance were nervous it might be undone by the Supreme Court, which had struck down multiple pieces of legislation. The hope was that this model would give it a better chance with the court, and even if the federal component were struck down, the state components could live on.
“It was designed to have this very broken and fractured structure,” Konczal said.
The point of unemployment insurance is to replace income for people who have lost their jobs and keep them attached to the labor market. It is also a measure to keep the economy going in times of economic downturn and support consumer spending; an unemployed worker being unable to pay their rent isn’t just bad for the tenant, it’s bad for the landlord.
In the US, unemployment insurance is meant to work by replacing about half of a worker’s wages (up to a certain cap) for about 26 weeks. It is intended for those who involuntarily lost their jobs, meaning they were laid off or fired, and not people who quit. Those who quit their jobs can wind up collecting benefits, namely if they can explain that they did so for good cause, such as experiencing sexual harassment, but it often winds up being a battle adjudicated by the state.
The program is financed through state and federal payroll taxes that are supposed to fund administrative systems and the benefits themselves.
Many states have kept those taxes pretty low, resulting in a system that is chronically underfunded. And during periods of stress, the impact of that underfunding really shows. State unemployment trusts can run out of money fast — during the Great Recession, about three dozen states had to borrow federal money to keep payments going. Years of disinvestment in technology and administration led to problems like those now affecting Suggs and millions of unemployed workers across the country. You make one mistake, or your case has one little quirk, and you’re sucked into a bureaucratic black box disaster with no clear end in sight. And then, once the economy gets better, everyone moves on and forgets, and the political impetus to fix these problems fades.
“It’s almost impossible to make repairs during the bad times, but that’s the only time anyone pays attention,” said Sara Flocks, policy coordinator with the California Labor Federation.
In 2010, the California state Assembly had a hearing to look into problems with the state’s unemployment technology and backlogs during the recession. “I’m shocked at how bad this situation has become,” then-Assembly member Charles Calderon said at the time.
A decade later, it’s California Assembly member David Chiu who is spearheading a charge to overhaul the still broken system. “This is a problem long coming,” he said. “The system broke down during the Great Recession, with many of the dysfunctional elements that we’re seeing today.”
“The administrative systems are pretty broken, or at least pretty frayed, or at least not up to this,” said University of California Berkeley economist Jesse Rothstein. “We haven’t invested in them over a long time.”
The fragmented state-federal system has resulted in an uneven and distorted unemployment insurance system
The federal government sets the bar for states to design their systems, but the bar is pretty low, and states are largely left to their own devices when it comes to how much they want to tax employers, how generous they want to be with benefits and for how long, and who gets deemed eligible for collecting benefits.
The fragmented state-federal system has resulted in an uneven and distorted unemployment insurance system. According to the Center on Budget and Policy Priorities, the average weekly benefits in the country were $333 as of April 2020, but that ranged from $101 in Oklahoma to $531 in Massachusetts. The length of unemployment varies significantly per state, as does the number of unemployed people who collect benefits. Pew Research Center estimates that just 29 percent of unemployed Americans received benefits in March, and in states like Florida, Arizona, and North Carolina, less than 10 percent did.
At the state level, employers have more control over the unemployment system as well, explained Wayne Vroman, a labor economist at the Urban Institute. Employers want low costs — as in taxes — and they don’t want employees claiming benefits they feel are undeserved. “The balance of power between labor and business has moved in the direction of business, so the programming increasingly reflects business concerns,” Vroman said.
Given the recent troubles with unemployment, there has been a lot of attention on the outdated technologies being used. But new technology does not always translate to a more effective system. Some states that have modernized their technology have done so with a focus on fraud and making them harsher on the unemployed, said Michele Evermore, a senior policy analyst at the National Employment Law Project (NELP). “Florida is technically a modernized system, but they changed the system with the absolute aim of making it harder for people to get benefits,” she said.
While experts acknowledge that fraud exists, they say there’s been too much attention on it, overshadowing concerns about getting money to people in need. “They’re focused on catching the bad guys rather than helping the good guys get through,” said Andrew Stettner, a senior fellow at the Century Foundation.
And because the system is so onerous and the benefits often so low, many people don’t even bother applying for unemployment, or they eventually stop trying.
When Suggs started running into problems with her unemployment claim, she went to Facebook to try to find answers and see what others in the same situation were doing. Eventually, she started her own group for people struggling to navigate the bureaucracy to talk to one another. “I wanted people to be able to post their frustrations and come and get support,” she said.
Members ask for advice, swap stories, and even share phone numbers they’ve used that have helped them finally get through. The EDD’s phone line for people who need help with a specific claim is only open from 8 am to noon, Monday through Friday.
The Coronavirus Aid, Relief, and Economic Security Act, or the CARES Act, the $2.2 trillion stimulus package signed into law by President Trump in March, was supposed to make life for the unemployed during the pandemic better. It tacked on an additional $600-a-week federal benefit through July 31, extended the amount of time people can collect benefits, and expanded the pool of workers who can apply for unemployment to independent contractors, gig workers, and others who are usually ineligible, such as artists and musicians.
But many people could not actually access the system. When Suggs finally got through to a real person at California’s unemployment office, the woman she spoke with told her she was lucky, because she actually knew what she was doing. The department had staffed up, but most of the new staff hadn’t received a ton of training. “They basically hired … people to just kind of answer the phones, hang up on people, and tell people they couldn’t help them,” Suggs says she was told.
“Not to be hyperbolic, but everywhere you look in our unemployment agency, there is a problem,” said Jennifer Kwart, a staffer for Assembly member Chiu.
A small error, such as an extra digit in a Social Security number, can put a claim in flux for weeks, and even with benefits being slow to go out, states’ unemployment trusts are already being tapped out. In May, California became the first state to borrow from the federal government to pay benefits during the current downturn. It took till 2018 to finish paying off what it owed the government in unemployment from the last recession.
As one source familiar with California’s EDD put it, a lot of the issue comes down to the complexity of how federal funding is handled and the fact that no governor is eager to raise taxes to fix things, Democrat or Republican. It’s just not politically popular, especially when employers are powerful and there isn’t exactly a union of the unemployed.
“The power of our labor unions is pretty strong, but at the same time, it’s really hard when it comes to unemployment insurance to convince people when times are really good to focus in on it,” the source said. “But the problem is when you don’t focus on it when times are really good is that when stuff is tough, like it is now, it’s the most important department in the state.”
All of this adds up to real consequences in people’s everyday lives, consequences that are even more stressful in moments of crisis like now.
Still, Suggs considers herself lucky — her husband has a steady income, and her family had recently sold a home they inherited. “If it wasn’t for him working, I don’t know what we would have done. We probably would have ended up homeless,” she said.
Yvonne Garcia, a member of Suggs’s Facebook group, is also thankful for her family’s support as she tries to work through the unemployment system after being laid off from the poker room she works for in March. She’s experienced the consequences of the focus on fraud directly. When she was unemployed in 2018, Garcia was paid an extra $172 in benefits she wasn’t supposed to receive. It happened during three days of training for a new job that she didn’t realize she was supposed to report. “I was just so embarrassed,” she said.
Garcia has paid back the money she owed, but even so, she was penalized five weeks of benefits this time around for the mishap after being furloughed. She successfully appealed her case and is now collecting benefits — just $167 a week. It’s enough for her to get by, for now. Garcia waited to request forbearance on her mortgage until August, when the extra $600 in federal benefits ended, to buy herself time. She hopes the poker room will reopen in January and in the meantime plans to pick up a part-time job at Costco.
“When somebody says you’re making more than what you make at work, I say, no I’m not,” she said. “I’d much rather be at work.”
“The $600 got us into a different conversation that acknowledges that wages are really, really low to begin with”
Personal incomes did rise about 10 percent in April, and poverty didn’t increase — it actually might have gone down. According to one recent paper from the IZA Institute of Labor Economics, between March and July 2020, expanded unemployment insurance under the CARES Act offset earnings inequality the country would have otherwise seen, particularly for low-income Americans, and it helped reduce the decline in aggregate demand in the broader economy by putting money in people’s pockets. And despite concerns that generous benefits would discourage people from working during the pandemic (which, one could argue, is at least partially the point), research for Yale found that didn’t happen.
“The $600 boost made a huge difference to families that are unemployed to no fault of their own,” said Liz Watson, executive director of the progressive nonprofit the Congressional Progressive Caucus Center. “For too long, the benefit has been set at a level that is completely unlivable.”
One estimate recently released by the group and put together by Center for American Progress researchers Justin Schweitzer and Lily Roberts made the case that typical single-parent households fall thousands of dollars short when trying to meet basic needs on typical unemployment insurance.
“The $600 got us into a different conversation that acknowledges that wages are really, really low to begin with, and anything that’s a proportional replacement of those wages will just reinforce how disparate wages are,” Roberts said.
“We have an opportunity to now create permanent structural change to this program,” said Rebecca Dixon, executive director of National Employment Law Project, at a recent panel hosted by Vox. “We often say that something is not working as designed, and I would just encourage us to realize it is working as designed, and we need to change that design.”
So how do we change it for the better? So that it works in the good times and the bad?
Many of the experts I spoke with said that if the US got a real do-over, it would be much better to go with a federal system — which the vast majority of countries that have unemployment benefits use — instead of a hybrid federal-state one. It could run much like the Social Security benefits program and would be a way to make the program more uniform in terms of benefit amounts and time frames across states.
“Having a 50-state system, and having them really underfunded by their states and by the federal government, hasn’t left us in a good position,” Stettner, from the Century Foundation, said.
While that might be the ideal situation (which would also ideally entail the federal government adequately funding the program’s administration and the benefits), it’s not super likely. Employers and state governments would likely oppose it. So then it’s time to start looking for overhauls to make where the states still get a role.
“If you take the existing state systems as here and impossible to get rid of, you can still have a minimum standard for benefits payment,” Vroman said. It’s a way to make sure that if you lose your job in Mississippi, you’re not in a much worse spot than if you lost your job in Massachusetts. “That could be legislated, and that’s a less radical change because it still keeps the states as the first line of administering the program.”
There are multiple proposals, both big and small, for how to improve and modernize unemployment insurance in the US. In 2016, the Obama administration laid out a series of proposals on that front, including expanding access to part-time, temporary, and low-income workers. More recently, Sen. Michael Bennet (D-CO) put out a series of proposals for the unemployment system, including automatic stabilizers that would ramp up the program when the economy falters and unemployment rises. Instead of waiting on Congress to decide to help out when unemployment is at 10 percent, as it is now, extra benefits would kick in automatically.
There is a lot of consensus among experts and activists around the issue. After decades of wage stagnation, the government should increase the amount of benefits paid in proportion to someone’s salary to make sure it actually helps, especially for people on the low end of the income spectrum, including people of color and women, who often aren’t even in a position to save in normal times. It should invest in administrative and technological infrastructures so that they are designed for moments of stress.
It should expand the pool of workers eligible for unemployment to less typical employees, including those who change jobs a lot and especially those lowest earners who are not covered. And it should provide job-seekers some sort of benefits as well. That way, recent graduates or people reentering the workforce aren’t scrambling. Some of these workers have been added into the mix under the CARES Act, such as independent contractors. Others, such as those without a long work history and recent graduates, are left out.
The government should also examine and encourage innovative programs, such as work sharing, through which employers temporarily reduce work hours for their employees and that reduced income is supplemented with unemployment insurance.
“It’s not perfect, but for a lot of employers, it means the difference between layoffs and no layoffs, and for workers, it means keeping not only their jobs but also their health care,” Flocks, with the California Labor Federation, said.
It’s the type of idea that could perhaps help someone like Suggs and her employer, because even when open, business isn’t back to normal. When the salon reopened for a while in the spring, things were pretty slow. People weren’t rushing to get their hair done. “I was having cancellations all over the place,” Suggs said.
To be sure, addressing the real shortfalls of unemployment is easier said than done, and there are real philosophical questions about how the program should work.
What amount of benefit is the right amount is not a simple issue. In the current crisis, arguments that benefits are too generous are unwarranted — when you’ve got four or five job-seekers for every job, the government being too nice to them isn’t really the problem, let alone in a pandemic. But in normal times, economists and experts don’t agree on how much is the right amount of income to replace.
“The best kind of insurance from the perspective of a worker would make them whole,” said Michael Stepner, an economist and postdoctoral fellow at the Harvard research project Opportunity Insights. “But the trade-off there is if you make people completely whole, there’s a concern that they just won’t bother to search for a job.”
Vroman said there is evidence of disincentive effects, and some people are more prone to follow those effects than others. Jeffrey Miron, a libertarian economist at Harvard, said part of the issue is making sure people don’t wait on unemployment insurance forever while also waiting for a job that’s not coming back. “There is an inevitable trade-off between trying to protect those people who are unemployed who generally face bad opportunities versus creating a perverse incentive for people to stay unemployed,” he said.
But given how scarce benefits are and how hard the system is to navigate, the real disincentive for people to apply for unemployment insurance at all is coming from state unemployment offices and poor systems no one’s entirely in charge of.
“The idea at least should be to give everyone, not just higher earners, the ability to feel secure after a layoff knowing they aren’t going to get evicted or have to skip meals while they take the proper time needed to look for a new job,” Schweitzer, the CAP researcher, said in an email, pointing out that even when things are normal, finding a job isn’t always easy. “The more desperate workers are to find a job fast, the more leverage employers have, especially in low-wage industries, to underpay them.”
That is especially harmful to workers of color and, in particular, Black workers, who typically have higher rates of unemployment than white workers and who have been hit especially hard during the pandemic. They also overall have less savings to fall back on and less wealth.
There are, of course, those who argue that the social safety net, whether unemployment insurance or otherwise, is a waste of money for the federal government and that even in the current crisis, such generous benefits are unwarranted. The US Chamber of Commerce, a private organization that represents businesses, has lobbied against expanding the $600 in CARES Act benefits, arguing that it is causing “significant distortions in the labor market and hurting the economic recovery.” Another read: It’s drawing attention to how little some companies pay their workers.
While Suggs says her situation is under control for now, she still sees people in the Facebook group every day talking about their troubles. “There are people out there that are really, really struggling,” she said, and even she remains frustrated. The government has made it “as difficult as possible for people to work or not work.”
“If you want everyone to stay home, why don’t you make it easier and fix the system somehow? We’re the tech state, and we couldn’t do it,” Suggs said. “It was a nightmare. It is a nightmare.”
Emily Stewart is a business and politics reporter for Vox, covering the ways people are affected by the forces of capitalism and money.
This story is part of The Great Rebuild, a project made possible thanks to support from Omidyar Network, a social impact venture that works to reimagine critical systems and the ideas that govern them, and to build more inclusive and equitable societies. All Great Rebuild coverage is editorially independent and produced by our journalists.


vox--2020-09-23--Young people are the new corps of engineers the US has been waiting for

Share All sharing options for : Young people are the new corps of engineers the US has been waiting for Part of The Great Rebuild Issue of The Highlight , our home for ambitious stories that explain our world .
I was born to Taiwanese American immigrants in upstate New York in the 1970s .
My father worked at General Electric , my mother at BlueCross BlueShield .
Like many others , the America I thought I inherited from them was one of opportunity .
Work hard at a job or school , get into a trade or college , @ @ @ @ @ @ @ you could afford .
Work for a few decades , then retire .
The boomers have lived in a world largely like that : 90 percent of them ended up better off than their parents , and they assumed their children would do the same .
The suburbs would continue to thrive , the number of cars per household would go up , and more frequent and exotic vacations for their children would be just one of the payoffs for that lifetime of hard work to provide their children with opportunity .
In @ @ @ @ @ @ @ cards for many Americans .
But now it ’ s barely in the cards for any .
The path to a decent life is more and more out of reach .
We ’ ve been brainwashed into thinking that the market determines everything — including human value — and that ’ s infected everything , from our public policy to our culture .
It ’ s easy to get student loans , because the market says college must be valuable since it ’ s expensive .
But it ’ s impossible to discharge @ @ @ @ @ @ @ and defaulting on loans is irresponsible .
We ’ ve driven metrics such as GDP and the stock market to the edge of a cliff , and then handed our children the wheel .
Students and graduates have amassed more than $ 1.6 trillion in student loan debt that many will never be able to pay off , while others will delay buying a home , getting married , and having kids because of this millstone around their necks .
Owning a home is unrealistic in many cities for almost anyone starting out @ @ @ @ @ @ @ retirement savings , which , for millions , will make stepping back from employment in older age less and less feasible .
Our infrastructure is crumbling beneath our feet .
And climate change yet looms over this generation and every generation to come .
For many young people , building savings or a career is next to impossible when we ’ ve had two “ once in a century ” recessions in the past 15 years , just as millions are trying to establish a financial foothold .
Economic inequality keeps climbing while @ @ @ @ @ @ @ keeps shrinking .
Many recent graduates are told by family members and boomer editorialists to simply lower their sights and expectations and accept underemployment .
And when millennials display any dissatisfaction with their grim inheritance , they are labeled entitled brats who spend all their money on avocado toast instead of saving for a home ( never mind that it would take 22 years of skipping it to put down a down payment ) .
Each of these problems is big , and we need to start setting the next generations up for @ @ @ @ @ @ @ But we can tackle them all with the same solution — rebuilding our economy and country with a massive and ongoing public works program .
To do it , we must build a human-centered economy , making sure it works for our children by ensuring that it stops working exclusively for those at the top .
Our winner-take-all economy has resulted in a country where , according to a 2017 CareerBuilder/Harris Poll survey of nearly 3,500 workers , 40 percent of people report usually living paycheck to paycheck .
Forty percent of Americans @ @ @ @ @ @ @ an unexpected $ 400 bill — and that was before the pandemic .
The economic deck is stacked even more significantly against millennials and young people .
Because of that unprecedented student loan debt and the recessions they have suffered during their early careers , the homeownership rate for millennials is nearly 8 percentage points lower than that of previous generations .
This has driven more than 20 percent to move back in with their parents — a situation that isn ’ t ideal for anyone involved .
More than half have less @ @ @ @ @ @ @ .
It ’ s no wonder that the generation had only a 50-50 shot of doing better than their parents , pre-pandemic .
Our economy has failed an entire generation , and as the current pandemic puts us on the precipice of the greatest downturn since the Great Depression , the future looks dark for many .
It ’ s no wonder that nearly half of those who came of age after the financial crisis don ’ t have a positive opinion of capitalism — they have experienced its failures directly and personally @ @ @ @ @ @ @ the greatest advances of modernity , including the technology we use every day .
But it is not designed to maximize our well-being ; it is designed to maximize investor returns and capital efficiency .
It is crystal clear now that what is good for capital is no longer good for many Americans .
A perfect example : Amazon is setting record highs in stock market valuation while millions await economic relief from Congress .
A more human-centered economy wields the positives of capitalism to maximize human well-being and flourishing , instead of @ @ @ @ @ @ @ say human-centered capitalism has three basic principles : Humans are more important than money ; markets exist to serve our common goals and values ; we should be using human-based metrics to determine success , not money-based ones .
It sounds silly to need to say these things , and yet here we are , in 2020 , still chasing stock market returns and gross domestic product growth as our mental health and opportunities evaporate .
The nation adopted GDP more than 75 years ago , and even then , its creator , @ @ @ @ @ @ @ terrible measurement of national well-being .
A century later , it is even more true .
If we were looking at the right measurements , we would see life expectancy that has stagnated or decreased over the past several years ; “ deaths of despair ” — suicides , as well as drug- and alcohol-related deaths , particularly among less educated white Americans — that have skyrocketed this century ; and anxiety and depression at record levels .
Labor force participation , a measure of how many working-age people are actually working or @ @ @ @ @ @ @ — less than 64 percent before the current crisis .
At the same time , our infrastructure requires a $ 4.6 trillion investment to reach modern standards .
With an investment in the next generations through a massive , ongoing public works program that addresses those infrastructure failings , we can help our children build a future they want for themselves and their country .
We need to start setting the next generations up for success while cleaning up our messes .
But we can tackle them all with the same solution .
@ @ @ @ @ @ @ those very same millennials whose economic future is in peril .
About 40 percent of recent college grads are working a job that doesn ’ t require a college degree .
Those with high school degrees today are worse off , as they experience more stagnant wages and a higher underemployment rate than the same cohort from 2000 .
With more than 70 million millennials and nearly the same number born to Generation Z , we have a vast number of young people who are looking for work and ways to make a @ @ @ @ @ @ @ do that .
Imagine that you ’ re a recent high school or college grad , and you ’ re unsure what to do next .
You have a variety of interests , but you don ’ t know how to turn that into a career .
Family members are telling you to find just any job that pays the bills , but you ’ re more interested in finding meaningful work than a job that pays more .
What if we as a nation instead showed these job-seekers the list of human-centered @ @ @ @ @ @ @ fix and asked them , “ What problem do you want to solve ?
” The federal government can collect and collate this data , and then it can provide work for anyone who has a plan to address it .
Whether that ’ s through the direct creation of federal jobs , grants to the states for projects they administer , or through public-private partnerships , the nation needs to address these problems .
If someone is worried about the state of our environment , let ’ s put them to work @ @ @ @ @ @ @ can be modernized .
Solar panels can be manufactured and installed .
Turbines can be built , and urban planning can be used to minimize the carbon footprint of our biggest cities .
The amount of work that can be done here to improve our way of life and the planet is staggering , and the various areas and levels of work that need to be done means an appropriate and exciting job can be found for tens of millions of people .
Do they find it disheartening that 21 million Americans don @ @ @ @ @ @ @ ?
They can be a part of the solution , working on projects that expand access to rural areas and increase affordability in urban ones .
Our water system is aging , poisoning our kids to the tune of hundreds of billions of dollars in economic costs , on top of the human costs .
I ’ m certain we ’ d see tens of thousands sign up to help address that .
There ’ s no shortage of work to be done that will provide the next generations with the meaningful jobs @ @ @ @ @ @ @ of the most obvious areas , there are so many more problem areas in this country that the passion and innovation of the next generation can solve .
There are 7.8 million job openings for in-home health aides , a number that will only increase as time goes on .
The private sector values this work at $ 10 an hour , which is far too low for a physically and emotionally taxing job .
The federal government can subsidize some and hire others to do this work , covering any gap left @ @ @ @ @ @ @ percent of newspapers in the US have closed , resulting in more and more people living in local news deserts .
Imagine a world where recent graduates can fill that gap .
Journalism majors could cut their teeth covering local politics , while business majors could explore new sources of income .
Is it unacceptable to them that more than 37,000 veterans are homeless and that millions lack affordable housing ?
We can use that passion to start a vastly scaled-up Veterans Community Project , building houses for those who need them .
@ @ @ @ @ @ @ building for sustainability — there ’ s a lot of existing damage that we have to address .
Let ’ s get young people working to build floodgates and move communities that are soon going to be ( or already are ) underwater .
Wildfires in the US are costing us billions of dollars each year ; surely , a large number of individuals would be willing to work clearing forests to lower that risk if given the opportunity and funding to do so .
There are tens of millions of jobs out @ @ @ @ @ @ @ to this country .
We can provide work to help get these underemployed generations back on track and ensure that future generations don ’ t get similarly left behind , all while engaging in one of the largest public works and modernization projects in history .
And what could their country do for them ?
As we make the right investments to shift our economy to be more human-focused , we can also help our children dig out of the mess that we left for them , and set them up for success @ @ @ @ @ @ @ country , let ’ s help them build their future .
First , each and every one of the jobs can start someone on a career path right , with training and mentorship , and let them build up experience they can use throughout their lives .
This is an area that I feel especially passionate about .
My nonprofit group , Venture for America , is known for trying to rebuild local economies through entrepreneurship .
What was just as important for me was mentoring the young individuals who came through the @ @ @ @ @ @ @ m still in touch with to this day .
These young people — all people — don ’ t just want jobs .
They want pathways to develop and grow .
Day care workers can train to become early childhood educators or childhood psychologists .
Home health care workers might transition to social work or health care .
Our future architects and civil engineers could start by building homes for the indigent , and our next generation of Pulitzer Prize winners can start by covering local board meetings .
After spending a year @ @ @ @ @ @ @ end up with an entire generation of park rangers and firefighters who fell in love with the job in this program .
We could even create positions for people who have worked in these jobs for some time to mentor the next cohort .
Additionally , these jobs could be offered to people at various points in their lives , helping to guide their education and plans for the future .
Maybe a recent high school grad who didn ’ t think college was for her will find a passion for engineering as @ @ @ @ @ @ @ Or someone who works on an HVAC renovation to make a building more environmentally friendly might decide to pursue a trade program that lets them build that into a career .
Someone who just graduated from community college with the intent to continue to a four-year college can join a project to see if the major they ’ re considering is an area they ’ d like to work in .
And we could actually value their time — unlike the market , which all too frequently places the value of the work @ @ @ @ @ @ @ people experience before they invest money in education will let them make smarter decisions , especially considering the massive cost of college .
Which is another problem we can address .
Much as the GI Bill provides funding for education for those who serve our country , we can also provide grants , scholarships , and loan forgiveness for individuals who work in any of these public works jobs .
We can ensure that everyone has proper health insurance , and pay everyone a living wage .
And as this will be the @ @ @ @ @ @ @ not most , of these individuals have , we can ensure that they receive financial counseling at a time when they ’ re most in need of it , along with getting them set up with retirement accounts and a plan on how to save for their golden years .
We have more than enough work to go around if we decide to invest in solving some of our biggest problems .
It seems like each major crisis or piece of legislation ends up bailing out people who were already doing well .
@ @ @ @ @ @ @ out banks in 2008 .
For nearly four decades , we ’ ve been hearing about the trickle-down economy , which promised that returning our tax money to the investors and job creators would trickle down to the rest of us .
And that ’ s how it was sold to us , as if getting a trickle of the success of this country is something to celebrate .
We need to end it and build a trickle-up economy , benefiting our people , families , and communities , on up .
The @ @ @ @ @ @ @ , which finally started to put money in the hands of individuals to allow them to make it through the crisis .
But helping people just make it through life shouldn ’ t be the goal of our government , and these constant shocks and failure to plan for increasingly common “ once in a generation ” market failures are a feature of our current , shareholder-driven , extreme economy .
We need to start measuring the right things in order to make sure our economy is geared toward maximizing our health and @ @ @ @ @ @ @ , we should be maximizing our quality of life , health , mental health , childhood success rates , and environmental sustainability .
It starts with universal basic income .
By returning money straight into the hands of our people , we can both retain jobs in small businesses around the country and give millions a path forward .
This will drive up demand both nationally and locally .
It would improve our health and well-being and stress levels .
The money would go straight to groceries , car repairs , child care @ @ @ @ @ @ @ ’ ve now witnessed in the stimulus checks of the CARES Act and in recent UBI trials .
It would give local small businesses a chance to survive .
We don ’ t exist to serve the economy .
It ’ s the other way around .
It ’ s time to rebuild our country and stop failing both ourselves and the next generation .
We must put ourselves to work , improving our way of life and investing in our people on a historic scale — only if we do can we @ @ @ @ @ @ @ for decades .
Andrew Yang is an entrepreneur and former Democratic presidential candidate .
He is also the founder of the nonprofit Humanity Forward .
This story is part of The Great Rebuild , a project made possible thanks to support from Omidyar Network , a social impact venture that works to reimagine critical systems and the ideas that govern them , and to build more inclusive and equitable societies .
All Great Rebuild coverage is editorially independent and produced by our journalists .
Help keep Vox free for all Millions turn to @ @ @ @ @ @ @ s happening in the news , from the coronavirus crisis to a racial reckoning to what is , quite possibly , the most consequential presidential election of our lifetimes .
Our mission has never been more vital than it is in this moment : to empower you through understanding .
But our distinctive brand of explanatory journalism takes resources .
Even when the economy and the news advertising market recovers , your support will be a critical part of sustaining our resource-intensive work .
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Share All sharing options for: Young people are the new corps of engineers the US has been waiting for
Part of The Great Rebuild Issue of The Highlight, our home for ambitious stories that explain our world.
I was born to Taiwanese American immigrants in upstate New York in the 1970s. My father worked at General Electric, my mother at BlueCross BlueShield. Like many others, the America I thought I inherited from them was one of opportunity. Work hard at a job or school, get into a trade or college, and start a family in a home you could afford. Work for a few decades, then retire.
The boomers have lived in a world largely like that: 90 percent of them ended up better off than their parents, and they assumed their children would do the same. The suburbs would continue to thrive, the number of cars per household would go up, and more frequent and exotic vacations for their children would be just one of the payoffs for that lifetime of hard work to provide their children with opportunity.
In reality, that was never in the cards for many Americans. But now it’s barely in the cards for any.
The path to a decent life is more and more out of reach. We’ve been brainwashed into thinking that the market determines everything — including human value — and that’s infected everything, from our public policy to our culture. It’s easy to get student loans, because the market says college must be valuable since it’s expensive. But it’s impossible to discharge these loans, because bankruptcy is bad and defaulting on loans is irresponsible. We’ve driven metrics such as GDP and the stock market to the edge of a cliff, and then handed our children the wheel.
Students and graduates have amassed more than $1.6 trillion in student loan debt that many will never be able to pay off, while others will delay buying a home, getting married, and having kids because of this millstone around their necks. Owning a home is unrealistic in many cities for almost anyone starting out. Each successive generation has less in retirement savings, which, for millions, will make stepping back from employment in older age less and less feasible. Our infrastructure is crumbling beneath our feet. And climate change yet looms over this generation and every generation to come.
For many young people, building savings or a career is next to impossible when we’ve had two “once in a century” recessions in the past 15 years, just as millions are trying to establish a financial foothold. Economic inequality keeps climbing while the ability to save and get ahead keeps shrinking. Many recent graduates are told by family members and boomer editorialists to simply lower their sights and expectations and accept underemployment. And when millennials display any dissatisfaction with their grim inheritance, they are labeled entitled brats who spend all their money on avocado toast instead of saving for a home (never mind that it would take 22 years of skipping it to put down a down payment).
Each of these problems is big, and we need to start setting the next generations up for success while cleaning up our messes. But we can tackle them all with the same solution — rebuilding our economy and country with a massive and ongoing public works program.
To do it, we must build a human-centered economy, making sure it works for our children by ensuring that it stops working exclusively for those at the top. Our winner-take-all economy has resulted in a country where, according to a 2017 CareerBuilder/Harris Poll survey of nearly 3,500 workers, 40 percent of people report usually living paycheck to paycheck. Forty percent of Americans also say they would have difficulty affording an unexpected $400 bill — and that was before the pandemic.
The economic deck is stacked even more significantly against millennials and young people. Because of that unprecedented student loan debt and the recessions they have suffered during their early careers, the homeownership rate for millennials is nearly 8 percentage points lower than that of previous generations. This has driven more than 20 percent to move back in with their parents — a situation that isn’t ideal for anyone involved. More than half have less than $5,000 in their savings account. It’s no wonder that the generation had only a 50-50 shot of doing better than their parents, pre-pandemic.
Andrew Yang on 2020, UBI, and fixing government The former presidential candidate discusses universal basic income, artificial intelligence, and his next job in politics.
Our economy has failed an entire generation, and as the current pandemic puts us on the precipice of the greatest downturn since the Great Depression, the future looks dark for many.
It’s no wonder that nearly half of those who came of age after the financial crisis don’t have a positive opinion of capitalism — they have experienced its failures directly and personally. Capitalism has led to some of the greatest advances of modernity, including the technology we use every day. But it is not designed to maximize our well-being; it is designed to maximize investor returns and capital efficiency. It is crystal clear now that what is good for capital is no longer good for many Americans. A perfect example: Amazon is setting record highs in stock market valuation while millions await economic relief from Congress.
A more human-centered economy wields the positives of capitalism to maximize human well-being and flourishing, instead of solely investment returns. I like to say human-centered capitalism has three basic principles: Humans are more important than money; markets exist to serve our common goals and values; we should be using human-based metrics to determine success, not money-based ones.
It sounds silly to need to say these things, and yet here we are, in 2020, still chasing stock market returns and gross domestic product growth as our mental health and opportunities evaporate. The nation adopted GDP more than 75 years ago, and even then, its creator, Simon Kuznets, said it was a terrible measurement of national well-being. A century later, it is even more true.
If we were looking at the right measurements, we would see life expectancy that has stagnated or decreased over the past several years; “deaths of despair” — suicides, as well as drug- and alcohol-related deaths, particularly among less educated white Americans — that have skyrocketed this century; and anxiety and depression at record levels. Labor force participation, a measure of how many working-age people are actually working or seeking work, is also unacceptably low — less than 64 percent before the current crisis.
At the same time, our infrastructure requires a $4.6 trillion investment to reach modern standards. With an investment in the next generations through a massive, ongoing public works program that addresses those infrastructure failings, we can help our children build a future they want for themselves and their country.
We need to start setting the next generations up for success while cleaning up our messes. But we can tackle them all with the same solution.
So where do we start? With those very same millennials whose economic future is in peril. About 40 percent of recent college grads are working a job that doesn’t require a college degree. Those with high school degrees today are worse off, as they experience more stagnant wages and a higher underemployment rate than the same cohort from 2000. With more than 70 million millennials and nearly the same number born to Generation Z, we have a vast number of young people who are looking for work and ways to make a difference. Let’s help them do that.
Imagine that you’re a recent high school or college grad, and you’re unsure what to do next. You have a variety of interests, but you don’t know how to turn that into a career. Family members are telling you to find just any job that pays the bills, but you’re more interested in finding meaningful work than a job that pays more.
What if we as a nation instead showed these job-seekers the list of human-centered stats that we’re looking to fix and asked them, “What problem do you want to solve?” The federal government can collect and collate this data, and then it can provide work for anyone who has a plan to address it. Whether that’s through the direct creation of federal jobs, grants to the states for projects they administer, or through public-private partnerships, the nation needs to address these problems.
If someone is worried about the state of our environment, let’s put them to work on sustainable infrastructure projects. Our grid can be modernized. Solar panels can be manufactured and installed. Turbines can be built, and urban planning can be used to minimize the carbon footprint of our biggest cities. The amount of work that can be done here to improve our way of life and the planet is staggering, and the various areas and levels of work that need to be done means an appropriate and exciting job can be found for tens of millions of people.
Do they find it disheartening that 21 million Americans don’t have access to reliable broadband? They can be a part of the solution, working on projects that expand access to rural areas and increase affordability in urban ones.
Our water system is aging, poisoning our kids to the tune of hundreds of billions of dollars in economic costs, on top of the human costs. I’m certain we’d see tens of thousands sign up to help address that.
There’s no shortage of work to be done that will provide the next generations with the meaningful jobs they desire. While infrastructure is one of the most obvious areas, there are so many more problem areas in this country that the passion and innovation of the next generation can solve.
There are 7.8 million job openings for in-home health aides, a number that will only increase as time goes on. The private sector values this work at $10 an hour, which is far too low for a physically and emotionally taxing job. The federal government can subsidize some and hire others to do this work, covering any gap left by the market.
More than 20 percent of newspapers in the US have closed, resulting in more and more people living in local news deserts. Imagine a world where recent graduates can fill that gap. Journalism majors could cut their teeth covering local politics, while business majors could explore new sources of income.
Is it unacceptable to them that more than 37,000 veterans are homeless and that millions lack affordable housing? We can use that passion to start a vastly scaled-up Veterans Community Project, building houses for those who need them.
The environment isn’t just about building for sustainability — there’s a lot of existing damage that we have to address. Let’s get young people working to build floodgates and move communities that are soon going to be (or already are) underwater. Wildfires in the US are costing us billions of dollars each year; surely, a large number of individuals would be willing to work clearing forests to lower that risk if given the opportunity and funding to do so.
There are tens of millions of jobs out there that would allow for meaningful contributions to this country. We can provide work to help get these underemployed generations back on track and ensure that future generations don’t get similarly left behind, all while engaging in one of the largest public works and modernization projects in history.
And what could their country do for them? As we make the right investments to shift our economy to be more human-focused, we can also help our children dig out of the mess that we left for them, and set them up for success. While they’re rebuilding the country, let’s help them build their future. First, each and every one of the jobs can start someone on a career path right, with training and mentorship, and let them build up experience they can use throughout their lives. This is an area that I feel especially passionate about.
My nonprofit group, Venture for America, is known for trying to rebuild local economies through entrepreneurship. What was just as important for me was mentoring the young individuals who came through the organization, many of whom I’m still in touch with to this day. These young people — all people — don’t just want jobs. They want pathways to develop and grow.
Day care workers can train to become early childhood educators or childhood psychologists. Home health care workers might transition to social work or health care. Our future architects and civil engineers could start by building homes for the indigent, and our next generation of Pulitzer Prize winners can start by covering local board meetings. After spending a year preventing wildfires in California, we might end up with an entire generation of park rangers and firefighters who fell in love with the job in this program. We could even create positions for people who have worked in these jobs for some time to mentor the next cohort.
Additionally, these jobs could be offered to people at various points in their lives, helping to guide their education and plans for the future. Maybe a recent high school grad who didn’t think college was for her will find a passion for engineering as she works on rebuilding a bridge. Or someone who works on an HVAC renovation to make a building more environmentally friendly might decide to pursue a trade program that lets them build that into a career. Someone who just graduated from community college with the intent to continue to a four-year college can join a project to see if the major they’re considering is an area they’d like to work in. And we could actually value their time — unlike the market, which all too frequently places the value of the work of interns at $0.
Giving people experience before they invest money in education will let them make smarter decisions, especially considering the massive cost of college. Which is another problem we can address. Much as the GI Bill provides funding for education for those who serve our country, we can also provide grants, scholarships, and loan forgiveness for individuals who work in any of these public works jobs.
We can ensure that everyone has proper health insurance, and pay everyone a living wage. And as this will be the first significant job that many, if not most, of these individuals have, we can ensure that they receive financial counseling at a time when they’re most in need of it, along with getting them set up with retirement accounts and a plan on how to save for their golden years. We have more than enough work to go around if we decide to invest in solving some of our biggest problems.
It seems like each major crisis or piece of legislation ends up bailing out people who were already doing well. We spent trillions of dollars to bail out banks in 2008.
For nearly four decades, we’ve been hearing about the trickle-down economy, which promised that returning our tax money to the investors and job creators would trickle down to the rest of us. And that’s how it was sold to us, as if getting a trickle of the success of this country is something to celebrate. We need to end it and build a trickle-up economy, benefiting our people, families, and communities, on up.
The recent pandemic led to the CARES Act, which finally started to put money in the hands of individuals to allow them to make it through the crisis. But helping people just make it through life shouldn’t be the goal of our government, and these constant shocks and failure to plan for increasingly common “once in a generation” market failures are a feature of our current, shareholder-driven, extreme economy.
We need to start measuring the right things in order to make sure our economy is geared toward maximizing our health and well-being. Instead of stock market prices, we should be maximizing our quality of life, health, mental health, childhood success rates, and environmental sustainability.
It starts with universal basic income. By returning money straight into the hands of our people, we can both retain jobs in small businesses around the country and give millions a path forward.
This will drive up demand both nationally and locally. It would improve our health and well-being and stress levels. The money would go straight to groceries, car repairs, child care, and local nonprofits — something we’ve now witnessed in the stimulus checks of the CARES Act and in recent UBI trials. It would give local small businesses a chance to survive.
We don’t exist to serve the economy. It’s the other way around. It’s time to rebuild our country and stop failing both ourselves and the next generation. We must put ourselves to work, improving our way of life and investing in our people on a historic scale — only if we do can we begin to right the imbalances we built for decades.
Andrew Yang is an entrepreneur and former Democratic presidential candidate. He is also the founder of the nonprofit Humanity Forward.
This story is part of The Great Rebuild, a project made possible thanks to support from Omidyar Network, a social impact venture that works to reimagine critical systems and the ideas that govern them, and to build more inclusive and equitable societies. All Great Rebuild coverage is editorially independent and produced by our journalists.
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