The Next Mission: Aid for the Country's Poorest


Warfare sweeps aside everything else on the public agenda. Itis thus doubly encouraging that American forces performed so superbly over the last two months. Not only did they evict Saddam Hussein from Kuwait and smash the military arms he paraded like King Strut, but U.S. forces managed the job with few American losses. And getting it done swiftly means the nation can now focus on its own critical problems, which defy swift solution.

Put this one at the top of the list: aid for the country's poorest.

A new report by the Washington-based Center on Budget and Policy Priorities makes it clear just how steeply the slope of economic downturn can become for the 12.8 percent of all Americans who fall below the poverty line. The report, "A Painless Recession? The Economic Downturn and Policy Responses," was released against the gloomy backdrop of the U.S. Commerce Department's own worrisome report that its Index of Leading Economic Indicators fell 0.4 percent in January, its sixth straight drop, continuing the longest string of declines // since 1984.

The Commerce Department says that the gross national produc -- the nation's total output of goods and services -- fell 2.0 percent in the final quarter of 1990.

According to the Associated Press, most analysts still think th recession, which began during the last half of 1990, will be milder and shorter than most post-World War II contractions. Those averaged 11 months each, during which the economy contracted 2.5 percent.

To a business executive, that might be encouraging, but Budget and Policy economists see it differently. Here's how it plays on the lowest rungs of the economic ladder:

"Even if the recession does prove to be moderate, its effects will still be substantial and will adversely affect millions of Americans. Just between June 1990 and January 1991, the ranks of the unemployed grew by 1.2 million. Moreover, the numbers of long-term unemployed workers -- those out of work more than 26 weeks and still looking for a job -- grew at a particularly rapid rate, rising 29 percent in this seven-month period."

It could have been worse. "From June to January, the nation's civilian unemployment rate rose from 5.3 percent to 6.2 percent. However, as Janet Norwood, commissioner of the Bureau of Labor Statistics, recently testified, the unemployment rate would have shown a greater increase if the U.S. labor force had not largely stopped growing in 1990. . . .

"If the labor force had grown at the same rate between January 1990 and January 1991 that it grew between January 1989 and January 1990 (and the same number of people had held jobs), the unemployment rate would now be 7 percent, rather than 6.2 percent."

Things are actually quite bad enough, thank you. And a new study by the National Bureau for Economic Research, summarized in the Budget and Policy Priorities report, says that for urban blacks, continued bad economic developments will rebound to deepen the unemployment and poverty which make so many lives miserable.

Attacking stereotypes, labor economist Richard Freeman noted that while some commentators believe unemployed and underemployed black men suffer more from their own behavior and the culture of poverty, what matters most is the strength of local urban economies where these young men live.

Analyzing unemployment rates of young black men who were out of school and had limited education, Mr. Freeman found that when urban economies grew strongly between 1983 and 1987, these young men's unemployment rates fell much more rapidly than unemployment rates for similarly under-educated men of other races.

Moreover, he found that in 1987, the unemployment rate for out-of-school blacks with limited education was 9.1 percent in metro areas with overall unemployment rates less than 4 percent, but 12.2 percent for blacks in urban areas whose unemployment had reached 4 to 5 percent. And in metropolises with 6 to 7 percent unemployment, black youths' unemployment rate skyrocketed to 23.4 percent.

As we all know, the economies of America's biggest cities are hurting. That boils down to another way of saying what blacks knew all along. This nation's economic colds turn into a %o pneumonia that lays waste to family progress in the inner cities. And that hurts everybody.

The Budget and Policy Center report proposes several remedies, including:

* Fixing the "safety net" to include more of the long-term unemployed, especially in hard-hit states whose unemployment has reached or exceeded 6 percent.

* Providing federal supplemental unemployment benefits to people who have exhausted regular benefits while still looking for work, such as was done from 1982-1985.

* Boosting federal funding for administrative costs of running state unemployment insurance programs, since current funding was set before the recession.

The center's analysts note that fiscal '91 domestic non-entitlement spending is actually below established budget ceilings, that $510 million in budget authority and $920 million in outlays is available. They recommend re-examining other budget priorities and cutting to make more room, as well as raising the wage base on which unemployment taxes is levied.

There's plenty to do, now that the shooting has stopped. Our soldiers, sailors, airmen and Marines have stood up bravely, knocking aside the fourth-largest military machine in the world. But what will they come home to? Getting an answer to that will require courage as well in the halls of Congress, and in the corridors of the Executive Office Building to match.

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