Most Welfare Dollars Don’t Go Directly To Poor People Anymore

Andrew Flowers | August 25 2016 | FiveThirtyEight

Screen Shot 2016-08-30 at 11.32.10 AM
Protesters demonstrate against welfare reform outside the Federal Building in downtown Los Angeles Sunday, Aug. 4, 1996. AP PHOTO/FRANK WIESE

Twenty years after President Bill Clinton fulfilled his vow to “end welfare as we know it,” it’s fair to say: mission accomplished. The old U.S. welfare system is dead. Whether the system that replaced it is better for the poorest Americans remains the subject of fierce debate.

The welfare reform bill that Clinton signed into law 20 years ago this month fractured the U.S. welfare system, from one managed mostly by the federal government to one largely directed by individual states. As each state became empowered to spend its welfare grant as it saw fit, one monolithic system devolved into 50 different ones — with far less money going directly to low-income families.

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The 1996 reform didn’t result in a reduction in total spending on welfare, now known as Temporary Assistance for Needy Families. Since 1998, the first year for which we have complete data, total TANF spending — both from federal block grants as well as required state matching funds — has remained essentially flat, after adjusting for inflation,1 according to data from the Center on Budget and Policy Priorities, a left-leaning think tank that is critical of welfare reform. Per-person spending has fallen, however: In 2014 there were about 12 million more people below the poverty level than in 1998, according to the Census Bureau. The U.S. population has grown nearly 20 percent during that time.

Continue reading Most Welfare Dollars Don’t Go Directly To Poor People Anymore

Escalating the War on Low-Income Families

Paul Buchheit | August 22 2016 | Common Dreams

For the nation’s poor, things are not getting better. They are getting worse. (Photo: Pixabay/CC0)

Illinois Governor Rauner recently cut “Meals on Wheels” for seniors and at-risk youth services. Chicago residents were hit with a nearly 13% property tax increase. Some Chicago public schools could face 2017 cutbacks of an incredible 20 percent.

But six of Illinois’ largest corporations together paid ALMOST ZERO state income taxes this year. Full payment of their taxes would have exceeded the $1.1 billion Chicago Public School deficit.

It’s much the same around the nation, as 25 of the largest U.S. corporations, with over $150 billion in U.S. profits last year, paid less than 20% in federal taxes, and barely 1% in the state taxes that are vitally important for K-12 education.

Sticking It To Low-Income Mothers

Because of the missing corporate tax revenue, House Republicans have tried to break even by proposing cuts to programs that are essential to mothers and children, such as Centers for Disease Control health programs, family planning, contraception, and—unbelievably, again!—food stamps. It is estimated that almost two-thirds of the proposed cuts would largely impact low- and moderate-income families.

At the state level, the suffering residents of Louisiana are facing some of the steepest regressive tax increases, along with cuts to vital programs that investigate child abuse and provide pediatric day care. The maternal death rate rose dramatically in Texas after women’s health programs were cut. In Kansas, where a Republican state senator has called Governor Brownback’s lowering of taxes on the rich a “train wreck,” 2017 cuts are targeting universities, Medicaid recipients, and the Children’s Initiatives Fund.

Sending Mental Health Patients to Prison

A 2014 government report found that nearly one in five adult Americans experienced mental illness the year before. Yet in the four years before that report, states cut $5 billion in mental health services and eliminated nearly 10 percent of the nation’s order lasix drug psychiatric hospital beds. Over half of U.S. counties don’t have a single psychiatrist or social worker.

Continue reading Escalating the War on Low-Income Families

Overwhelming Evidence that a Guaranteed Income Will Work

Paul Buchheit | August 29 2016 | Common Dreams

A giant poster in Geneva reading “What would you do if your income was taken care of?” ahead of Switzerland’s vote on a proposed “basic income” set the Guinness World Record for the largest poster ever printed. (Photo: Fabrice Coffrini/AFP/Getty Images)

We’ll have to do something drastically different to employ people in the future. Our jobs are disappearing. The driverless vehicle is here, destined to eliminate millions of transport and taxi-driving positions. Car manufacturing is being done by 3-D printing. An entire building was erected in Dubai with a 3-D printer. Restaurants are being designed with no waitstaff or busboys, hotels with no desk clerks, bellhops, and porters. Robot teachers are interacting with students in Japan and the UK.

There are plenty of naysayers and skeptics, of course. The Atlantic proclaimed, “The job market defied doomsayers in those earlier times, and according to the most frequently reported jobs numbers, it has so far done the same in our own time.” But this is a different time, with no guarantees of job revolutions, and in fact a time of unprecedented machine intelligence that threatens the livelihoods even of doctors, teachers, accountants, architects, the clergy, consultants, and lawyers.

Most of our new jobs are in service industries, including retail and personal health care and food service. The only one of the eight fastest-growing occupations that pays over $33,000 per year is nursing — and even nursing may give way to Robotic Nurse Assistants. The evidence for downsized jobs keeps accumulating. A US Mayors study found that ‘recovery’ jobs pay 23 percent less than the positions they replaced. The National Employment Law Project estimates that low-wage jobs accounted for 22 percent of job losses but 44 percent of subsequent job gains. Business Insider, Huffington Post, and the Wall Street Journal all concur: the unemployment rate is remaining low because of low-paying jobs.

We’re fooling ourselves by believing in a future with satisfying middle-class jobs for millions of Americans. It’s becoming clear that income should be guaranteed, so that recipients have the wherewithal and incentive and confidence to find productive ways to serve society.

Evidence from Research

Credible research overwhelmingly supports the concept. A World Bank analysis of 19 studies found that cash transfers have been demonstrated to improve education and health outcomes and alleviate poverty…concerns about the use of cash transfers for alcohol and tobacco consumption are unfounded. An MIT/Harvard analysis of seven cash transfer trials found “no systematic evidence that cash transfer programs discourage work.” The Brooks World Poverty Institute found that money transfers to the poor are used primarily for basic needs. Basic Incomes have been shown to lead to reductions in crime and inequality and malnutrition and infant mortality.

Successes in North America

One of the earliest experiments with guaranteed incomes was the “Mincome” (minimum income) program conducted in the town of Dauphin, Manitoba during the 1970s. The results were never made clear, partly because of a change to a more conservative government, which put the program’s records in storage, unevaluated. One study, however, found improved health outcomes for the recipients of the basic income payments.

Continue reading Overwhelming Evidence that a Guaranteed Income Will Work

Great Depression Unemployment Would Be 1.7% Using Today’s Unemployment BLS Calculations

The Great Depression’s highest unemployment came in 1933 at 24.75% (or 25% if you round up).

The 1933 U.S. population was 125,579,000; the Labor Force was 51,840,000; the number of unemployed was 12,830,000.  As a percent of the Labor Force, 24.75% were unemployed; as a percent of the entire population, 10.2% were out of work.

This is what is remembered most about The Great Depression: massive unemployment at 25% and long lines to the soup kitchens.

They calculated unemployment simply back then:
Unemployed / Labor Force  = Unemployment Rate  (12,830,000 / 51,840,000 = 24.75%)

 19321933Jan 1997Jan 2009Dec 2012Jul 2016
1. Population (U.S.Census Bureau)124,840,000125,579,000272,650,000307,000,000313,914,000322,762,018
2. Labor Force (DLT not for 1932 & 1933)51,250,00051,840,000135,456,000154,210,000155,597,000159,287,000
3. Percent of population working (labor force / population)41.1%41.3%49.7%50.2%49.6%49.4%
4. Unemployed (BLS)7,158,00012,058,00012,299,0007,700,000
5. + Not in Labor Force (BLS)66,829,00080,529,00087,918,00094,333,000
6. + Discouraged Workers (BLS)397,000734,0001,068,000591,000
7. = All Unemployed

8. Labor Force Unemployment Rate (unemployed / labor force)23.5%24.7%54.9%60.5%65.1%64.4%
9. Population Unemployment Rate (unemployed / population)9.7%10.2%27.3%30.4%32.3%31.8%
10. Actual number of people working (labor force – unemployed)39,190,00039,010,00061,072,00060,889,00054,312,00056,663,000
11. Employment Rate (Actual Number of People Working / Labor Force)76.5%75.3%45.1%39.5%34.9%35.6%
Modern U-3 unemployment rate (BLS)1.6% (7% of 23.5%)1.7% (7% of 24.7%)4.9% (7% of 64.4%)
Change in population from 1932 (people added since 1932)739,000147,810,000182,160,000189,074,000197,922,018
Population growth (number of times the population has doubled)

Since The Great Depression, the following categories (definitions included) have been added (the common thread in all these categories is that people are all without jobs):

  1. 1948 – Unemployed persons (Current Population Survey) (from the BLS Glossary):
    Persons aged 16 years and older who had no employment during the reference week, were available for work, except for temporary illness, and had made specific efforts to find employment sometime during the 4-week period ending with the reference week. Persons who were waiting to be recalled to a job from which they had been laid off need not have been looking for work to be classified as unemployed.
  2. 1975 – Not in the labor force (Current Population Survey)  (from the BLS Glossary):
    Includes persons aged 16 years and older in the civilian noninstitutional population who are neither employed nor unemployed in accordance with the definitions contained in this glossary. Information is collected on their desire for and availability for work, job search activity in the prior year, and reasons for not currently searching.
  3. 1994 – Discouraged workers (Current Population Survey) (from the BLS Glossary):
    Persons not in the labor force who want and are available for a job and who have looked for work sometime in the past 12 months (or since the end of their last job if they held one within the past 12 months), but who are not currently looking because they believe there are no jobs available or there are none for which they would qualify.

In addition, in 1994, Marginally attached workers (Current Population Survey) (from the BLS Glossary) was added, they are identified as a percent:
Persons not in the labor force who want and are available for work, and who have looked for a job sometime in the prior 12 months (or since the end of their last job if they held one within the past 12 months), but were not counted as unemployed because they had not searched for work in the 4 weeks preceding the survey. Discouraged workers are a subset of the marginally attached.

Continue reading Great Depression Unemployment Would Be 1.7% Using Today’s Unemployment BLS Calculations

“July Jobs Data Nowhere As Strong As Headline”

Tyler Durden | August 06 2016 | Zero Hedge 

One week ago, the BEA admitted that it had “found a problem” when it comes to calculating GDP numbers. Specifically it blamed “residual seasonality” adjustments for giving historical GDP numbers a persistent optimistic bias. This came in the aftermath of last week’s shocking Q2 GDP report which printed at 1.2%, less than half of Wall Street’s consensus.

Today, seasonality made another appearance, this time however in the much anticipated July jobs number, which unlike the woeful Q2 GDP number, was the opposite, coming in far higher than expected. In fact it was higher than the top Wall Street estimate.

consensus drift

And, just like in the case of GDP, it appears that seasonal adjustments were the culprit for today’s blowout headline print which excluding the Arima X 13 contribution to the headline number, would have been notably weaker.

As MUFG Securities strategist John Herrmann wrote in a note shortly after the report, the “jobs headline overstates” strength of payrolls. He adds that the unadjusted data show a “middling report” that’s “nowhere as strong as the headline” and adds that private payrolls unadjusted +85k in July vs seasonally adjusted +217k.”

In Herrmann’s view, the government applied a “very benign seasonal adjustment factor upon private payrolls to transform a soft private payroll gain into a strong gain.

Continue reading “July Jobs Data Nowhere As Strong As Headline”

2020 Vision: Four Steps to Get There

Paul Buchheit | August 08 2016 | Common Dreams

(Photo credit:

Bernie Sanders started losing the election over 200 years ago, when Alexander Hamilton proclaimed “The people are turbulent and changing; they seldom judge or determine right.”  And when James Madison argued for a republic that would make it “more difficult for all who feel it to discover their own strength, and to act in unison with each other.”

Little has changed over two centuries later, as the Democratic National Committee demonstrated when they “criticized and mocked” Senator Bernie Sanders during the primary campaign. People with money and power are still appalled by the notion of a popular democracy. But something is different now. The American majority, driven by frustrated workers and well-connected young people, are better able to communicate, and to unify in pursuit of a progressive nation.

The coining of the phrase “2020 Vision” can be attributed to the Democracy Alliance, which focuses on three “key issue areas that form the core of our 2020 Vision – an inclusive economy, a fair democracy, and strong action on climate change.”

The vision expounded here, in the four steps to follow, is focused on the cooperative efforts of the great majority of Americans, many of them young and few of them rich, who are beginning to understand the strength of the growing progressive movement.

1. Occupy the Next Four Years

The Youth & Participatory Politics (YPP) survey project reminds us of the power of people working together: In 2011 tens of thousands of disgruntled customers forced Bank of America to withdraw plans for a $5 debit card fee; and two months later activists worked together to defeat the Stop Online Piracy Act, which would promote Internet censorship. YPP defines participatory politics as “interactive, peer-based acts through which individuals and groups seek to exert both voice and influence on issues of public concern.”

Continue reading 2020 Vision: Four Steps to Get There

About the July Jobs Numbers

From Shadowstats:

• Just a Week into Headline 1.2% Second-Quarter GDP Growth, New Trade and Construction Spending Details Promise a Downside Revision

• Trade Deficit Widened and Deepened in Revision, Worst Since 2007

• With Quarterly and Annual Growth Collapsing Anew, Real Construction Spending Growth Was Weakest Since 2011 Series Trough

• Ten Years after its June 2006 Pre-Recession Peak, Real Construction Spending Remained Down 26% (-26%) from Recovering that Benchmark Level

Month-to-Month Unemployment Data Remained Meaningless and Nonsensical, Heavily Skewed by Inconsistent and Not-Comparable Seasonal Adjustments

• Though Heavily Bloated by Seasonal-Factor Distortions and Add-Factors, Annual Payroll Growth Effectively Held at a 29-Month Low

• July 2016 Unemployment: U.3 Held at 4.9%, U.6 Notched Higher to 9.7% and the ShadowStats-Alternate Rate Rose to 23.0%

• Annual M3 Growth Eased to 4.1% in July 2016, from 4.5% in June,


The July numbers:

U3: 4.9% (June was 4.9%)

U6: 9.7% (June was 9.6%)

Shadowstats: 23% (June was 23.9%)

Not in the Labor Force: 94,333,000 (June was 94,517,000)

Labor Force Participation Rate: 62.8% (June was 62.7%)

Jobs Created: 255K (P) (June was 292K (P)) (Note: May had its second revision; originally it was 38K, then revised downward to 11K, now revised up to 24K)



Obama’s job creation has been at best, erratic and inconsistent during his time in office.

Now with an election  just over 3 months away, the lipstick is being heavily applied to his jobs pig.

There are no coincidences.


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Why this Job Market is Still Terrible: The Politically Incorrect Numbers Everyone is Hushing up

Wolf Richter | August 05 2016 | Wolf Street

For individuals, it has barely improved since the Great Recession.

If you have a salary well into the six figures, stock options, nearly free healthcare, and other benefits such as access to free gourmet lunches and dinners at the company’s food court, you might have missed something that a lot of folks feel every day: It’s still a very tough battle out there in this job market. And here is why.

Today we got what was called a “stellar jobs report”: Non-farm payrolls rose 255,000 in July. In the other component of the report, the household survey showed that 420,000 new jobs were created. There are now a record 123.9 million full-time jobs. Government hiring was strong. Numerous sectors added to payrolls. And the unemployment rate remained stuck at 4.9%, with 7.8 million people deemed officially unemployed.

So everyone was happy. Well, certainly the stock market was. The S&P 500 closed at a new high. The Treasury market started worrying about a Fed rate hike, and the 10-year yield rose to 1.59%

But on an individual basis, on a per-capita basis – and this is what people feel when they’re looking for a job or asking for a raise – these “stellar” figures depict a job market that is only a little better than at the worst moment of the Great Recession.

On its population clock, the Census Bureau estimates that the US population on August 5, 2016, at 4:49 p.m. ET (yup, down to the minute) was 324.17 million.

That’s up from 308.76 million in April 2010. Since the darkest days of the Great Recession, the US population has grown by 15.4 million.

Continue reading Why this Job Market is Still Terrible: The Politically Incorrect Numbers Everyone is Hushing up

Last Word on Sanders

So, this has turned up over at Washington’s Blog:

“The difference between the reported totals, and our best estimate of the actual vote, varies considerably from state to state. However these differences are significant—sometimes more than 10%—and could change the outcome of the election.” ~ Fritz Scheuren, professor of statistics at George Washington University, President of the American Statistical Association (ASA)


It’s called Democracy Lost: A Report on the Fatally Flawed 2016 Democratic Primaries.


The larger picture
It’s unusual that a candidate loses one close primary/caucus after another (Iowa, Illinois, Missouri, and on and on and on), and then doesn’t challenge any of them.

Here is the bigger question for Sanders’ supporters:

If he doesn’t fight for himself and what he believes in, what makes you think he would have fought for you?

In the end, it probably turned out the way it was supposed to be.



We will never know if Sanders and his ideas could have made a difference; he lost most of his credibility with people when he endorsed Clinton (yes, he did say he would do that when he started).  Most movements don’t last too long after the figurehead is gone.  All Bernie ended up being for the millions who followed him was just fling, a disappointment, and a heartbreak who got some of their money.   The lesson learned is that if people want change, it’s up to them and not the politicians.

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NDP Note (also related to this post):

Why Bernie Sanders Was Not The One They Were Waiting For