Harvey Calls for a Return to Public Works

Are we all so caught up in making ends meet that we forget to look for big solutions? It is refreshing to read proposals that seek to transform the economy while offering clear budgets.

One report from Demos offers a solution reminiscent of the New Deal’s Works Progress Administration.  Philip Harvey, Professor of Law and Economics at Rutgers School of Law, penned a proposal called “Back to Work: A Public Jobs Proposal for Economic Recovery.”   He ascertains that the government should create immediate jobs for the unemployed by funding vital services in communities across the country.  Surveying the diverse needs in present-day America, he gives as examples of plausible jobs: retrofitting buildings, repairing roadways, and to providing vital services for seniors and children.

According to the press release from Demos, the policy center that published the report, the estimated net cost of creating 1.4 million new jobs (1 million directly and another 400,000 thousand through multiplier effects) would be $28.6 billion per year. Furthermore, this proposal could target communities who have seen the greatest loss of jobs: non-college educated workers, young people, and African American and Latinos–all of whom experience unemployment rates twice as high as the average population.

“The advantage of the proposal lies in its unique ability to serve the goals of anti-recessionary fiscal policy while simultaneously serving the social welfare needs of jobless workers,” Harvey wrote. “There is no other anti-recession strategy that can do either of these things as well as the direct jobs proposal, let alone combine them in a single programmatic initiative.”

Harvey strategizes how to fund the costly program, arguing that the price tag of the task is not beyond the reach of the economic resources of the U.S.  He estimates that this proposal would create enough jobs to bring the unemployment rate down to 4.5 percent, and yet would require a total net cost less than half the size of the $858 billion increase in the federal deficit that Congress accepted this past December.