While the worst of the layoffs in the private sector are over, we're on the cusp of major layoffs, furloughs and paycuts in the public sector as states and municipalities face revenue shortfalls that could total more than $350 billion in the next two years. State and local payrolls have already been trimmed by 191,000 jobs from August 2008 until January 2010. How bad the situation may become is illustrated by a story in the San Francisco Chronicle, which noted that San Francisco Mayor Gavin Newsom issued pink slips Friday to 17,000 of the city's 26,000 workers. Most will be rehired for a shorter workweek amounting to a 6.25% pay cut. Los Angeles has begun cutting 4000 city workers from its payroll. And it's the same from Abilene, Texas, to Columbia, South Carolina.
Rep. George Miller is seeking support in the Democratic Caucus for his Local Jobs for America Act, H.R. 4812, a two-year $100 billion that he hopes will leverage a million public and private sector jobs. It's precisely the kind of medicine the economy needs. But Republicans and deficit hawks among the Democrats aren't likely to find it to their liking. The details of the proposal, which Miller put together with the help of mayors from around the country, include:
• $75 billion over two years to local communities to hire vital staff
• Funding for 50,000 on-the-job private-sector training positions
The bill also includes provisions already approved by the House:
• $23 billion this year to help states support 250,000 education jobs
• $1.18 billion to put 5,500 law enforcement officers on the beat
• $500 million to retain, rehire, and hire firefighters
The Economic Policy Institute said of Miller's proposal:
Misguided critics will undoubtedly say we can’t afford legislation like this, but they are wrong. The fact is that the costs of inaction to our future prosperity are far greater than the cost of this bill. The best first step toward reducing the deficit is to get people back to work, since high deficits will be with us as long as high unemployment is.
Misguided critics, indeed. If anybody should be keeping their powder dry at the moment, it's deficit hawks and peacocks. Under the best of circumstances, it will take a minimum of three years to employ as many Americans as were working in December 2007 when the Great Recession began. Doing nothing to help curb tens of thousands of public sector layoffs will delay that process even further.