We need to reform the public assistance program so that more families in need are eligible. (Photo: badsci/flickr/cc)
Apr 02, 2020
The global coronavirus pandemic has put our economy in free-fall.
Even through Donald Trump's reckless economic policies, like his pointless trade war with China or his deficit-busting tax cuts for his billionaire donors, the economy has somehow managed to keep chugging along -- until now.
All of the stock market gains from Trump's time in office have been wiped out, and over the course of just over one week in March the Dow Jones Industrial Average experienced its five largest drops in history.
Watch:
Worse than a plummeting stock market, businesses and major industries have been forced to shutter their windows to help combat the rapid spread of the virus, putting hundreds of thousands of workers' paychecks at risk.
A recession is inevitable at this point. Here are 3 things we can do to prepare.
Number one: We need to reform unemployment insurance so it reflects the needs of today's economy.
When it was first created in 1935, unemployment insurance was designed to help full-time workers weather downturns until they got their old jobs back. But there are fewer full-time jobs in today's economy, and fewer people who are laid off get their old jobs back again.
As a result, only 27% of unemployed workers receive benefits today, compared to 49% of workers in the 1950s. We need to expand unemployment coverage so that everyone is protected.
Number two: We need to strengthen Temporary Assistance for Needy Families, also known as public assistance.
Since its creation in 1996, the number of families receiving cash assistance has declined dramatically - and not because they're doing well. Between 2006 and 2018, just 13% of families were lifted out of poverty, while the number of families receiving public assistance fell by 39%.
Already weak, the program didn't hold up well during the Great Recession. Funding doesn't automatically expand during economic downturns - meaning the more families are in need, the less money there is to help them. The program also has strict work requirements, which can't be fulfilled in a deep recession. Worse yet, many individuals in need have already exhausted their five years of lifetime eligibility for assistance.
We need to reform the public assistance program so that more families in need are eligible. It should be easier to waive the strict work eligibility requirements during the economic downturn, and the lifetime five-year limit should be suspended.
Number three: We need to protect the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps.
Unlike public assistance, SNAP responded well during the Great Recession. Its requirements are designed to expand during economic downturns or recessions.
Waiving work requirements during the Great Recession made thousands of people in need eligible for the program who otherwise wouldn't have been. Between December 2007 and December 2009, the number of SNAP participants rose by 45%. The program helped keep an estimated 3.8 million families out of poverty in 2009.
But that might not be an option this time around, as SNAP has come under attack from the Trump administration, which is trying to enact a draconian rule change that would kick an estimated 700,000 of our most vulnerable citizens off of the program. Luckily, a judge blocked the rule from going into effect, but the administration is still fighting to enforce it -- even in the middle of a global pandemic. We need to make sure SNAP's flexibility and ability to respond to economic downturns is protected before the next recession hits.
Stronger safety nets are not only good for individuals and families in need. They will also prevent the looming recession from becoming an even deeper and longer economic crisis.
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Robert Reich
Robert Reich, is the Chancellor's Professor of Public Policy at the University of California, Berkeley, and a senior fellow at the Blum Center for Developing Economies. He served as secretary of labor in the Clinton administration, for which Time magazine named him one of the 10 most effective cabinet secretaries of the twentieth century. His book include: "Aftershock" (2011), "The Work of Nations" (1992), "Beyond Outrage" (2012) and, "Saving Capitalism" (2016). He is also a founding editor of The American Prospect magazine, former chairman of Common Cause, a member of the American Academy of Arts and Sciences, and co-creator of the award-winning documentary, "Inequality For All." Reich's newest book is "The Common Good" (2019). He's co-creator of the Netflix original documentary "Saving Capitalism," which is streaming now.
The global coronavirus pandemic has put our economy in free-fall.
Even through Donald Trump's reckless economic policies, like his pointless trade war with China or his deficit-busting tax cuts for his billionaire donors, the economy has somehow managed to keep chugging along -- until now.
All of the stock market gains from Trump's time in office have been wiped out, and over the course of just over one week in March the Dow Jones Industrial Average experienced its five largest drops in history.
Watch:
Worse than a plummeting stock market, businesses and major industries have been forced to shutter their windows to help combat the rapid spread of the virus, putting hundreds of thousands of workers' paychecks at risk.
A recession is inevitable at this point. Here are 3 things we can do to prepare.
Number one: We need to reform unemployment insurance so it reflects the needs of today's economy.
When it was first created in 1935, unemployment insurance was designed to help full-time workers weather downturns until they got their old jobs back. But there are fewer full-time jobs in today's economy, and fewer people who are laid off get their old jobs back again.
As a result, only 27% of unemployed workers receive benefits today, compared to 49% of workers in the 1950s. We need to expand unemployment coverage so that everyone is protected.
Number two: We need to strengthen Temporary Assistance for Needy Families, also known as public assistance.
Since its creation in 1996, the number of families receiving cash assistance has declined dramatically - and not because they're doing well. Between 2006 and 2018, just 13% of families were lifted out of poverty, while the number of families receiving public assistance fell by 39%.
Already weak, the program didn't hold up well during the Great Recession. Funding doesn't automatically expand during economic downturns - meaning the more families are in need, the less money there is to help them. The program also has strict work requirements, which can't be fulfilled in a deep recession. Worse yet, many individuals in need have already exhausted their five years of lifetime eligibility for assistance.
We need to reform the public assistance program so that more families in need are eligible. It should be easier to waive the strict work eligibility requirements during the economic downturn, and the lifetime five-year limit should be suspended.
Number three: We need to protect the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps.
Unlike public assistance, SNAP responded well during the Great Recession. Its requirements are designed to expand during economic downturns or recessions.
Waiving work requirements during the Great Recession made thousands of people in need eligible for the program who otherwise wouldn't have been. Between December 2007 and December 2009, the number of SNAP participants rose by 45%. The program helped keep an estimated 3.8 million families out of poverty in 2009.
But that might not be an option this time around, as SNAP has come under attack from the Trump administration, which is trying to enact a draconian rule change that would kick an estimated 700,000 of our most vulnerable citizens off of the program. Luckily, a judge blocked the rule from going into effect, but the administration is still fighting to enforce it -- even in the middle of a global pandemic. We need to make sure SNAP's flexibility and ability to respond to economic downturns is protected before the next recession hits.
Stronger safety nets are not only good for individuals and families in need. They will also prevent the looming recession from becoming an even deeper and longer economic crisis.
Robert Reich
Robert Reich, is the Chancellor's Professor of Public Policy at the University of California, Berkeley, and a senior fellow at the Blum Center for Developing Economies. He served as secretary of labor in the Clinton administration, for which Time magazine named him one of the 10 most effective cabinet secretaries of the twentieth century. His book include: "Aftershock" (2011), "The Work of Nations" (1992), "Beyond Outrage" (2012) and, "Saving Capitalism" (2016). He is also a founding editor of The American Prospect magazine, former chairman of Common Cause, a member of the American Academy of Arts and Sciences, and co-creator of the award-winning documentary, "Inequality For All." Reich's newest book is "The Common Good" (2019). He's co-creator of the Netflix original documentary "Saving Capitalism," which is streaming now.
The global coronavirus pandemic has put our economy in free-fall.
Even through Donald Trump's reckless economic policies, like his pointless trade war with China or his deficit-busting tax cuts for his billionaire donors, the economy has somehow managed to keep chugging along -- until now.
All of the stock market gains from Trump's time in office have been wiped out, and over the course of just over one week in March the Dow Jones Industrial Average experienced its five largest drops in history.
Watch:
Worse than a plummeting stock market, businesses and major industries have been forced to shutter their windows to help combat the rapid spread of the virus, putting hundreds of thousands of workers' paychecks at risk.
A recession is inevitable at this point. Here are 3 things we can do to prepare.
Number one: We need to reform unemployment insurance so it reflects the needs of today's economy.
When it was first created in 1935, unemployment insurance was designed to help full-time workers weather downturns until they got their old jobs back. But there are fewer full-time jobs in today's economy, and fewer people who are laid off get their old jobs back again.
As a result, only 27% of unemployed workers receive benefits today, compared to 49% of workers in the 1950s. We need to expand unemployment coverage so that everyone is protected.
Number two: We need to strengthen Temporary Assistance for Needy Families, also known as public assistance.
Since its creation in 1996, the number of families receiving cash assistance has declined dramatically - and not because they're doing well. Between 2006 and 2018, just 13% of families were lifted out of poverty, while the number of families receiving public assistance fell by 39%.
Already weak, the program didn't hold up well during the Great Recession. Funding doesn't automatically expand during economic downturns - meaning the more families are in need, the less money there is to help them. The program also has strict work requirements, which can't be fulfilled in a deep recession. Worse yet, many individuals in need have already exhausted their five years of lifetime eligibility for assistance.
We need to reform the public assistance program so that more families in need are eligible. It should be easier to waive the strict work eligibility requirements during the economic downturn, and the lifetime five-year limit should be suspended.
Number three: We need to protect the Supplemental Nutrition Assistance Program, also known as SNAP or food stamps.
Unlike public assistance, SNAP responded well during the Great Recession. Its requirements are designed to expand during economic downturns or recessions.
Waiving work requirements during the Great Recession made thousands of people in need eligible for the program who otherwise wouldn't have been. Between December 2007 and December 2009, the number of SNAP participants rose by 45%. The program helped keep an estimated 3.8 million families out of poverty in 2009.
But that might not be an option this time around, as SNAP has come under attack from the Trump administration, which is trying to enact a draconian rule change that would kick an estimated 700,000 of our most vulnerable citizens off of the program. Luckily, a judge blocked the rule from going into effect, but the administration is still fighting to enforce it -- even in the middle of a global pandemic. We need to make sure SNAP's flexibility and ability to respond to economic downturns is protected before the next recession hits.
Stronger safety nets are not only good for individuals and families in need. They will also prevent the looming recession from becoming an even deeper and longer economic crisis.
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