maryland governor’s workforce investment board march 14, 2012
TRANSCRIPT
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Maryland Governor’s Workforce Investment
Board
March 14, 2012
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Our Vision
We seek an America that grows its economy by investing in its people, so that every worker and every industry has the skills to compete and prosper.
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Our Mission
• We organize broad-based coalitions seeking to raise the skills of America’s workers across a range of industries.
• We advocate for public policies that invest in what works, as informed by our members’ real-world expertise.
• And we communicate these goals to an American public seeking a vision for a strong U.S. economy that allows everyone to be part of its success.
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New Year, Same Old, uh, Stuff
• Overarching political focus still on deficit reduction
• Any policy discussion driven by this debate
• Budget / Appropriations process being used for policy change
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Reminder: What’s Happened So Far (Appropriations)• FY 2011 House
passed HR 1, $4B in cuts (including elimination of WIA)—eventually cut $1B
• FY 2012 similar dynamic. House proposed more than $2B in cuts to DOL + $44B in Pell cuts
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Reminder: What’s Happened So Far (Budget Control Act)• Debt ceiling deal• $1T in cuts through
new spending caps• Created “super
committee” to develop another $1.2T in cuts
• Included sequestration trigger if super committee failed
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Let’s Talk about Sequestration!
• Sequestration is simply the process by which automatic cuts are made
• Written into law as part of the BCA
• Triggered by super committee failure
• Goes into effect January 2013
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But What Does Sequestration Actually Do? • Automatic cuts each
year, 2013 through 2021
• $109B, equally divided between “national defense” and all other (non-defense) programs
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How Do the Cuts Work?
• Non-defense cuts include both mandatory and discretionary programs
• But many mandatory programs exempt– Social Security, SNAP, child
nutrition, SSIA, EITC and child tax credit, etc.
• Exempt mandatory programs means discretionary program must absorb more of the cuts
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An Exception to the Rule
• Sequestration functions differently in 2013 than in other years
• About $16B in non-defense cuts from mandatory programs, another $38.7B from across-the-board discretionary programs (estimated 9.1%)
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FY 2013 Budget and Appropriations
• President’s budget released today
• Starts year-long process on the Hill– Budget resolution
(April 15)– Appropriations
(June-September)– Sequestration
(December-January)
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Overview: Department of Labor
• “American Jobs Act”: expanded version of September proposal
• Discretionary programs largely level funded, but some cuts
• New direction signaled for dislocated workers, but few details
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American Jobs Act (New Budget Proposal)1. $12.5B “Pathways Back
to Work Fund”—targets low-income and other unemployed o $10 B for subsidized jobs and
other local training strategies;o $2.5 B for summer youth
2. $4B “Reemployment NOW” Fund—targets long-term unemployed
3. $8B “Community College to Career Fund”—Split between DOL and DOEd over 3 years. Supports partnerships between community colleges, states, and employers
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Key Takeaways
• Major new investments – but only if Congress passes supporting legislation
• Sustains existing system, but no new resources
• Hints of consolidation argument taking hold (DW proposal)
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What Does All of This Mean?
• Regular appropriations process will move forward– We expect the House
will propose deep cuts again
– Senate will likely oppose, but something has got to give
• Sequestration follows behind that with additional cuts
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Process on Auto-Pilot
• All the “easy” cuts have been made at this point—no more low-hanging fruit
• But additional cuts *must* be made (by law) and debate is not around undoing previous cuts or even preventing additional cuts—just where those cuts will fall
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All Policy Discussion Derives From Budget Debate• Policy conversation
is entirely within the context of fiscal austerity and smaller government
• Policy change primarily implemented now through budget and appropriations
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Workforce 2012 – New Reality• 2003-2010—No WIA
reauthorization, but general agreement that an appropriate (if shrinking) federal investment
• 2011—New reality:– Fiscal challenges –
FY 2011, 2012 efforts in House to gut workforce funding
– Political challenges – GAO report (“47 programs…”) puts consolidation on the front burner.
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New Focus on WIA Reauthorization
• To protect the workforce system, reauthorization critical vehicle for reform (only way to preserve funding)
• To eliminate system, reauthorization a vehicle for cuts (via consolidation)
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WIA Reauthorization – Shifting Debate• Summer 2011 –
Minor tweaks: Senate draft bill/McKeon bill.
• December 2011 – New reality: Foxx/Heck bills, consolidation focus
• March/April 2012 – House markup?
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Foxx Bill (HR 3610)
• Consolidates 33 existing programs into 4 funding streams– Workforce Investment
Fund ($4.3B)– State Youth WIF ($1.9B)– Veterans WIF ($218B)– Targeted Populations
WIF ($581B)
• Funding authorized at FY 2011 combined levels
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Foxx Bill (continued)
• Greater state authority; 2/3 business representation on state boards
• “Unified Plans” – can cover TAA, CTE, TANF, etc.
• Eliminates Wagner-Peyser Employment Service
• Does not address Title II alignment
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McKeon Bill (HR 2295)
• Similar to HR 27 (2005)
• Largely maintains current Title I, Title II infrastructure
• Consolidates Adult/DW/ES funding
• Maintains ITAs, merges core and intensive services
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Heck Bill (HR 3611)
• Increases business representation on local boards
• Greater emphasis on labor market analysis, business engagement
• Minimum training percentage
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WIA’s Future…
• Final House R bill likely to adopt Foxx funding structure, McKeon infrastructure, Heck local business focus
• Without viable alternative, becomes de facto starting point
• Harkin “middle-class” bill – shift in Senate emphasis, attention?
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New Reality Even Impacts Victories
• TAA reauthorization– Mostly retained expanded
eligibility, funding levels; BUT not as robust as ARRA, very heavy lift even with changes
• American Jobs Act– Major training
components, new investments (Pathways Back to Work, UI reforms) BUT no legislative progress
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Success at the Message Level...
The message about a skills gap resonates—lots of policymakers are adopting this language
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…But not Translating to Policy
“I am no fan of the federal government being involved in education. And I use the word education, because I don’t like the word training when it comes to human beings. You train animals….you educate people. If I had my way, there wouldn’t be any federal job training programs,”
–Rep. Virginia Foxx (R-NC)
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December 21, 2012 (The Mayans Were Right)Everything leads to December:•Presidential/ Congressional elections•Bush-era tax cuts expire•Debt ceiling likely to be reached•Sequestration begins January 2013
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Building the Strongest Argument
All of the debate around investing in skills are stepping stones on a path toward the decisions that must be made in December
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What This Means for Workforce…
• There will be cuts – the only question is how much
• Will depend on how lawmakers—even allies—weigh workforce against other key priorities
• We cannot be the least bad option—must reinforce importance of skills to economic prosperity, growth
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