Progress Illinois

Back in May, the Tribune cited a study by the Center for Labor Market Studies at Northeastern University which predicted some troubling trends in teen summer employment. Now the Center has analyzed recent Bureau of Labor Statistics data and determined that their unsettling employment forecast has come true. From a press release put out yesterday by the Alternative Schools Network:

- Between 2000 and 2008, the national summer teen employment rate for 16-19 year olds fell from 51.4% to 37.1%, a drop of almost 30% -- a Depression-era reduction in job opportunities for American youth and the lowest youth employment rate in 60 years.

- Only one in every five Black 16-19 year olds worked during June 2008.

- Low-income teens fare worst in the labor market. During summer 2007, only 30% of 16-19 year olds from households with annual incomes below $20,000 worked and only 15% of low-income Black youth held a job, versus an employment rate of 50% for teens in households with annual incomes between $75,000 and $100,000.

Unfortunately, little has been done to ease the pain at the federal level, where the report's authors say youth joblessness could really be tackled. Bills in both chambers to set up for a summer jobs programs were left out of the 2008 fiscal stimulus package.

You can download the entire report here.

While Illinois foreclosures were down in June as compared to May, they were still 42 percent higher than at the same point last year. Realty Trac Inc. found that one out of every 484 households in the Chicagoland area was foreclosed upon during June. Not surprisingly, home sales are also way down in the state, as compared to the previous year. And as the AP reported last weekend, "foreclosures will keep rising next year no matter who is elected president in November."

Meanwhile, in Washington, a bill providing assistance to cash-strapped homeowners has been moving along at a "glacial pace," thanks to GOP lawmakers who oppose it. Here are the details:

The centerpiece of the housing package is a plan to rescue as many as 400,000 families by helping them trade exotic loans with rapidly rising monthly payments for more affordable mortgages backed by the federal government. Under the proposal, the Federal Housing Administration would be authorized to insure up to $300 billion in new loans for families whose lenders agree to write down their debt to no more than 87 percent of their homes' current, reduced value. [...]

The package also contains a long-sought overhaul of the FHA and housing-related tax breaks worth $14.5 billion, including a credit of up to $8,000 for first-time home buyers. And it would offer local communities $3.9 billion in emergency funds to purchase foreclosed properties in hopes of halting or preventing the spread of blight.

The bill cleared a procedural hurdle in the Senate yesterday and is headed back to the House, where it's expected to undergo further changes (those emergency funds will likely be nixed) before facing another vote in both chambers. Democratic leaders hope to get it to the president's desk by the end of the month.

We know foreclosures in Illinois have jumped 25 percent since the subprime housing market collapsed last year, affecting homeowners all across the state. But what about people who choose to rent? Are they insulated from the mortgage meltdown? Kelly Virella of The Chicago Reporter says many aren't:

Since the nation’s worst housing foreclosure crisis began two years ago, the octopus-like tentacles of the global home mortgage industry have orchestrated the repossession of thousands of small apartment buildings in Cook County, affecting thousands of renters who live there.

In many cases, the evictions have been legal. In others they’re not because mortgagees — a bank or company that collects mortgage payments — fail to give tenants ample notice or an opportunity to contest the eviction in court. In some cases, like Tabitha’s, the evictions are illegal because there is no court order against the tenants themselves.

Although it's unclear exactly how many people have been impacted in Chicago -- 3,551 two- to six-unit apartment buildings were foreclosed upon in Cook County during 2006 and 2007, two-thirds of which were located in majority-black neighborhoods -- it's a problem in communities across the nation.

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On MSNBC this afternoon, The New York Times' John Harwood noted that John McCain vowed yesterday to "balance the budget by the end of his first term," and asked Sen. Dick Durbin: "You don't believe him?" Durbin responded, "It's voodoo two," referring to the term "voodoo economics," which former President George H.W. Bush used to deride former President Reagan's supply-side tax policies.

Durbin continued: "It's a rerun of what we've heard before -- that if you just keep cutting taxes, everything is going to work out." Watch it:

For more on McCain's empty promises to balance the budget, read Adam's post on today's Tribune editorial.

Yesterday, John McCain came out and proposed to balance the federal budget by the end of his first term. Today, the Chicago Tribune editorial board lapped it up:

Since winning the nomination, Obama reportedly has been moving toward the middle of the political spectrum. But on the budget, he still sounds left of center, with no interest in eliminating deficit spending.

So it was heartening to hear that at least John McCain is determined to restore fiscal discipline—and not in eight years, as he had previously suggested, but in four. On Monday, he released a plan that explains how he will manage the economy and says flatly, "John McCain will balance the budget by the end of his first term."

The board tempers their excitement with the acknowledgment that McCain has laid out virtually no plan for how to reach this budgetary bliss. Perhaps that's because it's politically unfeasible, a rather important point the Tribune considers only after heralding McCain's announcement.

In a post we highlighted in the Early Bird, the Center for American Progress' Wonk Room suggests that McCain will face a deficit of $700 billion, thanks to his extension and augmentation of Bush's expiring tax cuts. A "generous estimate" of the savings from McCain’s proposed spending freeze would be $50 billion, leaving a budget hole of $650 billion, a whopping total that could not even be erased by eliminating 10 whole cabinet agencies (Agriculture, Commerce, Education, Energy, HUD, Interior, DOJ, Labor, Transportation, Treasury and the EPA).

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As mortgage and medical costs skyrocket, unemployment rises, and wages stagnate, it's not surprising that more families are falling into the debt trap. In 2007, personal bankruptcy filings in the United States jumped 40 percent and in the first six months of this year, they rose 30 percent as compared to the same period in 2007.

In an economic speech this morning, Barack Obama laid out a plan to help ease the financial strain on struggling families by promising to push for amendments to the 2005 bankruptcy bill. That measure made it tougher for people facing personal bankruptcy to discharge debt by mandating an income test to measure a debtor's ability to repay obligations. The changes proposed by Obama include offering relief to families who defaulted because of high medical costs (which account for about half of all personal bankruptcies), making it easier for the elderly to keep their homes if they are facing bankruptcy, and creating a "fast-track" bankruptcy process for military families that get behind on expenses because of long deployments, repeated moves, or predatory lenders.

It's about time the Democrats attacked John McCain and his party for the lobbyist-penned travesty that was the 2005 bill. A pet project of credit card companies and other consumer lenders, banks claimed hundreds of thousands of debtors were frivolously filing for bankruptcy -- thus discharging the debts they owed to the banks -- when they had the means to cover the unpaid sum. In reality, the purported crisis was entirely invented by the banks. The nonpartisan American Bankruptcy Institute estimates that only three percent of filers were able to discharge debts they could actually afford to pay off. The vast majority were stuck in an endless cycle of debt and high interest.

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Last week, we debunked Rep. Mark Kirk's bogus argument for why he opposed the federal unemployment insurance benefit extension: that it would lead people to cash in after two weeks of work. Take a listen as he tells a Chicago radio audience: "I think that in this tough economic time. A temporary extension for people that held the job for a long time, that makes sense. But two weeks, that's probably not enough":

Internal mp3

Of course, as the Center for Budget and Policy Priorities pointed out: "Only in rare circumstances could a worker with such a limited work record meet his or her state’s regular UI requirements, which target assistance on workers with a demonstrated attachment to the labor force." They added: "the share of the additional benefits under the bill that would go to workers with very limited work records is almost surely miniscule."

But while Kirk is manufacturing excuses for his vote against this common sense legislation, unemployed workers are hurting. Check out some of the comments that appeared below our original post on this subject:

my husband ran out of benefits and can't find a job. we filed bankruptcy and lost our home. i'm on food stamps for the first time in my life but the problem is we'll no place to live to use them.

I have over 20 years of experience and can't even find a min. wage job!! Now that's bad! I guess we are supposed to support our goverment but they won't support us!!

Laid off for a year now after working for the same company for 17 years. ... I have been actively searching for a job, even applying out side the box jobs, the few that have contacted me, either have said I was over qualified or the position has been filled. The majority do not even respond, even after a follow-up. ... Savings account is long gone. I'm tapping into my retirement funds just to keep the house payments going.

Oh, and did we mention that the unemployment rate jumped almost a full percentage point in the past month?

Back in April, Mose noted the contrast between Illinois -- where lawmakers continue efforts to expand gambling -- and numerous other states across the country that have retreated from gaming as a cure-all for their budget woes. Today, the Tribune reports on a new study from the Rockefeller Institute which provides yet more evidence that gambling is waning as a dependable revenue source. Indeed, proceeds last month from Illinois' nine casinos were apparently "down 14 percent from May 2007." The article quotes one of the report's authors singling out Illinois' dependance on gaming revenue, while noting that it's not "a real winner ... in the long term":

Whatever the reason, study authors say states shouldn’t rely on gambling as a growth stream, given their findings.

Illinois counts on gambling for about 4 percent of its state revenue—a figure nearly double the national average of 2.3 percent, according to Robert Ward, deputy director of the Rockefeller Institute and co-author of the study.

“States have become very reliant on gambling revenue, Illinois more so than most,” Ward said. “Adding gambling operations can help solve short-term budgetary needs. It’s not going to be a real winner of a solution in the long term.”

Although the Prairie State has survived the severe economic downturns faced by other states in the region, the local economic landscape isn't too pretty these days. The Illinois Department of Employment Security reports the state's May jobless rate was 6.4 percent, up one full percentage point from last month and 1.5 percent from this time last year. Illinois sits well above the national unemployment rate of 5.5 percent as well.

Employment agency director James Sledge told the AP that this uptick further proves the need for Gov. Blagojevich's capital improvements plan. I'd say it also proves the need for more robust unemployment insurance, something Rep. Mark Kirk and his Republican cohorts in the Illinois Congressional delegation aren't too interested in providing.

As a young teenager, Jeone Thadison used to sneak out and shoot dice with local drug slingers to help his mother pay the bills. These days, the 19-year-old is playing it straight, having landed a job at a local Boys and Girls Club. But as Chicago Public Radio's Eilee Heikenen-Weiss detailed yesterday, many young Chicagoans aren't having the same luck securing summer employment:

THADISON: Everybody filled out the KIDSTART application, but everybody didn’t get a job.

Although the city’s KidStart budget has increased through the years, the program will still turn down the majority of applicants this summer. Mary Ellen Caron is the commissioner of the Department of Children and Youth Services.

CARON: 40,000 young people applied, and in our program, there are 18,000 jobs. So there will be 22,000 who applied that will not have a job through our program.

Andy Sum, the Director of Northeastern’s Center for Labor Market Studies, estimates the figures nationwide are at a historic nadir. Only 34 percent of the nation's teens will be able to obtain some type of employment during the June-August period, the lowest summer employment rate in the last 60 years.

Unfortunately, a proposal by congressional Democrats to create 1 million new summer jobs for young people has stalled. Meanwhile, Gov. Blagojevich's plan to spend $30 million on a summer jobs program aimed at employing young people between the ages of 15 and 22 hinges on the adoption of a capital bill, which looks unlikely for the time being.

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