Human Rights Experts See Connection Between Poverty And Recession

Georgetown University professor Harry Holzer said Thursday that there is a high correlation between the recession and the nation’s poverty level.

“Reports have shown that children growing up in poverty impose high cost on the economy since they have lower levels of educational achievement, lower employment, worse health, higher mortality rate, and are more likely to engage in crime,” said Holzer, who is also a fellow at the Urban Institute in Washington, D.C..

Holzer participated in a conference call with reporters to respond to the U.S. Census Bureau’s new report that shows the country’s poverty rate increased to over 14% in 2009.

Human rights advocate Wade Henderson expressed alarm over the report. “These numbers are a moral outrage and challenge our nation’s internal security,” he said.

However, Henderson, president and CEO of the Leadership Conference on Civil and Human Rights, credited the Obama administration with preventing the number of poverty-stricken Americans from being even higher.

“Without President Obama’s economic policies these numbers would have escalated by now.”

Holzer painted a grim picture in terms of the rate of child poverty, which has risen nationwide from 18% to 21% in the last two years, saying that it is likely to worsen in the coming years. This increase, Holzer said, will “accumulate to a long term cost of about 500 billion dollars a year.”

Both men encouraged Congress to pass legislation to create good-paying jobs and provide tax breaks to working families.

“We must make sure that we connect people to their jobs, and ensure that work pays more than welfare,” Holzer said.

UN Says World Economic Recovery Shaky

The world economy is slowly recovering from the global financial crisis but growth will remain fragile, says the UN Department of Economic and Social Affairs (DESA) in its new report on the economic prospects for 2010-2011. The report predicts a 2.9% growth in the US for 2010, and a drop back to 2.5% in 2011. “The good news is that the crisis in the world economy has abated and we see a continued recovery," says Rob Vos, Director of Development Policy Analysis of DESA. "but at the same time it is weak and uneven."

While the market for primary commodities has bounced back strongly, favoring “Developed” Asia (Japan, Korea, etc), other regions such as Latin America, Africa and Western Asia have seen no such growth.

With credit supplies and private consumption remaining low, Vos says that the current rebound in the world economy is heavily dependent on the fiscal and monetary stimulus plans. As most of these measures will be phased out by 2011, private sector growth in the coming year will have an important impact on the predicted rates.

Although stimulus packages played a key part helping the global economy bounce back, Vos believes that these measures, along with an overall decrease in tax revenues, are in part responsible for the current public debt crisis and widening budget deficits that are likely to be obstacles to substantial economic growth in the coming years. Vos also highlighted high unemployment rates and exchange rate volatility as continuing “crises" in part responsible the world financial markets mediocre growth prospects.

Has the Eye of the Economic Storm Passed?

By Courtney Ann Jackson-Talk Radio News Service

“The force of the economic storm is weakening a bit,” said U.S. Treasury Secretary Timothy Geithner yesterday. Geithner discussed proposed Fiscal Year 2010 budget for the Treasury Department and the Internal Revenue Service with members of the Senate Appropriations subcommittee.

“We’re working to repair and reform our financial system so that it works for, not against, recovery. We’re working to restore growth and meet our fiscal goals by redesigning our tax code, bolstering enforcement,” said Geithner. “We’re working to advance our interest globally, working with other countries to promote economic recovery and financial repair and to ensure more open markets for U.S. businesses.”

Geithner and the Treasury Department are seeking increases in multiple areas including an increase that will bolster the staffs of the U.S. domestic finance and tax policy offices. Other increases will contribute to community development institutions and IRS enforcement efforts. Geithner also said the increase in the budget proposal will allow the U.S. to “meet international obligations and to help us craft a global response to the crisis in this more integrated global economic system we live in today.”

Ed. Sec. Duncan: Unprecedented Money Will Lead to Unprecedented Reforms

By Michael Combier-Talk Radio News Service

The $100 billion given to the Department of Education by the American Recovery and Reinvestment Act is the most expensive piece of legislation since the G.I. Bill which provided college education for returning World War II veterans. The investment is intended to shore up state education efforts, while saving jobs and encouraging educational innovation with its main objective to provide a better future for the youth of this country and the future generations said Education Secretary Arne Duncan at a press conference this morning.

“It is a time of economic crisis, it is a time of educational crisis and I am convinced we need to educate our way to a better economy. The challenges are real, the challenges are profound,the stakes have never been higher but the opportunity is absolutely once in a lifetime,” said Duncan.

“With unprecedented resources we want to push unprecedented reform,” said Duncan, adding that “we have to get dramatically better if we were to retain our spot around the world as the education leader... By the year 2020, we want to have the highest percent of college graduates in the world.”

To reach this ambitious goal, investments will be made in nearly every level of education. $5 billion will be invested to early childhood education. $30 billion will be invested in higher education. “There are no good dropouts, no good jobs today for high school dropouts... condemning them to poverty and social failure,” Duncan said. $2.5 billion will be dedicated over five years to retain students in higher education, and “the goal is not to go to college, the goal is to graduate,” he said.

These students are "competing with students in India and China for jobs... We have to raise the bar,” said Duncan.

For Duncan,”we cannot go backwards”, the crisis should lead people “to think very differently, to invest differently... and show what the country is possible.”

Navigating through the Road Bumps in the Financial System

By Courtney Ann Jackson-Talk Radio News Service

We can’t let things go back to the way they were with the United States Financial System according to Treasury Secretary Timothy Geithner Monday. Geithner joined Newsweek Magazine editor, Jon Meacham, at a luncheon interview on the topic of the recession and what American’s should expect as the steps to recovery continue to be put into action.

“This is still the most challenging economic crisis that this country has seen in generations. It took a long time for these problems to build up," Geithner said. "It’s going to take time for us to work through them. We’re not going to have a steady, even process of repair, it’s going to be bumpy, still feel fragile for a while.”

Geithner expressed his sympathy for struggling Americans and said he understands why Americans are angry. He said that even as growth inevitably begins to turn positive, unemployment will continue to increase for awhile. He also said, “It’s not going to feel better for a long time for millions of Americans.”

As the administration continues to work its way through this economic crisis, Geithner believes they need to take a “fresh look” at the financial system as a whole. In terms of speed and quality of initiative that are already in progress, he said he thinks the administration is doing well.

“The American people want to see us moving to change things, not just waiting and hoping,” he said.

Meacham asked Geithner about people’s critique that the administration was being too lenient. Geither replied, “I actually think that what the President has put in place is the most aggressive approach to solving a financial crisis than we’ve seen from any serious country in a very long period of time.”

He also noted that they are doing more preventative work and referred to it as a type of insurance from a greater recession. They are working to make the system more stable and plan to release a new set of proposals in the next few weeks for reforming the oversight framework.