You would have to live under a rock not to know that gas prices are high. In fact, the “pain at the pump” that all Americans feel has dominated political discourse, so much so that we may forget the other burdens facing working families.

Thankfully, Governor Phil Bredesen of Tennessee reminds us what is draining the pocket books of American families even more than gas:

It is worth remembering that when it comes to real, sustained growth in costs, when it comes to real, sustained erosion of families’ disposable income, gas still can’t hold a candle to the real elephant in the room: health care.

He notes:

If gas prices had risen during my adult lifetime - since I got out of high school in 1961 - at the same rate as per capita health-care expenditures, gas would not be $4 a gallon today. It would be about $15.

Because medial bills are typically sent through third parties for payment, we sometimes only experience a physical “hurt at the hospital.” This disguises the true exorbitant health care costs for most Americans. But as Gov. Bredesen reminds us, this quietly escalating price tag creates more financial pain for many working families than the recent uptick at the pump.

This post was written by Jason Newman, State and Local Policy Director for the Democratic Leadership Council.

We all know the alarming statistics about the rapidly growing U.S. corrections system. Today, more than 2.2 million Americans are behind bars — one out of every 100 adults. In addition, more than 5 million Americans are on probation or parole and living in our communities, giving us a grand total of 7.2 million people in our corrections system compared to just 1.8 million in 1980.

Not surprisingly, this growth has had significant costs for our society, both in dollars spent on housing and supervising all these offenders, but also in the rising incidence of crime among individuals who cycle into and out of our criminal justice system.

Our “get tough” policies over the last few decades have quadrupled the number of offenders in the system, but haven’t led to a corresponding drop in crime among people who leave prison. In fact, two-thirds of former prisoners are rearrested for a new offense within three years of being released from prison, creating a vicious cycle of offenders through the revolving door of justice.

How do we end this cycle? Last week, PPI released a report arguing that to truly reduce crime we must refocus the entire corrections system on preventing crime as well as punishing it after the fact. Congress passed the Second Chance Act earlier this year, which will provide more funding for rehabilitation and reentry programs. This is important, but funding alone will not solve the problem. We need to couple increased funding with systemic changes that hold everyone involved in the corrections system - wardens, sheriffs, parole officers and probation supervisors - accountable for reducing recidivism rates. We recommend that the federal, state and local governments work in tandem to:

• Develop and implement a CompStat-like system that measures and publicizes recidivism rates of inmates and those on probation and parole.

• Create an Office of Community Supervision (OCS) within the DOJ that gives grants to states and cities in order to double the number of parole and probation officers and move them from behind their desks and into the communities.

• Give parole and probation officers the power to impose swift and consistent consequences for violators of parole and probation.

Right now, our corrections system fails to meet our ultimate objective of reducing crime. Additional funding for rehabilitation and reentry programs offered in the Second Chance Act will ensure that we have the money to help offenders make a successful transition from prison. But it is time that we begin making those responsible for supervising criminal populations accountable for, and more effective at, making our communities safer.

Over at The Atlantic, Matt Yglesias picked up on our post about the role of states and cities in poverty reduction. He rightly notes that:

National leadership is vital to making really sustainable progress, especially considering that the number of people in need of help goes up in downturns at just the time when state and local governments usually need to cut spending.

But the reality is that both John McCain and Barack Obama have made costly promises on the campaign trail. While poverty reduction should be a top federal priority, I don’t think states and communities should count on an increased cash flow in the near future.

This post was written by Jon Cardinal, an intern for the Progressive Policy Institute and Freedman Consulting, LLC. Jon graduated from St. Lawrence University this spring and is a 2007 Harry S. Truman Scholar.

A recent Washington Post article reported that the national youth jobless rate for June was at its highest in six decades, with 37 percent of teenagers ages 16 to 19 employed, compared with 51 percent in June 2000 — a decrease due largely to the downturn in the labor market and increased competition for low-wage service jobs

One way to ensure that our young people have job opportunities is to empower them with the entrepreneurial skills necessary to adapt to the shifting currents of the Information Age. This could not only alleviate increasing joblessness among youth, but also give our young people an opportunity to apply their unique abilities and knowledge of new technology in launching their own businesses.

According to a recent Gallup poll, seventy percent of high school students say they want to be entrepreneurs. Young people have grown up in a society where Bill Gates and the founders of Google have become icons, so it’s no surprise that they now desire opportunities to use the power of technology to make a name for themselves in the business world. The entrepreneurial spirit has the potential to help young people survive the struggling job market, but we must provide them with th proper tools and support so that they achieve entrepreneurial success.

For example, cities and states could follow the lead of New York’s St. Lawrence County summer youth internship program. The Discover Your Future Here program connects young people and private sector employers through paid internships directly related to career goals and employers’ needs. Youth are encouraged to work with local entrepreneurs in order to learn the ins and outs of running their own business and to discover how their interests and talents may be applied to a future business opportunity right in their backyard.

Such a program could be enhanced with continued entrepreneurship training and career technical education training offered to high school students who are unsure of whether or not they want to attend college. As this article on young entrepreneurs notes:

Entrepreneurship is becoming a viable alternative for our young people who may not be interested in a traditional liberal arts college education.

We also need to craft smart policies that supply our young entrepreneurs and all self-employed people an opportunity to succeed. Mark Ribbing in his PPI policy report outlines a strong pro-entrepreneurial program that would include tax reform that offers tax relief for microenterprises and small businesses, universal health care and pension reform. These supports would give entrepreneurs vital benefits that currently are only accessible in an employer’s benefit plan, and technological infrastructure development to increase the accessibility to technology like broadband that is critical to success in the 21^st century economy.

Michael Malone in a May 2008 Wall Street Journal op-ed declared that we are now entering a new frontier in our national story that he terms “Entrepreneurial America.” He writes that this new epoch will be shaped by:

Not just self-employment or sole proprietorship, but serial company-building, entire careers built on perpetual change, independence and the endless pursuit of the next opportunity.

With this New Frontier fast approaching, it is time for us to empower our youth with the tools and knowledge necessary to “look ahead, develop a good plan and then bet everything on themselves” in this entrepreneurial economy.

A group of the nation’s most well-known housing policy experts released a response yesterday criticizing The Atlantic article, “American Murder Mystery.” They go through Rosin’s assertions and debunk the ones based on incorrect data. For example:

Rosin links the reduction of crime in New York City to its rising rents, forcing poor families, using Section 8 vouchers, to move to New Jersey’s cities and suburbs, where crime is growing. In fact, fewer than 240 families have used vouchers to move from New York City to New Jersey.

Furthermore, they argue that Rosin missed the bigger point:

The questions that Rosin fails to ask her in her article are the most fundamental ones. Why does the U.S. have the highest poverty rate among the world’s affluent nations, and why is it far more segregated by race and income?

Despite America’s vast wealth, no other major industrial nation has allowed the level of sheer destitution that exists in the U.S. Americans accept as “normal” levels of poverty and inequality-as well as homelessness, hunger, malnutrition and diseases, and geographic concentrations of same-that would cause national alarm in Canada, Western Europe, or other wealthy regions.

Like I mentioned in the post on The Atlantic article, there are no silver-bullet anti-poverty policies. Instead, to truly increase opportunity for all low-income Americans, we must weave together a web of policies that “make work pay” and offer safety nets to fill in the gaps for people experiencing extreme hardship. The authors seem to agree, arguing that housing vouchers have been effective in meeting its main goal: “making housing affordable for very low-income people.” And that, “housing policy is a vital piece of the agenda…but now more than ever, we understand why it can’t lift people out of poverty on its own.”

They also note that there are real challenges that we must examine as we move forward with low-income housing policy including, linking voucher recipients with other social services, increasing the supply of low-income housing especially in tight markets, and helping low-income families move to more middle-class areas.

Finally, in addition to filling in the holes from the Rosin article, these experts remind us one thing that those of us who work in the public policy field should keep at the forefront of our work:

Basic statistics textbooks tell us: correlation is not causality. Such guilt by association is suggestive but irresponsible without better evidence.

There has been much discussion in the policy world about the roles of states and cities in the fight to end poverty. There are now twelve states with commissions, caucuses or summits geared toward reducing poverty. And of those states, five, including Connecticut, Delaware, Minnesota, Oregon and Vermont have specific targets - a numerical goal (e.g. 50 percent reduction) and a date by which they hope to achieve the target. As noted earlier, New York City has led the way in changing the way we calculate poverty and places like Washington DC, Montgomery County, Maryland, and San Francisco have instituted their own local versions of the Earned Income Tax Credit.

Due to the skyrocketing federal deficit, which Jonathan Weisman of the Washington Post writes today will grow to a whopping $490 billion dollars this year, it looks like states and cities will have to continue to lead the way and find creative solutions to reduce poverty and boost social mobility regardless of who wins the White House this fall.

Both candidates have promised to put poverty reduction at the forefront of their administration. Obama has committed to cutting poverty in half in ten years, saying:

I absolutely will make that commitment. Understand that when I make that commitment, I do so with great humility because it is a very ambitious goal. And we’re going to have to mobilize our society, not just to cut poverty, but to prevent more people from slipping into poverty.

And McCain vowed to:

Make the eradication of poverty a top priority of the McCain Administration. A strong and vibrant America, one in which people can move up into the middle-class, put their kids through college, work hard and one day retire in dignity, is critical not only to our economic future but to the very security of our nation. As president, I will set aside the needs of the special interests to advance the interests of the American people, especially those 12 million children who deserve every opportunity to achieve the American Dream.

Yet, given the fiscal realities that either Obama or McCain will inherit in January coupled with the potential price tags for other priorities like health care, states and cities should not count on a big influx of cash and resources.

Check out this article, “American Murder Mystery” by Hanna Rosin in The Atlantic. Rosin takes a detailed look at the spike of violent crime in smaller American cities, specifically Memphis, Tennessee. Based on her interviews and analysis, she cites housing vouchers as the cause for increased criminal activity in the previously sleepy cities. The voucher program, which worked in tandem with the demolition of dangerous, crime-infested, high-rise housing projects, helped to successfully de-concentrated poverty and moved people to more decent and humane living environments. But Rosin believes we may now be witnessing some unintended consequences of the policy:

While fewer Americans live in high-poverty neighborhoods, increasing numbers now live in places with “moderate” poverty rates, meaning rates of 20 to 40 percent. This pattern is not necessarily better, either for poor people trying to break away from bad neighborhoods or for cities, Galster explains. His paper compares two scenarios: a city split into high-poverty and low-poverty areas, and a city dominated by median-poverty ones. The latter arrangement is likely to produce more bad neighborhoods and more total crime, he concludes, based on a computer model of how social dysfunction spreads.

The voucher program has created many social benefits that Rosin fails to cite. However, she lays out a sobering reminder that there are no silver bullet anti-poverty proposals. These new potential realities do not mean vouchers are bad policy, but it does introduce a new series of challenges. In policy making too often we sweep these types of unintended consequences under the rug and declare success. But to truly help those who live on the margins and want to escape poverty, we must admit the existence of new challenges and tackle them head on.

This post was written by Jon Cardinal, an intern for the Progressive Policy Institute and Freedman Consulting, LLC. Jon graduated from St. Lawrence University this spring and is a 2007 Harry S. Truman Scholar.

The long-overdue minimum wage law passed by Congress last summer goes into effect today, marking the first pay hike for low-wage workers since 1997.

During the last decade while the minimum wage remained the same, milk and bread prices increased by 25%, the cost of a degree from a 4-year public college grew by 96%, the cost of health insurance swelled by 97% and gas prices spiked by 149%. The 3.5 million full-time workers earning less than poverty-level wages are clearly due for a break, but is this wage increase enough?

In a column on Wednesday, Holly Sklar compares the purchasing power of the new minimum wage to the most recent hike in 1997 and to the increase in 1968. She notes:

The new $6.55 minimum wage is lower than the 1997 minimum wage, which is worth $6.88 in 2008 dollars, and way lower than the inflation-adjusted $9.86 minimum wage of 1968. For full-time workers that translates into $20,509 a year at the 1968 rate, compared with just $13,624 at the hourly rate of $6.55.

Even after this much needed increase in the minimum wage, hardworking Americans will still find it near impossible to live decently. As Sklar explains, even with a minimum wage increase, low-wage workers will continue to struggle in keeping up with the exploding costs of living and will find themselves choosing “what to go without - heat or eat, child care or health care.”

Clearly, support is needed where the minimum wage fails to offer a fair handshake with American workers. As a result, we need to expand the Earned Income Tax Credit (EITC) so that work pays for all Americans as outlined here by Tom Freedman in the a Washington Post op-ed and here by Will Marshall and Katie Campbell in their PPI policy report.

The EITC is one of the government’s most successful anti-poverty programs, as it rewards work and provides the necessary support for many low-wage earners to make the climb out of poverty. However, there are shortcomings with the program that have real consequences. For example, many workers are unaware of the credit and do not file for it at tax time. Also, the EITC currently does not cover childless workers under the age of 25 and does not help meet the costs of raising more than 2 children.

In addition to the hike in the minimum wage, the federal government should increase the EITC for families with 3 or more children, rid it of the marriage penalties currently built into the program and expand outreach efforts. These reforms would help an estimated 3 million families and millions of low-earning individuals. It is time for our country to once again restore the fundamental promise that through hard work you can achieve a decent living for yourself and your family.

I have previously written (here, here and here) that the next step in welfare reform and poverty reduction must focus on low-income men. We know from numerous studies, like those of Harry Holzer and Paul Offner, that low-income men have been dropping out of the labor market at a rapid pace and that the absence of working men creates a host of social problems for families, children and communities at large.

However, a report released by Congress’s Joint Economic Committee yesterday shows that women are also withdrawing from the labor market - and not because they have decided to stay home and raise a family, but for the same reasons as men: layoffs, stagnant wages and pay cuts. During recessions in the 20^th century many families relied on the wages of women to keep households afloat if men faced unemployment. Yet, during the 2001 recession, women lost jobs at the same rate as men and those who took other jobs did so at a lower pay rate.

When women lose their jobs, families, particularly low-income families, suffer as the JEC report noted:

Women’s increased vulnerability to recession can wreck havoc on family economic well-being. The typical wife brings home over a third of her family’s income and the one quarter of children being raised in single-mother families have only their mother’s salary to rely upon….The only families who have seen any increase in real income over the past three decades are those with a working wife.

If we needed any more proof that the federal government must make expanding work supports a priority, this is it. In order to successfully build social policies around work, we must make sure that it pays by expanding the Earned Income Tax Credit and reducing its marriage penalties so that no family with a full-time worker lives in poverty.

Earning a college degree is one of the primary predictors of future economic success, yet due to rapidly rising costs receiving a diploma has added major strains on parents and students alike. The cost of college has risen faster than the rate of inflation for the past 30 years and during the 2007-08 term the list price for public, four-year universities rose 6.6 percent. For many students, the price is enough to make attending college impossible in state, not to mention at some of our nation’s most prestigious centers of higher learning.

One of the current debates in the higher education policy centers on whether elite colleges use enough of their exorbitant endowments to lower the costs for their students. (Harvard, Yale, Stanford and Princeton are among the richest institutions in the world.)

I was excited to see the New York Times weigh in on this debate and highlight Kentucky’s, Berea College an institution that was created over a century ago to educate poor Appalachian people and freed slaves. In fact, it was the first interracial, co-ed college in the south, and also the place of learning for my grandmother, Emma Lou Loftis McMinn. I have fond memories of her stories about bus rides from Asheville, North Carolina to Berea, Kentucky and experiences on campus.

Berea College ranks among one of the wealthiest colleges in the nation with an endowment of $1.1 billion, yet no student pays a cent of tuition to attend. As noted in the Times article:

Unlike most well-endowed colleges, Berea has no football team, coed dorms, hot tubs or climbing walls. Instead, it has a no-frills budget, with food from the college farm, handmade furniture from the college crafts workshops, and 10-hour-a-week campus jobs for every student.

This is not a model that makes sense for all of our nation’s colleges. But it is a creative solution to opening up the world of higher education to all Americans, regardless of their economic status. Those who have donated their resources to keep this institution in operation can rest easy knowing that their money ensures a lifetime of economic mobility for the 1,500 plus yearly graduates. My grandmother is one of them.