DC Mayor Gray Muddles Anti-Sequestration Message

Last week, Mayor Gray held a press conference purportedly to flesh out the negative impacts of sequestration on the District of Columbia.

I say “purportedly” because both he and his deputy for planning and economic development spent a good bit of time celebrating economic growth in the city — 60 cranes on the skyline, new construction here, new construction there, etc.

The presser did, however, provide data on sequestration impacts. What the Mayor and his people chose to present was interesting. What they didn’t was as well, in part because it left lots of unanswered questions about how sequestration has affected — and will affect — D.C. residents.

Judging from the presser, the big thing that makes sequestration bad is its effect on employment in the District — and as a consequence, on tax revenues.

So far as employment is concerned, the presentation hammered at the loss of government jobs — mostly federal, we were told. (Reductions in the District’s own workforce went unmentioned.)

Now, it seems, the public-sector job losses are dampening private-sector job growth. The private-sector number actually dipped a bit in July, according to one of the presser graphs that Washington Post reporter/blogger Mike DeBonis published.

The Deputy Chief Financial Officer attributes the slowdown to a fall-off in consumer spending — the usual result of job losses, job security anxieties and furloughs.

The end result is that the unemployment rate, which had dropped from 10.3% during the Mayor’s first months to 8.4% at the end of last year, has ticked back up to 8.6%.

But for sequestration, the rate would be either 8% or 8.2%, according to the Department of Employment Services’ projections. Not a big difference, as the Deputy Mayor for Planning and Economic Development acknowledged. But he worries about losing momentum.

And, of course, joblessness depresses tax collections, both income and sales. The Deputy CFO cited a loss, due to sequestration, of $30 million this fiscal year and $60 million in Fiscal Year 2014.

This would still leave the District with an estimated $6.23 billion to spend — about $900,000 more than this fiscal year. So “loss” doesn’t actually mean “less.”

Barely mentioned, except by one reporter, is the fact that the private-sector job growth has been heavily weighted toward low-wage occupations, e.g., retail sales, food preparation and service, hotel front desk operations.

Not mentioned at all is the fact that the labor force, i.e., the number of people working or actively looking for work, seems to be shrinking, as it is nationwide.

If it were the same size as it was in March, when the unemployment rate was also 8.6%, there’d be 3,725 more residents working — not necessarily full-time, of course, or earning anything like what it costs to live in D.C.

Which bring me to the sequestration impacts that got short shrift — cuts in what must be a very large number of federal grants, including those intended to benefit low-income and other vulnerable people.

The Mayor said that the District will lose some $30 million in the upcoming fiscal year. His budget director provided specific figures for the five agencies he said would take the greatest hits — $24.1 million of the total.

Details on what the cuts would mean in human terms for only two agencies. Just general references to what the other agencies use their grant monies for.

So, for example, we were told that the Office of the State Superintendent of Education channels grant funds to charter and regular public schools and to early childhood education programs. But that doesn’t tell us what sequestration will do.

Maybe less for special education, early childhood ed. and free and reduced-price lunches, the Mayor’s press release says.

The last, however, are not subject to sequestration. And I don’t see sequestration-related damage to the other two in the District’s Fiscal Year 2014 budget. If children will be hurt, we need to know how.

Damage there will be to the federally-funded housing voucher program that the DC Housing Authority administers. Here we were given a concrete impact — a “freeze” that will deny an estimated 200-250 families this form of housing assistance in the upcoming fiscal year.

But then the presser reverted to how sequestration would put a crimp in the Mayor’s wildly successful economic development strategy — and all because the federal government is shedding jobs,

Well, that’s not going to make a bit of difference to members of Congress, except perhaps our non-voting representative.

And it’s not going to help the many organizations that are working hard to show the potentially persuadable members why they should end sequestration.

I’m inclined to think the Mayor knows this and, as De Bonis suggests, had other political motives for his presser.

But I was truly disappointed.

Even if, as seems likely, the Mayor and the DC Council have taken advantage of recent and projected revenue growth to shore up programs that will lose federal funds, sequestration will still mean lost opportunities to extend benefits and services to residents in need.

That, I think, is what the Mayor and his officials should have talked about if they wanted to support the campaign against sequestration.

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One Response to DC Mayor Gray Muddles Anti-Sequestration Message

  1. […] Sequestration isn’t just bad for the city; it’s bad for the people who live in the city (Poverty & Policy) […]

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