Michael Horowitz: Hello, everyone and welcome. And thank you for joining us at today's virtual event, the Impact of Pandemic Response Programs and Spending on Underserved Communities. I'm Michael Horowitz, the PRAC chair, and Inspector General at The Department of Justice. I'm here on behalf of the Pandemic Response Accountability Committee, also known as the PRAC, you'll that acronym, as well as the National Academy of Public Administration and referred to as NAPA there, and we are co-hosting today's events.
Michael Horowitz: Over the last 15 months, through various emergency relief legislation, Congress has provided for more than $5 trillion in pandemic relief spending, money that's gone to businesses, individuals, state, local, and tribal governments, businesses, large and small, the healthcare to serve on the healthcare side, in terms of vaccines and hospital care, as well as many other sectors of the economy. The PRAC was created back in March of 2020, about a year and a half ago to ensure that there was effective independent oversight of that $5 trillion, plus in belief spending.
Michael Horowitz: The PRAC is comprised of 22 federal inspectors general, we worked together to undertake that independent oversight and to ensure that, that money is going to the right places. We work closely with the General Accountability Office, state, local auditors and inspectors general, to make sure that we're well coordinated in our efforts. One of the primary questions that we've been asked to think about at the PRAC, and that we've undertaken to look at is, not only has the money been going to the places where a law provides it should go and to ensure that if there is fraud or wrongdoing in connection with the money that it's address, but also to ensure, and to look at the question of, whether the spending has been effective. Has the money that taxpayers have spent in supporting this pandemic relief effort gotten to the places where it's supposed to go? And what's the impact [inaudible]?
Michael Horowitz: Those are very significant and important questions and questions we're going to talk about during today's program. Looking forward to hearing from wide variety of perspectives on that issue and in particular, whether funding has gone to those communities that were most in need of support and help during this pandemic that's affected, obviously, not only the United States, but globally as well. So you'll hear from a variety of experts today, who've considered these questions, thought about these issues, and we're very appreciative of having an opportunity to hear their insights and evaluations today. The panels will explore these issues in depth. We'll talk about some of the data that they found, what their research has indicated, and thoughts about how this funding effort may help improve our thinking for future efforts, because as those of us in the oversight communities know, unfortunately, disasters occur with some regularity, whether that's hurricanes, fires, other natural disasters that require emergency relief.
Michael Horowitz: So appreciate everybody joining us today. All of you who are watching, our panelists, thank you, especially to NAPA for co-hosting this with us. And with that, I'm going to turn it over to our moderator, Joe Mitchell, of NAPA. Joe.
Joe Mitchell: Great. Thank you so much, Michael. We really appreciate your participation today. The academy is so pleased to be co-hosting this event with the PRAC. I lead the academy strategic initiatives, and will be moderating the conversation today. And we have a great group of panelists to share their insights with you. Shena Ashley, is vice president of nonprofits and philanthropy at the Urban Institute. John Friedman, is the co-director of Opportunity Insights at Harvard and professor of economics in public affairs at Brown University. Andre Perry, is senior fellow with the metropolitan policy program at the Brookings Institution. And Clarence Wardell, is chief data and equitable delivery officer with the American Rescue Plan Implementation Team at the White House.
Joe Mitchell: And as Michael noted, our panelists are going to be discussing the impact of the COVID relief funds, programmatic issues, data issues and advice moving forward. And to our audience, we really appreciate your participation today. And as you have questions for the panelists, please send them into the chat function and we'll get through as many of those as possible over the course of the conversation today. So as we begin our conversation, I wanted to ask each panelist to just tell the audience a little bit about what you'd like for them to know about you as we begin our conversation today. So Shena, I'll turn it over to you.
Shena Ashley: Thank you so much, Joe. I really appreciate the opportunity to be here. As you mentioned, I work at the Urban Institute. I have the privilege of being surrounded by experts who have been looking deeply at these issues across different policy areas. And since March, 2020, I've been fortunate to lead our racial equity analytics lab, which is an initiative where we are focused on equipping race, conscious leaders with real time racially desegregated data to help them make decisions during this crisis. And so a lot of my perspectives in this conversation will come from the countless hours spent in conversation with leaders on the ground who have been trying mightily to achieve equity through the distribution of these funds.
Joe Mitchell: Great. Well, thank you for that much needed and wonderful work. John, over to you.
John Friedman: I'm John Friedman, and I'm really coming at this through the lens of data, more generally at Brown and Opportunity Insights. I work with large data sets to try to understand social mobility inequality. In this particular context over the last 15 months, Opportunity Insights has published the economic [inaudible]. Takes data from private sector firms to provide a more real-time and dis-aggregated look at the impact that the pandemic is having on the economy so that we can deal, not just in national aggregates, but understand how the pandemic is really differently affecting people even as close as people living in the same city or working in different industries, living in different neighborhoods. I think that's very much the background that I bring to that, and I hope those data can be useful for this conversation.
Joe Mitchell: Great. Thank you. Yeah, it'll be a very important part of our conversation today. Clarence.
Clarence Wardell: Great. Thanks, Joe, great to be here with everyone today and with fellow panelists. As you mentioned, I currently serve as the chief data and equitable delivery officer with the ARP implementation team where my charge is really to work across the team and work across implementation to ensure to the extent possible that the president's executive order and advancing racial equity and supporting underserved communities to the federal government, shows up and is manifest through the implementation of the American Rescue Plan. In that role, it's a fairly simple charge but fairly complex in practices, as we will end up talking about today. I also had to wear another hat working with the Domestic Policy Council as a senior advisor for policy implementation and delivery. But really a lot of overlap there, and I think as folks know, the Domestic Policy Council has been charged with executing the President's vision for equity to a whole of government effort. And so, there's quite a bit of overlap in that work, including, supporting the work on the equity [inaudible] or working group. And so I'm excited about the conversation today and learn some thoughts as well.
Joe Mitchell: Great. Well, thank you so much for joining us. Andre.
Andre Perry: Well, first I want folks to know that I am so happy I don't have Clarence's job, enormous task. But I work at the Brookings Institution where I study black majority city, specifically, I look at the assets that are worthy of an investment and if we did, it would increase economic and social mobility. And it's been said numerous times that the pandemic, as well as other shocks to the economy, really just exposed existing structural inequalities. And so I'm going to come from that perspective, that what are the structural barriers that continue to persist and what opportunities do we have to fix those inequality, repair those structural barriers so that we can prevent the next disaster from having disparate impacts?
Joe Mitchell: Great. We'll look forward to hearing more about that. And Andre, actually, would like to continue with you because I was thinking before we got into the details of individual programs and how resources have been, I'd like to get your perspective on the overall impact of these relief funds on the nation's economy and society?
Andre Perry: Like a lot of the folks on this panel, we hang out with a bunch of economists and economic experts. And I remember in the beginning, a lot of folks said, the sky was falling, we were approaching a depression, it will take decades to recover and that really hasn't happened. And I really want to say, it had a lot to do with the federal spending that occurred. And particularly, with Biden stimulus, the allocation of resources directed towards working class people. Everything from the Child Tax Credit to housing assistance, we'll talk about that later, small business investments. I mean, these things along with technology and other areas really uplifted or kept the sky from falling, so to speak. And so I would say one of the lessons I learned overall is really being cognizant of how federal spending can prevent these disasters from really hurting Americans and going into a depression.
Joe Mitchell: Yeah, it's amazing. The early days of the pandemic, especially, the sky certainly did seem like it was falling. John, you're an economist, what is your perspective on this topic?
John Friedman: Yeah. I really agree that the initial and continued federal policy response, I think, made the experience of many households in this recession and really a night to day different from what they've experienced in the past. Just to give you one simple statistic at the national level, household income actually rose in this recession, despite the fact that we had an initial labor market contraction, that was the largest since the great depression. And that speaks to the extent to which the direct payment funds, the extended and enhanced unemployment benefits and various other benefits. Not for every household, but for many households, and on average, really did fill that need to keep those households with food on their table. But I do think what we've seen, especially as the pandemic has worn on and the economic crisis has worn on, is a really sharply different experience, even given the federal policy response for high income versus low income households.
John Friedman: So employment fell everywhere in April, 2020, but what we saw among higher income workers is a very sharp rebound, such that by the time you got to the beginning of the summer, or maybe at the beginning of July, employment had actually already rebounded to the same level that it was pre-pandemic. That's not to say that different people were in different jobs, certainly some families have been affected, but on average, we were really back to where we started very quickly. In contrast, low-income workers both at a much steeper decline in employment initially in April. They then recovered quickly through those first few months, April, May and June. But since July, 2020, and this actually is a statement that really holds until the current day, we've seen almost no recovery. Overall employment numbers are down about 20% on the pre pandemic baseline.
John Friedman: For many months, it appeared that in many cases, were no jobs for those households to return to. Now, we're starting to see many jobs come back, you see hiring signs everywhere, job postings are at an all time high recently, but still, we've not really seen much recovery. And so given that the extended and enhanced unemployment benefits are going to expire soon, I don't foresee any more direct payment checks on the horizon from a policy process. I think the fact that this recession really exacerbated a lot of the inequality that already existed in this country, that's something that I think it is already a fact, the policy response has helped to dampen that, but that's something that we're going to have to reckon with even more over the next 12 months. And it's something to keep in mind as we think about, as you said, responding to future crisis of this nature.
Joe Mitchell: Right. So even as the economy overall has recovered, but it certainly had differential impacts on different groups. Clarence, I know that the White House is following this, wanted to get your perspective on the overall impact of these relief bonds on our economy and society.
Clarence Wardell: Yeah, no happy. I think not a ton to add, but I think similar to, Andre, I was reflecting on where do we think we would be in this moment in March, April of 2020. And I have to say that the impact of these funds has been undoubtedly, and you read and I'm sure, Shena, will talk about this, the New York Times article that talks about the Urban Institute study, as I was thinking about the literal life and death for many folks, the difference between the life and death for many folks who were on the edge and on the precipice, and I would say that these have carried a lot of folks through. In some cases in the data, we're starting to see on the impact of the childcare Tax Credit and some of the other direct payments, is actually in many cases, even as that income gap, the inequality gap may wide, we're starting to see folks who have been at the bottom of that income distribution, even their situations have materially improved in many cases during the pandemic. That's it, there's still a lot more to go.
Clarence Wardell: I think that, I forget exactly when you reached out to me about participating in this round table. Even a month ago, we're in a completely different place and I think we all thought the trajectory was a different one than we sit here today. And so I'm also a little bit cautious about talking about this as though it's done and over with, where I think heading into fall is where many of us thought we would hopefully be.
Clarence Wardell: And I would say, the administration took a bit of criticism early on for the size of the package and where folks thought, "Hey we're through this thing, we don't really need anymore." And I think, I just submit that we are moving in a moment right now where this thing continues to be unpredictable in many ways. And I think we've been really fortunate that we've been able to marshall the political will to continue to support folks in this time. So I'll leave it there, I think it's been a lot of successes. I will say the one other piece, I think it is especially, there's a lot of experiments that are happening. There's some things that we've been able to see through this that we probably didn't think we'd be able to see in our lifetime. And I do think it stretch the imagination a bit for what we can do policy-wise into what we can do on response to both similar, not just disasters, what studies, for whatever council study state policymaking in the future as well.
Andre Perry: Joe, can I just pick up on [crosstalk] one thing the Clarence said was very important? We're not out of this and as much as the sky didn't fall, if people aren't wearing masks, if they're not getting vaccinated, if they're not following these guidelines, I mean, there are limits to spending. There are limits, we have to play our part. And so if there's a cautionary message, is that Americans still must engage in this process by following the health experts' opinions around getting vaccinated when needed, wearing masks when needed, because, we can only do this so many times. And so we have got to play our part. I just wanted to say that given the Delta variants and the many variants to come.
Joe Mitchell: It's a great point. And the trajectory has definitely been different. I think most of us thought we would really be coming out of this and I'm not. As I look at the mast that I have [inaudible], I don't think people thought we would be still needing those. So great. Well, Shena, I wanted to talk to you, I know you and Urban have been doing so much good work. And just in general, what do you think have been the most significant challenges to the equitable distribution of COVID relief funds?
Shena Ashley: Yes, exactly. Like everyone said, there've been some positive things through this experience and we've been able to get a lot of money out really quickly, but there have been some challenges, particularly around uptake, mostly because we have relied on systems and networks and experiences that existed before the pandemic that were not necessarily built with an equity infrastructure in mind. And we relied on those particular systems for the delivery of a lot of the recovery funds through this process. So depending on making sure that individuals file taxes for them to be eligible for accessing the shifts that came through the tax system, making sure that businesses and individuals had banking relationships. Funding was distributed through banks. Individuals needed to have stable bank accounts or stable addresses, which excludes a lot of people who are less connected to the systems. They had a much harder time accessing the benefits and supports, and many of them still have missed out on benefits that they are eligible for.
Shena Ashley: I think another challenge that has been particularly around issues of implementation, where I've heard from communities on the ground is, no guidance really being provided on how federal funding can explicitly address racial disparities. In a number of the communities we talked with, they are saying, "We are trying to do this, and we're trying to target, we see discrepancies in our particular communities, but we are afraid to run a file of Title VI on the Civil Rights Act of 1964." And so is there a way that we can prioritize by race or should we use geographic proximity or geographic barriers as a proxy for that in order to try to target some of the vulnerabilities and inequalities that we're seeing in our community?
Shena Ashley: And the last one that I'll say is that we struggle with understanding at the community level, having a real time understanding of where federal funding is actually falling in community, so that state and local and philanthropic resources can fill in the gaps. There's just not real-time understanding of where the funding is actually going, and who's not being covered by those particular issues. And I think those have been really significant challenges for hitting equity, where there are impulses on the ground to make more equitable delivery. They just are operating in the dark without that real-time information.
Joe Mitchell: Yeah. Great. The good news is many communities around the country want to address the issue, the bad news is, it's very difficult within our existing system to do that. Andre, what is your sense of this, the most significant challenges that we're facing?
Andre Perry: Well, there's two and I'll follow up a little bit with what, Shena, has just said. One is around, who do we center when we are creating these policies? I'll just use the Paycheck Protection Program is an example. Now, if you know anything about business development, particularly about black communities, you know we're under-banked. So when the treasury announced they would work with mainstream banks, they were essentially saying, they're not going to work with black entrepreneurs, black business owners. 95% of black businesses are sole proprietorships compared to 73% of white entrepreneurs and there are other groups in between that. And so what it showed that we could have started with the black entrepreneur in mind, yet we didn't. And you don't get many opportunities to literally outlay trillions of dollars to build capacity so that you can create systems to prevent the next tragedy. And yet we just ignored the realities of people, not necessarily who needed the most, but if you solve for this problem, you solve for a lot of other people.
Andre Perry: In addition, and this is going to be a recurrent theme for me is, while we don't have systems to truly means test wealth, for instance. We have to keep wealth in mind when we're creating these policies, because it's low wealth individuals who can't really take full advantage. Just again, if you're a low wealth and you have this [inaudible] chocolate state with people and business, if you have low wealth, you can't lean on home equity, you can't lean on savings and other source. Guess what you have got to do? You have got to go to credit cards. And those folks went further and further into debt while others had more cushion, and that should have informed our agenda moving forward.
Andre Perry: And we'll probably talk about first come first serve as a policy a little bit later, which hurts the low wealth individuals. And so for me, we have to look at, when we're looking at policy, to really figure out who we're going to center. Are we going to continue with too big to fail? Are we going to send a working class person who will expose what systems need to be built in order to effectively get this money out the door and do what it's supposed to do?
Joe Mitchell: Right. Really, what are we designing for and building that in for the beginning? So Clarence, I wanted to ask you, the government wanted to get this money out fast, but there have been some factors and issues that have made it take longer to get a financial relief to underserved communities. And I wanted to get your sense of what are those factors?
Clarence Wardell: Yeah. I agree with everything has just been said, and I would maybe just add to and talk specifically on specific programmatic distribution challenges. And I think about this in two buckets, and Shena, hit on this. There's a bucket of programs that, for more or less, automatic. You have your stimulus checks, you have the Child Tax Credit. And so these are things that you virtually don't have to do anything and you'll get it. But as Sheena points out, you're also missing and so you're relying on this existing system. And there's a whole bunch of folks that are going to get that, but then you're still missing. And the key here is the underserved population. You're still missing a lot of those individuals who aren't part of, or weren't part of these systems initially.
Clarence Wardell: And so for them, it's not automatic and it becomes a signup process, which is your whole next bucket of programs, which are those that an individual or a company needs to apply for. And so those are rife with issues from the beginning through the end and challenges, quite frankly. We've tried to work through a lot of those and I'd almost separate out a little bit, there's in the Federally Administered Programs, which one has to apply for. And then you have a hole and somewhere is a feature and somewhere is a bug, but in many ways to try to push funds down to the state and local level, so they can respond to the contours of the crisis in their communities.
Clarence Wardell: Well, what that does is you end up with a lot of different types of programs, you end up in places that already have resources and maybe an ability to administer those better than others that are building programs from scratch. And so you see a whole range of burdens introduced there. Again, this is built on top of systems that, in some cases, have intentionally been designed to be overly burdensome for folks to access and other cases, not intentional, but that's still is the outcome. And then you layer that on top of something like unemployment insurance system, where you've now opened that up through pool to a whole new swath of individuals that weren't previously eligible at the same time in which just general eligibility demand has increased. And so just the systems themselves, I would say, is we're not really designed and built and it made it a bit harder to get those funds out the door.
Clarence Wardell: And I will say, what we're spending a lot of our time is, quite frankly, awareness and outreach and supporting folks, hands-on with enrollment. The policy landscape has changed dramatically over the span of a year to even the most in-tune individual could have a very difficult time keeping up with what is available, who's eligible for what, when, where, and how. And so, you can only imagine for folks who have lives to live, families to feed, for them, really understanding what is available to me and how can I access it, it's something that we continue to work at, but recognize it is certainly a challenge to get resources to folks most in need.
Joe Mitchell: [crosstalk] John, yeah.
John Friedman: I think something that, Clarence said is incredibly important, which is that the policy landscape has changed dramatically over the past 15, 16, 9 months. And while on the one hand, I think that has created a lot of problems that, Clarence mentioned, that there's a lot of stuff, and there's a lot of tax credits and we absolutely need to make sure that everyone who is eligible for those programs can benefit from them. I also think that there's a flip side to that coin, which is if anything a silver lining to this entire experience, which is that I really think it has reset the bar of how federal policy and state policy and local policy can help address these issues, which I really see at the core of inequality.
John Friedman: This is not a new problem in our country, it's something that has always been there. And on many dimensions, has actually been getting worse for about the last 40 years. You see this economically, you see this in education, you see this in health, you see this in almost every dimension. And I think that it's not that we weren't thinking about how to address this before, but I think it's safe to say that we had not yet really cracked that code nor had, I think, we made really a substantial effort to do so. I don't think that what we've done during the pandemic, we were going to solve that problem, but I really do think it's redefined what is possible, as well as gotten many more people focused on this issue. And I think that's one thing that I really hope that we all take from this experience, as we think, not just about how to deal with the ongoing effects of this crisis, but how we want federal policy to shape our country going forward.
Joe Mitchell: Yeah. The art of the possible has definitely changed. Shena, I'd like to get your perspective too on, what else do you think has made it challenging to get financial relief to underserved communities?
Shena Ashley: No, I would just like to add on the point, John, raised. I think it is clear that we have this new policy landscape, but also that we need to meet it with a program delivery system that also has some learnings and lessons and centers the people that, Andre, pointed out. And we've seen this and we've been learning over the course of the distribution of this emergency funds. If we look at emergency relief assistance program, we have seen more funding unlocked when there was more flexibility added in March, 2021 for people to be able to do digital copies to make sure that they're able to verify their income. If we're designing a system, knowing that people are busy and have lives and don't know where original copies are, we can remove simple barriers in that way.
Shena Ashley: And also, in the language and the guidance. We've been learning also in March, 2021, treasury went back and said, "We don't just want to look at the causes or people who are eligible for this who were caused by directly harmed by COVID-19 directly or indirectly." Just that little language shift opened the possibility for states and localities to say, "We can be more flexible in our delivery of these things." So this new landscape has to be matched with a broader imagination in the way that we deliver the programs and not adding more administrative burden or issues on top of people to prevent them from accessing the particular benefits.
Andre Perry: I'm going to add on too. One of the things that it is become absolutely clear, at least in my head, that when you're trying to get funds direct to individuals, we really do need some public banking, postal banking system to distribute resources when events eventually will happen like this. I mean, one of the things that is part of the Biden stimulus was around this rental and landlord assistance of $46 billion that was allocated to the states, but they can't get the funding out because... And this is the thing we have got to think moving forward, should we regulate more the very unregulated landlord and rental system that we have in this system? So one of the struggles with that is that states and counties have to figure out, who's actually a real landlord, who's actually renter, does your income qualify you? And they're taking months, which already with a burdensome process.
Andre Perry: And so we could alleviate that somewhat down the road if we think about creating some type of federal registry that now most housing is essentially regulated in counties. But you can foresee moving forward that there's some new federal system in terms of housing, but in particular, some new banking structure to make sure we can get funds to individuals faster. Because, when you're talking about things like housing, the most primary of services, if people can't have a home, everything worsens. And so we have got to figure out, at least in some areas how to move more quickly.
Joe Mitchell: Yeah. Housing and banking systems are going to need reform to match the needs. And this is supposed to be a series of conversations. So I think the Rental Assistance Program will be something that we'll be talking about in a lot more detail moving forward. It's definitely a major challenge. John, I'd like to get your perspective, we've been talking about underserved communities, but specifically, which communities have experienced the most discrepancy in program reach and why that's the case?
John Friedman: What we've seen in the data is that the pandemic had, and especially, local effect on economies due to the way in which it affected the economy, particularly in the pullback of in-person services. So in the great recession, for instance, a lot of people stopped buying cars and no matter where you are in the country, if you stop buying a car, that's going to be a problem for the auto industry, which is generally not a local. That's a bunch of manufacturing jobs that are located in particular place and particular states. This recession though, people actually kept buying, in some cases bought more durable goods like cars. If people really pulled back on in-person services, people weren't going to restaurants, they weren't going to shop and especially, the smaller main street stores.
John Friedman: And so with that lead was a very localized recession where some places like Midtown Manhattan. The people live in Midtown Manhattan, weren't shopping anymore. There weren't people coming into Midtown Manhattan anymore. And so if you were a worker who worked in Midtown Manhattan in one of these in-person service businesses, which were by and large low income workers, the recession was very, very severe for you. Whereas, you might've been a worker at the same chain, but at an establishment, let's say, in the Bronx and would've had a very, very different experience. And so what we saw was that all consumers and particularly, high income consumers really pull back from in-person services in a way that then boomeranged back around to harm, particularly the low income households whose livelihoods depended on those higher income households. And in some way, was a really perverse effect of the fact that we've had such imbalanced growth in this country.
John Friedman: If the only way to generate growth among lower income households is to make them the service providers for these very high income households, you're setting things up in a way that it's going to be very sensitive to when these higher income households pull back. And so that's generated a lot of variation across the country, within cities, across cities. You've seen a lot of these much larger denser cities where you have these agglomerations, these are also cities that have a higher fraction of people of color that have been hit, particularly, hard as a result of this. And that's obviously not a complete characterization, but that gives you a sense of some of the most important dimensions along which we've seen some of these differences.
Joe Mitchell: Yeah, very good perspectives. Some people can do their work remotely and other people can't. Andre, I wanted to get your sense of which communities have experienced the most discrepancy and why that's the case?
Andre Perry: Well, on black majority cities and neighborhoods have really suffered. And that's not a surprise because of the longstanding levels of discrimination and it's really hard to see where discrimination against people and discrimination against place begins and ends. And when you look at COVID related deaths, when you look at evictions, when you look at unemployment rates. I remember, and as John stated, prior to the pandemic, we were what economists call, a state of full employment. Low unemployment across the board, but when you looked under the hood, you saw particularly in certain cities, in particular neighborhoods, you saw that black people were in that recession of sorts, that the prosperity that we're seeing nationally was not being distributed equitably or evenly. And so when the pandemic came, that only made matters worse.
Andre Perry: On top of that, black and brown people are more likely to be essential workers, you've mentioned, were more likely to have to go out to work, which puts us at risk for contraction. And so it's not a surprise. You can look at many different sectors across many different metrics, black majority neighborhoods are
just not seeing the same results from the various programs as their white counterparts, particularly, the wealthy white counterparts.
Joe Mitchell: Yeah. It's a major challenge. I like to say that the race and geography mixing, it's hard to see where one ends and one begins. This all gets to, what do we know about underserved communities? So it raises data questions. And Shena, I also want to get your perspective on really, what is the best data to look at when we're trying to evaluate how successful the pandemic funding has been in reaching underserved communities?
Shena Ashley: It's really tough because we're making do with really awful data and in so many ways, a system where we have not had a racially desegregated data, that's also rigorous and representative, particularly when we're thinking about data related to businesses or capital access in this country. We just have not fulfilled the data needs that we need to have. One of the things and one of the bright spots, I think, that has come through this, it's been the expanded use of survey data to track households throughout the COVID-19 pandemic. I am a big fan of the Census Household Pulse Survey data, which has been doing every two weeks. And I think seeing that and seeing the trends over time, even as we have been bringing in these recovery funds to see in which communities, in which places that there are still food insecurity or mental health challenges and access, has given us a picture of on the ground situations that even infusions of capital are not solving and that we still need to respond to.
Shena Ashley: That's been a really great data assets that's helped. At Urban, we've created a tool called Tracking Effects by Race and Ethnicity, to really highlight the racial disparity that we can see within those data. Also, our health policy center does a COVID tracking, and in that to speak to what Andre was saying, they have been showing that discrimination and unfair treatment that people report that they've experienced is keeping them from accessing the benefits that they need to go sign up for. And that's kept a number of them outside of that. So having data that's really not just tracking what their income and wealth are, but what they are experiencing during this and what their continued needs are, has been really helpful information to have.
Joe Mitchell: Great. Well, glad that you all have developed that tool. Clarence, I want to your sense from the White House is, at the white house, what are you looking at? What data do you think is the best to look at to determine impacts?
Clarence Wardell: Yeah. I don't know about the best, I think there's a serious point. I focused a lot on American Rescue Plan programs, but that is on itself to such a wide variety of programs. And so for us, it's been very specific use cases to try to really understand, especially for programs that are just starting, and I know folks have mentioned rental assistance several times and that's one, brand new, stood up by treasury. And it is one where we have just really been trying to go full speed to really understand what's the landscape, both from the quantitative perspective, I think as folks know, treasury has put out several instruments that are designed to get more of a monthly, at least high level of understanding, as opposed to some more than traditional quarterly data that we get.
Clarence Wardell: But also, quite frankly, working with a lot of private sector companies to understand specifically where they have, are working with populations that might be in need of those programs to really understand the awareness and experience that folks are having with interacting with those types of programs. And so that has been really valuable. And then I would just say, I can't stress enough, and Shena's mentioned this, and I know been in many of these conversations, the qualitative piece to inform all this data that we're collecting.
Clarence Wardell: I think I'm constantly surprised. You'll see one thing through an administrative data set. And you start talking to folks who are administering the programs or are the program recipients, have tried to access the programs. And it suddenly really illuminates where some of the other issues are and where you might want to focus some additional attention on delivery of resources. We've been able to do that across a set of programs, but it's a bit hard to do that, I think even to as in-depth as you would want. And so things like the Census Household Pulse Survey, and things like that, have been really invaluable throughout this.
Joe Mitchell: Good. John, what data are you looking at for your work?
John Friedman: The data that we're looking at comes from private sector companies. Just to give you an example, credit card companies by having internal records of all of the credit card purchases in the country. They actually have a very detailed sense of how the economy is evolving, in a way that's not a replacement for surveys like the Consumer Expenditures or other surveys that come out of the Bureau of Economic Analysis. But we can really compliment that by providing both granular and real-time looks into what's happening. And that's really only one example. We've worked with data from credit card aggregators to get a sense of consumer spending. We've worked with payment processing aggregators to get a sense of revenues, which especially, it's small businesses are the ones that really use these.
John Friedman: We've looked at data from payroll processing companies like Paychex and Intuit, in order to really get a sense of what's happening in the labor force. And because these companies have data not just on tens of thousands of workers, which sounds like a lot, but if you're trying to understand, say what's happening in Providence, Rhode Island, as it differs from the more rural parts of Rhode Island, that's not that much. These firms have millions of workers where you could really get a very clear sense. And I think what that real-time aspect allows you to do is actually to design policies in a new way. For instance, in this past year, I think we had three different major relief packages. The first package, I think, was very similar to what we normally do, where there's a big crisis.
John Friedman: We were all saying, the sky is falling, we don't really know what's going on, but we need to do something. We need to do something big. We do it and we help. The push to do a second round of stimulus, which due to political considerations, got split into two pieces, one of which passed in late December, and then the second of which passed in early March, and almost by accident. That actually allowed us to look at what happened as a result of that first second stimulus rate. We could see what happened as a result of the December bill, to let us actually understand a little bit and more about how economic conditions were changing and how these policies would or would not affect the economy. And then build that into the bill that was in the end passed in March. For instance, at the beginning of the recession, households of all types were spending their direct payments, stimulus checks in a way that we've seen in many past recessions.
John Friedman: But by the time we got to January, many higher income households because of the combination of reducing spending and this very rapid recovery in the higher income labor market, they actually managed to save quite a bit. Savings rates generally were incredibly high over the past year. And what that meant was that they already had, call it a once a month and a half worth of wages, that they'd saved additionally, beyond whatever they would have been saving before and they weren't spending. Imagine you have a family making $150,000 a year. They've now got an extra $15,000 in the bank that they're not spending. Making that $15,600, isn't really going to move their spending. Making it $17,000 also isn't really going to move their spending. And that was something that these data actually produced three weeks after those direct payments went out in a way that we've seen the same thing has happened where the stimulus checks that were paid out in March, they were really spent very quickly by many lower income households, but again, they were largely saved by higher income households.
John Friedman: So that's just one example of the way in which these new data sources can not just help us target things better and understand the recession better. But it really opens up new avenues of policy-making that were not available.
Joe Mitchell: Right. We're talking about data, I wanted to get to one of the questions on the chat, was around how this is all impacted younger individuals compared to older generations? So I was just wondering if based on the data that we have, do we know the answer to that question? Can anybody speak to that issue?
John Friedman: We've looked a little bit at this and I think we need to answer the question in two parts. So as for the direct impact of the recession, there's a bunch of countervailing forces, but my sense is largely that the answer is, there were not large differences in the direct effect of the recession across these different groups. However, this is not something, of course, we can measure it directly, but looking at past recessions, they can have a particularly severe, what people call a scarring effect, for individuals who are just getting out of educational programs and just entering the labor force. And so, whether that be people who are just graduating from high school, people who are just graduating from college, there's evidence that it shrinks a little bit the more education you get.
John Friedman: But because those things appeared to be very long lasting, even an effect that would, say you earn 1% less for the rest of your life because you graduated in a recession. That can add up to a lot. And so that's something that we saw for students graduating in the 2000, 2001 recession. We saw it again for students graduating in the midst of the Great Recession. We can't look at the long-term for these students yet, but my sense would be that we would expect a similar thing where some of these younger workers might feel these scarring effects going forward.
Shena Ashley: [crosstalk] And we're seeing that also in housing. In a lot of parts of the country, this recovery, we're seeing really high costs of housing driving up, which is excluding young people who are ready, who have capital to access their first home and start building wealth, are being delayed further in that process. And so that's another way they are differentially impacted through this recovery experience.
Joe Mitchell: Yeah. And the small changes can add up to a lot over time, so it can really have a major impact. I wanted to think about moving forward here. Unfortunately there will be other disasters. And so I wanted to get people's recommendations based on the experience that we've had with COVID-19 and these programs. What recommendations do you have to prepare the government for the next disaster? So we have three non-governmental people in here. So I thought I would ask that of you. And Shena, I'd be interested in starting with you.
Shena Ashley: Thank you so much. For the disaster that might come tomorrow, how do we prepare? Even for that? I think there are a couple of things that we're learning. I think, Clarence mentioned this, that there's a lot of innovation happening, and we're experimenting with really different approaches here. And I think it's going to be important in coming on us right now to capture the lessons that are coming through the designs that are happening for the distribution of these emergency relief programs. And start to invest in some of those key changes, like creating a lottery systems where we're seeing some cities do instead of the first come first serve. Let's learn how that was able to drive greater equity, and then transfer that knowledge to other places. We also need to invest in infrastructure that will allow local program designers to quickly hire additional staff for processing assistance applications.
Shena Ashley: I mean, the thing that stresses me out is that we are still delivering more funding on top of more funding through individuals who are burnt at both ends, who are so tired and exhausted, and been trying to deliver these programs and don't have the mechanisms and assistance and ability to quickly hire to help when they need to surge in capacity. And related to that, we so desperately need to invest in decision support tools and algorithms that can help these designers make targeted decisions so that we can really move things faster. We are still relying on paper-based systems of understanding eligibility, of really getting money distributed. And there are so many things that we can pull on private sector data and other ways for us to actually identify who's eligible for programs without people coming to apply for them. And so I think the more we can invest in those systems and processes, the better we are at being prepared.
Joe Mitchell: Yeah. We have to have the capacity to be able to deliver in the future. John, what are your thoughts in your advising the government in terms of preparing for the next crisis, whatever it is?
John Friedman: I think when you look at how we address other types of disasters, when there are wildfires, we don't wait until the wildfire is burning in order to figure out, what it is we're going to do. Obviously, you have to adapt a little bit, but there's plans in place so that when things happen, we know what we're going to do. And I think that having more thought about how to structure these plans, not just in terms of the scope of what the policy is, but also to address a lot of these issues of delivery that, I think, everyone has brought up in the context. It's been difficult getting direct payments to individuals it's been difficult, getting support to businesses, it's been difficult getting support to renters.
John Friedman: Thinking about how we can do this when it's calm, so that we have these plans ready to go when crisis strikes, because that's when there's never enough time. And I think that data, like the data that we produced, and Shena, has produced and then others have produced, I think that can help by thinking about, how do we do this in a way that can ensure an equitable delivery? How could we do this in a way that doesn't just produce a scrum around who ends up getting funds, but does so in an orderly way, because that not only makes the delivery of these funds better? If people know that the funds will arrive in an orderly way, that's going to let them just be a lot more relaxed about it as well.
Joe Mitchell: Great. Andre, your thoughts.
Andre Perry: Yeah. I put something in the chat that I will lead with just as we score policies budgeted against budget impact, we should score for racial equity as well. We should look at these issues on the front end before they hit us on the back end. And we have a lot of folks, particularly, in the OMB and the Congressional Budget Office who can do the equity scoring that's suggested in that blog. In fact, a [inaudible] mix, actually introduced legislation partially based upon that small report we put out. And so we do need to just look for potential impacts on disenfranchised groups. So we don't make mistakes. The other thing that I'm going to just introduce, we're seeing some of the consequences of unregulated markets, particularly the housing market.
Andre Perry: We probably need to bring some regulation to that space for the sake of deficiency when disasters occur. And another thing is, a lot of people know me from looking at housing devaluation and looking at how we price homes. And people don't know how much data we don't have available. And so particularly when you're talking about the GSEs and all the housing data, it's just not there. There's a lot talk about appraisals and again secretary fudge. I was on this planning call, they had announced the Inter-Agency Task Force to address appraisals. That's a great thing. Hopefully, that Inter-Agency Task Force will make for the GSEs to provide the data so we can actually see these gaps in valuation. And so we got to create systems of scoring equity. We probably need to look at the balance of regulation and speed in that regard because deregulation makes it messy to respond. And again, make data available, not just to the muckety-mucks like us, but make it available to the public in general.
Joe Mitchell: Great. Well, thank you. Clarence, you now have had a lot of advice and in honor of that, I'm going to give you the last question which is to start us off with, based on where we are now with the pandemic and with these programs, what gives you the most hope and also, what are you most concerned about?
Clarence Wardell: I appreciate you letting me go first. I suspect my answer will probably be similar to everyone else on the panel. Most hope is our ability to respond how we have responded. I think as Andre hit at the beginning on really, the underlying piece of all this and the thing that is going to hopefully get us to some sense of normalcy, again, is really the medical breakthroughs. And the speed at which we have effective vaccine deployed and available, that is the pinnacle of hope And it is now about that last mile, and hopefully, getting across the threshold.
Clarence Wardell: The flip side of that is, again, we're still in a pandemic. It's highly uncertain. As we touched on before, almost weekly changing the trajectory of this thing. And I think, as a father of a very young child, I think, quite scared around what we're seeing in terms of proliferation of this virus amongst children. And so that, I think, really does change the dynamic in a way that will be different than, even in the last [inaudible]. Not to end on that, I should have put those, I should have started with [inaudible].
Joe Mitchell: Hope and concern. Shena, what are things that gave you the most hope and the things you're most concerned about?
Shena Ashley: A lot of things I'm concerned about, I am particularly frightened and concerned after seeing the recent CBPP report that they estimate 4 million children are still not accessing the CCT expansion benefits. That is a real worry and my colleagues at Urban in the Tax Policy Center say, we really don't know that number, but I am hopeful and impressed that folks at CBPP are looking at other data systems like Medicaid data to find these children. We know that they exist. They are served by nonprofits. They are served by other government programs. And it takes us a stretch of imagination to go out and find them in other data systems. So I'm hopeful that the lesson we're learning through this will lead to better data integration systems, so that we never see this again.
Shena Ashley: The other thing is I'm hopeful again, and remain hopeful from what I see on the local level. Looking at places like Nevada, where they have American Recovery Plan Implementation Framework that doesn't explicitly mention race as a priority, but they do explicitly say that they are trying to deliver their Opera funding to address and eliminate historical and structural barriers, which were further exacerbated by the COVID-19 disaster.
Shena Ashley: And so just seeing that language, I don't know if we can get to the promise of that, but seeing that language actually in an implementation plan, gives me a lot of hope that people are paying attention to this and that they are trying with all their might to at least approach it. And that gives me a lot of hope that other places can learn from places like Nevada.
Joe Mitchell: Right. Andre.
Andre Perry: Yeah. I'll start with the concerns. I mean, it goes without saying, when you're in places like Alabama and 30 something, percent of people are vaccinated, that's a concern, because all of this can be for not. People are dying because they're making a political choice not to get vaccinated. And if they're willing to do that, how far will they go in other areas? And so that's my main concern. What gives me hope is that, I think, finally we're seeing the need for structural reform. It was almost impossible to get politicians, elected officials to say structural racism three years ago. And now, you had President Biden say equity probably more than any other president combined, including the first black president.
Andre Perry: And so for me, I think while we are far from it, we are now seeing a reparative culture replace an exclusive culture. That's leading to policy change. Just very quickly, remember things redlining didn't come from the federal government, it came from local municipalities to DC. And now we're seeing Asheville, Evanston, they're actually doing reparations programs. As a sign, there's a cultural shift that I think we'll go to DC and we'll see a new policy framework moving forward. I'm actually hopeful, and John said this near the beginning, that we're just seeing a new framework that we won't realize it in two years, four years, but we're approaching just a new way of creating policy moving forward.
Joe Mitchell: Yeah. Definitely, we've got a new paradigm. John, your thoughts about your hopes and concerns?
John Friedman: Yeah. Sure. I think, I really agree with everything that, Shena, Andre and Clarence have said. And so, just to reinforce those in two other ways, we've been largely focused on the economy and health, but education is another aspect of this along which the pandemic has really exacerbated inequality. We have data on the learning of elementary school students throughout the pandemic. And it's very clear that there are very large discrepancies that opened up last spring. And honestly, that really continued during this past year that, again, exacerbate inequalities along income lines, along race, that we've struggled with for a long time. And so the fact that the pandemic is making all of this so much worse, I think is what I'm concerned about.
John Friedman: Then I think, again, the silver lining on this is it really has people to think in new ways about what's possible in policy, about how to address some of these issues. Shena, you mentioned the ARP plan in Nevada, just to give one more example on that. I'm on a committee here in Rhode Island. We don't have a full plan yet, but we're working to think about how these funds, how would we recommend to the legislature and the government that these funds be allocated?
John Friedman: At the beginning of the process, we put down four guiding principles. And just to, literally, read the first guiding principle is to use these funds to address the root causes and conditions of systematic inequalities based on race, gender, disability, economic status, and other historically marginalized or oppressed communities, which predated and were exacerbated by the COVID-19 pandemic. So I really feel in so many areas that we have redefined what is possible, we are focusing on this as a problem that is not just a problem to be solved, but perhaps, the problem to be solved. And I don't know whether
we're going to get there, but I think that we're in a much better position on this in terms of what's possible going forward now than I would have said 18 months ago.
Joe Mitchell: Yeah. All of these challenges are opportunities, especially with a new paradigm for policy making. I want to thank our panelists, I can not thank you enough. This has been a great conversation. I only wish we didn't do this in person, and that we couldn't take the whole afternoon, so really, really appreciate it. And to our audience. Thank you. Sorry, we weren't able to get to all of your questions. But we do want to be respectful of people's time. There was a request for different pieces of information. We will be communicating back out with people with that information, and we hope that you will standby for future sessions, because we're hoping to make this a series. So thank you so much. And with that, I want to turn it over to, Terry Gerton, for some concluding remarks.
Terry Gerton: Well, thank you, Joe. I want to thank, Michael Horowitz and the PRAC for co-hosting this event today. I want to thank this fabulous panel for a really powerful discussion. I think what I took away from it was a couple of things. We have a tremendous opportunity to apply the hard lessons of the last 18 months and really designed for the future while we have maybe a little breathing space here. And back to the point that, Andre, made at the beginning, be very deliberate about who we put at the center of our program design. And as we're designing those programs to think carefully. And Shena, and John reminded us about our delivery systems, and Clarence, reminded us about the data that we make and can collect so that we can evaluate our progress. And so you all have left us with some really powerful thoughts.
Terry Gerton: But more importantly, some really practical actions that we can all in all of our different roles start to take now to hopefully address these challenges preemptively before we get to what will certainly be another crisis down the road. I want to thank all of you who joined us today, and I want to thank our panel and the PRAC for a tremendous session today. Thanks everybody for joining us.