Tackling Obama’s Domestic Agenda—Round Two

Melody Barnes talks job creation, small business initiatives

BE: Why is there this disconnect related to the administration’s view of the Recovery Act’s effectiveness and the perception of the public, especially minority business?

Barnes: Well, I think there are two things. One, [the Recovery Act resulted in jobs] created or saved. If your job has been saved, you don’t necessarily know that you were about to lose your job. We know through our reporting systems that these dollars were able to retain jobs in the public sector or elsewhere. We are also comfortable with the information we’re receiving that $2.6 billion or 15% of contracts are, in fact, going to minority contractors. That number isn’t good enough and we want to push harder. That’s why Secretary LaHood, [SBA] Administrator [Karen] Mills, [Commerce] Secretary [Gary] Locke and others are pushing hard to match contracts to minority contractors. At the same time, we also are putting in place other tools to find greater benefit. For example, $28 billion dollars worth of loan guarantees are going out.

BE: A recent survey found that 71% of small businesses say they will not add new hires in 2010. When will the administration put in place its new programs and what will be metrics for success?

Barnes: Some of the programs are already in place and we’re extending them into 2010. We are unveiling some programs in our budget and we’ll be pushing forward in the current year. For example, with the $5,000 tax credit up to a limit of $500,000, we’re talking about up to 100 jobs that can be created. We also want to give a tax credit for a business owner to increase wages of employees. That also applies to start-up businesses. We look at the studies done by the nonpartisan Congressional Budget Office, not our budget office, and they are saying one of the top ways to increase employment and job creation is through the very tax credit I talked about. And we’ve look at other things. For example, we had a green manufacturing tax credit. We got about $2.6 billion dollars worth of dollars based on the applications we received. It was oversubscribed to the tune of about $8 billion. At the beginning of [last] month, the president announced another round of tax credits to encourage growth in the green economy because we knew there was such an appetite. At the same time, we’re looking at green job training. I’m specifically looking at ways through competitive grants because we know that creates access for minority businesses and other entities to train people of color through community-based organizations.

BE: In terms of getting individuals prepared for the jobs in emerging industries, share with us the administration’s education initiatives.

Barnes: One of our proudest moments from this past year has been connected to what we’ve been able to do around education. The president and [Education] Secretary [Arne] Duncan, who I work very closely with, walked in the door with a philosophy that I think is very important to understand. Over the past few years, we’ve been focused on – and rightly so – closing achievement gaps. But what we have to do in addition to that is promote a philosophy of success and excellence for all of our children and schools.  Hence, we developed this Race to the Top program. We did that with Recovery Act dollars. We started out by trying to stop some of the hemorrhaging that was going on, prevent layoffs of teachers, principals and others who work in the educational field. We wanted to use $5 billion to encourage the kind of reform that we think is necessary.  So we launched this competition. Before it even started we could see states changing laws so they would be better able to compete in ways that we think will improve teacher training and retention, support our best leaders to turn around our lowest-performing schools and ensure innovation in the education system. We’ll soon be handing out those dollars in the first round of our competition. Connected to that is a very specific focus on STEM education: science, technology, engineering and math. I can tell you the president pounds on this week after week. He can tell you from his travels around the world that other countries are so far ahead of us in terms of training our workforce and making sure our children are educated in this area.

BE: How are you getting business involved?

Barnes: We’re doing a couple of different things in the context of education K-12 as well as the work we’re doing in community colleges and job training programs. One of the things the president has said to me is make sure that when students have completed high school, college or a community college program that there’s a job waiting for them on the other side. That means we have to work with the business community as we are designing these programs. When you take a very specific example like our science technology, engineering and math program we launched a couple of months ago called Educate to Innovate, we specifically are inviting public-private partnerships. We’ve set up a program with a few business leaders and those in science and technology to engage the business community to work with us to support teachers [as well as] students to go into those fields. As we’re developing our new job training program, we want to make sure that we’re linking our ideas to what’s practical.

BE: What can black business leaders, economists and nonprofit officials do to help the president move his agenda forward?

Barnes: We certainly don’t believe the wealth of ideas are sitting somewhere along either end of Pennsylvania Avenue. We recognize what’s smart and innovative going on in communities around the country. I have an Office of Social Innovation in the Domestic Policy Council working with agencies across the government actively seeking engagement, involvement, and expertise in the areas of education, the green economy or wellness and prevention. [The president] consistently talked about the fact that because of big challenges facing us that this is an all-hands-on-deck moment. We really need everyone to be involved.

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