BHS - 7A – Homeless Services Funding | The Problem with ‘In-Demand’ Jobs

Closing the funding lag that drains millions from homeless services. For the first time ever, Gen X saw their 401K balances top those of Baby Boomers. The problem with ‘in-demand’ jobs.

Episode Transcript

(00:01):
You're listening to Bill Handle on demandfrom KFI AM six forty. This is
KFI AM six forty Bill Handle.Here a SCHITZI hot Monday morning, June
twenty four, and we are lookingat several days of this boy across the
country. This heat dome, allman. It is usually we have a

(00:24):
dry heat, not so much,not so much. Today It's a Schmitz
all right. Before I get tothe funding lag story, I want to
share with you with homelessness. Ofcourse I have to do a homeless story.
I want to remind you that todaythe Dodgers are in Chicago to take
on the White Sox. First pitchU is five ten this afternoon. Listen

(00:44):
to every play of every Dodger's gameon AM five seventy LA. Stream all
the games a HD on the iHeartRadioapp. The keywords AM five seventy LA
Sports powered by LA Care for allof LA. Now, in terms of
I can't do a week, Ican't do two days worth of topics without
getting into homelessness, because that isin many ways the number one problem here

(01:10):
in California. Let me think ofthis. Gavin newsom Ran on homelessness to
become governor Karen Bass ran on homelessness. Paul Caruso, her opponent, ran
on homelessness, and we have thishorrific problem. Neil just did a story
on the homeless in various parts ofLos Angeles. I went to an event

(01:33):
on Saturday night the Lawyer's Philharmonic.Had to go through downtown. The number
of tents that were out there.In one case under a bridge, there
was support, a potty, andthere was a big tent. So that
was a two bedroom, one bath, And I'm sure that people really are
just striving for one of those.They're just more comfortable. Okay, with
that being said, here's the wayit works with these homeless programs. It's

(01:59):
not just the government here have somemoney or will spend some money. These
government they don't really have governmental programs. It's governmental grants. It's outsource to
nonprofits. And there's a story inthe LA Time about one nonprofit reclaim Possibilities
twenty two beds in LA and thisis for men released from jail and prison

(02:21):
who would otherwise go into homelessness.And the owner again had to tell us
ten employees, you're not going toget paid or you won't get paid for
a while because reimbursement checks haven't arrived. Many nonprofit providers with government contracts,
which is virtually all of them otherthan the ones that are non governmental,

(02:42):
and said, there are different foundations, but this is the majority. There's
this tangled reimbursement scheme. In otherwords, the government pays but doesn't pay
upfront. Obviously, it has topay based on expenses. And yeah,
here's how crazy it goes invoices goto La County Probation Department in this case,

(03:04):
and then the California Department of Corrections. The rehabilitation goes back to the
agencies, then goes to reclaim possibility. It goes back and forth. It
is just a complicated, god awfulmess and there's no good way to deal
with it. And well, thereactually is. But here's what happens with
a lot of these nonprofits. Themoney, a lot of it goes to
interest because they have to get thesepredatory loans, I mean nonprofit agencies have

(03:30):
to go and get these payday loans. Effectively. The answer, and we
haven't gone there yet in La CountyBoard of Supervisors is looking at this is
to use the factoring model. Whatis factoring? Factoring is used in the
schmata industry. It is used inalmost every industry that has inventory. In

(03:51):
this case, the inventory is thecounty that owes money. So factoring.
Let's say you have a company,you have a clothing manufacturing company and will
owe you money and you don't havecash right now. Well, I'm a
lending institution and I'm lending you themoney based on the assets that you have.
The assets being money that's owed toyou, and I give you the

(04:11):
money discount it because I'm taking somewhatof the risk and I have to make
a profit, and I charge intereston the money. That happens almost instantly.
It's a model that makes no senseas a matter of fact. In
New York, this is what they'redoing and this is a model program.
There is an organization in New YorkCNY. I'm going to get into that

(04:33):
what that stands for. But whenyou're starting with FEC, I mean that's
a problem. Is funded by philanthropyand the city one point six billion dollars
and no interest bridge loans. Andthis enables these nonprofits to keep the money

(04:54):
to sustain their services, which ifyou have a nonprofit in this case homelessness
nonprofits and tell me how unimportant thatis, right, I mean, all
they're all important, But as wedeal with this problem, we want to
just maximize the number of dollars becauseit's all going to be incremental anyway.

(05:14):
I mean, it's going to belittle bits and pieces. The only one
of the homeless, and this isone of them. And the way the
system is it makes it almost impossiblefor them to either get all the money
pay their employees without these insane loansthey have to take out. Let's put
in the factoring system the money thatthe model that New York uses just a
straight business model. You've got inventory. And by the way, when you

(05:38):
have inventory, when the government owesyou money, you're going to get paid.
There isn't a lot of bad paperthere. You get paid. So
that's solid for a lender. I'llbuy those loans or I'll buy that money
that's owed at a discount, andhere's your money right now. And so
that's the way. It's a goodidea. It's a good idea. And

(06:00):
are you ready for this? They'reactually going in that direction. Hold on
a minute. A good idea thatmakes sense fiscally, and the government is
saying, yeah, we're gonna doit. Calendar that one, okay,
because you're not going to see thatvery often. Okay, Now I get

(06:20):
some pretty good news until you diveinto it, and then I guess it's
very good news for some folks.I'll explain why Gen X four to one
K retirement lags. But guess what. Four oh one K balances of Gen
X workers now beats baby boomers bytwo hundred dollars at five hundred and forty

(06:44):
three thousand dollars. And this isa fidelity looking at twenty two million accounts
in the first three months of thisyear. Okay, xers are born between
nineteen sixty five nineteen eighty. Thisis the next generation torect tire behind the
boomers born between forty six and sixtyfour. I am a boomer and I

(07:04):
am in retirement age. Although youknow, I don't know what you do
when you retire. I don't playgolf, I don't have friends, I
don't do much. You can onlycouch potato as a verb for so long.
In any case, Gen X isoften referred to as the forgotten generation.

(07:24):
Why because you've got boomers and millennialson either side. And here's the
tough part, and it's kind ofa good story about how so many of
them actually have this much money.They're the first generation to start working with
four to oh one k's replacing pensionplans. Now, the law the irs

(07:47):
allows you to have a pension planand a four to oh one K,
And that's what a lot of usdid and do. When you're in an
industry that has pension plans, andyou know, it used to be that
virtually every major company had a pensionplan. We don't hear iHeart doesn't allow
a pension plan or doesn't provide one, and most major companies today don't.

(08:11):
And it's now you're retiring and you'vegot the gen xers who are looking at
two things. Retirement funds they haveto put in four o one ks and
so security and whatever savings they have. That is not easy to put together,
it really Isn't you take away oneof those pillars. What is the
difference between a pension and a fourto oh one K four one K plan

(08:33):
plan? Is you're investing money andin the pension plan you receive a you
receive a plan that usually the employerpays there. Now there can be a
contribution but a four oh one Kplan unless there is a matching three percent
contribution, then it's your Basically,your money goes in a four to one

(08:56):
K plan and the employer money goesinto a pension plan with a little some
differences. And we, for example, because we are members of AFTRA,
the American Federation of Television Radio Artists, which I've never understood that how we
are artists, we have a pensionplan. And if you are smart,
you have a four to oh oneK, which I know you have,

(09:20):
and if you're very smart, youput in the maximum allowed by law.
And by the way, that moneyis tax deductible. So if you make
one hundred thousand dollars and you're allowedto put in thirty thousand dollars, now
then you're taxed on one hundred andseventy thousand dollars, and the thirty thousand
dollars is put away and you're nottaxed on it. It goes into a

(09:45):
four oh one K and you can'ttouch it until you're sixty or late fifties.
And there are a bunch of otherrules, but the bottom line is
that's tax free money, or that'sit's non taxable, and that builds up
over the years. Oh does thatbuild up if you're in the thirty percent,
Well, actually you're in forty percenttax bracket. At one hundred thousand
dollars a year, you're able toput away thirty That's a lot of money

(10:07):
that you're not paying taxes on it, and that makes a great deal of
sense. The government lets you dothat as well, it should, and
then after fifty it even turbos thatup to thirty thousand, because until then
you're a twenty three thousand. Idon't want to get into the minutia because
now we're getting into the weeds.But the bottom line is that gen X
workers have take have to take thatinto account, and it's just harder.

(10:30):
Baby boomers have the most disposable incomeof any generation ever, but we've had
pension plans which don't exist anymore now. The other thing about four oh one
case, A lot of companies willdo a match in other words, for
the first three get three percent.So if you're making one hundred thousand dollars
a year, you put away threethousand dollars into a pension plan for example,

(10:56):
or four oh one k, thethe government or the company will match
up to that much money. Sothree percent is typical. So you make
one hundred thousand dollars, three percentis matched by the cover by the company.
And I always say, you areout of your mind not to put
that in, because you know whatthe return is on that three percent.

(11:18):
You put in on that three thousanddollars and you're making one hundred grand,
it's one hundred percent return. Itdoubles because three thousand dollars becomes six thousand
dollars the moment you put it in. So there are governmental programs out there
not to give you money, butallow you to do things that eliminate taxes,

(11:43):
let you build things up that letsyou get where you keep more of
your money, and then you paytaxes on it way later. It's all
tax deferred money. And so genxers are actually paying attention and now starting
seriously to do this in their fifthffties. I started seriously putting money away

(12:05):
when I think I was in mylate forties. Had I started putting money
away when I was in my twentiesor even thirties the way that it is
suggested. Joel Larsgard and I havetalked about this ad nauseum on Thursdays.
Had I started in my early thirtiestoday, you would be listening to my

(12:26):
assistant do this show, and Iwould be sitting on my ass listening and
saying, hey, good for you, as my money is turboing. And
instead I started in either late thirtiesI'm trying to figure out where it was,
or early forties, so I havea limited amount now I have been

(12:48):
maximizing it. Also, I liveunder my means. That's a whole different
story, so you don't spend asmuch as you have. They are people
that go the other way. Butthis is just a stat that is actually
good news for so many Gen xers. You've worked harder at it. If
you have enough money laid aside forretirement, you had to have worked far

(13:13):
higher than I had to have worked, and most of us boomers, and
the same rules always apply. Maximizeany retirement savings and tax deferred opportunities,
anything that you can get. Ithink it's up to fifteen percent you're allowed
to put away in certain cases.So if you do it, you do

(13:35):
it, you do it now.Kno, this is not for people who
actually work here at iHeart because Idon't care how much you're living under your
means. You're living over your meansbecause well, this is iHeart. Do
I make enough fun of this company? Yes, yes, you would.

(14:00):
You would think that someone in managementwould come up to me and go handle
you know, why don't you justleave it alone for a bit? Okay?
And then I come back with You'reno better worse than any other major
corporation. This is the way Americadoes business, and that's what it does.
It's a whole new world that usedto be major corporations put into their
financials pension plans and it costs themoney too. Pension plans are not inexpensive

(14:24):
for corporation. But it's a differentworld. It's the beans who count the
beans. That's the way we live, all right. I just want to
make you feel good. But congratulations, by the way, to your gen
xers who have done what is muchmore difficult to do. All right,
Now, I want to talk aboutsomething that is near and dear to my

(14:48):
heart because I've got a personal storyabout this. And let's go back to
the nineteen nineties. All right.Globalization was happening, and it was going
to be rough on folks. Openingthe economy up to imports, cheap imports
from Canada, Mexico and China.Well, that's going to hurt workers who

(15:09):
made and manufactured here products because itwas just cheaper to buy from even Canada.
So on top of that, welfarereform eliminated a lot of money to
families, and so it was adouble hit. On the one hand,
you lost your job and on theother hand, those of you who were

(15:31):
on welfare job benefits got less money. So Congress comes up with a solution,
the federally funded job training to helplaid off workers and destitute parents figure
out a new way of income.And it made sense think about this.
Manufacturing workers would reskill for the informationage economy, moving from the factory floor

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to let's say, computer science.Impoverished moms would get a hand up instead
of a handout. You've heard thata whole bunch of times. In reality,
it was failed miserably. A twentyseventeen study by Mathematica Research compared people
who had gotten this federally funded jobtraining under the nineteen ninety eight law.

(16:17):
It was known as the WIOA,the Workforce Innovation and Opportunity Act. And
so they took a control group andthey took people who had gotten work training
under the WIOA. And guess what, thirty months later later, the training
group had zero effect, made nota dime more. Whoa wait a minute,

(16:45):
Well, when this thing started,you know, they didn't talk much
about it, but you have someoneon the factory floor, robotics comes in
wipes out. I don't know whatpercentage of factory jobs used to take one
hundreds and hundreds of people to maketo produce a car, Now it's in
the dozens because everything else is robotics. So who is going to hire a

(17:07):
fifty five or fifty eight year oldworker who has been laid off and to
be retrained? And so someone getsretrained, and now you start a job
at fifty five or fifty eight andyou've had no work experience in the field
you've been trained for. They neverdid able. They were never able to

(17:29):
figure that out. And so intwenty twenty two, the US Department of
Labor published a comprehensive study of thisprogram and also similarly structured federal job training
initiatives, a bunch of these programs, and here's what they found. The
programs did manage to put a lotof people through training, absolutely and many

(17:52):
of those people were then hired ininto in demand jobs. Then it gets
really interesting, what is an indemand job? For the first three years
after training, their wages did increaseby six percent. As against those of
workers who didn't receive training, itwent up from an average of sixteen thousand,

(18:15):
three hundred to seventeen thousand, threehundred. It was one thousand dollars.
And by the way, even thatdiscrepancy didn't last very long. And
so why well figure this one out? Ever growing skill requirements for jobs in
the global economy, the skill levelhas to be higher and higher, and

(18:40):
the only way to really stay onis to be indispensable, otherwise you get
tossed. And here is a fundamentalissue. The programs failed because they're designed
not to help the employees, isto help the employers, which in the
big picture actually makes sense. Youwant to be trained to do as good

(19:03):
a job as you can, andjobs that are needed, and since we
have a new technological global economy thatdoesn't need you to put on lugnuts on
the assembly line, move into thosehighly sought after and needed jobs in the

(19:26):
global economy. Those are in demandjobs, and those jobs mean that programs
that fund those jobs and train youare eligible for federal funding. And of
course that's dominated by business interests.And here's the reality. Businesses want more

(19:49):
make more money with lots of lowpage workers, low paged workers, or
low paid workers, age workers.I got that together. I conflated a
little bit. Lots of low wageworkers trained by someone else, even in
a very very rudimentary setting, forexample, coding, and I mean just

(20:14):
putting in data. I mean youhave to have a certain a certain amount
of training for that. Well,it's not paid a whole lot of money.
And by the way, the trainingis done by the FEDS, not
by us. And that's the demand. And this started in the nineteen nineties
because the global economy changed all ofa sudden. The imports, all the
tariffs were offs, and people werebuying Walmart was buying only from China because

(20:40):
it just was so much cheaper inMexico, and cars were being made in
Mexico and Canadian the dollar or theAmerican dollar was strong. It just made
a lot more sense. Well,it costs people a lot of jobs,
and so one of the things thatthe FEDS did was create these federally funded
programs work training programs to take peoplewho are were fired from these jobs that

(21:03):
were well disappeared and or were replacedby robots and train them for in demand
jobs. Usually you think about hightech jobs, HVAC, solar panel installation,
that sort of thing. Well,the reality is that that's not what
happens. I don't know of asolar company that took a quote federally trained

(21:26):
worker at the age of fifty five. It just doesn't happen. So what
happens, Well, a lot ofthem went into this training, and what
are the jobs they actually trained for? The most common job and we're talking
about You take number one, whichthis is, and you take the next

(21:49):
nine and combine them, and itdoesn't equal. Number one is truck driving.
Learn to drive the big rigs.And why you think with a shortage
of drivers you'd have people all overthe place. You know, there's a
ninety percent turnover in truck driving everyyear, ninety percent. It is brutal

(22:11):
work. Imagine you're on the freewayand it's bumper to bumper traffic. Imagine
doing that twelve hours a day,fourteen hours a day. I mean,
that is brutal. That's numbing work. And the entire issue of do you
train people for dead end jobs ordo you just pay them welfare. It's

(22:32):
just cheaper. Put them on thedole, give them enough money to live
on, and if you want towork, you go find it, you
go train yourself. Now, Itold you about the fact that I was
a host of the worst television showin the history of mankind, and it
was called the worst television show inthe history of mankind with your host Bill

(22:55):
Handle and it was different topics.One of the topics we had, one
of the better ones show is Ihad a group of women and that was
exactly that topic. They had Idon't know, nineteen kids, each of
them sitting up on the stage.And the argument was and they were all
on welfare, and they all wantedto be on welfare, and they were

(23:17):
taking care of their kids, whichI think is harder work than actually going
on a job. And their argumentwas, what are you going to do?
Are you going to pay us totrain and give us work, and
who's going to take care of ourkids? And the cost of doing it.
Well, this is why the showdidn't work out so well, because
I completely lost it. I justcompletely lost it. I zoned out and

(23:41):
started screaming, you welfare queens atthe top of my lungs. I work
fourteen hours a day so you cansit on your asses and have kids and
kids and more kids, and youexpect me to pay you welfare. And
they all smiled at me and said, yeah, pretty much. And I

(24:04):
just, I mean laid into themwhat you're not supposed to do. By
the way, just to let youknow that, on a new TV show
talk show average first year thirty threehundred and fifty four hundred letters a week.
That episode we got over four thousandletters, every one of them laying
into me. How dare you treatthese girls like that? How dare you

(24:26):
treat them? It goes to showyou who watches TV during the day.
But the point is is that thesejobs that people train for, these federally
funded jobs are for the most part, it's kind of bs. Have you
seen though? And there's some ofthese jobs, for example, you train
for and you get loans for thisthe front end office of medical office front

(24:51):
end turt learn to run the frontend of a medical office. You know
what the front end of a medicaloffice is. You pick up the phone
and you go doctor Smith's office sure, I'll make an appointment for you to
see doctor Smith. There's your job, but first you need a federally funded
job training program to pick up thephone and go hi doctor Smith's office.

(25:15):
Now, maybe it's a little hyperbole, but not a lot, not a
whole lot. You don't see daytimeTV saying hey, learn to be a
dentist, get off your ass andget a federally funded work training program for
dental school. You don't see thatusually. So the program, uh,

(25:36):
it really didn't work. And thenthat the dilemma is still there because how
many jobs you think AI is goingto eliminate? And what do you do
with someone and I've been an employeean employer before, what do you do
with someone who is in their fiftiesand has no experience in the work that
they've been training to do, assumingthat it's a good training program. I

(26:00):
don't think there's an easy answer tothis one, not at all all,
right, kf I am six fortylive everywhere on the iHeartRadio app. You've
been listening to the Bill Handle Show. Catch my show Monday through Friday six
am to nine am, and anytimeon demand on the iHeartRadio app.