Last Thursday, President Obama proposed new federal jobs and job-training programs for youth and the long-term unemployed. The federal government has experimented with these programs for almost a half century. The record is one of failure and scandal.
In 1962, Congress passed the Manpower Development and Training Act (MDTA) to provide training for workers who lost their jobs due to automation or other technological developments. Two years later, the General Accounting Office (GAO) discovered that any trainee in this program who held a job for a single day was counted as "permanently employed"—a statistical charade by the Department of Labor to camouflage its lack of results. A decade after MDTA's inception, GAO reported that it was failing to teach valuable job skills or place trainees in private jobs and was marred by an "overriding concern with filling available slots for a particular program," regardless of what trainees actually needed.
Congress responded in 1973 by enacting the Comprehensive Employment and Training Act (CETA). The preface to the new law noted that "it has been impossible to develop rational priorities" in job training. So instead of setting priorities, CETA spent vastly more money, especially on job creation. Notorious examples reported in the press in those years included paying to build an artificial rock for rock climbers, providing nude sculpture classes (where, as the Pharos-Tribune of Logansport, Ind., explained, "aspiring artists pawed each others bodies to recognize that they had 'both male and female characteristics'"), and conducting door-to-door food-stamp recruiting campaigns.
Between 1961 and 1980, the feds spent tens of billions on federal job-training and employment programs. To what effect? A 1979 Washington Post investigation concluded, "Incredibly, the government has kept no meaningful statistics on the effectiveness of these programs—making the past 15 years' effort almost worthless in terms of learning what works." CETA hirees were often assigned to do whatever benefited the government agency or nonprofit that put them on the payroll, with no concern for the trainees' development. An Urban Institute study of the mid-1980s concluded that participation in CETA programs resulted in "significant earnings losses for young men of all races and no significant effects for young women."
After CETA became a laughingstock, Congress replaced it in 1982 with the Job Training Partnership Act. JTPA spent lavishly—to expand an Indiana circus museum, teach Washington taxi drivers to smile, provide foreign junkets for state and local politicians, and bankroll business relocations. According to the Labor Department's inspector general, young trainees were twice as likely to rely on food stamps after JTPA involvement than before since the "training" often included instructions on applying for an array of government benefits.