Our guest blogger is Karla Walter, Senior Policy Analyst with the American Worker Project at the Center for American Progress Action Fund.

New York City residents are gearing up to support a bill ensuring that when businesses get taxpayer dollars to invest in the city, they give back good jobs to the community. New York City is home to some of the nation’s largest development deals, and the City Council is considering the Good Jobs Bill, which would ensure that when developers receive those city subsidies, building services workers (such as security guards, janitors, and maintenance workers) at those sites are paid family-supporting wages.

The bill has the backing of more than 30 council members, but Mayor Bloomberg is withholding his support and his administration is claiming that wage standards could hurt the city’s economy:

“It’s quite broad and it affects basically everything the city does,” said Tokumbo Shobowale, chief of staff to Deputy Mayor for Economic Development Bob Lieber. “Rather than do harm, we prefer the deliberative approach,” he added. The administration would rather the City Council hold off on any wage requirement mandate until it conducts a living wage study, which it is scheduled to complete in 2011.

A new report from the Center for American Progress Action Fund’s American Worker Project refutes these claims and gives fact-based ammunition to supporters of wage standards. In the largest study of its kind ever conducted — looking at more than 20 years of data across 31 cities — the report finds that business assistance wage standards have no negative impact on employment levels:

Our estimates indicate that passage of a business assistance living wage law has no measurable effect on citywide employment. Employment levels are unaffected in low-wage industries as is employment in industries likely to be targets of economic development subsidies and in firms that are sensitive to the perceived business climate of a city. This suggests that business assistance living wage laws are unlikely to have direct, direct spillover, or indirect effects on employment levels. These findings discredit the primary arguments used by opponents of business assistance living wage laws that these laws are harmful to employment in direct and indirect ways.

New York is not alone in this important public debate on whether to link job creation programs with job quality standards. State and local governments spend $50 billion every year to entice private businesses to invest in their communities, financing developments such as sports arenas, high-tech manufacturing zones and big-box retail. The idea is that this public investment will spark job growth and build a sustainable local economy. But these public funds often help create low-quality jobs that pay poverty wages and provide no benefits.

Cities across the country are recognizing this problem and adopting wage standards to make sure that when businesses receive subsidies, they pay family-supporting wages. Wage standards proponents are right: job quality and job quantity can and should go hand in hand.

Yesterday, Rep. Mike Pence (R-IN) — who has been serving as House Republican Conference chairman and is being touted as a possible 2012 Presidential nominee — gave what his office promoted as a “major economic speech” at the Detroit Economic Club. At the best of times, Pence has a very tenuous grasp of economic reality, but he still believes that he has the recipe for fixing the country’s long-term deficit: a spending limit amendment to the Constitution. During his speech, Pence invoked former President Reagan to promote his idea for this new constitutional amendment:

For my part, I believe the answer is a Spending Limit Amendment to the Constitution. Since World War II the federal government has operated on an average of just under 20 percent of gross domestic product. But, in the past three years, federal spending has climbed to nearly 25 percent of GDP. Left unchecked, and accounting for no new programs, federal spending will reach 50 percent of GDP by 2055. We should remember what Ronald Reagan said, “No government ever voluntarily reduces itself in size.” We must have a mechanism that forces Washington as a whole to make the hard choices necessary to reform our nation’s addiction to big spending and unsustainable entitlements.

Pence then appeared on CNBC to reiterate his support for spending cap amendment. Watch it:

But over at Capital Gains and Games, Bruce Bartlett — who served as an economic official under both Reagan and President George H.W. Bush — blasted Pence as “not ready for prime time” because of his amendment proposition:

I just want to call attention to Pence’s ultra-gimmicky plan for dealing with the deficit: a constitutional amendment limiting federal spending to 20 percent of GDP. No need to spell out spending cuts or anything politically unpopular, just let the Constitution do all the dirty work. What a total crock.

Pence does have an awfully hard time identifying any actual spending cuts he would make in the budget, so proposing a constitutionally mandated spending cap is indeed a convenient way to pretend to be serious about the deficit without getting into actual substance. A cap like the one Pence envisions is totally unworkable for a variety of reasons, including: our imprecise GDP measurements (which would make assessing the dollar amount allowed under the cap very difficult); large and very obvious loopholes that could be exploited by Congress to circumvent the cap; and a complete lack of enforceability.

For someone who invokes the sanctity of the Constitution so often, Pence seems pretty cavalier about changing it to suit the political moment. And at the end of the day, proposing this sort of blunt budget instrument does nothing but provide Pence with a nice talking point that he can parrot to cover for his lack of actual, constructive ideas.

Unless Congress acts today, unemployment benefits will expire for 2.5 million Americans, with unemployment above nine percent and five unemployed workers competing for every available job opening. If Congress, as expected, does nothing, this will be first time in the last forty years that benefits have expired with unemployment so high.

According to calculations by the Congressional Budget Office, Moody’s Economy, and myriad other economists, unemployment benefits are the single best way to pump money into the economy and generate economic activity, as the unemployed are very likely to spend all of the benefits they receive (thus moving money into local businesses). But during an interview with MSNBC’s Mike Barnicle today, Rep. John Shadegg (R-AZ) scoffed at the notion that unemployment benefits help the economy. “Unemployed people hire people? Really? I didn’t know that,” Shadegg jeered:

BARNICLE: What about the fact that unemployment benefits pumped into the economy are an immediate benefit to the economy? Immediate…

SHADEGG: No, they’re not! Unemployed people hire people? Really? I didn’t know that.

BARNICLE: Unemployed people spend money Congressman, ’cause they have no money.

SHADEGG: Aha! So your answer is it’s the spending of money that drives the economy and I don’t think that’s right. It’s the creation of jobs that drives the economy…Actually, the truth is the unemployed will spend as little of that money as they possibly can. Job creators create jobs.

BARNICLE: Have you ever been unemployed? Have you ever been unemployed?

SHADEGG: Yes, I have.

BARNICLE: What did you do with the money? Save it?

Watch it:

At the same time that he was dumping on the unemployed, Shadegg called for extending all of the Bush tax cuts without paying for them, joining a slew of Republican lawmakers who care more about tax cuts for the very wealthy than unemployed Americans about to lose the last strand of safety net that they have available.

Shadegg never managed to explain why all of the job creators he cites would create any jobs if households aren’t spending money. In that vein, MarketPlace noted today that “when unemployment checks stop, it’s felt right away by businesses like gas stations, apartment operators, and grocery stores.” And as the Center for American Progress’ Heather Boushey and Jordan Eizenga found, “the workers losing benefits have an average weekly benefit of a little over $290 per week, which translates into a total loss of about $2.5 billion dollars in benefits over December. This is equal to about one in seven dollars of the gain in retail sales seen between December 2008 and December 2009.”

Some economists estimate that allowing benefits to expire could cause economic growth to “fall by one half to nearly 1 percentage point,” as well as throw hundreds of thousands of people into poverty. “Look for homelessness to rise and food lines to get longer as we approach Christmas if the situation can’t be resolved,” says Diane Swonk, chief economist at Mesirow Financial.

While Shadegg joked that he will be unemployed come January since he is retiring from Congress, next year he will be eligible for a federal pension (if he opted for one), as he is turning 62 and served on Capitol Hill for more than five years.