So DO Tax Cuts Create Jobs?

In Wednesday’s debate Mitt Romney repeated his claim that cutting individual and corporate income taxes creates jobs. But when you look at what actually happened, the periods when we had the highest tax rates were the periods we had the greatest job and economic growth. And the periods with lower taxes had lower job and economic growth. (And we all know what happened in the Bush years…)
Here is Romney at Wednesday’s debate,

“54 percent of America’s workers work in businesses that are taxed not at the corporate tax rate, but at the individual tax rate. And if we lower that rate, they will be able to hire more people. For me, this is about jobs. This is about getting jobs for the American people.”

and,

“The problem with raising taxes is that it slows down the rate of growth. And you could never quite get the job done. I want to lower spending and encourage economic growth at the same time.”

So DO tax cuts for rich people and already-profitable businesses create jobs? DO businesses hire people when they have extra money? When few customers are coming through the door will tax cuts cause businesses to hire people to sit around reading newspapers or checking Twitter?
I think that people with jobs have money to spend and then the businesses that get their business will hire people, and will make money and be happy they have profits to pay taxes on. And I think that the numbers — and charts that help us visualize those numbers — back me up. Here are some of those numbers.
Michael Linden at Center for American Progress took a look at tax rates and job creation, in Rich People’s Taxes Have Little to Do with Job Creation, Conservative Arguments that Higher Income Taxes for the Wealthy Hurt Employment Don’t Hold Up to Scrutiny,

… in years when the top marginal rate was more than 90 percent, the average annual growth in total payroll employment was 2 percent. In years when the top marginal rate was 35 percent or less—which it is now—employment grew by an average of just 0.4 percent.
And there’s no cherry-picking here. Pick any threshold. When the marginal tax rate was 50 percent or above, annual employment growth averaged 2.3 percent, and when the rate was under 50, growth was half that.

In fact, if you ranked each year since 1950 by overall job growth, the top five years would all boast marginal tax rates at 70 percent or higher. The top 10 years would share marginal tax rates at 50 percent or higher. The two worst years, on the other hand, were 2008 and 2009, when the top marginal tax rate was 35 percent. In the 13 years that the top marginal tax rate has been at its current level or lower, only one year even cracks the top 20 in overall job creation.

OK, got that? The periods of highest job growth correspond to the periods of highest tax rates on the wealthy. 70% top tax rates. 90% top tax rates. Maybe this is because that money gets used to build roads and bridges and buildings and ports and dams and the things that make our economy more efficient and competitive. And maybe because the years of low tax rates are the years of government cutbacks because there isn’t enough revenue coming in — infrastructure not maintained, education budgets cut, etc.
What do tax rates do to economic growth? Romney says raising taxes hurts the economy. Is that what happens?
Michael Linden looked at what happens with taxes and GDP growth, in The Myth of the Lower Marginal Tax Rates, Conservatives’ Go-To Growth Solution Doesn’t Hold Up (I’ll spare you the blow-up photo of Speaker Boehner’s face),

The top marginal income tax rate has ranged all the way from 92 percent down to 28 percent over the last 60 years. With such a large range, it should be easy to see the enormous impact of lower rates on overall economic growth, as conservatives routinely claim. Years with lower marginal rates should boast higher growth, right?
That’s definitely not what happened. In fact, growth was actually fastest in years with relatively high top marginal tax rates. Back in the 1950s, when the top marginal tax rate was more than 90 percent, real annual growth averaged more than 4 percent. During the last eight years, when the top marginal rate was just 35 percent, real growth was less than half that.

Altogether, in years when the top marginal rate was lower than 39.6 percent—the top rate during the 1990s—annual real growth averaged 2.1 percent. In years when the rate was 39.6 percent or higher, real growth averaged 3.8 percent. The pattern is the same regardless of threshold. Take 50 percent, for example. Growth in years when the tax rate was less than 50 percent averaged 2.7 percent. In years with tax rates at or more than 50 percent, growth was 3.7 percent.
These numbers do not mean that higher rates necessarily lead to higher growth. But the central tenet of modern conservative economics is that a lower top marginal tax rate will result in more growth, and these numbers do show conclusively that history has not been kind to that theory.

Zaid Jilani at CAP’s Think Progress also takes a look, in Top Reagan Economic Advisor: Return To Clinton-Era Tax Rates Would Not Hurt Economic Growth,

Historically, the United States has actually had some of its strongest periods of economic growth while taxes were high. As this graph from Slate shows, some of our strongest periods of growth in gross domestic product actually occured while taxes were very high:

In the 1950s, which had one of the sharpest periods of economic growth in all of American economic history, the top marginal tax rates for the richest Americans stretched above 90 percent. Likewise, economic growth in the relatively higher-taxed 1990s was much stronger than in the 2000s. This isn’t to say that higher taxes necessarily cause greater economic growth, but it does seem to show that higher taxes do not appear necessarily to be impeding job growth, nor are lower taxes especially helpful.

OK, did you see those charts? Not only do high taxes on the rich not impede growth, but growth looks to be higher when taxes are higher. Maybe this is because higher taxes on the rich means that the government — We, the People — has more to spend on the things that make our economy more efficient and competitive like schools, roads, bridges, transit systems, courthouses, judges, etc…
And, again, the periods of low taxes are the periods of government cutbacks …
David Leonhardt at the NY Times looks at recent numbers, in Do Tax Cuts Lead to Economic Growth?

President George W. Bush and Congress, including Mr. Ryan, passed a large tax cut in 2001, sped up its implementation in 2003 and predicted that prosperity would follow.
The economic growth that actually followed — indeed, the whole history of the last 20 years — offers one of the most serious challenges to modern conservatism. Bill Clinton and the elder George Bush both raised taxes in the early 1990s, and conservatives predicted disaster. Instead, the economy boomed, and incomes grew at their fastest pace since the 1960s. Then came the younger Mr. Bush, the tax cuts, the disappointing expansion and the worst downturn since the Depression.

(Click that graphic for larger)
Whoa, did you see what happened after Bush cut taxes for the rich? Do you remember what happened after Bill Clinton got taxes increased on the rich?
My own 2010 post, Did The Rich Cause The Deficit? included this chart, (The red line is the tax rates, the blue is growth and the red arrow shows the trend.

Top Tax Rate vs GDP

But, from that post, one thing that cutting taxes on the rich obviously does cause is deficits:
TopRates_vs_Debt_Chart

And deficits cause government to cut back, cut infrastructure projects, cut the things government — We, the People – does for We, the People. And the economy slows…
The real job creators are working people with money in their wallets.
Tax the rich, use the money to modernize our infrastructure and help regular working people. Build roads, schools, bridges, ports, airports, dams, courthouses, wind farms, water systems, high-speed rail, municipal transit systems, all the things that make our economy efficient and competitive…
(PS I also came across a chart showing that lowering capital gains rates correlates with lower, not higher, economic growth. But somehow we knew that would be the case…)
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Austerity Suicide — Literally

You might be hearing about the “Fiscal Cliff.” And you might be hearing about a “Grand Bargain.” You certainly have heard about “Simpson Bowles.” You will be hearing more and more about these strangely-named things because the usual suspects are cranking up the usual propaganda machine again, getting the usual DC elite ready to play out another of the usual take-from-the-people-to-give-to-the-rich games right after the election. This time it’s a push for austerity.

Why Deficits?

I always start any discussion of deficits and debt by reminding people that the country had a big budget surplus before Bush cut taxes for the rich, and doubled the military budget.

Deficit history: Reagan dramatically cut taxes on the wealthy and corporations. He doubled the military budget. Huge deficit resulted and the country began accumulating massive debt. They called it “strategic deficits,” a plan to “starve the beast” by bankrupting the country and forcing cuts to government, to the things government does for We, the People, and the ways government protects us from exploitation by the wealthy and powerful.

After 12 years of Reaganomics people were fed up, and elected Clinton. Clinton raised taxes on the rich. Those increases combined with the stock market bubble created a surplus and we were paying off the debt, and then something changed. ‘W’ Bush again cut taxes for the wealthy and again doubled the military budget and now the deficits are enormous. So here we are.

But fixing what caused the deficits is not on the table. It never is, because that doesn’t fit the plan.

Fiscal Cliff

They say the country faces a “Fiscal Cliff” at the end of the year. After the election the Bush tax cuts for the wealthy expire. And – this is a bit complicated – something called “sequestration” also kicks in. This is a series of budget cuts that happen because of the “debt ceiling” deal, when Republicans held the debt ceiling hostage and threatened to put the country into default, demanding that we immediately take trillions out of the economy. The sequestration deal was a compromise that was intended to force the Congress to agree to a bipartisan solution, which failed.

The sequestration includes military cuts, which our billionaire-backed DC elite believe would ruin the economy when combined with expiration of the Bush tax cuts — because in their minds tax cuts do not cause deficits and unlike other government spending military spending creates jobs. So to avoid the “Fiscal Cliff” after the election Congress is supposed to meet to keep the military budget intact, keep taxes on the rich from rising and cut the things our government does for We, the People.

Why After The Election?

That pesky democracy thing keeps on getting in the way of Wall Street’s plans for our economy. But after the election comes what’s called a “lame duck” session of the Congress. The legislators who have been chosen by the people aren’t in office yet, the ones who have been defeated are still there and the ones who were re-elected know that anything they do will be long forgotten by the next election. Democracy and the will of the people will not be a factor. Every poll says the public wants immediate action on jobs and no cuts in the things government does for We, the People.

If Obama is re-elected the post-election debate will be between the Obama deficit plan, a “Grand Bargain” based on the “Simpson-Bowles” plan vs the Ryan plan — the budget the House Republicans passed that privatizes Medicare and reduces spending on most things government does for our people. If Romney is elected all bets are off.

Simpson-Bowles

Simpson-Bowles is a budget plan put together by a Republican Senator and a Director of the Wall Street bank Morgan Stanley. After the President’s National Commission on Fiscal Responsibility and Reform (“Deficit Commission”) failed to make recommendations, the two came up with a plan that cuts Social Security, cuts a number of other things government does for our people, cuts a bit from military and cuts tax rates on the rich and corporations, calling it “reform.” (The plan also eliminates the home mortgage interest deduction, for example.)

Important point: At least Simpson-Bowles is not a “cuts cause growth” plan. It is sold as a deficit plan, even though it cuts taxes at the top and for big corporations. It clearly asks that any cuts not take place until the economy has improved because cuts slow growth.

Grand Bargain

The “Grand Bargain” is the idea that Democrats and Republicans can reach a compromise involving Republicans “allowing” tax “reform” that eliminates some tax deductions like the home mortgage interest deduction and reducing tax rates on the wealthy and corporations, in “exchange” for cuts in things government does for us, including Medicare, Social Security and Medicaid. (These cuts do not eliminate the need, they just shift the cost away from the government onto the larger economy.) (If this sounds like a “bargain” that entirely benefits the wealthy and large corporations, that’s just how Washington works these days.) (“Reform” always means cutting out things government does for We, the People and reducing taxes on the wealthy.)

Austerity

Austerity is the word used to describe attempts to lower budget deficits by cutting government spending on the things that government does for its citizens.

The theory is that cutting way back on government will cause the economy to grow because government is “in the way” and helping citizens “takes money out of the economy.” Also, when government provides fewer safety-net services unemployed people are forced to take any work they can get, which drives wages down and increases corporate profits. Government cutbacks also mean they can’t enforce regulations, which unleashes businesses to pollute, commit fraud, cut safety procedures and other things government polices that restrict corporate profits.

But austerity literally “takes money out of the economy.” Public-employee wages and pensions are cut. Government services and safety net programs are cut. Public assets are sold off for immediate cash (reducing the government’s income in later years). So the demand side of the economy is reduced as people are not able to spend.

The Results Of Austerity

In practice the theory that removing government makes the economy grow has not worked out. Several European countries have been severely cutting budgets, and the result has been that the economies in the “austerity” countries have suffered. These economies appear to have fallen into a downward cycle where the “reforms” reduce demand, growth stalls, this reduces tax revenue, which means the deficit-cutting is not effective. (And meanwhile the economies are ruined and people are in misery.)

The austerity cycle happening in Europe works something like this:
Bankers demand “austerity” which drives up unemployment, cuts demand and slows economic growth. The reduction in economic growth causes tax revenue to shrink and increases use of whatever “safety net” programs remain, thereby increasing budget shortfalls.

So bankers demand more “austerity” which drives up unemployment, cuts demand and slows economic growth. The reduction in economic growth causes tax revenue to shrink and increases use of whatever “safety net” programs remain, thereby increasing budget shortfalls. .

So bankers demand more “austerity” which drives up unemployment, cuts demand and slows economic growth. The reduction in economic growth causes tax revenue to shrink and increases use of whatever “safety net” programs remain, thereby increasing budget shortfalls.

So bankers demand more “austerity” … well you might be starting to get the picture.

Recession Resulting From Austerity

These are the GDP growth rates in European “austerity” countries:

Spain expects -1.7% from 0.4% 2011

Greece -10% to 11%

Portugal -1.2%

Italy -0.7%

Ireland -1.1%
UK -.7%

Chart from Think Progress, CHART: HOW AUSTERITY IS SQUASHING EUROPE’S ECONOMIC GROWTH.

Unemployment Resulting From Austerity

These are the official unemployment rates in European “austerity” countries:
Spain 24.6%
Greece 24.4%
Portugal 15%
Italy 10.7%
Ireland 14.9%
UK 8%

Austerity NOT Lowering Debt

Here is a chart of the debt-to-GDP ration as these countries shrink their GDP – and tax revenue – through austerity (click for larger):

Decline Resulting From Austerity

CNBC: Europe Facing Mental Health “Catastrophe” as Crisis Worsens,

Europe is approaching a crisis as the region’s debt crisis and austerity measures increase the rates of depression, suicide and psychological problems – just as governments cut healthcare spending by up to 50 percent, according to campaigners, policy makers and health organizations.

NY Times: ‘Shocking’ Dip in Britain’s Output Reflects European Stress

Guardian: Portuguese death rate rise linked to pain of austerity programme,

Portugal’s health service is being forced into sweeping cuts as last May’s EU/IMF bailout terms begin to bite

Catholic Online: European economic crisis takes emotional toll

Suicides Resulting From Austerity

Alternet, April: Crisis to Suicide: How Many Have to Die Before We Kill the False Religion of Austerity?
Telegraph, April: Italian businessman becomes country’s 25th ‘austerity suicide’ of the year

CNN, April: Austerity drives up suicide rate in debt-ridden Greece

Digital Post, July: Austerity takes its toll with suicides increasing in Greece

Tampa Bay Times, August: Suicide rates rise in Europe amid job losses and severe cutbacks

Digital Post, August: Italian dies after setting himself alight in austerity protest

Reuters, August: Study links British recession to 1000 suicides,

A painful economic recession, rising unemployment and biting austerity measures may have already driven more than 1,000 people in Britain to commit suicide, according to a scientific study published on Wednesday.

CNN, September: Death and taxes in Italy

Watch the following news reports if you can stomach it:

What You Can Do

So the experiment in austerity that is playing out in Europe is coming to the US after the election – when democracy can’t intervene.

But the way to reduce deficits is to grow the economy. When people have jobs they pay taxes and use fewer social services. Jobs programs that come out of fixing our infrastructure and making us less dependent on oil also make our economy more competitive in the future so they pay for themselves.

Contact your member of Congress and let them know that you do not think this is the time to cut the budget. Let them know that you want to see jobs programs, infrastructure maintenance and improvements, increase the safety net so people are not forced to take any work, cut the age when people can get Medicare and Social Security and increase the benefits so people can retire and open up jobs and renegotiate trade deals that are sucking us dry.

Tell them jobs fix deficits — you want to grow us out of deficits, not pretend that cuts will work. Cuts make deficits worse.

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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We Can So Easily Create Jobs, Cut The Deficit And Revitalize Our Economy!

The path to creating millions of jobs is so easy and obvious. Hire people to modernize the infrastructure and to retrofit buildings to be energy efficient. Millions would be paying income taxes instead of receiving unemployment or food stamps. The companies that supply the materials and steel would also be hiring and paying taxes, and the companies that supply them … and the companies that supply them. And when we are finished, the payoff to the economy from a modern infrastructure and energy efficiency will be enormous. Anyone who tells you we can’t or shouldn’t do this is up to no good.

Millions Of Jobs Need Doing, Millions Unemployed

We have millions of people unemployed at the same time as we have millions of jobs that need to be done. Connect the dots! It is so easy!

Dot: No net job gains since 2000. 8 million jobs lost in the recession. Never mind jobs for the 86,000 new people entering the labor force every month…

Dot: According to the American Society of Civil Engineers (ASCE),

“congested highways, overflowing sewers, and corroding bridges” were creating a “looming crisis that jeopardizes our nation’s prosperity and our quality of life.”

Dot: From a recent NY Times story on our country’s water systems,

Today, a significant water line bursts on average every two minutes somewhere in the country, according to a New York Times analysis of Environmental Protection Agency data.

. . . State and federal studies indicate that thousands of water and sewer systems may be too old to function properly.

[. . .] “There’s a lot of evidence that people are getting sick,” he added. “But because everything is out of sight, no one really understands how bad things have become.”

Connect the dots.

Ten million jobs needed. Ten million jobs that need doing.

Connect the dots. We need a National Rebuild America Project! It would employ millions, it would get people and businesses back in the economy, paying taxes, buying things, and not receiving the badly-needed help of unemployment, food stamps, etc.

Jobs Fix Deficits

Jobs fix deficits. How hard is that to understand? We have a deficit of jobs. People who are not working are not paying income taxes, and are instead likely receiving unemployment, food stamps or other assistance. In any event they are certainly not contributing to the economy by making things or buying things. Jobs fix deficits.

The Payoff

There wold be an enormous economic payoff from investing in a National Rebuild America Project. I mean an economic payoff beyond getting people back to work, paying taxes, buying things and beyond getting people off of government assistance.

Imagine an economy with a fully modernized infrastructure providing the nourishing soil for new and existing businesses. Imagine our economy with energy efficiency freeing up resources to apply to other areas. Imagine our economy with everyone working. Imagine our economy with companies able to compete in world markets with the very latest and most efficient foundation undergirding their efforts.

Deficit Emergency?

They say we can’t invest in modernizing our infrastructure or in energy efficiency because this would be “government spending.” They say we can’t afford to do this kind of work. They say we instead need to cut back and pay off the deficit instead. As if laying off teachers helps the economy!

Where did all of this “deficit emergency” nonsense come from? We had a huge budget surplus when Bush took office. The debt was projected to be paid off entirely in ten years. So Bush gets elected, Greenspan says we’re paying off the debt “too fast” and they gave the rich a huge tax cut, and doubled military spending! It’s not hard to see where the deficit came from. (No, seriously, click through and see the charts, it’s not hard.)

So we shifted to a huge deficit instead and Bush said this was “incredibly positive news” because it will force the country into a debt crisis that they can propagandize to force cuts in things government does for We, the People.

Hey people, figure it out, we do not have a debt emergency, we have a manufactured crisis that is being used to scare people into giving up the benefits of democracy.

Has To Be Done Anyway

This is work that has to be done anyway! Once again, our infrastructure is falling apart, our companies are not competitive, our energy inefficiency is costing us dearly. This work has been put off for a long time. Every day we wait, it just becomes a more expensive problem. Funny how this is the way conservatives describe the debt, when in reality is the problem with delaying investment in modernization.

So why not do it now, when people really need the work? We have been deferring the maintenance of our infrastructure since the big Reagan tax cuts for the rich. The roads, bridges, dams, airports, rail, energy grid and the rest are in bad shape. This is slowing our economy. This is hurting people and costing money and time. This is costing our businesses in their international competitiveness.

Your Homework Assignment

OK, here is your homework: Big Ideas To Get America Working: Rebuild Our Infrastructure.

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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California Taxpayers Financed A New Chinese Competitor!

American tax dollars should employ American workers and build American companies. But the Bay Bridge project not only didn’t do that, it paid to build up a new Chinese state-owned competitor that will bid against American companies on future projects! Let’s not make that mistake again. Jeeze!
Should Be Made In America
Last week I wrote about the Should Be Made In America project. A coalition of American companies and labor organizations has launched this campaign to let taxpayers know when their state sends jobs out of the country. This is an effort to get state governments to buy steel and supplies from American companies when they do infrastructure projects. If they do not, there will be a PR campaign to shame the elected officials and state procurement agencies who made the decision to outsource American jobs with taxpayer dollars.
The New San Francisco Bay Bridge Project
The new San Francisco Bay Bridge is underway. The eastern span of the new bridge is called the self-anchored suspension span (SAS), which will have a single 525-foot-tall tower and uses a single mile-long cable to support the deck, which is two side-by-side steel roadways. The cable is made up of 137 strands of steel which are being pulled across the bridge one-by-one right now. The 1,542 ft span is the largest span of its kind in the world. (Lots of info is available here.)

They Turned Down Federal Dollars So It Could Be Made In China!
The cable and key sections of the tower and deck were outsourced to China. Governor Arnold Schwarzenegger’s administration wanted this done in China, saying the low wages and lack of environmental regulations would lower the cost. Federal procurement rules require that taxpayer dollars be spent here, so Schwarzenegger turned down federal funds for the job, in order to be able to outsource the work. Never mind the cost of lost tax revenues, unemployment benefits, food stamps and other “safety net” programs for the lost workers and bankrupted companies that resulted. And never mind the cost to the larger economy and country from the foreclosures, closed businesses, lost jobs, etc. Those larger costs to the larger economy and country were not Schwarzenegger’s problem
Built Up A Competitor!
Shanghai Zhenhua Heavy Industries got the job — even though they had never done a job like this before. Until now the company manufactured cranes and ship loaders. But, thanks to California’s tax dollars, they can now. California paid for this Chinese state-owned company to build its capacity to do major infrastructure projects like this one. And they will be bidding against American companies on project in the United States and around the world from now on.
Here is Scott Paul from the Alliance for American Manufacturing, talking about the Should Be Made In America project, on KQED’s show Forum. Skip to around 16:00.

“What it has done now unfortunately is established a competitor to these American firms, that has been subsidized by the taxpayers of California, that will compete on future infrastructure projects. And California taxpayers have given this state-owned firm in California China the knowledge and the know-how to do this. And that is not fair to other private-secotr firms in the United states.”

(Note, at 16:18 Scott says the Bay Bridge project has “given a state-owned firm in California” the obviously meant to say China.)
So one agency of California “saved money” by outsourcing a project to China. But the state government overall probably lost money when you add in all the costs to other state agencies who lost tax revenue and have to pay out “safety net” expenses. And the national government and larger economy certainly lost out from the lost jobs, closed businesses and loss of steel and manufacturing capacity. American businesses certainly lost out.
At least now as other states look to future infrastructure projects the Should Be Made In America project will be there to remind them of the larger costs that come from “saving money” by sending taxpayer dollars out of the country.
P.S. here is the video from the Should Be Made In America launch event:

This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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There Is Consensus On How To Fix Economy

“There was clearly something wrong with the U.S. economy long before the crash.”
Consensus
Consensus. Again and again, people who examine what went wrong with our economy leading up to the great recession come to the same conclusions! Study after study, book after book, statement after statement, op-ed after op-ed, organization after organization, expert after expert, all weighing in, all coming to the same conclusions. One after another voices speak up (click through for just a sampling), voicing their understanding of what happened to the economy, what caused the crash and what we have to do to fix things. One after another they voice the same conclusions: our economy was damaged by,

  • tax cuts for the rich combined with huge military budget increases (and wars) that led to budget deficits and increased inequality;
  • trade deals that damaged vital industries and led to trade deficits, layoffs and wage cuts;
  • deregulation of rules that protected working people, unions, vital economic sectors and the commons of public wealth;
  • and cuts in crucial areas of investment in our people and our economic future, including education & job training, infrastructure, energy, manufacturing, transportation and R&D into new technologies.

All of these betrayals of the social contract were enabled by the influence of big money on our political system, including huge sums spent on an infrastructure of corporate/conservative organizations designed to propagandize the public into accepting these changes – or at least keeping the victims from rebelling.
This Time, The AFL-CIO
This time the AFL-CIO offers their analysis, Fixing What Is Wrong With Our Economy. Here are a few excerpts – but if you have been paying attention you have heard all of this again and again from all directions:
The crash was the end-result of policy changes brought in with the “Reagan Revolution:”

The crash of 2008 and the Great Recession were inevitable consequences of three decades of economic policies designed by and for Wall Street and the wealthiest Americans. At the heart of the problem was the hollowing out of American manufacturing, the growing dysfunction of our financial sector and a rapid increase in economic inequality, all of which crippled the growth engine of the U.S. economy.

Trade deals and policy choices that sent jobs, factories and industries out of the country:

[. . .] The deindustrialization of America and the substitution of speculation for productive investment were not accidents, they were not inevitable, and they were not the outcome of natural forces. They were the predictable results of mistaken policy choices made by politicians of both parties for more than a generation. These policy choices had victims with first and last names: millions of displaced workers, shuttered factories and hollowed-out communities across the country hobbled by shrinking tax bases that no longer could support vital public services.

In The Way
The corporate/conservative propaganda apparatus (and its candidates for office) continue to demand even more tax cuts for the wealthy and cuts in the things our government does for We, the People:

[. . .] The Republican candidates pretend that tax cuts for corporations and the wealthy are the answer to wage stagnation and the economic crisis, but the Bush years taught us that these obscenely wasteful tax cuts only make the problem worse. They are the equivalent of eating our seed corn, because they starve the kind of public investment in education, infrastructure and innovation that is indispensable for long-term economic growth.

The Fix
Again and again experts tell us how to fix the problems we face in our economy and society: restore democracy’s (the 99%’s) controls over corporations (the 1%) and especially re-regulate the financial sector, reverse the taxation policies that led to budget deficits and extreme inequality, fix the trade deals and other policies that led to trade deficits and allow the wealthy to pit working people against each other, and invest heavily in our country and people again. That’s a start, anyway — get the influence of big money and big money’s propaganda machine out of our politics and maybe after a while We, the People can start addressing the rest of our problems again.
The AFL-CIO’s conclusions, from a summary of the analysis:

The statement outlines several significant steps that need to be taken to build an economy that can compete with world economic powers like Germany and China and that works for all, including:

  • Significant investment over the next decade in education and apprenticeship programs for young people, infrastructure, energy, manufacturing, transportation, skills training and new technologies;
  • A fair share from Wall Street and the wealthiest Americans, who have benefited most from the economic policies of the past 30 years—pass a financial speculation tax, let the Bush tax cuts for the wealthy expire and tax capital gains at the same rate as ordinary income;
  • Tackling the problems of wage stagnation and economic inequality by reforming labor laws so that all workers who want to form a union and bargain collectively have a fair opportunity to do so, making full employment the highest priority of our economic policy, increasing and indexing the minimum wage, shrinking the trade deficit and eliminating incentives for offshoring;
  • Reviving U.S. manufacturing by bringing the trade deficit under control, enhancing Buy America safeguards, aggressively enforcing trade laws and ending incentives for offshoring;
  • Once again regulating Wall Street, eliminating tax advantages for leveraged buyouts and finding other ways to favor strategic investment over short-term speculation;
  • And working toward a global New Deal that establishes minimum standards for the global economy, prevents a race to the bottom, creates vibrant consumer markets in the global South and creates new markets for advanced U.S. manufacturing.

The American people aren’t stupid. Majorities are also coming to the same conclusions. The American Majority in poll after poll show agreement with these conclusions.
We have to reverse the corporate/conservative, anti-government, pro-1% policies that started about 35 years ago. All the charts show the changes, when the changes happened, and how those changes have worn away at our economy and our people — click through and see for yourself the story that the numbers tell: tax cuts, deregulation and outsourcing our jobs, factories and industries has not helped our economy or our people. Since then all the gains from the efforts of all of us have gone to fewer and fewer of us. Since then our infrastructure has fallen into disrepair. Since then our trade deficit has gotten worse and worse. Since then regular people — the 99% — have been falling further and further behind, democracy has eroded to the breaking point, with plutocracy — rule of, by and for the 1% — taking its place.
Our wealth is being extracted for the benefit of a few. We, the People must reassert control, or face further decline.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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So You Want To Talk About Jobs?

Before leaving on vacation President Obama said he is going to talk about creating jobs in September. The latest word is he will give this speech next week. Campaign for America’s Future has put together some ideas for creating jobs. See our series Big Ideas To Get America Working:

The task is not simply to give the economy a stimulus, as if we were giving a charge to a dead car battery. We need to rebuild the engine and modernize the wiring, creating a new strategy for America in the global economy. We asked our writers and contributors to lay out the “big ideas” and framing you can use to push a jobs-first agenda to the forefront of the national debate.

Here is where we are: People need jobs and jobs fix deficits. We have to get people back to work and the American people deserve good-paying jobs, not just any new job at half the old wages. Lots and lots of regular people are not working or have settled for jobs that don’t offer enough hours or just don’t pay enough or provide benefits. And here’s a fact: people who are working are paying taxes, are not collecting unemployment and are less likely to be collecting food stamps, so putting people to work lowers deficits.
Of course people want their President to be reasonable and bipartisan and compromise to get things done, but more than that they want results. Mr.President, if you can’t get results any other way people want you to move the obstructers out of the way. Republicans in the Congress are blocking every effort to boost the economy and create new jobs – especially good-paying jobs. Many think they are doing this to sabotage Democratic chances in the coming elections.
Go Big
So, Mr. President, you have to take this to the public. Go big. Draw contrasts. Give the public a clear choice. You don’t have to propose something that Republicans will pass — because no matter what you propose, they won’t. Instead you have to bring forward proposals that will clearly put lots of Americans to work, so the public can decide what they want to do.
Above all, it is time to be reality-based in the approach. The country is sick of spin and propaganda and putting the best face on things. Reality and good policy are the best politics. Here are some “reality-based” ideas to help get this going.

  • Reality: Millions of Americans are out of work or are working in low-paying jobs and outside of the DC area it is not getting better.
  • Reality: Getting people back to work lowers deficits because they are paying taxes and require fewer government services.
  • Reality: Tariffs on goods made by exploited workers in exploited environments = jobs and good wages here. Our trade agreements have created huge trade deficits that are draining our economy. “Free trade” is a myth that has been used to drive wages down here, not to create trade partners who buy as much from us as they sell to us.
  • Reality: Other countries have national industrial/economic strategies. This means we increasingly send our companies out alone to compete with national systems and they won’t win that fight no matter how big they are.
  • Reality: Other countries use national domestic-content procurement policies, and we need a “Buy American” procurement policy.
  • Reality: For decades all income gains have gone to the top. This is distorting everything in our society and democracy.
  • Reality: Tax cuts for the rich cause deficits. They also incentivize predatory business models by rewarding get-rich-quick schemes over good, long-term, sustainable business strategies.
  • Reality: Climate change is real and it is serious and we have to address it. And addressing climate change means millions of green jobs will be created.

The same old same-old debt and bubble economy won’t work and got us into this mess. Last week in The Jobs Question, Robert Borosage described the problem:

Twenty-five million Americans are in need of full time work. One in four teenagers not in college can’t find a job. Wages aren’t keeping up with prices. Our trade deficit is rising, as more and more good jobs get shipped abroad. It’s projected that a staggering 48 percent of homes with mortgages could be underwater – worth less than the mortgage – by the end of the year.
Moreover, there is no recovery to an old, healthy economy. The old economy didn’t work for most Americans even when it was growing. The cancer was spreading before it metastasized in the financial panic. In the so-called Bush recovery years before the collapse, the few captured all the rewards of growth. The average income of the bottom 90% dropped. That economy was built on debt and bubbles. We were hemorrhaging manufacturing jobs and borrowing $2 billion a day from abroad. And we were in complete denial about global warming and the catastrophic climate changes that have already begun. We can’t recover to that old economy – and we wouldn’t want to.

Summary: The old way didn’t work and led to disaster. Don’t try to bring that back, thinking it will be better this time. We need a new vision, and new strategies.
So let’s get down to business. Here are the ideas presented in our Big Ideas To Get America Working series:
Today’s Big Idea To Get America Working: Fix The Housing Crisis by Liz Ryan Murray.
Today’s Big Idea to Get America Working: Hire the Young to Build Their Own Future by Richard (RJ) Eskow.
Today’s Big Idea To Get America Working: Revive American Manufacturing by Dave Johnson.
Today’s Big Idea To Get America Working: Make Work Pay by Anne Thompson.
Today’s Big Idea To Get America Working: Invest In Public Education by Jeff Bryant.
Big Ideas To Get America Working: Rebuild Our Infrastructure by Dave Johnson.
This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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Infrastructure Work Is Needed And People Need The Work

We’ve been deferring maintenance of our infrastructure since the Reagan tax cuts – never mind modernizing to restore American competitiveness. It is something that has to be done anyway, and here we are with so many people needing work. It’s just nuts. Millions of jobs that need doing, and millions out of work, and we can’t connect the dots.
Finally SOME people in DC are trying to get some jobs going. “Senior Senate Democrats” are proposing “a large infrastructure package funded by tax increases” and that is exactly what the country NEEDS. From The Hill last week, Do more on jobs, Dems tell Obama,

Senior Senate Democrats are growing frustrated by what they see as President Obama’s passivity on the economy, and are beginning to discuss a large infrastructure package funded by tax increases.
. . . “I am concerned about the Obama administration’s approach on this,” Harkin said. “It always has been about jobs. I think the administration kind of got snookered talking about the deficit and the debt after the last election.
“The last election was about jobs and the economy, and now we’re in a position where we really do need some economic pump-priming by the federal government,” he said.

Has To Be Done Anyway
The country needs this infrastructure work done anyway. Since the Reagan tax cuts we have been putting off maintenance of our infrastructure. And this is catching up to us.
Experts say $2 trillion of infrastructure work is needed just to catch up. The American Society of Civil Engineers (ASCE) Infrastructure Report Card, says a $2.2 trillion investment is needed to bring the country up to current standards. ASCE says, “Years of delayed maintenance and lack of modernization have left Americans with an outdated and failing infrastructure that cannot meet our needs.”
Imagine where the economy would be today if this work had been done as needed. We would have a well-maintained infrastructure, keeping our businesses competitive in the world, not to mention where we would be with an additional $2 trillion of employment and the resulting savings, homes, kids sent to school… This is a measure of the cost of the Reagan tax cuts and the pullback of public investment it caused.
Another measure is the resulting attitudes. Here we are with millions out of work, and millions of jobs that need doing, and we can’t even get going on doing the needed work! So the continued lack of investment in our public structures will have future costs as well.
“Falling Dramatically Behind”
Recently the Urban Land Institute issued a report on the country’s infrastructure, showing how we are falling behind countries like Brazil, China and India. The Washington Post covered the report last month, in Study: $2 trillion needed for U.S. infrastructure

The United States is falling dramatically behind much of the world in rebuilding and expanding an overloaded and deteriorating transportation network it needs to remain competitive in the global marketplace, according to a new study by the Urban Land Institute.
Burdened with soaring deficits and with long-term transportation plans stalled in Congress, the United States has fallen behind three emerging economic competitors — Brazil, China and India, the institute said.
[. . .] As Congress debates how much should be spent and where to find the money, China has a plan to spend $1 trillion on high-speed rail, highways and other infrastructure in five years. India is nearing the end of a $500 billion investment phase that has seen major highway improvements, and plans to double that amount by 2017. Brazil plans to spend $900 billion on energy and transportation projects by 2014.

According to the report,

  • … the U.K. has committed Us$326 billion (£200 billion) over the next five years to continue national infrastructure projects focused on rail, energy production, and broadband access, with an emphasis on reducing the nation’s carbon emissions through investments in renewable energy.
  • France, germany, spain, and Italy continue to build out high-speed rail and freight networks between major cities and extend cross-border transport links …
  • Australia is working to shore up existing infrastructure while setting national priorities for future investments; expansion of ports, refashioning of rail lines, and relief of urban traffic congestion take precedence.
  • Canada is expanding its PPP initiatives to address the revamping of aging facilities.
  • … China is moving ahead with wide-ranging infrastructure programs, including completion of an unprecedented 10,000-mile high-speed rail network by 2020. newly constructed airports, ports, and subway systems in China’s major centers facilitate the country’s growth into the world’s second-largest economy and help it deal with mounting congestion from burgeoning urban populations.
  • India is working hard to attract more private financing for desperately needed infrastructure to nurture aspirations for global economic leadership, while the United arab emirates and Kuwait continue to use oil wealth to build out transport hubs and seek energy-efficient solutions for future power and water needs.
  • Brazil is accelerating road, transit, and water projects to accommodate its burgeoning economy and buttress an enhanced standing on the world stage; it does not want to disappoint people visiting for the 2014 World Cup and the 2016 summer olympics.
  • Public Wants It
    Public Opinion Snapshot: Public Backs Infrastructure Investment, from the Center for American Progress, says,

    Eighty percent declared themselves in agreement with President Barack Obama’s State of the Union call for a major effort to rebuild and modernize America’s infrastructure in a new Hart Research/Public Opinion Strategies survey for the Rockefeller Foundation.

    Last month Rep. Jerry Nadler wrote a pro-infrastructure op-ed for Politico, The necessity of infrastructure cash,

    The single greatest challenge is to fund the investments that we so desperately need in the face of a Republican-sponsored hysteria for budget cutting that pays no regard to the consequences. Just last week, for instance, an Urban Land Institute study concluded that we need $2 trillion just to make basic repairs to our critical infrastructure.
    [. . .] Every stage of American prosperity and growth has followed federal investment in infrastructure. From Henry Clay’s “American System” to Abraham Lincoln’s “Internal Improvements” and Trans-Continental Railroad to Dwight Eisenhower’s Interstate Highway System, the federal government has financed the nation’s major infrastructure growth and enabled our economic development.
    If America is to lead the world economy in the 21st century, it will require a modern infrastructure capable of promoting and sustaining economic growth. And it will be built not by happenstance but only through the leadership and investment of the federal government, as in the past.
    If we choose not to make the investments necessary to lead the world, there will be no shortage of countries ready and willing to take our place.

    So here we are, stuck, with all this work that needs to be done, and all these people needing work, and we can’t as a country connect the dots and get this going.
    This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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    Businesses Hire When Customers Are Coming In The Door

    Another bad jobless claims report… and this time Washington seems to have finally noticed that there are some unemployed people out here in the sticks. But instead of jobs programs the geniuses are proposing … what else? … even more tax cuts. (And after a few hours they’ll go back to complaining about deficits but blame “spending.”) And of course, they are once again trying to “appeal to Republican lawmakers” without getting it that Republican lawmakers are doing everything they can to slow job growth so they can win the next election.
    Bloomberg: Payroll-Tax Break Said to Be Discussed by Obama Aides Amid Slowing Economy,

    President Barack Obama’s advisers have discussed seeking a temporary cut in the payroll taxes businesses pay on wages as they debate ways to spur hiring amid signs that the recovery is slowing, according to people familiar with the matter.
    . . . The talks reflect the political constraints the White House is operating under with the Republican majority in the U.S. House pushing to cut federal spending. A hiring stimulus based on a tax break for employers may appeal to Republican lawmakers, many of whom have called for measures to help businesses.

    Companies Only Hire When Customers Are Coming In The Door
    Here is something the geniuses haven’t noticed, in all their geniosity: It doesn’t matter how much more money you give to business owners, businesses are not going to hire any more employees until they have a REASON to – and that reason is customers coming in the door.
    OK, That was bold and italicized. Maybe if I make it ALL CAPS the geniuses will see it? Let’s see: BUSINESSES ARE NOT GOING TO HIRE ANY MORE EMPLOYEES UNTIL THEY HAVE A REASON TO AND THAT REASON IS CUSTOMERS COMING IN THE DOOR.
    Businesses are not going to hire people just to sit around and listen to iPods or read the paper, waiting for a customer.
    Terrance Heath, in America’s Unhappy Anniversary: Ten Years Of The Bush Tax Cuts For The Wealthy,

    Republicans claim that preserving the Bush tax cuts for the wealthy is in the interest of small businesses, but small business owners are starting to demand a repeal of the Bush tax cuts.

    We are fed by our consumers, not by our tax breaks,” says Rick Poore, owner of Designwear, Inc., a screen-printing business based in Lincoln, Neb. “If you drive more people to my business, I will hire more people. It’s as simple as that. If you give me a tax break, I’ll just take the wife to the Bahamas.

    Businesses are fed by their customers, not by tax cuts. Tax cuts only feed deficits. Customers coming in the door is what causes businesses to hire. In case you missed that: Customers coming in the door is what causes businesses to hire.
    Direct Job Creation Is Needed
    Until there are more customers businesses are not going to hire. Why should they? So it is up to us (government: We, the People…) to create some customers. The way to do that is to hire people to do some of the things that it is government’s job to do anyway, but government has been putting off because of so many tax cuts.
    Fix the infrastructure: Our infrastructure is crumbling. In Obama Should Call Chamber’s Infrastructure Bluff I linked to an Urban Land Institute report on the country’s infrastructure, showing how we are falling behind countries like Brazil, China and India, and to the American Society of Civil Engineers (ASCE) Infrastructure Report Card, that says a $2.2 trillion investment is needed just to bring the country’s infrastructure back up to current standards.
    This infrastructure work has to be done no matter what. The longer we delay it the more our country falls behind. It is millions of jobs that need doing at a time when millions need jobs! (And by the way the government can borrow at nearly zero interest rates right now — one more reason to do it now.)
    Green jobs: And then there are the green jobs you should be creating. You should be hiring people to retrofit every home and building in the country to be more energy efficient. This pays for itself because we stop sending so much money to the oil-producing countries, stop putting so much carbon in the air, and our economy becomes more efficient. And put more money into alternative energy, too. I mean, jeeze, geniuses, what part of this is hard to get?
    Jobs fix deficits: Hiring people to fix up the infrastructure takes them off the unemployment rolls and off the other assistance programs, lowering government spending on those programs. Having those jobs means they are paying taxes again, raising government revenue. And fixing up the infrastructure makes our businesses more competitive again, growing the economy. It’s a no-brainer which should mean even the DC geniuses can figure it out.
    Fix Trade
    Because of bad trade deals, much of any revival of our economy just means that we send more money out of the country. The trade deficits, especially with China, are also economy deficits. We are not just sending jobs and money out of the country, we are sending our chances of coming out of this economic slump out of the country as well.
    And these trade deals pit exploited, underpaid workers in non- or weak democracies against our workers who had been benefiting from the good wages, workers protections and other non-”business friendly” things that democracy brings along with it.
    Our trade deals have made our democracy and the resulting high standard of living into a disadvantage. Who were the geniuses that let that happen?
    Restore Long-Term Incentives
    Tax cuts have cut the incentive for long-term business models. It used to take time to build a fortune, so businesses had to place themselves within healthy communities with good schools, well-maintained infrastructure and solid, well-funded public structures like the court system. Cutting top tax rates changed business models to make more sense “harvesting” those things in a hurry and moving on to the next community with resources to plunder. Low top tax rates encourage quick-buck schemes.
    Propose The Right Thing
    Propose the right thing and do it publicly, instead of trying to appease a political ideology bent on destroying government. Doing the right thing is also the right thing politically. If the job situation doesn’t get better you’re going to be thrown out of office. So come one, geniuses, get smart and start hiring people to fix up the infrastructure and make the economy more energy efficient.
    10 years of Bush tax cuts is enough! Click here to demand your representative supports the Fairness in Taxation Act so the rich contribute their fair share.
    This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
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    It’s (Still) The Economic Paradigm, Stupid!

    This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
    Yesterday I wrote that the President may have sacrificed his long-term vision on trade and economic/industrial policy to day-to-day concerns and politics. The tax-cut deal is another indicator that a big-picture vision has been sacrificed. But however much smoke gets thrown up to mask the real problem it’s still all about the economic paradigm.
    There is still a lot of forward-thinking work to do on our economy. The big picture is, of course, jobs. It is balance of trade, a coherent and especially comprehensive economic/industrial policy, education, infrastructure. But even more than those, fixing the real economic mess is about finding a sustainable and equitable formula, and changing the equations of who gets what for what. It is a bigger picture.
    But now we are totally caught in the day-to-day fights over tax cuts for the rich, giving forever more and more to the big financial institutions, letting the big corporations get away with more and more while delivering less and less and making us work harder and harder. It seems that all we do now is just react to corporate/conservative assaults. We are trying to fight off attacks on everything, everything and on every, every front.
    Instead of job-creation programs we are fighting over just giving unemployed people the same unemployment benefits that American workers have always gotten. Instead of doing something about climate change we are fighting to keep the big oil companies from killing rail projects and green energy initiatives.
    The corporate/conservatives are using their “Overton Window” tactics to push the discourse ever further to the right and away from addressing the real problems. (I don’t mean Glenn Beck’s book. More info here and here.) And we are now living the result.
    Step back, remember how we got here. Thirty years ago the corporate conservatives launched their assault on We, the People. They elected Ronald Reagan, who declared that “We, the People are the problem,” and that decision-making by We the People (government) had gotten too big. Now the Reagan Revolution has come home to roost and we are living in the conservative dream. The rich ever richer with more and more power, the rest of us are “the help,” just trying to get by, and our minds are under continual assault from a sophisticated propaganda barrage designed to keep us from doing something about it.
    The basics have not changed. The fundamental changes we need are still needed. The corporate conservatives have all the money in the world and are so well organized but they can’t fight off reality forever. The planet really is warming and the climate really is changing and it really is because of carbon. The conservative economic model really does not work and is draining the people and the planet for the benefit of just a few.
    In my first post for the Campaign for America’s Future, It’s The Economic Paradigm, Stupid!, I wrote,

    It is not just the economy out of whack. The business practices that brought us here — overextraction, overextension, overleveraging, overconsumption — have also whacked the planet’s resources. The fisheries are increasingly depleted. The aquifers are increasingly drained. The forests are increasingly logged. The landfills are increasingly full. And, of course, the planet is increasingly hotter.
    Our economic system has also taken a toll on the people. Too many hours at a stressful workplace with too little sleep have burned many of us out. Our thinking and identity are about our jobs, not our spirit and character. Our values are devoted to markets with many of us placing making money over loving and caring for families and others. And there’s no time for that stuff anyway. We have become consumers instead of citizens and humans. Decades of falling wages, decreasing savings and increasing debt have tapped us out. Consumption has used us up. And we’re fed up.

    The problems are still the problems, only more so. And we’re still fed up, only more so.
    (*Please click the links)
    (*Please click the links)
    Previous: It’s The Economic Paradigm, Stupid!
    Overton Windows links: Here, here and here.
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    Jobs: It’s BOLD PLAN Time

    This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.
    Today’s jobs report showed that the economy added 151,000 jobs in October, the biggest rise since May. The 159,000 increase in private sector employment was the second-largest monthly rise of the “recovery.” The official unemployment rate stayed at 9.6 percent. NY Times: U.S. Added Jobs Last Month for First Time Since May,

    On many levels, the October report was much stronger than expected. Forecasters had been expecting a gain of only 60,000 jobs. The report also revised the numbers for August and September, showing 110,000 fewer jobs losses than previously estimated. Hourly wages were slightly higher, too.
    … A broader measure of unemployment, which includes people who are working part-time because they cannot find full-time jobs and people who have given up looking for work, ticked down slightly to 17 percent from 17.1 percent in September.

    This might seem like good news — until you think about it. We are so used to really bad news that new that just sort of OK sounds great. Dean Baker, writing at the Center for Economic and Policy Research,

    At this rate it would take more than 15 years to make up the job shortfall from the downturn, but at least the economy is moving in the right direction.

    Meanwhile, the Federal Reserve this week announced “quantitative easing,” through which they will pump another $600 billion into the economy by purchasing US treasury bills, also known as “printing money.” I guess the idea is to top off and overflow the coffers of the already-wealthy, thereby forcing up the price of stocks and other assets held by the already-wealthy, while keeping interest rates low on the savings of working and retired people. At the same time conservatives in Congress are demanding further extensions of tax cuts for the rich, which did so well stimulating jobs up to now. The thinking seems to be that at some point the really, really wealthy will have so astonishingly much extra cash on hand that they will hire a few more servants, which will then stimulate purchasing of necessities by said servants, which will then drive the economy.
    It’s time to call out this nonsense for what it is.
    We Need A Bold Plan
    It is time for the President to announce a BOLD PLAN for a job-creation agenda. (Actually, it was time for him to do this a year or two ago…) Here are three badly-needed 5-year plans:
    * A 5-year plan to revive American manufacturing. This is how our country and our people can make a living again.
    * A 5-year plan to bring America’s infrastructure into the 21st century, making our economy competitive again.
    * A 5-year plan to make our homes, buildings and electric grid energy efficient to lower our energy costs and reduce our imports of oil.
    These are things that we have to do anyway. We have a lot of unemployed people, and any one of these three plans will put a huge dent in unemployment. Any one of these three revives our economy. Any one of these three restores American competitiveness. ALL THREE restore us as the economy leader in the world.
    And, the politics will be good because it is what is needed and good for the country and everyone knows it.
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    Social Security – A Divide Between DC And The Rest Of Us

    This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF.
    The DC-elite think that “the responsible thing to do” is to cut Social Security benefits. The public who they are supposed to represent overwhelmingly thinks that Social Security is one of the few remaining lifelines and must not be cut. The public strongly favors investing in rebuilding the country’s infrastructure, returning to taxation of the wealthy and corporations — especially Wall Street, and cutting back the enormous military budget as the key ways to address the budget deficit.
    This morning the results of a new poll were announced, and politicians would do well to take note. The poll, A Research Study On Investment and Deficit Reduction, By Greenberg Quinlan Rosner Research, Democracy Corps, Campaign for Amerca’s Future is described as follows:

    Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation, according to a poll by Greenberg Quinlan Rosner commissioned by the Campaign for America’s Future and Democracy Corps, with support from MoveOn.org; the American Federation of State, County and Municipal Employees, and the Service Employees International Union.

    I’l like to bring that first sentence out and repeat it so that it is clear: Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation.
    And again: Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation.
    There is a brief slide show of the results here, a comprehensive Powerpoint presentation is online here, and full poll results are available here.
    Key findings of the poll:

  • 68 percent said they would oppose making major spending cuts in Social Security and Medicare to reduce the deficit, while 28 percent said they would favor cutting those programs. That included 61 percent of Republicans and 56 percent of independents.
  • Strong majorities support progressive solutions for addressing the federal deficit: 63 percent back lifting the Social Security cap on incomes higher than $107,000 a year; 64 percent would favor eliminating tax breaks for corporations that outsource jobs; 62 percent would support a tax on excessive Wall Street bank profits.
  • Strong majorities also oppose common conservative proposals for addressing the budget deficit: 65 percent oppose raising the Social Security retirement age to 70; 65 percent oppose replacing Medicare with a private sector voucher; 62 percent oppose a 3 percent federal sales tax; 60 percent oppose raising the Medicare age from 65 to 67.
  • More people support a message that embraces the need for both investments in our future and reduce the deficit over time (52 percent) than a message that only stresses cuts in spending (42 percent). Also, almost equal percentages of respondents were favorable toward “a plan to invest in new industries and rebuild the country over the next five years” (60 percent) and “a plan to dramatically reduce the deficit over five years” (61 percent).
  • 62 percent of respondents support more federal to states once they understand that the aid comes in the context of states laying off teachers, first responders and other essential workers due to the recession. That includes 55 percent of independents and 48 percent of Republicans.
  • 60 percent of those surveyed responded positively to an economic message that said that “we have a budget deficit, but … we also have a massive public investment deficit” that requires us to “rebuild the infrastructure that is vital to our economy” and to the economic growth that will “generate revenues to help pay down the budget deficit.” This message tests better than any other progressive message on investment as well as more conservative messages focused on spending cuts.
  • Click here for more on the poll.
    Click here to see which members of Congress have signed the “Hands Off Social Security!” pledge
    Click here to sign the petition: Hands Off Social Security!
    Click here to visit Strengthen Social Security … don’t cut it.
    One more time: Politicians will face major voter backlash if they advocate cuts in Social Security benefits or choose deficit reduction over job creation.
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    Unpaved: Out-Of-Cash America Undoing Its Infrastructure

    This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture as part of the Making It In America project. I am a Fellow with CAF.

    In case you missed Rachel Maddow last night, she had a segment on American cities and counties actually undoing their infrastructure because they are out of money. She listed city after city across the country that is shutting off its streetlights, turning paved roads into gravel, shutting down bus systems, shutting down schools, firing police, and other steps to save money.
    To me, the most striking comment was, “Somewhere in China it is entirely possible that a businessperson sat down for a ride on a 200mph state-of-the-art levitating bullet train, and cracked open the Wall Street Journal, and read about how in American we’ve decided we can’t afford paved roads anymore.”
    Is that how we want the rest of the world to think of us? Do we really want to become a broken-down, corrupt, uncompetitive 3rd-world country? Well, that is where we are going. We can see the infrastructure crumbling around us.
    Meanwhile, as the country falls further and further behind the rest of the world the government is unable to function. In Washington the conservative Senate minority continues to use the filibuster — over 110 times since President Obama took office — to block every effort to do anything about our problems. They block helping states keep teachers. They block helping the unemployed. They block job-creation efforts. They block everything government does for We, the People.
    And at the same time as they resist spending to help the country, publicly pleading that the deficit and debt are too high, the conservatives also resist doing the things that will fix the problem: raise tax rates on the wealthy, and cut the huge, massive, bloated, more than $1 trillion per year military and military-related budget.
    They think a worsening economy with no solutions will demoralize enough voters that they can turn out their “base’ and win in November. Destroy the economy and the country to get votes. Great. You’ll make marvelous leaders — oh wait, been there, that’s how we got into this mess.
    Yes, we know how we got here. Everyone this knows that the deficits and debt come from tax cuts for the wealthy, and huge increases in military spending. AConservatives know. They said their plan was to cut taxes and thereby “starve the beast” as a way to cut government. Their reason to cut government is to make way for the only available alternative: so that the large corporations and the wealthy can rule instead. Cutting government means cutting the controls and protections that We, the People have been able to build up over the years, ensuring that we get a slice of the pie. This has been going on for thousands, even ten thousand years, as the broad masses of regular people work to assert their rights over whatever wealthy and powerful group has seized the reigns of power and is trying to grab everything for themselves as fast as they can.
    Look where this cynical strategy is taking the whole country! We are not only not maintaining and modernizing our infrastructure, we are falling into 3rd-world status. This can’t even help the wealthy and the big corporations they control. The conservatives still have to live here even if this scheme does bring them control. They will still have to live with fewer police, fewer teachers, fewer streetlights, unpaved roads, crumbling factories, and an ever-less-competitive economy.
    Will it be worth it?
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