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After the Summit Ends

It's Jobs Summit Day at the White House, and here's hoping it creates real momentum for a bold jobs bill that the people of this nation desperately need.

 

Katrina vanden Heuvel

December 3, 2009

It’s Jobs Summit Day at the White House, and here’s hoping it creates real momentum for a bold jobs bill that the people of this nation desperately need.

You know the bleak statistics–10 percent unemployment, underemployment at 17.5 percent. For urban communities and minorities the jobs picture is even more severe–a silent depression–16 percent unemployment for African-Americans and 13 percent for Latinos. In all, nearly 16 million people are out of work.

"In cities and states with a sizable black population, the unemployment rate has reached incredible levels," writes C.Nicole Mason, executive director of the Women of Color Policy Network at New York University. "Detroit, for example, has an unemployment rate of 30 percent and one-third of its residents live below the official poverty line."

Hunger is on the rise. One in four children now relies on food stamps.

Now is not a time for deficit hawk hysteria; rather, it’s a time for smart thinking to rebuild this country which has been pillaged and looted for these last eight-plus years, resulting in a massive public investment deficit. We need to create jobs, and in turn increase consumer demand, raise revenues, and grow our way out of this jobless recovery. The private sector can’t get that job done at this moment–the government must fill the void.

The Economic Policy Institute (EPI) shows how we can do that in its just-released American Jobs Plan to create at least 4.6 million jobs in one year.

The plan includes renewing unemployment insurance and COBRA subsidies set to expire (which would be catastrophic) at the end of the year, and expanding food stamp benefits; fiscal relief to state and local governments that former Labor Secretary Robert Reich argues "are now mounting an anti-stimulus package (tax increases, job cuts, service cuts) of over $200 billion this year and next"; investments in transportation and school modernization–the latter was approved in theHouse Recovery bill but cut from the final version; a public service employment program that puts people to work in jobs that benefit our communities; and a job creation tax credit.

All told, it would cost roughly $400 billion in the first year to create 4.6 million jobs. And before you can utter the words "Blue Dogs", note that the entire cost can be recouped within 10 years by enacting a financial transactions tax after the first two years–with the added benefit that the Wall Streeters who created this meltdown would be paying for this investment in the real economy, instead of just turning their Bailouts into Mega-bonuses.

Not only is this the kind of bold plan our country needs, it’s also good politics. Swingstates Michigan and Nevada rank one and two for highest unemployment rates in the nation, California is fourth, Florida is ninth, Ohio is fourteenth. And if you look at the polls, voters prefer job creation over deficit reduction by a two-to-one margin.

We are a country of great wealth, with a debt to GDP ratio that is still very manageable from a historical perspective. As economist Lawrence Mishel, President of EPI, said in a conference call with reporters today, "The reason we have a very large deficit right now is because we have a very large recession…The path towards fiscal responsibility lies in first generating jobs and growth."

In 1937, just as there was some recovery from the Depression, the debt hawks swooped in and there was a return to the deficit reduction model. Things went south again. We don’t need a repeat of that. Also instructive is President Roosevelts 1944 State of the Union address–where he described his incomparable economic bill of rights: "Necessitous men are not free men," he said. "People who are hungry and out of a job are the stuff of which dictatorships are made."

A jobs bill is expected on the floor of the House in December. Hopefully, the Senate will follow suit in January. The Jobs Summit today could prove helpful if it makes clear that now is a moment for courage and bold proposals, not a moment to shrink in fear of out-of-touch conservatives and conservative Democrats.

The recovery bill kept our economy from falling into the abyss. Now it’s time to walk away from the edge and rebuild.

Katrina vanden HeuvelTwitterKatrina vanden Heuvel is editorial director and publisher of The Nation, America’s leading source of progressive politics and culture. She served as editor of the magazine from 1995 to 2019.


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