What About Our Sinking Economy?
The Politics
Now that Congress has voted to bailout Wall Street bankers, what about the rest of us? No one seriously believes that the $700 billion bailout will stop the oncoming recession. This morning, we learned the economy continued shedding jobs in September. Yet this week, Senate Republicans used a filibuster to kill a modest stimulus bill. We need help for the real economy, not just for the mess on Wall Street.
The Facts
The recession is worsening. This morning (October 3), the Bureau of Labor Statistics announced that nationwide job losses claimed far more workers than expected. We lost 159,000 jobs last month alone, the largest monthly loss in five years, and the ninth straight month of job loss this year. [Bureau of Labor Statistics] Yesterday (October 2), the Labor Department reported that claims for unemployment insurance rose to their highest level since the September 11th terrorist attacks. [CNN]
Americans know we’re in a recession. Sixty-nine percent of Americans believe our economy is in a recession or worse. In fact, 33 percent think this is a depression. Seventy-three percent say our nation’s financial troubles will get worse and 64 percent are worried that they may not have enough money for retirement. [USA Today/Gallup]
Nevertheless, President Bush and conservatives in Congress have blocked economic-relief legislation. For months, progressives in Congress have sought to enact a new economic stimulus package to provide average Americans with economic relief. Bush says it is “premature.” McCain has refused to endorse a stimulus, and conservative senators blocked its consideration. [Associated Press]
Instead, conservatives promise to continue and expand the Bush trade policies that are costing Americans their jobs. Under President Bush, America’s trade deficit has shot up by nearly $250 billion (adjusted for inflation). [Bureau of Economic Analysis] The U.S. trade deficit caused the loss or displacement of over five million jobs in 2007 and created downward pressure on wages nationwide. [Economic Policy Institute] Conservatives, led by John McCain, have promised to continue Bush’s disastrous trade practices. [JohnMcCain.com]
Conservatives plan to help big corporations, but not workers. For example, John McCain’s “Jobs for America” plan includes a huge tax cut for corporations, but no direct job creation or new economic stimulus proposals. [JohnMcCain.com] One analyst estimates that the major components of McCain’s so-called jobs plan would cost $280 billion and create fewer than half a million jobs in 2009. [Center for American Progress Action Fund] This is nowhere near enough new jobs to match the jobs lost during the current economic downturn, or even to keep up with the 1.5 million new workers entering the labor force next year. [Bureau of Labor Statistics]
The Argument
Big corporations don’t need someone to fight for them—workers do. With their multi-billion dollar bailouts and armies of lobbyists, corporations are going to ride out the economic downturn in style. So why are conservatives like John McCain proposing economic policies that focus on tax breaks for companies like Exxon, instead of direct support to the American families who need help the most?
We can’t fix the American economy by continuing the policies that undermined it. President Bush’s tax cuts for the richest Americans didn’t “trickle down” to stimulate the economy—they created pre-Depression levels of income inequality. Conservatives want to continue and expand these policies, throwing good money after bad. It just won’t work—America needs an economic about-face.
Workers drive the American economy and should be at the center of any economic recovery plan. While America’s recession deepens, Washington is concentrating on stemming losses for big banks, not on turning our economy around. We need a stimulus plan that creates jobs and promotes healthy, wage-driven economic growth by guaranteeing fair pay for all workers.
Progressive Solutions
In the short term, progressives are fighting for a program to kick start the economy—public investment in renewable energy and rebuilding projects for schools and infrastructure, expanded unemployment benefits, and aid to cities and states to avoid layoffs of teachers and cops. In the long term, we need a national strategy in the global economy that works for working people, while supporting workers with universal health care coverage, union-organizing rights, and fair wages.
For more information on progressive economic stimulus policies, see the Making Sense fact sheet on economic growth.
