The big talk in Washington rightfully is all about jobs, jobs, jobs, and what to do to create them. Some would rather do nothing and wait for them to magically appear. Others have trotted out a proposal to create jobs that media sources say carries a price tag of about $100 billion. While many have protested a $100 billion price tag is too much to spend at time of record deficits, the reality is it's not nearly enough.
It's not enough when you have the worst unemployment crisis in 70 years with nearly 16 million unemployed Americans and another 9.3 million underemployed. It's not enough when according to economic forecasts the unemployment rate will remain above 8 percent through 2011. It's not enough when 8 million jobs have been completely removed from payrolls since the start of the recession, nearly a million more than previously estimated.
The economy is a mess, and while we rescued Wall Street from self inflicted wounds, the greatest threat to America's stability, economic stagnation and slow job growth, festers. Congress must do more to promote job growth. Now is not the time to shrink deficits on the backs of America's workers, not when persistently high unemployment rates will continue to weigh down economic growth, continue to ravage lower- and middle-class Americans' earnings, and continue to incur long-lasting damage on our economy. Putting Americans back to work is our best chance to turn around our economy and address our long-term debt. Without heavy government intervention, the economy will recover, but slowly and so weakly that we will doom ourselves to lower tax revenues, stagnant wages and higher government spending, all of which would exacerbate our fiscal woes.
Putting Americans back to work fast enough to pull us out of this slump is going to take a lot more than $100 billion. According to the Economic Policy Institute's American Jobs Plan, a solid start to bringing our unemployment rate back to pre-crisis levels would require a $400 billion investment by our government, leading to the creation of at least 4.6 million jobs in the first year.
We need more than $100 billion in order to take a comprehensive approach that includes the creation of a community jobs program, strengthens the safety net, provides fiscal relief for state and local governments, invests in transportation and schools, and extends a job creation credit tax.
- We need to increase our spending on unemployment insurance, food stamps and COBRA subsidies. Not only does it help sustain affected families, but according to EPI, each $1 billion of unemployment compensation grows our gross domestic product an estimated $1.63 billion to $2.15 billion.
- Without an extension of unemployment insurance from March to the end of the year, EPI estimates we could lose 800,000 more jobs this year.
- Congress needs to invest in a large-scale, federally funded direct job creation program that puts people to work immediately, helps rebuild our communities and addresses specific unemployment trends by providing funds to local officials closest to the needs on the ground. The jobs program would cost $40 billion a year and would be modeled after President Franklin D. Roosevelt's Civilian Conservation Corps, which put hundreds of thousands of people to work within months.
The money for a community jobs program would be allocated through the Community Development Block Grant (CDBG) formula, and would increase employment and household income in the communities most severely affected by the economic downturn. The jobs created would target four areas: neighborhood/community improvement, child health and development, access to public services, and public safety.
The second phase would focus on jobs that integrate education and job skills training, coordinate with apprenticeship programs and in sectors where job growth is most likely and with the most opportunities for advancement.
Putting Americans back to work is not only an economic imperative, but a moral one as well. It's a national shame that we put the tax payers on the hook for $23 trillion to rescue Wall Street fat cats, but balk at spending a tiny fraction of that on the workers who are the backbone of our economy. After neglecting lower- and middle-class workers for more than 20 years, a time when the richest one percent received more than half of all income growth in the US, it's high time for the government to act boldly on behalf of the people who build and sustain our country.
$100 billion? Not enough!
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