For 30 years the American economy has undergone profound changes for the worse. Throughout the Reagan-Bush-Clinton-Bush era there have been five main themes that have eaten away at the wellbeing of millions of working Americans: Outsourcing; McJobs; Deregulation; Inequality; and Cuts in Welfare Spending. These five trends have wreaked havoc with the economy and have contributed to the current crisis. The collapse of the financial system is the predictable result of government policies that have put too much money into too few hands too quickly. Barack Obama yesterday unveiled his bold "Economic Rescue Plan for the Middle Class," which is both a broad outline and a detailed vision filled with innovative new programs that will not only address the current crisis but moves towards aggressively tackling the bigger picture as well.
Outsourcing: The exporting of good-paying (often unionized) American jobs to low-wage countries overseas or across the border must be slowed or stopped. Obama offers tax credits to every small business that creates new jobs, as well as a "Jobs and Growth Fund" to invest in America's small businesses to create and keep jobs here at home.
McJobs: The exchange of good-paying (often unionized) jobs for low-wage "McJobs" has hindered Americans' buying power and eroded many local tax bases. The stagnation in wages has led millions of people to turn to credit cards and other forms of debt to keep their heads above water. Obama wants to help people deal with the current crisis by allowing them to withdraw some money from their IRAs or 401(k)s through 2009, as well as investing in training and education programs that can help move people into better paying jobs.
Deregulation: The deregulatory frenzy of the past 30 years has produced an economy that is volatile, unfair, and unpredictable. It has allowed for large corporations to practice a million different forms of legalized robbery and attack worker safety, consumer protection, and the environment. The market fundamentalists who promised us that the economy would prosper if it were unburdened by regulation have been proven wrong. Too often these deregulatory "reforms" were nothing but greed masquerading as public policy. Obama calls for new common sense regulations (especially in the financial sector) to rebuild the regulatory state that has been largely dismantled over the last three decades. He understands that regulations not only protect workers, consumers, and the environment, but they are essential for the smooth functioning of our modern capitalist economy.
Inequality: Since Ronald Reagan's first term the gap between the rich and everybody else has been allowed to grow to levels that threaten the stability of American society. Obama proposes investing in education, rebuilding our infrastructure, and employing millions of people in the innovative alternative energy sector, as well as a more fair tax policy that gives assistance to the middle class.
Cuts in Welfare Spending: One of the most heartless and brutal trends since the 1980s has been the wholesale destruction of America's social safety net. This shredding of the welfare state has come at a time when the economy has undergone a profound transformation. Millions of people have been left behind and are in need of help to make the transition to a new, greener economy. With the foreclosures and credit crunch the suffering of the least among us has increased. Obama's plan for universal health coverage will go a long way in helping families in need. And his call to extend unemployment insurance benefits, eliminating the tax on unemployment insurance, and providing relief to homeowners in danger of losing their homes are also steps in the right direction.
"We can bring a new era of responsibility and accountability to Wall Street and to Washington," Obama said yesterday. "We can put in place common-sense regulations to prevent a crisis like this from ever happening again. We can make investments in the technology and innovation that will restore prosperity and lead to new jobs and a new economy for the 21st century. We can restore a sense of fairness and balance that will give every American a fair shot at the American dream. And above all, we can restore confidence - confidence in America, confidence in our economy, and confidence in ourselves."