This seems like Framing and Political Strategy 101 to me, but since few other people are talking in this way, let me just lay out a basic idea: all this talk about doing a stimulus package versus not doing a stimulus package is fundamentally besides the point. What we need is a comprehensive policy package that is very simply focused on one thing and one thing only: jobs.
I know the policy wonks on Capitol Hill may be confused by that paragraph because, they would say, well, a stimulus program would create jobs. Well, yeah, that is the idea of stimulus. But my point is this: the politics of a second stimulus package are a dead end. The politics of having a debate about a policy package that will create jobs is a helpful thing. Announcing a second stimulus package gets Democrats into a defensive crouch about why the first one failed, and gets us into that same "can we get to 60" dance with Ben Nelson, Arlen Specter, Olympia Snowe, and Susan Collins that caused the first stimulus bill to be pared back and rendered less effective.
Voters don't know what it means to say you are going to stimulate the economy, but they do know what a job is. And right now, what we need is jobs sooner rather than later. My point here is not to just rename the stimulus bill the jobs bill. In fact, there are quite a few things the White House and Congress can do to focus on jobs that don't involve just spending more, although more money will certainly need to be spent. Here is what I would include in a comprehensive package:
1. Take on, far more aggressively than now, the currency manipulation going on in China. Our balance of trade problem and big losses in our manufacturing sector will not be solved without aggressively dealing with the country that we have by far and away our biggest trade deficit with, and China's policy of currency manipulation is a huge part of the problem.
2. A serious industrial policy that helps emerging industries grow. Every other industrialized country in the world has an industrial policy that helps emerging industries quickly grow and create new jobs. Yes, it does mean picking winners and losers, but we need to get over our reticence about doing that so that we can help the industries with the most potential for producing big numbers of good jobs.
3. Force every big bank that was propped up during the financial collapse -- which is pretty much all of them when you include the Federal Reserve dollars sloshing around the system -- to actually make loans to businesses so that they can create jobs. This "money for nothing and your kicks for free" philosophy has to end. The big banks need to understand very clearly that we expect something more from them, after all they have been given, than merging with other banks and giving record bonuses to their executives.
4. Direct the Justice Department to actually use existing antitrust law (and then beef it up where necessary) to break up the big banks and other mega-corporations stifling small business and competition. Promoting real competition in these industries will produce real jobs.
5. Fundamentally restructure the corporate tax system to incentivize American job creation and dis-incentivize the outsourcing of jobs.
6. Consistent with what every other industrialized country in the world, and consistent with existing WTO rules, have our federal purchases (20% plus of the economy right now) buy from companies producing goods in America. Big business and media elites will scream protectionism, but it would just be doing what every other economic power does.
7. And yes, spend some more money -- on infrastructure, on green jobs, on state revenue sharing. On all those things that were foolishly cut in the last stimulus package by the Nelson/Specter/Collins/Snowe cabal. But this time, just add the money into the federal budget so the job-killing Senators can't screw things up with a filibuster.
I've said it before and will likely say it again: this economy will not recover, and Barack Obama will not have a successful presidency, without a laser beam focus on creating good jobs. Resuscitating the big banks, whether you believe that needed to be done or not, did not create any new jobs (although it did save a few bank executives' jobs, and I'm sure their record bonuses will someday trickle down to the rest of us. Or maybe not). What we need is not another short-term stimulus package, what we need is a real plan, a comprehensive plan, to create good jobs ASAP over the short and long term.