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Just Whose Economic Recovery Is it, Anyway?

02/07/2011 11:11 am ET | Updated May 25, 2011
  • Pearl Korn Advocate for Improved Medicare For All

After hearing the SOTU speech, no one can have any doubts about where our president's political proclivities lie. Fully on display were his elitist credentials as a conservative and pro-business president who is all too willing to throw "ordinary people" -- a/k/a hardworking and struggling Americans -- under the bus. At the end of the speech, even weepy Boehner and hard-nosed McConnell must have found a great deal to cheer about. Were it not for their recent efforts to repeal the contentious health care reform bill, they would probably have celebrated the event with Obama in a conga line around the Oval Office wearing party hats.

The president offered a glowing report of an economy on the mend, for which he, of course, took credit. Offering up tax cuts for corporations and aid for their research and development programs so even more profits could be realized. I, personally, would have liked to have heard more about who those good souls are who would be on the receiving end of this support, and how giving them more of our blood and treasure will in turn aid the economy. "Competition" was mentioned no less than 9 times and "jobs" 32 times as the president announced our reentry into the global economy full-throttle. With corporate profits at an all time high, it would seem tax increases rather than tax cuts should have been put forth, at least as an option. As for those who can't find work, the conventional thinking in DC appears to be that it is because they lack the necessary educational skills, and so it is their fault. Americans will have to be better educated in order to compete with workers in India, China and South Korea who are paid pennies on the dollar in comparison. Yes, Mr. President, big business shipped all those jobs overseas because we're too stupid.

So, continued Obama, "the economy is growing again," and he has "broken the back of the recession." Yes, the financial sector, among other corporate entities, is thriving due to the generous bailouts provided by the American taxpayer -- corporate welfare handed out to those who created this mess in the first place, both at home and abroad. The Republicans, and now the Dems, it seems, have shown themselves to be little more than lackeys for the elites, two parties against the people, creating a more disenfranchised America. Welfare continues to be provided for the rich, while safety net programs for those who need it most are offered up for the chopping block.

Only 36,000 new jobs were created last month, when 148,000 had been predicted. Could the administration's continued support of NAFTA-style trade agreements that do not create jobs at home be part of the problem? Since the 90's and the introduction of NAFTA, we have lost 5.1 million jobs and 46,000 factories have closed, contributing to our ever-growing trade deficits. Obama's recent China agreement is a disaster, now to be followed by a Korean trade agreement projected to cost another 159,000 U.S. jobs. This is another of the President's campaign promises that seems to have gone missing: over-hauling America's "free" trade agreements, starting with NAFTA.

Our standard of living is now below that of several European countries and Japan. Wages have been flat or decreasing for decades, Mr. President. Where in the SOTU was your compassionate reference to the homeless, the hungry, the poor, those who have lost their homes and those 13.9 million still out of work? Instead, you presented the same warped view of the economy we get from the experts:

  • Even though unemployment is now 9%, a significant drop, a closer look reveals that millions no longer are looking for work and have given up in despair -- our jobless recovery. How are they doing, Mr. President?
  • Corporate productivity is up while every ounce of blood is squeezed out of employees terrified of losing their jobs. Meanwhile, corporate costs are at a rate lower than in the past 50 years. More hiring must take place and investment in businesses that employ workers here at home must materialize.
  • Retail sales have improved, and there is hiring in this sector, as well as the service and health industries. But these jobs come with low wages. Walmart reported $409 billion in revenue last year, more than Apple, Exxon Mobile, Coca Cola and Morgan Stanley combined. Walmart's size alone makes them capable of destroying communities just by showing up, driving out local stores and businesses. Adding to their negative impact are the traditionally low wages they pay and penurious health "benefits" they offer, which only boost their bottom line, not that of their workers.
  • 20% of New Yorkers are now forgoing visits to doctors and purchasing prescription drugs due to costs, a health care disaster lurking down the road and a story repeated across the country in every state. Congress and our President must open their eyes and take a look at what is really happening around the country.

If the new buzzword is "competition," how is it that the most uncompetitive industry is the banking industry? Controlling most of the nation's wealth, the American people have been reduced to serfdom, beholding to the banks for our every daily need: car loans, education, mortgages, paying for food, clothes, prescription drugs - the list goes on. We bailed out Wall Street and banks to the tune of 12.3 trillion dollars of taxpayers' money, and today they are sitting on unprecedented mountains of cash here and abroad, while offering little if anything to bail out homeowners who continue to lose their homes, which will number over 1,000,000 more this year. Homeownership is now at a low of 66%.

Meanwhile, loans to small business are few and far between, and those credit card rates keep an indentured working class in bondage while the banks make more money than ever. Stockholders aren't doing too badly either, along with Bank CEO's and other high-level banksters. To create banking competition, now is the time for State Banks to be created in every state. It would offer up competition to the banking industry -- a "Public Option," if you will -- forcing them to compete and lower loan rates while reducing unemployment and providing for municipal needs like infrastructure, loans to businesses, schools, student loans and other services. No gambling on risky products allowed, and accountability would be high since the only shareholders would be the states and their citizens. The Bank of North Dakota is the template for this kind of national economic revival that we need and are more than ready for. North Dakota's 4% unemployment rate is to be admired, along with the fact that they have been solvent for 100 years (see my previous HuffPo article on North Dakota's bank Here).

Here is another suggestion, Mr. President: How about a stimulus effort from the banks, a novel idea of giving back to those taxpayers who saved their behinds and pulled them from the brink. Call for a banking summit at the White House of all of the CEO'S of major banks and press them to raise the anemic interest rate on savings accounts. That 0.5% interest rate doesn't keep up with inflation, further eroding principal. After all, Mr. President, this is also workers' money that is used by banks to make loans and plump up their profits. We need an interest rate increase on savings accounts equal at least to the cost of living annually. Surely, hardworking Americans having a savings account with a respectable amount of interest would be helped in these tough economic times? How much would this pump up the economy while creating even more business and profits for banks? I can see the banking community even launching a national advertising campaign as a result of this grand effort about YOUR FRIENDLY NEIGHBORHOOD BANK. The good will would be enormous. Money would remain in local communities, benefiting local small businesses and winding up back in the banks in those communities - a win, win.

And let's not forget those drowning homeowners who still need help refinancing their mortgages, Mr. President. Stop their spiral downward. Press those CEO's at the banks to renegotiate mortgage loans and save those homeowners on the brink of becoming homeless themselves, as predatory speculators swoop in for the kill. And while I am dreaming about pie in the sky, why not roll back those credit card rates as well, at least for two years to match your extension of the tax giveaway to the millionaires' club?

The American people need not be sacrificed as the cost of promoting corporate growth. Both can coexist. It is time to seek a balance, Mr. President.