Tonight in his State of the Union speech, President Obama will offer initiatives to strengthen the middle class. The middle class is suffering, and it is important for the President to put forward proposals to help. But our nation cannot achieve a truly sustainable recovery without targeting assistance to low-income people who aspire to join the middle class.
In the 2001 recession, there was no strategy to help low-income and working-class families. As a result, many of them faced prolonged unemployment and actually lost economic ground during the recovery period. This recession is much deeper, and the economic consequences of failing to act would be much worse. For most of the past decade, we failed to make significant investments that would prepare people to work in a new economy. As a result, many people now find themselves without the skills they need to find a job. If we want to avoid a legacy of more and more people excluded from the middle class, we must take steps to prepare our workforce for a modern economy.
The American Recovery and Reinvestment Act (ARRA) managed to staunch the loss of jobs somewhat, creating or saving jobs for 1.2 million people. Moreover, it is significantly reducing suffering of the unemployed: by providing health insurance subsidies and increasing Medicaid funding it protects access to health care; by expanding food stamp benefits it helps ensure that people do not go hungry; and by funding a variety of state services it ensures that as struggling families need help, help is available. Education, training, weatherizing homes, and rehabbing public housing all are contributing to rebuilding the economy.
But time has shown that the measures in the recovery plan were only a first step. The recession is far deeper than originally hoped, and more must be done.
What will the President offer tonight to help those who are falling from the middle class into poverty for lack of jobs -- or those who are struggling to reach the middle class for the first time?
As he speaks, I'll be listening for a few key items. Here's my checklist; I encourage you to follow along.
First on any list must be efforts to create new jobs and stop job loss. One of the most disturbing signs of our fragile economy has gone largely unnoticed: the number of workers who have been unemployed for more than six months is growing steadily and has reached a record level of 6.13 million. That's four out of ten unemployed workers.
This trend is particularly disturbing because workers who have been unemployed that long have exhausted their state unemployment benefits and are dependent on two federal unemployment extensions, one of which will expire at the end of February. Unless Congress extends those benefits, in March alone one million workers will exhaust their unemployment benefits.
Without unemployment benefits many, perhaps most, of those workers will fall into poverty. The recession is causing widespread hardship. Our national food stamp enrollment is skyrocketing -- a record nearly 38 million people received food stamps in October, nearly 7 million more than a year ago. Despite this increase, 49 million people are struggling against hunger according to the most recent USDA findings, 17 million of whom are children. Children in households that cannot afford enough nutritious food are more likely to suffer ill health and fall behind in school. Economists predict steeply rising child poverty through 2010, with one in four expected to be poor. For too many, that means talents and potential squandered and a lifetime of lower earnings. We cannot be competitive if we deny millions of children the building blocks of success. I want to hear the President tell us that we cannot rebuild our economy while leaving one-quarter of our children poor or hungry
Certainly Congress must extend unemployment benefits, and I will be listening to see if the President supports such an expansion. But I also want to know if the President will call for jobs legislation that will
- Offer a menu of direct job creation opportunities, not a one- size- fits-all plan. Direct job creation activities should benefit both experienced but now jobless workers and those who are struggling to get a foothold in a decent job; it should provide both immediate jobs and pathways such as on-the-job training to long-term employment in good jobs.
- Extend income supports like food stamps and refundable tax credits, as well as unemployment benefits, which are job creation engines. Economists tell us that in addition to reducing suffering, food stamps, refundable tax credits and unemployment benefit expansions are the most efficient investments to create new jobs, because recipients spend every penny, bolstering the economy.
- Prevent the loss of 900,000 jobs by expanding relief to states. Just when they need to provide services to growing numbers of struggling families, states are facing the worst budget shortfalls in decades.
Second, I -- and most of the country -- want to see whether he proposes to forge ahead with comprehensive health care reform. Congress has legitimate procedures at its disposal to allow a simple majority to enact health care legislation similar to the compromise reached a few weeks ago. The legislation will not be perfect, but it will protect people from being denied coverage and it will extend affordable health insurance to 30 million people. Congress has the tools to finish the job it started, but its will to do the right thing is wavering. The President has signaled over the past week that he will fight for health care reform. His State of the Union message should commit to that fight in the strongest terms. He should remind the nation how often families are thrust into financial ruin because they are unlucky enough to get sick, and that many bankrupted families paid for health insurance for years only to discover it would not cover them. He should explain how this legislation will ensure that health insurance can be counted on, and how insuring most Americans is a giant step towards economic security and economic growth.
Thirdly, I will be listening to see if President Obama moves forward on his early commitment to help low-and moderate-income families to join the middle class. Some of his proposals clearly do; his child care initiative helps middle-income parents through an expanded tax credit, and is expected to provide funding for subsidized child care for families with lower incomes. The cap on student loan payments would be helpful to people with low incomes. But reports of a three-year freeze on appropriations are very troubling. I'm prepared to reserve judgment until the details are known. However, if it is true that military, homeland security, and veterans' funding are exempt from the freeze, it is far more likely that badly needed services for some of the most vulnerable low-income people will be threatened. For years President Bush and Congress allowed services to protect children from abuse or neglect to shrink with inflation; similarly, substance abuse, mental health, and youth services have eroded, despite growing need. Further, a freeze could be used to prevent continued funding of very beneficial job training programs temporarily expanded through the economic recovery act. These programs are still needed. I would like to think the President will stand with the vulnerable, so they can have a chance to join the mainstream.
Our Union is facing some of the toughest times in generations. Tonight as the President speaks I'll be listening and hoping that the President agrees that the best way through these times is by pursuing opportunity for all.