Obama, try this for a jobs plan
What did the President do in response to last week鈥檚 horrendous job report 鈥� unemployment rising to 9.2 percent in June, with only 18,000 new jobs (125,000 are needed each month just to keep up with the growth in the potential labor force)?
He said the economy continues to be in a deep hole, and he urged Congress to extend the temporary reduction in the employee part of the payroll tax, approve pending free-trade agreements, and pass a measure to streamline patent procedures.
To call this inadequate would be a gross understatement.
Here鈥檚 what the President should have said:
This job recession shows no sign of ending. It can no longer be blamed on supply-side disruptions from Japan, Europe鈥檚 debt crisis, high oil prices, or bad weather.
We鈥檙e in a vicious cycle where consumers won鈥檛 buy more because they鈥檙e scared of losing their jobs and their pay is dropping. And businesses won鈥檛 hire because they don鈥檛 have enough customers.
Here in Washington, we鈥檝e been wasting time in a game of chicken over raising the debt ceiling. Republicans want you to believe the deficit is responsible for the bad economy. The truth is that when the private sector cannot and will not spend enough to get the economy going, the public sector must step into the breach. Cutting the deficit now would only create more joblessness.
My first priority is to get Americans back to work. I鈥檓 proposing a jobs plan that will do that.
First, we鈥檒l exempt the first $20,000 of income from payroll taxes for the next two years. This will put cash directly into American鈥檚 pockets and boost consumer spending. We鈥檒l make up the revenue shortfall by applying Social Security taxes to incomes over $500,000.
Second, we鈥檒l recreate the WPA and Civilian Conservation Corps 鈥� two of the most successful job innovations of the New Deal 鈥� and put people back to work directly. The long-term unemployed will help rebuild our roads and bridges, ports and levees, and provide needed services in our schools and hospitals. Young people who can鈥檛 find jobs will reclaim and improve our national parklands, restore urban parks and public spaces, recycle products and materials, and insulate public buildings and homes.
Third, we鈥檒l enlarge the Earned Income Tax Credit so lower-income Americans have more purchasing power.
Fourth, we鈥檒l lend money to cash-strapped state and local governments so they can rehire teachers, fire fighters, police officers, and others who provide needed public services. This isn鈥檛 a bailout. When the economy improves, scheduled federal outlays to these states and locales will drop by an amount necessary to recover the loans.
Fifth, we鈥檒l amend the bankruptcy laws so struggling homeowners can declare bankruptcy on their primary residence. This will give them more bargaining leverage with their lenders to reorganize their mortgage loans. Why should the owners of commercial property and second homes be allowed to include these assets in bankruptcy but not regular home owners?
Sixth, we鈥檒l extend unemployment benefits to millions of Americans who have lost part-time jobs. They鈥檒l get partial benefits proportional to the time they put in on the job.
Yes, most of these measures will require more public spending in the short term. But unless we get this economy moving now, the long-term deficit problem will only grow worse.
Some in Congress will fight against this jobs plan on ideological grounds. They don鈥檛 like the idea that government exists to help Americans who need it. And they don鈥檛 believe we all benefit when jobs are more plentiful and the economy is growing again.
I am eager to take them on. Average Americans are hurting, and their pain is not going away.
We bailed out Wall Street so that the financial system would not crash. We stimulated the economy so that businesses would not tank. Now we must help ordinary people on the Main Streets of America 鈥� for their own sakes, and also so that the real economy can fully mend.
My most important goal is restoring jobs and wages. Those who oppose me must explain why doing nothing is preferable.
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