Robert Reich: The President's Job's Initiative Doesn't Measure Up

[Better Believe It]

The President's Job's Initiative Doesn't Measure Up
By Robert Reich
December 8, 2009

Barack Obama is trying once again for balance. On the one hand, he wants enough government spending to offset the timid spending of consumers and businesses. Otherwise, the jobs and wage recession could drag on for years. On the other hand, he doesn't want to set off more alarm bells about the budget deficit. Otherwise, conservative Democrats might join forces with Republicans to block heath care. So what does he do? A little bit more stimulus spending, but stimulus spending that doesn't look like more stimulus because it's not really adding to the deficit. It's coming out of savings from money already authorized to be spent on the bank bailout. Hmmm?

No president in modern times walks a tightrope as exquisitely as this one. His balance is a thing of beauty. But when it comes to this economy right now -- an economy fundamentally out of balance -- we need a federal government that moves boldly and swiftly to counter-balance the huge recessionary forces still at large.

Main Street is hurting worse than ever. Ten percent unemployment translates into roughly 18 percent of our workforce unemployed or underemployed. Housing markets are in terrible shape: One quarter of homeowners are paying more each month than their houses are worth; the rates of tardy mortgage payments continue to rise. Thirty percent of American households contain someone who has lost a job and can't find another, and yet almost all households are dependent on more than one wage earner in order to make ends meet. A quarter of all American children are now dependent on food stamps.

There is no reason to tolerate this degree of misery. We know exactly what to do. The government has the fiscal tools to do it. Start by bailing out state and local governments (if Congress would prefer to call it a loan and require payback over the next five years, fine). Renew unemployment and COBRA benefits. Increase federal spending on infrastructure. If we have to, hire people directly. The package should be $400 billion over two years.

We don't know exactly how much the President is proposing to spend, but sources tell me it's in the range of $70 billion, redirected from the $200 billion in TARP savings. The President's small, calibrated attempt to balance a stimulus with deficit reduction will in fact make the deficit worse over the long haul. It postpones the day when we're back to near full employment, when almost all Americans who need a job get paychecks on which they pay taxes. This isn't really balance at all. It prolongs the economic imbalance.

Read the full article at:

http://robertreich.blogspot.com/

[saracat]

1. I guess some will now throw reich under the bus! How dare he critique the Prez!

with this insightful well written OP. K+R

[IndianaGreen]

6. He was already under the bus

on account of health care.

[David Zephyr]

10. +1

.

[paulk]

2. "A quarter of all American children are now dependent

on food stamps."

As Reich points out, our economy is fundamentally out of balance. We don't need a tightrope walker, we need a mover and shaker willing to risk his political career to do what he knows is right. Let us all hope that Obama will become that leader.

[truedelphi]

9. Even if Obama woke up tomorrow, the damage that he has let Bernanke & Geithner do is probably

Not reparable. The money that belonged to Main Street has been moved into the coffers of a few Big Banks on Wall Street, and from there to acquisitions and foreign investments. In fact, they move the money into every and anything, as long as it doesn't help anyone of the middle class.
We are seeing the extermination of our middle class. And there has never been a democracy without that class being prosperous!

[paulk]

13. at this point, "hope" is all we really

have left...

[Thrill]

3. Doesn't measure up? He didn't even say what he was going to do yet?

lol

[Better Believe It]

5. More tax cuts! That's the ticket! Obama clearly said "we don't have enough public dollars" to

provide the number of jobs we need. That's total nonsense. We can spend hundreds of billions of dollars right now to create several million jobs in new and important public works projects.

[IndianaGreen]

7. Obama: Money for wars. No money for people!

Change You Can Believe In!

[Thrill]

12. You must have missed the speech today

Or did you only focus on tax cuts for small business?

[IndianaGreen]

14. Robert Reich thinks Obama's job initiative falls short of the mark

We don't know exactly how much the President is proposing to spend, but sources tell me it's in the range of $70 billion, redirected from the $200 billion in TARP savings. The President's small, calibrated attempt to balance a stimulus with deficit reduction will in fact make the deficit worse over the long haul. It postpones the day when we're back to near full employment, when almost all Americans who need a job get paychecks on which they pay taxes. This isn't really balance at all. It prolongs the economic imbalance.

http://robertreich.blogspot.com/

[Better Believe It]

15. Three kinds of tax cuts! A capital gains tax cut for starters! The unemployed are really

excited about that! Sounds like it's out of Newt Gingrich's playbook .... the old capital gains tax cut. Remember that?

And a tax cut for employers who hire people. Of course, as many economists have pointed, employers will only hire people that they really need to get their work done. They will hire these people with or without a tax incentive. They won't spend money on hiring and increasing payroll for employees they don't need just to qualify for some tax cut. So how many billions will be wasted on that project?

And a tax cut for weatherizing! Of course, if you're out of work, have taken a big pay cut or just need to hang on to your money until better times, you won't be spending thousands of dollars to take advantage of that incentive.

We need to spend hundreds of billions of dollar in government funds to put people back to work. It's long past time for bold plans.
Conservative half measures won't get the job done. The government has the money for bold, big and many public works projects contrary to President Obama's false claim that "we don't have enough public dollars".

He's had no problem finding trillions of dollars for Wall Street and foreign wars. And President Obama says the government has funds to give the private health insurance industry nearly a trillion dollars in money to "help" individuals buy private insurance policies! A trillion dollar handout with millions of new customers. We can afford that, no problem!

If President Obama is really serious about creating jobs and isn't taking his marching orders from Wall Street, the insurance industry, big Pharma and corporate America there should be no problem with "finding" the funds. The Secretary of the Treasury can help him find that money.

Of course, President Obama has already warned us that the government will be looking carefully next year at Social Security and other so-called "entitlement" benefits. Do you think they plan on expanding and increasing those benefits?

[truedelphi]

16. I have a belly full of his speeches. They usually end up sounding great -

A mesmerizing orator employs lofty rhetoric in a fabulous way.

But in the end we are handed the exact opposite of what we are promised.

However, should you hear that he is about to address the nation regarding the elimination of Bernanke, Rubin, Summers, Kissinger or Geithner from their appointed slots, pls give me a PM

That would be one speech I would be glad to listen to.

[polichick]

4. In short: Wouldn't it be great if the prez acted less like a calculating politician...

...and more like a wise leader?

[xchrom]

8. recommend

[David Zephyr]

11. K&R.

On the mark from someone who should be on Obama's Cabinet right now.