Revised 6/28/08

Ask the candidates:

"How can you turn

the economy around  for everyone?"

•  Create a better future with millions of good jobs.

•  Strengthen economic security.  Moderate the costs  
    of energy, health care and higher education. 

•  Get wages moving up again for middle class and
    working people.  

Can this be done?  YES.

Contact them.

Call, write, fax, email or meet in person.  Let them know how this affects you and people you know.

(For names and links: U.S. Senate - www.dscc.org, www.nrsc.org;
U.S. House - www.dccc.org, www.nrcc.org.  
President: www.BarackObama.com,  www.JohnMcCain.com.)   

Write letters to the editor.

(Google: "[name of your newspaper], letters to the editor" or see www.50states.com/news/)

Eliminate corporate domination of public programs, such as trade deals that shortchange workers and the environment, Medicare subsidies for private HMO's and farm programs that primarily benefit big agribusiness.   

Implement a publicly-financed election system.  Take money out of politics.   

End the era of easy political promises.  "Make it work as you go" should be the guiding principle of major federal initiatives.  The public expects results.     

• Boost the economy and create millions of jobs by rebuilding America.  Invest in job-creating industries, like alternative energy, and essential public needs, such as transportation and education. 

Substantially increase long-term federal investment to rebuild our society's foundations. We cannot create enough good jobs in the near future, or a decent society for our children[1], unless we reverse 3 decades of disinvestment in America[2].  

Pay for it by ending the war in Iraq, cutting unnecessary military spending, returning to the kind of fair tax system we had for 30 years after WWII and reducing tax avoidance.  

• Strengthen economic security for all our people.

Moderate the cost of living with major initiatives to focus American ingenuity and political will on better methods to provide and finance energy, health care and higher education.  To start, crack down on prescription drug prices and significantly expand college student aid.    

Return to America's neglected task of building a decent foundation of security for all, as proposed in FDR's Economic Bill of Rights[3].  Enact universal health and a minimum wage of $9.50[4].  Get started on expanding job training, unemployment insurance, day & family care, flex-time and minimum vacations.  Strengthen Social Security with sensible fixes, not benefit cuts[5].  Create universal investment accounts with a cash benefit at birth[6].  Expand opportunities for employee ownership. 

Invest to bring all who are left out into full partnership in our economy[7].  

Enable earned citizenship for undocumented immigrants already here, moderate the flow of new ones, and reject the "guest-worker" concept (which would depress wages).    

• Get wages moving up again; restore the freedom to join a union. 

Unions raise wages an average of 14.7%, provide a 28.2% better chance of employer health benefits and 53.9% better chance of pensions[8].  They are America's greatest single force for economic justice and are key to passing progressive legislation. 

53% of non-union workers want to join a union[9].  Many are stopped by illegal corporate practices and intimidation. 

• Steer the economy toward economic well-being for all. 

Re-regulate the financial sector to prevent a long, deep recession.  Bail out ordinary people, not just Bear Stearns.  Stop the abuse of consumers.  

Put the Federal Reserve Board back in the business of promoting full employment and the public interest. 

• Our economy can create millions more jobs than it has since 2001. 

"The starting point must be full employment, since only then do workers everywhere have the power to bargain increased wages that equal productivity growth. - - The best measure of full employment is when wages rise with productivity." [10]

The Bush administration added only one-third the jobs of the previous administration (Bush - 72,000/month or 5.8 million total; previous - 237,000/month or 22.7 million in total).[11]   

• Public investment has always been central to creating the conditions for economic growth and jobs. 

Government financed the Erie Canal, sea and air ports, free public schools, land grants to help railroads and colleges grow, public sanitation (which dramatically reduced disease rates), interstate highways, nearly half of all semi-conductor research from the late 50's to early 70's and billions of dollars worth of biomedical advances, among others.[12] 

Rolling back the recent tax cuts for the wealthy will not be enough to rebuild America.  The total "pot" of money for all "domestic" needs has been shrinking since the 1970's (as a percent of national economic output or "GDP")[13] (i.e. for alternative energy, transportation, education, housing, science, cities, the environment, social services, medical research etc.).  The trend of federal investment in major physical "infrastructure" (roads & bridges etc.) plus education and training has declined significantly since the early 80's.[14] 

We can afford the things we need.  We can generate approx. $880 billion per year (32% of total federal spending in ‘07) if we: 1. Restore the level of tax fairness we had for 30 years after World War II.  2. Cut unnecessary military spending while building a smarter defense system.  3. Hire more IRS auditors to crack down on corporate and high-income tax evasion schemes.[15]  

But there will not be a mandate for a major increase in domestic spending unless the White House and Congress implement dramatic changes in the way Washington works.  Despite considerable support for upgraded public services[16], there is deep public distrust of the way decisions are made at the highest levels[17].  Significant new federal initiatives must be opened up to full public view and proven to work effectively, step by step.  

Public policy can stimulate the revitalization of manufacturing to create and save more jobs.[18] 

Government can upgrade millions of low-paid social service jobs by financing better pay and training for day/elder care, psycho-social rehabilitation and other services[19]. 

Tax breaks must be eliminated for oil companies and those that ship jobs overseas, create substandard jobs in the U.S., or create few jobs per public dollar.    

• The labor movement is the largest single counter-force to the power of big business and money, and is essential for passing key economic reforms. 

"It is hard to overstate the constructive role of unions in both the economics and the politics of maintaining a broadly egalitarian economy.  [They] - - equalize wages - - increase labor's share of the total pie, as well as increasing workers' ‘voice'.  - - Unions were the core political constituency for  - - Medicare, Social Security, federal aid to education, financial regulation and the great civil rights acts."[20] 

Unions have been weakened by increasingly intense illegal corporate practices and intimidation, and lax Federal enforcement of labor laws.  The Employee Free Choice Act should be passed[21] to help the 53% of non-union workers who want to join a union. 

92% of employers hold captive audience, anti-union meetings; 78% require anti-union one-on-one meetings between supervisors and supervisees; 49% threaten closing or job reduction; and a quarter fire union supporters.[22] 

• Government must actively steer the overall economy to create the greater economic security and fairness the private sector cannot achieve by itself. 

Excessive de-regulation of the financial sector has put our entire economy at risk.  Complete regulatory overhaul is needed.  We could have prevented the mortgage/debt crisis and resulting economic downturn.[23] 

Negotiating trade deals that are fair for the U.S. as well as our trade partners will save more of our jobs [24] and reduce environmental damage. 

Increase American exports and jobs (including manufacturing) by lowering the dollar against undervalued currencies.  Trade partners that unfairly depress their currencies, thereby raising the price of our goods to their people, should be penalized. 

By requiring our trade partners to honor their workers' right to join unions, their wages will rise with productivity, lowering the wage difference between our country and theirs. 

Mandatory environmental standards will reduce the incentive for corporations to move jobs to countries that tolerate high pollution levels. 

America's 30 year economic expansion after World War II was based partly on the Federal Reserve Board's equal commitment to full employment and inflation control.  But since 1979, it has favored inflation control over full employment (on average).[25] 

Increasing genuine economic aid to developing nations will enable their domestic economies to grow, reducing over-dependence on exports to the U.S.       

• Public policies can raise wages and improve the jobs we already have.

Millions of existing jobs can be improved through strong enforcement of employment laws and the right to join unions, raising the minimum wage to the higher relative purchasing power it once had, mandating paid family leave and minimum vacation; improving safety and health standards (including ergonomics); and creating incentives for company-paid workplace training for all employees (not just the highest paid).

Federal and state initiatives can generate more opportunities for employee ownership[26].    

• Americans have always been capable of building a better future. 

From 1947 to 1973, median family income rose by 103.9 percent due largely to an entire system of national structures built during and after the "New Deal" of the 1930's.  Central to this system were strong enforcement of the right to join unions, a high minimum wage that significantly raised the bottom of the wage scale, increased taxes on very high income levels, and active government intervention between business and labor to promote fairness and the public interest. [27]  This helped build successful programs such as cheap Federal Housing Administration loans that helped many join the middle class, the G.I. Bill to pay for higher education for millions of returning World War II veterans, Social Security, Medicare and others. 

But from 1970 to 2000, "earnings for - - nine Americans out of ten - were almost exactly flat - - $27,060 in 1970 and $27,035 in 2000 (inflation-adjusted 2000 dollars). - - incomes for the top 10 percent - - went up by 89 % - - [and for] the richest one tenth of 1 percent - - 550 percent, from $3.6 million to $24 million"[28]. 

Although globalization has played a part in the recent 30 year trend of flat earnings, more important has been the weakening of public structures (such as those above) to help grow the economy and expand the middle class[29]. 

PLEASE TAKE A LOOK AT THE INTERESTING REFERENCES & LINKS BELOW, CHOSEN PARTLY FOR THEIR EDUCATIONAL VALUE.  

ENDNOTES 

[1] "The big banks cowed Bill Clinton into obsessing over the deficit. But our next president will need to spend, spend, spend", Joseph Stiglitz, former Chairman (under President Clinton) of the Council of Economic Advisors, "Deficit, Scmeficit", Conde Naste Portfolio, May 2008,  http://www.portfolio.com/views/columns/2008/04/14/The-Economy-and-the-Next-President.  Regarding the revenue that would be raised by the Democratic Presidential candidate's tax plan, Paul Krugman says " But while $700 billion may sound like a lot of money, it's probably not enough to pay for universal health care - - - [the candidate] isn't willing to challenge the Bush tax cuts as a whole.", "Fiscal Poison Pill", NY Times, 6/16/08, http://www.nytimes.com/2008/06/16/opinion/16krugman.html?_r=1&oref=slogin.   
Criticizing the U.S.'s current measures to counteract the downturn, Stephen S. Roach, Chairman of Morgan Stanley Asia, says "A more effective strategy would be to try to tilt the economy away from consumption and toward exports - - [with] - - a weaker dollar - - which would strengthen demand for American-made goods - - [and] - - laying the groundwork for future growth, especially by upgrading the nation's antiquated highways, bridges and ports".  "Double Bubble Trouble" N.Y. Times, 3/5/08, p. A23, nytimes.com/2008/03/05/opinion/05roach.html?_r=1&scp=2&sq=Stephen+S.+Roach&st=nyt&oref=slogin  
For a more comprehensive critique, see Ron Blackwell, Thomas Palley, "Winning the Edwards Vote", 2/11/08, www.thomaspalley.com/?p=98#more-98; and "Reviving Full Employment Policy", by Thomas Palley, Economic Policy Institute, Briefing Paper #191, 6/22/07, www.sharedprosperity.org/bp191/bp191.pdf.        

[2] From 1972-81, "domestic discretionary outlays" averaged 4.28% of GDP; from 1997-2006, they averaged 3.32%.  Had the percentage been the same from '97-'06 as from '72-'81, there would have been an additional $127 billion for discretionary domestic spending in 2006, or 27.6% more than the available amount of $460.2 billion.  Calculations from: Congressional Budget Office, The Budget and Economic Outlook: Fiscal Years 2008 to 2017, January 2007, Tables E-7 and E-8, "Discretionary Outlays, 1962 to 2006", pp. 146-147, http://www.cbo.gov/ftpdocs/77xx/doc7731/01-24-BudgetOutlook.pdf.  

[3] President Franklin D. Roosevelt, message to Congress on the State of the Union, January 11, 1944, http://www.worldpolicy.org/projects/globalrights/econrights/fdr-econbill.html

[4] Robert Pollin, Making the Federal Minimum Wage a Living Wage, New Labor Forum, 16(2): 103-107, Spring 2007, http://www.peri.umass.edu/fileadmin/pdf/other_publication_types/Pollin_May_2007_NLF_Column--Making_Federal_Min_Wage_a_Living_Wage.pdf.

[5] "Protecting Social Security's Beneficiaries", Nancy J. Altman, Economic Policy Institute,  11/2//07, EPI Briefing Paper #206, www.sharedprosperity.org./bp206.html.

[6] A savings account for every child, to be used for higher education and a home might be linked to a "Guaranteed Retirement Account" (better than a 401-K).  See newamerica.net/publications/policy/aspire_act_bill_summary; and Teresa Ghilarducci, "Guaranteed Retirement Accounts", 11/20/07, EPI Briefing Paper #204, pp. 8-13, www.sharedprosperity.org./bp204.html.  Hopefully, our American ideals will also bring us to seriously consider making reparations to African Americans for the nearly 200 years of slavery and Jim Crow since 1776, which created a wide, persistent disparity in wealth between white and black families.  See William Darity, Jr., "Forty Acres in the 21^st Century", 2/06, www.igpa.uillinois.edu/lib/data/pdf/FortyAcresMule.pdf and the live presentation at http://rockethics.org/media/mediasite/darity/SupportingFiles/Viewer.html. 

[7] Millions lack full partnership in our society due to income inequality, discrimination, insufficient education, disability, family responsibilities and sexual preference.  If we make the large investments needed to ensure equal opportunity for all, the result will be a much stronger, healthier American community and economy.     

[8] Lawrence Mishel, Economic Policy Institute, "The Right to Organize, Freedom and the Middle Class Squeeze", 3/27/07, pp. 2-4, epi.org/content.cfm/webfeatures_efca_testimony_20070326. 

[9] Richard B. Freeman, "Do Workers Still Want Unions? More Than Ever", EPI Briefing Paper #182, Economic Policy Institute, 2/22/07, p.2, sharedprosperity.org/bp182.html.

[10] R. Blackwell, T. Palley, "Winning the Edwards Vote", 2/11/08, thomaspalley.com/?p=98#more-98. 

[11] Paul Krugman, "Job Growth - Clinton vs. Bush", 10/5/07, coffeerooms.com/bb/showthread.php?t=1329.  Further, "Manufacturing has lost 1.8 million jobs during the [recent] expansion - - which is unprecedented. Before 1980 manufacturing - - hit new peaks [during] every expansion. Since 1980 it has trended down, but it at least recovered somewhat during expansions."  Thomas Palley, "The Fed and America's Distorted Expansion", 9/11/07, www.thomaspalley.com/?p=85#more-85.  

[12] Thomas K. McCraw, ed., Creating Modern Capitalism (Harvard U. Press, Cambridge, MA, 1997), pp. 310-316, 352-353; Jeff Madrick, "Breaking the Stranglehold on Growth", EPI Briefing Paper #192, 6/22/07, pp. 14-18, sharedprosperity.org/bp192/bp192.pdf. 

[13] See 1. (Krugman) and 2. above.

[14] Max Sawicky, "About that Bridge to the 21^st Century", Economic Policy Institute, 4/12/07, slides 7-8, http://www.sharedprosperity.org/av/070412/20070412-sawicky.ppt#256 . 

[15] "Where's the Money to Rebuild America", 11/07, www.fairpriorities.org; Robert S. McIntyre, "Loophole-Consolidation Program", American Prospect, 12/1/03, prospect.org/cs/articles?articleId=6941; "Just Security", Institute of Policy Studies, June 2007, Chapter IX - "Just Security Budget", John Cavanagh, Anita Dancs, Miriam Pemberton, pp. 57-62, www.ips-dc.org/reports/070608-justsecurity.pdf; "Tax Enforcement Crisis Grows", Economic Policy Institute, 4/6/06, epi.org/newsroom/releases/2006/04/060406-taxenforcement-pr-public.pdf.        

[16] Ruy Teixeira, "What the Public Really Wants on Budget Priorities", Center for American Progress, 11/7/07, www.americanprogress.org/issues/2007/11/wtprw_budget.html; Stan Greenberg, James Carville and Kristi Fuksa, Democracy Corps, "Winning the Debate on Taxes and the Economy", 1/15/08, www.democracycorps.com/wp-content/uploads/winning-the-debate-on-taxes-and-the-economy_011508.pdf.

[17] Democracy Corps, "The New Middle Class Populism, An Economic Message Strategy for Democrats", 4/10/08, http://www.democracycorps.com/strategy/2008/04/economic-message-strategy/?section=Analysis.  "This survey reveals a profound tension between Americans' desire for their government to invest in the right priorities and their skepticism that government will do the right thing-a concern primarily due to its blind obedience to the special interests. By a 55 to 39 percent margin, voters believe that government mostly gets in the way of job growth, rather than stimulating it.  - - - Distrust in government centers less on incompetence and more on government catering to special interests and wasting money. - - - Skepticism towards government results in a cutting waste argument trumping an investment argument by 12 points, 55 to 43 percent. Voters want to invest in health care, alternative energy and education, but the government's waste of resources and misplaced priorities push voters to support cutting waste before investing. - - However, when the argument is reformulated to include investment in businesses in order to create jobs, the investment argument prevails over the cutting waste argument." To counteract the deep distrust, the report recommends the following message:  "We need urgent action on the economy to get prices down and keep jobs in America so the middle class can prosper. We have to retake government from the big business special interests that assure wasteful spending on tax breaks for oil and drug companies while the middle class is squeezed by rising costs for gas, health care and college. - - - We have policies that will get gas prices and health care costs down, and we will partner with businesses that want to create jobs here. We will work with both parties to invest in emerging industries and American jobs, particularly alternative energy, solar, wind and bio-fuels. We need new economic policies that work for the middle class." 

[18] "Manufacturing", Agenda for Shared Prosperity, Economic Policy Institute, 2/13/08, www.sharedprosperity.org/topics-manufacturing.html.   

[19] "Here is a very straightforward proposal. Let's have a national policy to make every human-service job a good job -- one that pays a living wage with good benefits, and includes adequate training, professional status, and the prospect of advancement -- a career rather than casual labor."  Robert Kuttner, "Good Jobs for Americans Who Help Americans", The American Prospect, May 2008, p.31, www.prospect.org/cs/articles?article=good_jobs_for_americans_who_help_americans

[20] Robert Kuttner, The Squandering of America (Knopf, New York, 2007), p. 54. 

[21] For information on the Employee Free Choice Act, see http://www.americanrightsatwork.org/employee-free-choice-act/resource-library/why-workers-need-the-employee-free-choice-act.html. To take action, see http://www.unionvoice.org/campaign/signthe_EFCA_16.

[22]Dr. Kate Bronfenbrenner, "Uneasy Terrain", Cornell University School of Industrial and Labor Relations, Submitted to the U.S. Trade Deficit Review Commission, 9/6/2000, Tables 7-8, govinfo.library.unt.edu/tdrc/research/bronfenbrenner.pdf.

[23] Robert Kuttner, ibid., Chapter Five; Paul Krugman, "Blindly Into the Bubble", N.Y. Times, 12/27/07, www.nytimes.com/2007/12/21/opinion/21krugman.html. 

[24] Jeff Faux,  "Globalization that works for working Americans", Economic Policy Institute, EPI Briefing Paper #179, 1/11/07, www.sharedprosperity.org/bp179.html; Robert Kuttner, ibid., p.97.   

[25] Thomas Palley, "Reviving Full employment policy", Economic Policy Institute, Briefing Paper #191, 6/22/07, p. 5, www.sharedprosperity.org/bp191/bp191.pdf.

[26] "Employee Stock Ownership Plans (ESOP's)", Community-Wealth.org, http://www.community-wealth.org/strategies/panel/esops/index.html; "Largest Study Yet Shows ESOPs Improve Performance and Employee Benefits", http://www.nceo.org/library/esop_perf.html.

[27] Frank Levy and Peter Temin, "Inequality and Institutions in 20th Century America", NBER Working Paper #W13106, May 2007, pp. 15-30, http://papers.ssrn.com/sol3/papers.cfm?abstract_id=984330.  For example, "Roosevelt's clear goal was to compress the income distribution using unions and the minimum wage to raise low incomes while using tax rates and moral suasion to hold down incomes at the top" (p. 18).

[28] Robert Kuttner, ibid., pp. 20-21.

[29]  R. Blackwell, T. Palley, "Winning the Edwards Vote", 2/11/08, www.thomaspalley.com/?p=98#more-98.  For a similar viewpoint with substantial data to support it, see Frank Levy and Peter Temin, (reference #23 above), pp. 31-42, esp. 34 & 35.   For example, "The firing of the air traffic controllers, combined with the 1978 defeat of labor law reform were signals that the third man-government-was leaving the ring.  From that point on, business and labor would fight over rewards - - with most workers in an increasingly weak position.   - - With Reagan's strong backing, Volcker's [Federal Reserve Board Chairman] policy reduced inflation far more rapidly than most economists had predicted.  - - But by 1982, Reagan's tax cuts, combined with little expenditure reduction had led to projections of large future deficits.  [As a result] Financial markets - - kept interest rates high - - [which] increased global demand for U.S. securities and the dollars required to buy them. - - the trade-weighted value of the dollar rose by 55 percent.  - - U.S. durable manufacturing firms - a pillar of private sector unionization - were hit first by the deep recession [created by Volcker's policies] and then by the high dollar that crippled export sales" (p.34).