President Obama’s team made it clear months ago that he will brook no talk of a “second stimulus” at a time when the first stimulus is under significant criticism—from the right, to be sure, but also from the left. Nonetheless, Thursday’s announcement of a White House jobs summit offers an opportunity to reset the political conversation on building an enduring recovery for the 17.5 percent of Americans who are unemployed and underemployed.
It matters where that conversation starts. When Obama disclosed news of the summit at White House, Campaign for America’s Future co-director Robert Borosage issued this statement:
The jobs summit should consider both immediate and long-term strategies. Next year, the Congress should act to create jobs immediately – creating urban and green jobs corps to put young people to work, aiding states and localities to forestall layoffs of police and teachers, expanding investments in new energy, in retrofitting buildings, in transport and infrastructure to boost economy over the course of the next two years.
At the same time, the president should use the summit to begin defining what the engine of growth will be in the economy that we build out of the ruins of the old. Consumers will not go back to spending more than they earn. With a falling dollar, exports could play a bigger role. But the main engine will be public-investment-led growth, featuring a bold commitment to make the transition to new energy the centerpiece of a long-term economic strategy. This can be deficit-funded while the economy recovers, but should be paid for by progressive taxes over the long-term.
The political right would rather focus the conversation on another number—$12 trillion—which is what the national debt will be by early December. Concern over the deficit constrained the size and ultimate effectiveness of the American Recovery and Reinvestment Act, which has arguably kept unemployment from getting worse but has yet to prove to a lot of people outside the Beltway that it is actually improving the Main Street economy. If anything, our experience with that stimulus plan—split between one-third tax cuts and two-thirds inadequate spending on such items as infrastructure—tells us that our economic malaise needed to be treated like a serious infection: Only a fast, hard and consistent attack works; anything less allows the disease to fester and become harder to treat.
News of the summit comes at a propitious moment. Senate Majority Leader Harry Reid has said that his top priority now, other than getting a health-care reform bill passed, is to get job-creation legislation passed. John Nichols writes in The Nation that Reid and his fellow Democrats can borrow from proposals that are already on the table in the House, including Oregon Democratic Rep. Peter DeFazio’s plan to fully fund a surface transportation reauthorization for our highways and mass transit with the aid of a crude-oil transactions tax. (Bill Scher has included links to some other ideas from progressive leaders in today’s “Progressive Breakfast.”)
The news also hits an American public that is dispirited by the state of the economy—only 39 percent of the people interviewed in a Pew Research Center poll this week see the economy improving next year—and the Wall Street bailouts, which a majority of the people in a CBS News poll saw as solely benefiting the bankers at the expense of the taxpayers.
But President Obama still has significant political capital, and he can use it to build consensus around an investment economy agenda: Rebuild the nation’s public commons, fuel the transition to the green economy, restore manufacturing as a critical building block of restoring middle-class prosperity. Those who have reaped he most from our economic policies should be asked to contribute the most to its continued security.