The Progressive Caucus Budget for All, the embodiment of the progressive vision for rebuilding the economy, was voted down overwhelmingly on the House floor Thursday. But that vote was just the beginning of what should be an epic debate over the choice between conservative policies that are crushing the middle class and the change of course that will revive it.
In fact, Sen. Tom Harkin, D-Iowa, took that debate to a new stage on Thursday when he introduced his Rebuild America Act, a bill that shares many of the basic principles and specific proposals of the Budget for All.
Harkin said he knows that if his budget proposal were put to a vote, it would meet the same fate as the Budget for All in a Congress dominated by conservatives and the timid. For a broad segment of the American public, however, he said his bill would satisfy a hunger for real solutions to the continuing economic stagnation trapping working-class and middle-class people.
“We’re not getting to the root of our problems and I think rather than appealing to transient, emotional fervor we really ought to have a more serious dialogue about the essence of our economy,” Harkin said. “What is our economy? How do we want to proceed?”
Harkin said much of the American public would support the progressive solutions embraced in the Rebuild America Act. “I firmly believe that anyone running for office, if they were to take up this bill, or if they take up the direction of this bill … that it will be a winning formula for anyone running this year,” he said.
The key components of Harkin’s bill include:
- $300 billion for investments in upgrading roads, bridges, and energy efficiency systems.
- $20 billion in formula grants for the modernization, renovation, and repair of early learning facilities, K-12 public schools, and community colleges.
- Funds for state and local governments to hire teachers, cops, firefighters and other critical employees.
- Grants to states to provide professional development to teachers and other school personnel.
- Challenge grants to regional partnerships of businesses, schools, labor, and economic development officials to train workers for well-paying jobs of the future.
- A national manufacturing strategy, with measures to strengthen American manufacturers and workers so that they can better compete in the global economy.
- Improvements in Social Security benefits and the private pension system so that more Americans can count on a steady stream of retirement income they will not outlive.
- An increase in the minimum wage and measures that would ensure that workers don’t have their jobs improperly classified so that they are ineligible for overtime pay, and would mandate that workers receive up to seven paid sick days a year.
To ensure that the wealthy pay their fair share of taxes, the Harkin bill would institute the “Buffett rule” that unearned income be taxed at the same rate as earned income. The legislation would also include a Wall Street transaction tax of 3 cents per $100 of trading, would close loopholes for companies that ship jobs overseas, and would improve protections for the 44 million Americans with defined-benefit pension plans.
Robert Borosage, the co-director of the Campaign for America’s Future, has embraced the Harkin bill. “Harkin’s bill is common sense. If we want to rebuild the American middle class and revive the American Dream, we have to invest in areas vital to our future – a modern infrastructure, modernizing our schools, investing in education and training for 21st century jobs. And we have to be serious about a national manufacturing strategy so we make things in America once more. And, as Harkin’s bill shows, we can afford to do this, with sensible and fair tax reform.”
To help speak on behalf of his plan, Harkin called on Nick Hanauer, owner of a Seattle-based venture capital firm who took apart the conservative ideology underlying the House Republican budget with the skill of a fisherman with a fillet knife.
“For 30 years, politicians and the press, it should be said, have been enthralled with the terrible and mistaken idea—you can call it trickle-down economics, you can call it supply-side economics, call it what you will, but the idea that rich business people like me are job creators in our economy and that the economy essentially revolves around this small number of rich people, is completely and totally mistaken,” Hanauer said.
“The idea that the better the very rich do, the better everyone else will do, is an idea that, you know, if you still buy that you need to have your head examined,” he continued. “f it was true, if there was a shred of truth to the idea that the richer the rich guy gets and the lower their tax rate goes, the more [growth] we’d have now, then today you would be drowning in jobs. If there were a shred of truth to the claim that the lower the tax rates were on corporations [the more growth there would be], then it could not also be true that corporate taxes are at a 40-year low and unemployment is at a 50-year high. If it was true that the more profitable corporations were the more employment that we would have, it could not also be true that corporate profits are at a 50-year high and unemployment and underemployment is also at a 50-year high. All of this is utter nonsense and I’m here because this bill is a step in the right direction.”
“I started dozens of companies and initially hired lots of people but if there was no one around to buy what we had to sell all those jobs and all those companies would have evaporated. In that sense, middle-class consumers are the true job creators in our economy, and our single-minded goal has to be to support them,” he said.
Hanauer later added, “The problem isn’t that the economy isn’t fair enough. The problem is that the economy is structured to die.” To turn that around, higher taxes on millionaires and billionaires are necessary so that those resources can be reinvested in the essentials of a growing middle class.”
As Harkin put it, “As we say in the Midwest, you don’t fertilize a tree from the top down. you fertilize the roots.”
And yet, in defiance of that bit of folk wisdom, House Republicans today embraced a budget that enriches the wealthy and impoverishes the 99 percent, while there was a bipartisan rejection of a budget that would lead to prosperity for everyone because it would fertilize the roots of the economy: the millions of Americans who have suffered because of decades of conservative misrule.
One vote can’t be allowed to end this debate. Harkin’s Rebuild America Act and the Progressive Caucus Budget for All together, though they differ in detail, present a bold vision for an America in which the American Dream is back within the reach of ordinary Americans. What we need is enough people bold enough to capture the vision and fight for it in the coming months.
This post was updated to correct a quote from Nick Hanauer.