Commentaries

March 23, 2011

Stale economic ideas fueling U.S. troubles

 

Tsunami, earthquake and nuclear horror in Japan. Revolution throughout the Middle East. Grim austerity in much of Europe. America scarred by 25 million people in need of full-time work, and by pressure on wages and benefits. In Egypt, the unemployment of one in four young people led directly to the uprising. In the United States, unemployment among young people nears that level.
 
We live in troubled times.
 
In America, we learn how corporate corruption and government timidity delayed action on the nuclear plants in Japan, worsening the crisis and putting lives at risk. But aren’t we in this country facing our own tsunami choice? We’re in crisis. Fundamental changes are needed. Yet both parties in Washington seem divorced from the reality that faces us. Both seem to assume there is a recovery, and are turning to how much to cut from the federal budget. Both seem to assume that America can go back to the economy that we had before the Great Recession.
 
But for working families, there is little sign of a recovery. Jobs are still scarce; homes are still under water and being foreclosed upon; wages and benefits are still being cut, and vital public services are being dismantled.
 
Our old economy cannot — and should not — be recovered. It was built on unsustainable disparities such record trade deficits, Gilded Age inequality and a declining middle class. Wall Street’s bubbles overwhelmed the real economy.
 
If we are to rebuild a strong economy with a broad middle class and the opportunity for all to participate in its widely shared blessings, then wrenching and fundamental changes are needed. Consider even a partial list:
 
We must transform our energy system, for global warming is accelerating faster than even the alarmists predicted. This requires a bold strategy for building solar and wind energy, deciding about nuclear power, retrofitting homes and buildings, transforming our transportation system and much more. Yet, in Washington, denial dominates the Republicans in the House. The result is that little progress is being made.
 
We must rebuild our ability to make things in America, and dramatically change our global strategy. That will require unilateral steps at home and an intense global dialogue to reduce imbalances that all agree can’t be sustained. Yet, Washington is repackaging old trade accords, ignoring ever more aggressive Chinese mercantilism and watching as the trade deficit begins to rise again.
 
We must empower workers to capture a fair share of the profits and productivity they produce. Without a broad middle class, there is neither sufficient demand to make the economy work nor sufficient revenue to support vital government services. Yet in Washington, the debate focuses on lowering top tax rates even more, and on protecting tax breaks to the richest Americans.
 
Instead of debating ways to empower workers, Republican governors across the country are leading an attack designed to strip workers of their basic rights to bargain collectively.
 
We must fix our health care system or it will bankrupt everything. Yet, House Republicans argue only for repealing the reforms that began to curb the excesses of the insurance companies that drive up prices.
 
We need a clear strategy for moving to full employment. The largest and most diverse generation in American history is graduating into the worst jobs market since the Great Depression. We cannot afford to squander their talent, their energy and their hopes. And yet, in Washington, their plight is simply ignored.
 
There is more — spending less policing the world in order to rebuild America, curbing the big banks, revitalizing our schools, sensibly getting our books in order. But it is as if we are in an old movie house with a broken projector endlessly repeating the same scenes. House Republicans argue for returning to policies like deregulation, top end tax cuts and attacks on workers that drove us into the mess. Democrats remain compromised and divided.
 
So for those American commentators who decry the Japanese corporate corruption that impeded response to the nuclear disaster, one word of advice: Do not throw that stone without looking at the glass around you.