The White House announced its economic initiatives for middle class families, described as a preview of the State of the Union Address. They're all good ideas and I hope every one of them passes. But something is missing.
Mostly, the new initiatives don't create jobs. Doubling the child tax credit, limiting student loan payments to ten percent of income, expanding tax credits to match retirement savings they're just relief. They are designed to help underpaid or unemployed people to cope when they don't have enough money. They don't create jobs or generate wealth.
Many people are hoping for more. Both middle class people looking for work, and activists looking for something to fight for.
The House of Representatives started the ball rolling with a $154 billion jobs bill in December, with half the money coming from TARP. At a minimum, Obama could help push this bill through the Senate.
More robust economic packages are out there, on the shelf, ready to be used. The AFL-CIO jobs plan puts people to work rebuilding our crumbling roads and bridges, and laying new track for high speed rail. It covers the basics like aid to the states so they don't have to lay off teachers and fire fighters
The Economic Policy Institute offers a similar plan with greater detail. Rebuilding our infrastructure and offering public service jobs when the private sector fails, EPI estimates the plan will create over 4.6 million jobs in the first year, at a gross cost of roughly $400. The entire cost would be recouped within ten years by a financial transactions tax, which would take effect three years after enactment.
The hole we're in was many years getting dug. Unfunded wars and supply side tax cuts created trillion dollar deficits. Conservative deregulation turned our banks into gambling houses and crashed the whole economy. Many years will be needed to dig our way out. The Recovery Act was one small step in the right direction.