With the hostage crisis behind him, the President is now ready to talk about the nation's real problem.
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Nine paragraphs into his remarks today announcing the nation has paid
most of the ransom the radical right demanded as a condition for
maintaining the full faith and credit of the United States (he didn't
use these exact words), the President pivoted to the agenda he should
have been talking about all along:
"And in the coming months I'll continue also to fight for what the
American people care most about: new jobs, higher wages, and faster
But what precisely will he fight for now that the debt deal has tied his hands?
He says he wants to extend tax cuts for middle class families and make sure the jobless get unemployment benefits.
Fine, but the new deal won't let him. He'll have to go back to
Congress after the recess (five weeks from now) and round up enough
votes to override the budget caps that now restrict spending. What are
the odds? Maybe a little higher than zero.
He says he wants an "infrastructure bank" that would borrow money
from private capital markets to pay private contractors to rebuild our
nations roads, bridges, airports, and everything else that's falling
Fine, but the new deal he just signed may not let him do this either --
if the infrastructure bank relies on federal funds or even federal loan
guarantees to attract private money. The only way he could create an
infrastructure bank without sweetening the pot would be by privatizing
all the new infrastructure. That means toll roads and toll bridges,
user-fee airports, and entry fees everywhere else.
Apart from its potential unfairness to lower-income people, such a
privatized infrastructure would have the same effect as a tax increase.
After paying more for roads and bridges and all other infrastructure,
Americans would have less cash for to spend on goods and services. That
means no boost to the economy.
The President also wants to complete trade deals and reform the
patent process. These may make the economy slightly more efficient, but
they're not going to have any perceptible positive impact on the lives
of the 26 million Americans who are now either looking for work, working
in part-time jobs but needing full-time ones, or have given up looking.
More importantly, the deal he just signed makes it impossible for the
President and Democrats to launch any major jobs program -- no WPA or
Civilian Conservation Corps, no major lending program to cash-starved
states and locales, no new help for distressed homeowners, and so on.
"We've got to do everything in our power to grow this economy and put
America back to work," the President says, now that the hostage crisis
But the sad truth is he and the nation remain hostage to the ideology
of right-wing Republicans who won't let the government spend more
money. Yet if the government can't spend more -- at least this year and
next, until the pump is primed and the economy is growing again -- we
won't see job growth. And without job growth, the economy will remain
That's why even the stock market is reacting badly to the end of the hostage crisis.
If you hadn't noticed, the number of people unemployed or
underemployed keeps growing. (We'll know Friday how many it added in
July, but remember it needs to add 125,000 a month just to keep up with
the growth of the labor force. Anything below 125,000 means we continue
to slide backward.)