Why Being 'On The Right Track' Isn't Enough
Robert B. Reich
Dear Mr. President:
So far your election strategy can best be summed up as: "We're on the right track, my economic policies are working, we still have a long way to go, but stick with me and you'll be fine."
I'm afraid this won't be enough to win you the election. The recovery is too anemic, and the chance of an economic stall between now and
Only 33 percent of the public thinks the economy is improving, while 39 percent say they're still falling behind financially -- an 11-point increase from 2008. Nearly two-thirds are concerned about paying for housing, and 23 percent of Americans with mortgages say they're underwater.
If the economy stalls, Romney's empty promise will look even better. And I'd put the odds of a stall at 50-50.
But the biggest worry is domestic demand here in the U.S. Because most Americans' real pay continues to drop, they're going deeper into debt and tapping into their savings. Inevitably they'll have to cut their spending. Without sufficient government spending to make up the difference, total demand will shrink, causing employers to pare hiring. March's disappointing jobs report could mark the beginning.
This puts the odds of a Romney presidency far too high for comfort.
You have to go beyond "we're on the right track" and offer the nation a clear, bold strategy for boosting the economy. This would help inoculate you if the economy slows. It would also provide you with an economic mandate for your second term.
What might such a strategy entail? I'd advise you to focus on four items:
First, demand that the nation's banks modify mortgages of homeowners still struggling in the wake of
Threaten that if the banks fail to provide meaningful relief, in your second term you'll fight to resurrect the Glass-Steagall Act that used to separate investment from commercial banking, and you'll seek to break up
Second, stop oil speculators from raising gas prices. Numerous studies show that speculation by U.S. index-fund traders has been raising gas prices by up to
Push the CFTC to set those limits, and instruct the
Third, make it clear you won't allow government spending cuts to take precedence over job creation. You won't follow
Instead, you'll make further job-creating investments in the nation's crumbling infrastructure, and renew your call for an infrastructure bank.
Finally, make sure Americans understand the link between the fragile recovery and widening inequality. As long as so much of the nation's disposable income and wealth goes to the top, the vast middle class lacks the purchasing power to fire up the economy.
That's why the Buffett rule you've proposed -- setting a minimum tax rate for millionaires -- is just a first step toward ensuring that the gains from growth are more widely shared. Vow to do more your second term.
Such an economic strategy -- forcing banks to help distressed homeowners, stopping oil speculation, boosting spending until unemployment drops to 5 percent, and fighting to ensure economic gains are widely shared -- is critical to jobs and growth.
But to put it into effect, you need a
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Why Being 'On The Right Track' Isn't Enough | Politics
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