Without jobs, people lose hope. Without hope, there is no future.
Millions of Americans have lost their jobs this year in the aftermath of the Wall Street collapse. Good jobs continue to disappear. Millions of young people leaving high school and college this year aren't finding jobs. This is the nation's No. 1 crisis, because without jobs, people lose their homes. They stop buying medicine. They go to bed hungry. They lose hope.
President Barack Obama started his presidency with a large-scale recovery act that has helped to slow the job loss. But nine months into the stimulus, with double-digit unemployment, we need a full-scale emergency relief plan that goes much further.
In a new study, our organizations (the Institute for Policy Studies and Jobs with Justice) have joined with the Center for Community Change and Legal Momentum to offer a plan to turn the country around. We suggest three initiatives that will bring good jobs and a sense of security back to our nation for roughly $400 billion.
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First, we need a public jobs program like the programs of President Franklin D. Roosevelt's New Deal. This is vital because the private sector isn't going to step up to the plate. Corporations are cutting costs wherever they can and are squeezing more work out of the existing work force. The government can create good new jobs for about $40,000 a year per person that allow workers and their families to lead healthy, stable lives. It could create about a million new jobs for $40 billion. Most of the jobs could be for the critical "green" transition this country needs to address the climate crisis.
Second, the federal government must drive money to state and local governments, whose tax base has collapsed in this crisis. They need about $270 billion to cover their projected deficits next year and to save millions more jobs that are vital for community services.
Third, the "safety net" programs that keep people alive in this country require a $100 billion funding boost. One in eight Americans now get food stamps. We need an outreach program to help reach the 15 million to 16 million Americans who qualify for food stamps but have yet to sign up. We'll need roughly $60 billion more in 2010 to maintain unemployment insurance for those who have lost their jobs. An additional $20 billion to help the jobless pay for health insurance. And our flawed "welfare" program for "needy families" requires additional funds, even though it reaches only a fraction of those in need.
This frayed safety net needs fixing in the long run. In the short run, it needs more money.
Clearly, we can't borrow forever to pay for these programs. That's why we also propose fair tax proposals that would raise the same amount of revenue we propose be spent with common-sense steps that place the burden of costs on those who created the crisis. For example, a small tax on the buying and selling of stocks on Wall Street could generate $150 billion and discourage the financial shenanigans that triggered the current crisis. Raising the top tax rate back to what it was when President George W. Bush took office could raise tens of billions dollars more.
The economic crisis we're in didn't fall from the heavens. It resulted from 30 years of Wall Street pressing government to free it from critical regulations. By last year, Wall Street was far removed from responsible lending practices. It resembled a vast casino without rules. We need to close the casino so that financial institutions can go back to lending to the firms that should be creating the bulk of good jobs in this country.
A bold jobs plan will put people back to work. It will keep hope alive.