The Economy

Robert P. Watson

A sad truth is that the nation is less optimistic about our future today than when George W. Bush took office in 2001… and rightfully so given what passed for leadership during much of the past decade. On balance, a record 1.7 million private sector jobs were lost during President Bush’s first term. Only an increase in public sector employment helped stave off even worse figures. In the latter half of 2008, thousands of jobs were lost each month.

America’s manufacturing industries, for example, lost 2.7 million jobs. And the bleeding continues. In the past few years General Motors laid off 25,000 employees, Hewlett-Packard released 16,000 of its employees to stay in business, and Winn-Dixie supermarkets closed 900 stores. Household incomes can’t keep pace with inflation, as the average American family’s earnings are down roughly $1,500 since George W. Bush took the oath of office, young people are more in debt than ever because of a lack of jobs and escalating college costs, and seniors on fixed incomes are pinching pennies. The failures of Wachovia, Washington Mutual, AIG, and other banking and insurance giants, along with the housing crisis of 2008, brought the nation into recession. But you already know this…

Two principles should guide any plan for prosperity – fairness and responsibility. A fairness doctrine must guide economic policy in terms of extending economic opportunity to all Americans and growing the economy in a way that benefits everyone, not just a select few. For instance, during Bush's presidency, the gap between rich and poor widened with the hyper-rich benefiting the most during the Bush years. The top one-tenth of one percent of the country did better than any other group in America, the top 10% increased their wealth somewhat, but the remaining 90% of America saw their earnings fall.

Is it fair that those earning more than $10 million per year now pay a smaller share of their income in taxes than those making $100,000 - $200,000 per year? Is it fair that the highest 400 incomes in the country (those making over $87 million per year in 2000) now pay the same percent in taxes on income, Medicare, and Social Security as those making $50,000? Not only is it unfair, but it is not good for the economy.

We must all recognize that each of us has a role to play in the economy, and that includes corporations and corporate CEOs. Our business leaders, like Congress, have been largely missing in action on important issues such as Social Security and the escalating costs of healthcare. Many captains of industry in an earlier day and age rose to the call of social responsibility by acting as stewards to the community and fathers to their employees. But too many business leaders today bail out with golden parachutes, leaving behind wrecked employee pensions and federal investigations.

To lead in the global economy we need a strong economy, a healthy citizenry, prosperous communities, and a quality educational system. No one should be arguing for these more than our business leaders. They are well educated, have benefited from our economic prosperity, and are the ones whose businesses depend on affordable, quality healthcare, retirement security, and educational excellence. It is time for them to step up to the plate.

Social responsibility is more than consumers trying to "buy American" or "buy local," it is also good business practice for the businesses themselves to serve their customers and their communities. A number of companies have donated to charitable causes, established on-site child care, improved their records on hiring women and minorities, and so on. But there is another facet to social responsibility…

GM’s layoff of 25,000 employees should be put in the context of their inability to compete with foreign competitors who have unfair advantages. It is estimated that roughly $1,500 in healthcare costs goes into every GM car, meaning there is more healthcare than steel in each car. I am certain that GM would rather not be in the healthcare industry in order to focus on making automobiles. Their Japanese, Korean, and German competitors benefit by being in nations that provide universal healthcare. It is time for companies like GM to embrace single-payer universal healthcare. It is in their self-interest economically and it is good for the community of consumers who work for them and buy their products. The same can be said for many other pressing social, environmental, and economic problems.

The time for calling on the oil industry – which has made record profits while consumers are charged record high prices at the pump – to promote clean energy and alternative fuels has past. It must be mandated by government. Yet, rather than issue the siren call to fairness and responsibility, President Bush and too many congressional leaders chose to remain silent while providing as many favors as possible to these corporations.