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To Build the Economy, Build Bridges—Literally |
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Whether you call it a recession or serious slow down, the nation’s economy is in deep, deep trouble.
Most economists say the tax rebate checks that are part of the fiscal stimulus package approved by Congress last month, along with the recent interest rate cuts initiated by the Federal Reserve Board and the other measures will help in easing some of the worst effects of the economic meltdown. But as AFL-CIO Chief Economist Ron Blackwell told a U.S. Senate committee yesterday:
They are not sufficient…to avert recession, nor do they deal with the fundamental economic imbalances at the root of the current economic crisis.
Appearing before the Senate Banking, Housing and Urban Affairs Committee, Blackwell told the committee that the next step to rebuild the broken economy should be a second stimulus package that includes rebuilding the nation’s crumbling infrastructure.
The new package should also include an extension of unemployment insurance, expansion of the food stamp program and federal aid to states and cities to prevent further cutbacks of vital public services.
We also support front-loading public investment in infrastructure to maintain our schools and repair crumbling bridges and deteriorating highways. Spending that puts people to work on projects we desperately need is more likely to stimulate the domestic economy than tax cuts that may be saved or spent largely on imported consumer goods.
Congress has approved billions of dollars of school repair and transportation projects that now are in the pipeline. Getting those up and running could relatively quickly create tens of thousands of jobs in an economy that has been shedding jobs since the beginning of the year.
The U.S. Department of Transportation estimates that every $1 billion invested in transportation infrastructure generates between 40,000 and 50,000 jobs.
Joining Blackwell on the panel were representatives from the U.S. Chamber of Commerce, Goldman Sachs and the American Society of Civil Engineers (ASCE) who, while differing on some details of how to proceed, all agreed it is critical to the nation’s economic future to repair, rebuild and develop new transportation and communication infrastructure.
Felix G. Rohatyn, co-chair of the CSIS Commission on Public Infrastructure and a trustee for the Center for Strategic and International Studies, said:
Our bipartisan commission reflects the strong support for this idea among both Democrats and Republicans, as well as business and labor. We know that our public infrastructure crisis is no less serious for being silent. To fix it, we call for federal action that is big enough and smart enough too compete in the global economy, improve our quality of life and raise our standard of living, we must successfully rebuild America’s public infrastructure.
In the long term, ASCE President David Mongan estimates it will take $1.6 trillion over five years to bring roads, rails, bridges, waterways, transit systems and other infrastructure components into “good condition.” That, said Blackwell, could create some 15 million jobs a year.
He said those jobs could help reverse the generation-long stagnation of working families’ income.
Our wealthiest families have benefited as never before from the economic policies of the past three decades, but working families have been left behind. Productivity has increased 67 percent since 1980, but wages have barely budged. Median family incomes are only 19 percent higher today than they were three decades ago, and only because workers are working longer hours and families are sending more members into the workforce….To ensure that the [infrastructure] jobs created, workers employed in infrastructure projects should be paid the prevailing wage.
Sen. Chris Dodd (D-Conn.), the chairman of the committee, along with Sen. Chuck Hagel (R-Neb.), last year introduced legislation to establish the National Infrastructure Bank. The Infrastructure Bank would identify and prioritize major infrastructure needs and help arrange funding. The AFL-CIO has been working to ensure the legislation strikes a proper balance between public and private resources and interests.
Said Blackwell:
Public investment in infrastructure is essential for restoring strong and sustainable economic growth essential for ensuring American prosperity, but it must also contribute to ensuring that the resulting prosperity is broadly shared.
It will take a new administration in the White House before any action is likely, said AFL-CIO President John Sweeney at an infrastructure conference last month. He said for the past seven years, the Bush administration:
has refused even to consider using infrastructure spend as a job-creation vehicle.
In their economic proposals, Democratic candidates Sens. Hillary Rodham Clinton (N.Y.) and Barack Obama (Ill.) both address infrastructure financing and rebuilding as a way to create jobs and boost the economy. Republican Sen. John McCain (Ariz.), on the other hand, didn’t even bother to show up to vote on an economic stimulus plan to help working families and help the economy.
Click here to read Blackwell’s full testimony and here for testimony from witnesses and video of the hearing.
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Good report, and good photo of Bay Bridge construction in SF Bay Area. For more photos and articles re: Bay Bridge, check the website of the SF Building Trades Council:
http://www.sfbuildingtradescouncil.org/
Rohatyn: We Need Global Dictator to Run a Global Big Mac
PARIS, March 6, 2008 (LPAC)–Felix Rohatyn, currently the vice-chairman of Lehman Brothers, explained in detail his explicit plan for a fascist new world order — hinting that he would be the perfect economic dictator, in a long interview given to the New York correspondent of France’s leading economic daily Les Echos on February 11. Rohatyn called for a “new global regulator, capable of imposing regulations and speaking with a single voice,” to deal with what he described as far more than “just another crisis,” but a global breakdown of the financial system with serious social consequences.
Using his usual sophist appeal to FDR’s New Deal, he revealed what his idea of the New Deal really is: “Today, we need a new New Deal. It reminds me somehow of the middle of the seventies when the city of New York was about to go bankrupt. Helmut Schmidt and Valery Giscard dEstaing had warned us: a bankruptcy of New York risked provoking a dollar crash. The crisis we confront today is much more global. That is something frightening.”
Of course, Rohatyn was brought in to “save” New York City at that time, as head of Big MAC (the Municipal Assistance Corporation) which threw the Constitution aside to turn over the control of the city’s finances from its elected officials to the private banks, to ensure all debt payments, at the expense of wages, services, and maintenance of the city’s industries — which were destroyed. Clearly he is suggesting the need for a Global Big MAC, with himself (or his fascist pal Michael Bloomberg, perhaps) as the “global regulator.”
His fraudulent references to Roosevelt were further exposed when the journalist asked: “Do you want to rehabilitate Keynes, or do you want the New Deal of FDR?” Rohatyn ignored the (correct) distinction between Keynes and FDR, calling himself “a fervent capitalist, but I have never hidden the fact that I am a Keynesian.” He then incredibly claimed that FDR saved capitalism, not from fascism, but from socialism!
Rohatyn noted that “our traditional industries are collapsing simultaneously” (but not mentioning his own role in bringing that about), naming the auto sector, real estate construction, and the financial sector. The problem is that “finance has been globalized…, but the control structures, they have not adapted. Taken separately, each central bank is too isolated and follows its own policy. America lowers its rates. Europe isn’t. We might need a more global regulator.”
He also spelled out his corporatist scheme for infrastructure, making explicit that the key is the private sector use of public funds for leverage. Referencing the $1.6 trillion infrastructure deficit in the U.S., he said we need a “domestic World Bank” with $60 billion in federal funds, “which could then raise funds and lend money to finance great projects. She never would lend more then 50% of the investment, in order to maintain a strong relation to the private sector.” Of course, these vultures are already leveraged far more than 1-1 in their corporatist schemes.
There is a humorous side: Rohatyn, the Godfather of Mergers and Acquisitions and hedge fund speculation generally, complains that the U.S. image has been tarnished by the fact that “Today, we do not project an image of being a country of serious investors, but that of a country of gamblers enticed by profits. That is very bad.”