We are facing one of the most difficult periods in the history of the United States‘ economy. With approximately 2.6 million jobs lost in the last year - nearly 2 million in just the past four months - many American workers began 2009 with greater financial woes than they’ve ever had.
The close of 2008 saw a record number of emergency economic recovery proposals and rescue plans for our financial institutions, the automotive industry and insurance companies. This crucial support was key to preventing even larger economic declines. As we enter 2009, it’s time for a renewed focus on American workers, the backbone of the U.S. economy. We need decisive, bipartisan action to return our economy to a path for growth, full employment and an enhanced standard of living for all Americans.
We need to act immediately, but we must also act prudently. New legislation must focus on job creation and investments that will transform our nation’s ability to compete in the international economy. We must ensure emergency action includes provisions that address several critical areas.
First, permanent middle-class tax relief must be a priority. American consumers are key drivers of the U.S. economy, and immediate assistance will increase American families’ net incomes and bolster consumer confidence, reigniting our economic engine. Furthermore, Congress should extend federally funded unemployment benefits to help workers who have exhausted regular benefits.
Additionally, we must repair and modernize our infrastructure. Targeted infrastructure investments will help put Americans back to work in the short term, and enhance American competitiveness in the long term. In addition to physical infrastructure, we must focus this reconstructive effort on transformative investments, including uniform, interoperable health information technology, scientific research and development capabilities, and alternative, efficient energy technologies.
We must also stabilize the deteriorating housing market by reducing mortgage rates to 4.5 percent or lower. For most Americans, a home is their most significant asset, making stability of the housing market essential to improving consumer confidence. Additionally, with housing and housing-related industries accounting for more than 20 percent of U.S. GDP, calming the housing market would go a long way toward creating more American jobs.
Moreover, we should improve access to education and training so American workers can develop the skills needed to take on new jobs and more effectively compete in the international marketplace. An intensified commitment to efficient and renewable energy infrastructure would increase demand for green jobs; Congress should fund green-technology job training now to prepare for that need. Additionally, there are already job opportunities in the oil, gas and coal industries. We must continue to expand opportunities for more of these domestic positions. To help further ensure a quick return to employment, we should expand federal dislocated-worker training programs, directing them toward training workers for jobs in high-need occupations and targeting regions with unemployment rates significantly higher than the national average. It is also important to provide a worker-training tax credit for employers, which would create incentives for companies in growing sectors to take on displaced workers who need training to prepare for a new career.
Finally, America’s businesses are the key to U.S. economic growth. Stimulating business investment would provide both immediate relief and long-term value. To foster a faster recovery and return our country to a path of growth, we must remove tax impediments to business investment. Tax incentives can enhance liquidity, which is vital to business’ daily operations and investments in infrastructure and innovation.
Stimulus recommendations must be considered with an eye to innovation, which will lead directly to job growth. As we implement stimulus initiatives, we must carefully measure the economy’s response to ensure a return to long-term, sustainable growth.
While such measures will inevitably increase an already significant deficit in 2009, they are necessary to avert a prolonged and potentially deep recession. Once we regain solid economic footing, measures to control future spending, including a comprehensive review of all federal expenditures, must be immediately implemented. Long-term high deficits are unacceptable.
With renewed commitment to enacting reform from the ground up, we will ensure sustained, long-term economic growth for our workers, families, communities and companies.
John J. Castellani is president of the Business Roundtable, an association of chief executive officers of leading U.S. corporations with a combined workforce of more than 10 million employees and $4.5 trillion in annual revenues.