Jan. 21—In his State of the Union address Jan. 20, President George W. Bush said “jobs are on the rise” and pledged to address the nation’s job crisis by expanding his tax, trade and economic policies.
Bush’s statement came less than two weeks after government figures showed those policies created only 1,000 jobs in December—and fell short by more than 1.6 million jobs of the more than 1.8 million new jobs Bush promised his economic policies would create by the end of 2003.
“Mr. Bush’s tax and trade policies have been tried, and they have failed. When it comes to jobs, all we have to show for three years of multi-trillion-dollar tax cuts for the rich, free-wheeling trade policy and race-to-the-bottom corporate globe-trotting is the loss of 2.9 million private-sector jobs, including a staggering 2.6 million manufacturing jobs,” says AFL-CIO President John Sweeney. “More of the same will make matters worse for the nation and for working families.”
A comparison of Bush’s State of the Union rhetoric with reality shows a much different state of the United States. The information below is compiled from the Economic Policy Institute, Center for American Progress and America’s Future.
Jobs
Bush stated, “The pace of economic growth in the third quarter of 2003 was the fastest in nearly 20 years.” While the economy has rebounded slightly from the 2001 recession, Bush has presided over a jobless “recovery” and has the worst job creation record of any president in 58 years, since the Great Depression.
In fact, the nation’s economy has shed a net 2.9 million private-sector jobs since Bush took office—the largest job loss since the administration of President Herbert Hoover.
Bush’s solution—urging Congress to make permanent his $1.7 trillion in tax cuts (for an additional cost of $1 trillion)—has proven it cannot address the nation’s job crisis that leaves some 15 million U.S. workers unemployed, underemployed or too discouraged to continue looking for jobs.
While Bush says he supports working families, his administration has mounted an attack against overtime pay protections that, if successful, could cost 8 million workers overtime pay. The Bush White House also has allowed the federal emergency unemployment insurance (UI) program to end, denying any type of financial support for workers who cannot find jobs before exhausting their state benefits. Even during this so-called economic recovery period, 90,000 jobless workers a week are running out of their state UI benefits without being able to find jobs.
“Solving America’s jobs crisis requires a change in direction; it requires new policies deliberately designed to create and preserve good, family-supporting jobs,” Sweeney says.
Job Training
Bush is proposing $120 million in a new job training program but did not explain how that would overcome the $1 billion in cuts to job training and vocational education he has proposed since taking office.
Health Care
Bush’s State of the Union notably did not emphasize the state of the nation’s health care and the twin crises of declining coverage and out-of-control costs. In the first two years of Bush’s term in office, nearly 4 million more Americans became uninsured, bringing the total number of uninsured to 43.6 million in 2002. And in the past three years, workers’ premiums for family health care coverage rose 50 percent. Bush’s main health care proposal, a $1,000 tax credit for the purchase of private health insurance, is estimated to reduce the number of uninsured by only about 4 million—under the administration’s own estimates—and will do nothing to rein in skyrocketing costs.
In other statements, Bush also has proposed capping federal spending on Medicaid and the State Children’s Health Insurance Program, which could result in more than 7 million people losing coverage under those programs by 2013.
While Bush made much of the Medicare prescription drug legislation passed last month by Congress, the new law has large coverage gaps that will leave many middle-class seniors with huge prescription drug bills. It does nothing to lower drug costs for most of America’s seniors and, in fact, bars Medicare from using its buying power to negotiate lower drug prices from pharmaceutical makers, and it forbids seniors from importing lower-priced medicines from Canada. The new law also gives employers incentives to drop retiree coverage.
Manufacturing
Bush noted the loss of U.S. manufacturing jobs—but did not acknowledge the massive scope of the problem: 2.6 million manufacturing jobs lost since he took office, more than the total lost in the preceding 22 years. His proposals to stem the tide of manufacturing job loss center on expansion of his current and flawed free trade policies such as the Free Trade Area of the Americas (FTAA) and the Central American Free Trade Agreement (CAFTA), which do not include protections for workers or the environment. He also called for more corporate tax breaks and looser regulations on American companies.
Along with the huge job losses, Bush’s trade policies have created a record U.S. trade deficit, making the United States the world’s largest debtor because the nation imports far more goods than it exports.
Social Security
Bush recycled earlier administration proposals to privatize Social Security, as part of what he calls “The Ownership Society.” He proposed establishing tax-free saving accounts, yet only 5 percent of people have enough excess income to take advantage of the current contribution limits to IRA or 401(k) accounts. In addition, most experts believe that as previous Bush proposals, this plan could result in cuts in the guaranteed Social Security benefits millions of America’s workers depend on, while diverting billions of dollars from Social Security coffers.
Privatizing Social Security would be a windfall to Wall Street, an investment industry still mired in corruption scandal.
“In the wake of all these corporate scandals and mutual fund shenanigans, we would be entrusting these industries, without government accountability, with the retirement security and tax payer money, of the American people,” says AFGE President John Gage.
Education
Bush claimed his No Child Left Behind education mandate has increased funding to schools by 38 percent. In fact, Bush has underfunded the No Child Left Behind Act by $17 billion, and state and local schools districts are struggling with scarce resources to meet the federal mandates imposed by the Bush administration. In a state-by-state analysis of Bush’s school funding proposal, AFT finds class sizes could be reduced and key learning programs expanded if Bush did not shortchange schools of funding. For instance, California schools could fund smaller class sizes for 1.1 million students with its share of the funding shortfall; in Texas, more than 85,000 additional students could participate in pre-kindergarten classes; and in Florida, more than 46,000 uncertified teachers could become certified.
A Better Vision
“The president has no more important domestic responsibility this year than to solve America’s jobs crisis. He can do so only with a program consciously designed to create and sustain good middle class jobs. More tax cuts for the very rich and more trade deals that help corporations at the expense of workers will only translate into more of the same despair for America’s working families,” Sweeney says.
He calls on Bush and Congress to roll back tax cuts for the very rich and invest these saved resources “to build schools, hire teachers and improve education and job training; make high quality health care accessible and affordable for all Americans; strengthen critical infrastructure, such as highways, roads and bridges; help the states meet their crushing financial burdens; extend the emergency unemployment insurance program, raise the minimum wage and protect workers’ overtime rights and the right to organize and bargain collectively.”
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