Reaction to this week's political shocks, why many conservatives are choosing to double down on Trump critics, and then, a conversation on the growing dis-union in America.
The White House has been promoting its efforts to boost economic prospects for women. Diane and guests explore how the current recession has cut across age, gender and income groups and what it means for the midterm elections.
- Valerie Jarrett Senior adviser and assistant to the president.
- Gary Burtless Senior fellow of economic studies, The Brookings Institution.
- Michael Tanner Senior fellow at the Cato Institute.
- Heather Boushey Senior economist at the Center for American Progress.
MS. DIANE REHMThanks for joining us. I'm Diane Rehm. The Obama administration is touting how much its economic policies have benefited women during the recession. The National Economic Council released a report this morning titled "Jobs and Economic Security for America's Women." We take a look at how the recession has cut across not only gender, but age, race and income groups. Joining me in the studio, Gary Burtless of the Brookings Institution, Heather Boushey of the Center for American Progress and Michael Tanner of the Cato Institute, but, first, joining us by phone to talk about the new report, Valerie Jarrett. She's senior advisor and assistant to the president. Good morning to you, Valerie. Thanks for joining us.
MS. VALERIE JARRETTGood morning, Diane, and to everybody else that you have there in the studio.
JARRETTThank you for having me on.
REHMWell, it's my pleasure. Now, I first would like to ask you since we are going to talk about economic aspects of policy and what affects women -- first, I'd like to ask you about the confusion over Don't Ask, Don't Tell, how that affects not only women, men as well, the confusion raised by the Justice Department going to bring a stay to the judge's ruling that Don't Ask, Don't Tell is unconstitutional. Couldn't the administration simply have stayed out of that debate altogether?
JARRETTWell, Diane, that's a very good question. I'm glad you raised it, and you're right that there has been a great deal of confusion around the issue. So let me be very clear. First of all, the president, from day one, has said that he does not support Don't Ask, Don't Tell. He feels that our brave men and women who are serving and protecting our country should be able to do so and that this law should be repealed. But we are a nation of laws. And Congress passed the law, and it should be Congress that repeals it. The vast majority of American people think that the law should be repealed, and we're calling on Congress to repeal it.
JARRETTHowever, the Justice Department's responsibility is to defend the laws of the land, and right now that's the law. And so they are directed to vigorously defend whatever laws are on the books. And so our goal -- we're working with the Defense Department now to have an orderly preparation for getting rid of the law, but we're -- and we're calling on Congress to repeal it. But in the meantime, the Justice Department has to do what it is charged to do, and that's defend the laws.
REHMBut surely, that's not likely to happen very soon, that the Congress in its lame duck session will be looking at so many other issues, and in the meantime, you've got confusion among especially those who are reenlisting as openly gay.
JARRETTWell, I think that it's up to Congress, and we would ask them to act as quickly as possible. Every day that goes by that these laws are on the books we think is doing an injustice to our men and women of service, and so the president has spoken out very publicly and very clearly about this issue. And he's looking to Congress to act, and we are hopeful that they will. And I'm glad that you asked the question because hopefully we'll begin to build mounting pressure on Congress to take the appropriate action.
JARRETTBut in the meantime, the Defense Department is working very hard with the military to prepare them for the transition to getting rid of Don't Ask, Don't Tell, and we are expecting Congress to act. The president said very clearly just this week that during his presidency, he expects this law to be repealed. And he has been very passionate about this, and we are hoping the Congress will act.
REHMValeria Jarrett, she's senior advisor and assistant to the president. Moving on now, how do you believe the Obama administration policies have helped women, especially during this recession?
JARRETTWell, as you mentioned, we have been going through a very deep recession that began before the president took office. Just to put it in context, the six months before he took office, our country had lost four million jobs. In January when he took office, we lost over 750,000 jobs. And so we were on this downward spiral. And what the president has done from day one is to try to move our country in a positive direction, creating a better foundation, a stronger foundation for long-term sustainable growth, which we all know really rests in the private sector. And so he took some short-term steps in passing the Recovery Act.
JARRETTAnd every aspect of the Recovery Act benefits women, whether it's providing resources for those who are unemployed so that they have unemployment benefits and COBRA benefits, whether it's providing tax credits so that everybody has an extra -- average of an extra $600 in their pocketbook, whether it's providing tax credits. We recently passed the small business bill so that companies can reduce their costs and make it easier for women to be entrepreneurs and to start new businesses. We've had a wide range of initiatives through the small business administration. Access to capital is a very important component for small businesses to grow. And so our women-owned businesses have entered into 12,000 loans just since the president has been in office.
JARRETTAnd so they are growing rapidly. But one point, I think, it's important for everybody to know is that women are now 50 percent -- nearly 50 percent of the workforce. Two-thirds of households either have a woman single head of household, or they have two people who are the breadwinners now. So women's contribution, particularly in this economic climate...
JARRETT...is essential. And we have really focused on doing everything that the federal government can do...
JARRETT...to allow them to thrive and grow.
REHMNow, did women not fare better in this economic downturn because of the nature of the jobs lost?
JARRETTWell, that is true. That is very true that women did fare better than men, but they still didn't fare well. And another important point to keep in mind about women is that they still only earn 77 cents on the dollar when compared to men. The very first law that the president signed into law was the Lilly Ledbetter Act that will equip women with better tools to fight discrimination in the workforce. And right now, we were -- we are looking to Congress to act on the -- excuse me -- Paycheck Fairness Act, which will give additional teeth to prevent discrimination. And so as long as we have these gaps, we have to continue to be vigilant, and we have to continue to work because of the contribution women are making to the workplace.
REHMI'm interested in why the administration is singling out a particular group -- namely women -- by touting its economic policies directed toward them as opposed to across the general population?
JARRETTWell, we do both. We do it across the general population. The president recently announced the last time the job numbers came out that we have now had nine consecutive months of private sector job growth which puts our country in the right direction. We're not anywhere near where we want to be, but we are certainly moving in the right direction compared to the prior 22 months of losing jobs.
JARRETTAnd so we do -- we do it both ways. But I think for the reasons that I mentioned early on, because of the statistics about the growing importance and that women are playing in terms of helping support the family unit...
JARRETT...it was important to highlight just how effective our tools have been.
REHMAt the same time, I would wonder whether the administration might be intending to release a report on what has been done to help African-Americans or Hispanics hit hard by the recession.
JARRETTWell, the president has given a variety of interviews over the last several weeks doing just that, highlighting exactly what we have done in both the African-American and the Latino communities. And I think what -- if you add up all of our different initiatives, and you look at where the president's focus has been since day one, we have really have made a concerted effort to help everybody. And so part of what we're doing now is giving examples so that people can see how this directly affects their life. I think oftentimes when bills are passed through Congress, they seem distant. And what we're trying to do is to make them real and personal, so people can see very clearly the choice that they have before them.
JARRETTRight now, as we enter into the election, we have a very clear choice. We can go back to the policies of the prior administration, and that's what the Republicans have said they'd like to do. They'd like to roll back what's left of the Recovery Act even though it has benefited so many people. They would like to roll back healthcare, which is, you know, if you have a child with a preexisting condition, are you then subject to lifetime caps on health insurance. They'd like to roll all that back. They'd like to get rid of the financial regulatory...
JARRETT...reform and our consumer protection agency that's right there to help consumers be -- advocate on their behalf. And many of these initiatives that I just mentioned have a particular impact on women. And so going in to this home stretch, I think it's important that we provide a contrast so that the American people understand what's at stake here. And the stakes are very high, and they can choose. Do they want to continue to move in a forward direction, knowing that we still have a long way to go? Or do we want to go back to where we were when we were losing...
JARRETT...four million jobs in six months?
REHMAnd I wonder whether people are a little concerned that this report has been timed to the midterm elections.
JARRETTWell, you know what I would say to that, Diane? I'd say if look at the president's announcements over the last 22 months, he has had a series of measures that women could look at and understand what we are doing for them. So, for example, a few weeks ago in the White House, we had a women's entrepreneurial forum, where we invited women entrepreneurs and lenders and people from the federal and state and local government to come in and look at best practices for what we could do to support women entrepreneurs.
JARRETTEarlier than that, we had a workplace flexibility forum at the White House where, again, we invited a cross-section of stakeholders to come in and explore with us what are the best practices to create an environment where there's flexibility in the workplace. And our council and economic advisors released a report that shows that actually, if you have flexibility in the workplace, it makes for a more productive workplace.
REHMValerie Jarrett, she is senior advisor and assistant to the president. Thank you so much for joining us.
JARRETT(sounds like) I could talk forever.
REHMAnd during that first segment, you heard Valerie Jarrett, senior advisor and assistant to the president. Now, turning to our guests here in the studio, Gary Burtless of The Brookings Institution, Heather Boushey of the Center for American Progress and Michael Tanner of the Cato Institute. We will, of course, include your calls, your comments. Join us on 800-433-8850. Send us your e-mail to firstname.lastname@example.org. Good morning to all of you.
MR. GARY BURTLESSGood morning.
MS. HEATHER BOUSHEYGood morning.
MR. MICHAEL TANNERGood morning.
REHMGood to have you with us. I want to read you the first message we've had on Facebook. It's from Dorothy. She says, "It has been more than two years since I have regular full-time work. I barely get by on the occasional scraps of work I receive, but I'm grateful for them. They enable me to survive. My lifestyle is bare bones -- no insurance, no doctors, no drugs, no travel, no long or unscheduled car trips, eating what's on sale at the grocer instead of what I prefer, a tiny apartment, no dry cleaning, limited laundry." I'd like to ask you, Gary Burtless, how you think women are faring in this economy.
BURTLESSWell, the recession has certainly been extremely serious, and the person who sent that message exemplifies why. It's very difficult for people, once they lose their jobs, to get reemployed. That is really the feature of this recession that makes it different from the other post-war recessions. The layoff rate, at the worst part of the recession, was not exceptionally high by the standards of severe recessions in the past. But what has been extremely unusual is the very low rate at which employers are adding to their payrolls, and thus giving people who are unemployed an opportunity to get a job and get re-employed.
REHMHeather Boushey, there are some who are saying if the federal government begins a downsizing program, that then women will be hit in equal amounts as men and other majority minorities.
BOUSHEYCertainly. You know, we saw over the first year of this recession, that men lost majority of the jobs. And we saw, as the recession moved forward, women started losing more and more jobs. But since the spring, since we've seen these large cutbacks -- especially at the state and local government level -- you've seen women losing an increasing share of the jobs. Women are, of course, the majority of state and local government workers. And because of those large cutbacks, that has not only hurt women who rely on those services, who rely on the public school system or after-school care or home health aides or any of those, but who are those workers who are majority women. So this is one way that the recession has been, as it is played out and as we've seen these cutbacks at the state and local level and these enormous deficits, that we've seen women really hurt more than, I think, we did expect at the beginning.
REHMAnd, Michael Tanner, what about different age groups?
TANNERWell, in terms of simple unemployment levels, the younger you are, the more likely you are to be unemployed. But I think the group that is probably having the hardest time are actually older workers who, once they lose their jobs, find it extremely difficult to get back in the labor force. Companies are generally reluctant to hire people who have only four or five years left of employment. It has always been difficult for them to move on to second careers, and many of them are in the type of businesses now where they are not likely to see those jobs come back. We know that construction and manufacturing were the hardest hit in this recession. Someone in their 50s, who lost a job in those fields, is going to find it very difficult to get back into the labor force.
REHMVery interesting to me that 51.7 percent of African-Americans held a job in September compared to 59.2 Hispanics, 59.7 Asians, 59.5 of whites. So it would seem, Heather Boushey, that across races, you're seeing big differences.
BOUSHEYWell, certainly. You know, typically, you see that the unemployment rate for African-Americans is about double that of whites. That's true in good times and in bad. And it means that when recessions hit, those communities are hit the hardest, and that is what we've seen this time around. To a somewhat less extent than in prior recessions, this recession has actually been broader than prior recessions, but not by a great amount. But it is certainly the case that African-Americans have been hit the hardest, especially in the early phases of the recession, you saw their unemployment rates rise phenomenally.
REHMWhat about Obama administration programs helping women? To what extent have they been at the forefront?
BOUSHEYWell, I think that the -- there have been so many things that this administration has done and this Congress has done to focus on stemming the tide of job losses and getting folks back to work. And those help women workers, women and their families and all families. I think that that is certainly the case that if you -- because you've seen unemployment so high, and you've seen it -- it's so hard, as Gary said, for people to get back into jobs. The best thing we can do for everyone is to get that unemployment rate down.
BOUSHEYThe Recovery Act that was passed in February of 2009 has saved or created 2 or 3 million jobs at this point. That is an important step forward. Instead of hemorrhaging jobs, we're actually seeing job creation. And especially for women and their families, you've seen things like tax credits, the expansions of the earned income tax credit, child tax credit, the passing of the Lilly Ledbetter Fair Pay Act. These are things that have helped boost incomes. Because one of the things that has happened in this recession -- is because men have lost more jobs than women -- you've seen family incomes fall sharply because women tend to earn less.
REHMYou know, you've been talking about families. What about single people? What about those who don't have another in the household to lean on to help out when one loses a job, Gary?
BURTLESSWell, I think that there's two distinctive things about what this administration has done in response to the severe recession. One is we have the longest spells of unemployment insurance that have ever been made available in the United States. Ninety-nine weeks of benefits are available in states with high unemployment rates, and the previous record was 65 weeks back in the mid-1970s. The second thing that's very different from what previous administrations of any political stripe -- Republican or Democrat -- have done when there's a severe downturn is give -- this administration has given a lot of fiscal relief to state and local governments.
BURTLESSThat has been especially important, I think, to women employees because, as you just heard, they constitute the majority of state and local government workers. And so it has protected women more than men because men are more likely to be employed in the private sector, which has taken, really, the brunt of job losses since the beginning of the recession. There's -- I think private employment is down about 7 ½ million since the beginning of the recession. Public sector employment is only off about a quarter of a million.
BURTLESSAnd so the protection of the jobs in state and local government, and, of course, also in the federal government...
BURTLESS...has helped -- been helpful for women.
TANNERWell, I think that's right. The administration has done a pretty good job of propping up government employment but has done very little in terms of stimulating private sector employment. And I think we realize that if we're going to get out of this recession and get unemployment back down again, it needs to be done on the private sector. And here, I think, the administration's approach has been decidedly wrongheaded, that...
TANNERWell, in terms of the stimulus that they've pumped into the economy, it really has had very little effect in the private sector. We don't see significant economic growth. And in fact, there are several economists that suggest that, you know, in the long term, it is actually sucking growth out of the economy as we -- because it is so heavily deficit-funded. Businesses understand that those deficits will ultimately have to be paid for through higher taxes. And they are therefore holding off on making the investments that will ultimately (sounds like) degrade our hiring.
TANNERThey understand that, in the future, they're going to bear a tremendous burden, and that's keeping them from getting back into the job creation market, and when you combine that with burdens such as the healthcare bill, which significantly adds to the cost of hiring workers -- things of that nature -- that all just drives down employment in our economy.
REHMHow about your assessment, Heather Boushey? Do you disagree with Michael Tanner on that point?
BOUSHEYCertainly, I do disagree. I think that, you know, one of the things that we've seen month after month from the survey, from the National Federation of Independent Businesses, which is small business owners, is that the single most important concern that these business owners are reporting in the survey is a lack of sales. They're concerned about where their customers are.
BOUSHEYNow, the Recovery Act was designed to boost demand, and it did that in a variety of ways. One, by making sure that states aren't acting as pro-cyclically by laying off people right when there are so many unemployed. That does boost -- you know, help to maintain state and local spending. But, of course, we're seeing that waning now. In recent months, we've seen significant layoffs at the local level. And so that's one key issue, but the Recovery Act also did a lot of things to try to boost private sector investment. This administration has done a lot for small business owners to increase grants, access to loans.
BOUSHEYBut the concern for those small and medium-sized businesses is that they aren't seeing enough customers coming through their doors or getting online and buying their good and services. So things like unemployment insurance, things like the TANF Emergency Fund that's created public-private partnership jobs -- all these help create demand, which then puts money in people's pocket, so they can go out and be those customers.
REHMAt the same time, Gary Burtless, there are economists such as Paul Krugman who's saying not enough stimulus went into the economy to help those very individuals get out and do the buying that the administration says is necessary to get this economy moving again.
BURTLESSWell, the first thing is to establish what was in the stimulus, and most of the stimulus really was directed at raising the after-tax incomes of American families. If little of it got spent, it's because American families were scared to spend money because their financial position was so weak. But most of the money was not spent on maintaining public employment. The overwhelming fraction was in tax cuts to middle class and poor families and improvements in unemployment benefits, health insurance benefits so that the people hardest hit by the recession…
REHMSo how well do you think that stimulus package did for the economy?
BURTLESSWell, here's a number to bear in mind. Since the beginning of the recession, the after-tax income of Americans -- taken as a whole -- is a little bit higher right now than it was when the recession began.
REHMGary Burtless, he is senior fellow at the Brookings Institution. And you're listening to "The Diane Rehm Show." And we're going to open the phones now, 800-433-8850. First to Tallahassee, Fla. Good morning, Martha. You're on the air.
MARTHAGood morning. I have a quick question regarding credit availability. I have, by any definition, a very successful sole proprietorship consulting firm that I've had for 12 years. It has remained engaged through the recession. But my husband did temporarily lose his job, and we were having to pay (unintelligible) pay rents and, you know, had a decrease in our income. And also, my clients had, you know, became late paying their bills. You know, there were problems with cash flow, that sort of thing. And as a result, it has taken a toll on my credit rating. You know, I feel like I'm a survivor, because I was able to stay in business, but it wasn't without, you know, consequences.
MARTHAAnd now that, you know, we're getting back on our feet, my husband is back employed. You know, there's benefits -- come with his job. There are things that I would like to do to adjust to our lower income because, you know, as an employer...
REHMSure. So, Martha, tell me what your question is.
MARTHAI'm sorry -- I'm sorry. Well, my question is, is there going to be anything to, sort of, loosen some of the lending standards through some of the SBA programs so that, you know, businesses that can show a track record -- maybe on paper as far as, like, a credit rating or, you know, some late payments or something like that -- aren't just immediately turned away by a bank? Which is...
REHMSure. All right. Small business assistance, Gary Burtless.
BURTLESSWell, I think the administration has tried to do something about that. And if you speak to them -- if you speak to members of the administration in the economic side, they say that that is the concern that big businesses have a lot of cash, and they have easy access to credit markets.
REHMAnd they've been holding on to that cash for the most part.
BURTLESSThat's right, and smaller businesses have found it harder to get credit for the reasons you mentioned. That is, it is not easy for banks to loosen their lending standards after a financial crisis that was mainly caused by having very loose lending standards -- although for a different purpose, namely for mortgage lending. But I think a lot of financial institutions are very spooked by that experience.
REHMMichael Tanner, do you see any changes on the horizon?
TANNERWell, I think they're sort of caught in a catch-22 here, which Gary just mentioned. You have a situation where you want to create it -- make it easier for small businesses to get credit. But you have a situation where loose credit helped contribute to the problems we've just had. And you've got an administration that's sort of on both sides of this. At one point in time, they were sort of pushing more lending. And then they're also with the new consumer credit agency -- protection agency they've just created and with some of the regulations that are coming down saying, we're going to punish businesses that we think don't participate fairly in the credit markets. And all of this combined just scare businesses...
TANNER...and make them very reluctant to get involved.
BOUSHEYCertainly. I mean, you know, one of the things we know is it's going to take us a while to dig ourselves out of the hole that we've created after the financial crisis that we had in the late 2000. So it has been challenging. I think one thing we need to remember is that there are a lot of big businesses right now that are sitting on, as you said, sort of piles of profits. And why are they not investing? Why are we not seeing them moving out there and starting to create those jobs?
REHMMichael Tanner says it's because they're worried.
TANNERThat's right. It's the uncertainty about the future -- the potential for new taxes, the potential for the costs of the healthcare bill. And we haven't seen -- you've mentioned the consumption. We haven't seen any aggregate increase in consumption as a result of the stimulus bill. You put all that together, and it leaves businesses very frightened.
REHMMichael Tanner, he's senior fellow at the Cato Institute. Heather Boushey is at the Center for American Progress. Gary Burtless is senior fellow at the Brookings Institution. Short break. More of your calls when we come back. Stay with us.
REHMAnd welcome back as we talk about how the economic downturn has hit people across the span, both in gender, in racial terms, in aging factors. Let's go now to Winston-Salem, N.C. Good morning, Jerry. Thanks for joining us.
JERRYWell, good morning. And I just have a comment for you and all those smart people that you've got on there.
JERRYYou know, one of the things I have observed -- okay -- is a lot of the people who are, you know, the age cohort -- let's say 50 to 60 -- who lost their positions -- you know, when companies are trying to refill some of those positions, they change the criteria. For example, I mean, a lot of these people that I, you know, deal with, you know, really weren't that, you know, up-to-date on computer knowledge, you know, using Outlook or Excel or Word and depended on somebody else to help them through that.
REHMSure. Sure. Gary, you had a story.
BURTLESSWell, we know that employers do discriminate against older job applicants, probably based on the kind of thought that you just mentioned, that the older ones take longer to learn and may be more difficult to train. There is a young professor at Texas A&M University who a couple of years ago did the following experiment. She answered help wanted ads with resumes matched to one another, so all of the qualifications looked similar. But in one set of letters, the response made it clear that the person probably was in his or her 50s, and in the other, it was made clear that the person was probably in his or her 30s.
BURTLESSAnd there was a very big gap in the number of employers who followed up and tried to interview people. And, of course, it was to the disadvantage of the older job applicant, so we know, based on experimental evidence, that employers do tend to discount the qualifications of older job applicants.
REHMAnd, Heather, I wonder if that's particularly true where older women are concerned.
BOUSHEYCertainly. You know, we've seen over the course of this recession record high unemployment rates among older workers, both men and women, workers 55 and older, and higher than at any point in the post World War II period. I think we have a real challenge on our hands moving forward. We've got a lot of older workers who were laid off in this recession. And like the first caller that we had at the -- a few minutes ago, you know, many of these folks may -- it's going to be really hard for them to find full-time stable employment moving forward.
BOUSHEYSo we need to be thinking about a comprehensive solution for a couple of things. One, what can you -- what is reasonable to expect in terms of retraining and helping folks get into new sectors? Two, what are we thinking about in terms of helping folks move across the country, move to new places, to find work?
BOUSHEYIn this recession, one of the unique things is that this is the first major recession where most families are dual earners. So maybe she's still working, but he's lost his job. How do you -- how should these families be thinking about that job search?
BOUSHEYAnd what are we doing to help them?
REHMMichael Tanner, I can remember in the Clinton administration, Labor Secretary Robert Reich coming on and talking about job training, job training, job training -- there wasn't any job training for, certainly, people who had lost their jobs, who needed more skills in a totally different field.
TANNERWell, there certainly were job training programs. The government has something close to 70 different job training programs. The question is how many of them actually are effective? Some of them are remarkably ineffective, basically teaching no new skills while keeping people out of the labor forces. The old Job Training Partnership Act actually used to lead people less likely to get hired after they completed it than going into the program.
TANNERBut -- so the question isn't the number of programs. It is how do we adapt to what's going to be a very different economy? We're not going to be a manufacturing-heavy economy -- not because we produced less, but because we produced it more efficiently and with fewer workers. And we're going to be having a very different high-tech service industry economy, and that's going to take a different type of educational skill.
REHMAll right. To Index, Wash. Good morning, John. You're on the air.
JOHNGood morning. Thanks, Diane.
JOHNYou know, I am about 15 months away from turning 50. I lived in New York for five years. Let me get to my point real quick here. The banking system -- you know, going back to -- first, President Bush and, you know, the banking failure back then -- and we had a rerun now of that. You know, the problems with the banks even worse with the no-doc loans, the no-documentation loans, had a real estate license for a minute, but my broker screwed me, honestly. And, you know -- and so I got right back out of real estate. It just wasn't for me -- mainly carpentry and line cooking, you know, cooking in restaurants and such.
JOHNI was in New York for about five years, and I helped found something called the Federal Land (word?). While I'd been sitting here on the phone, it seems like, you know, I never kept at that environmental stuff, didn't make any money doing it...
REHMJohn, I need your question, please.
JOHNOkay. The question is, with all this public land and public resources that everyone has, you know, birthright to as citizens, if -- we need eyes on the ground for our water supply, for fire control, for alternative energy, climate control.
REHMSo we need lots of people moving into those kinds of fields. Heather.
BOUSHEYCertainly. You know, one of the things that the Recovery Act did and that this administration is focused on has been the move towards, you know, thinking both about climate change, but also importantly, thinking about whether or not the U.S. will become the leader in producing the kinds of goods that we need to have a more energy efficient future. Solar panels, windmills...
BOUSHEY...or, you know, all of this sort of stuff and really encouraging job creation and an innovation and investment here in the United States in those industries. I mean, I think that Michael's point that we don't make things here in the United States anymore is really something that we can think about in terms of policy, that whether or not we're going to have manufacturing jobs is a question that folks are talking about here in Washington. What kinds of jobs do we want to create? What kind of industries do we want to be supporting, moving forward? And this administration is really focused on energy being a key point in how we can revitalize U.S. manufacturing.
TANNERWell, I just want to make sure, I didn't say we don't make things anything anymore. We actually produce more in terms of manufacturing...
REHMBut more efficiently.
TANNER...but we produce it more efficiently, which means we use less workers in order to produce it. The question on all these green jobs is, if they were really productive jobs, that really could earn a return, the private sector would invest in them. You wouldn't need to subsidize them. They're subsidized because they are not productive at the moment…
REHMYet. They may not be productive yet, but look at the extent to which the oil industry has been out there with its lobbies, with its monies for years, decades and decades. And, now, we need to turn to a new kind of energy system. It's going to need a lot of help, isn't it, Gary?
BURTLESSThat's right. Actually, a lot of development of new industries does depend on a lot of public intervention.
BURTLESSThe railroad industry did not snap out of -- did not -- that was not created out of whole cloth by private investors alone. The government needed to make a lot of changes, allowing private firms to have rights of way so that they could build the railroads, and we could move to a different kind of a transportation system. The same thing is true of airlines.
REHMAll right. And let's go to Jake in Orlando, Fla. Good morning. You're on the air.
JAKEThank you. I saw Bill Clinton yesterday doing a rally for Kendrick Meek. And since it was a university -- the University of Central Florida -- they put a lot of emphasis on the Student Aid and Fiscal Responsibility Act, which was passed as part of the healthcare legislation. And they're doing all of these great things for college students and loans and making it acceptable to go to school. But for someone who's about to graduate, what is there out there? And, thank you, I'll take my question off the air.
REHMAll right. Thanks for calling. And that's a great question. Do you have an answer, Gary?
BURTLESSWell, the way our country tries to prepare people for the future is it offers a huge educational system -- higher educational system and makes...
REHMIt's not free.
BURTLESSIt's not free, and we make loans available so that people can help pay for their own education.
REHMGary Burtless, he's at The Brookings Institution. Heather Boushey is at the Center for American Progress. Michael Tanner is at the Cato Institute. And you're listening to "The Diane Rehm Show." And we'll go back to the phones to Dallas, Texas. Good morning, Chris.
CHRISGood morning, Diane. How are you?
REHMI'm great. Thank you.
CHRISI'll be brief. A couple of things -- I'm a guy in his 50's who lost -- was laid off and was laid off for one year to the day, went back to work the very day I was laid off a year prior. Before I -- and one of the things I'll say about the administration and their efforts is that my wife and I are direct recipients of the benefits of extension of the, well, the unemployment benefits and the subsidizing of the COBRA so that our health insurance, we were able to cover that with our savings. So a couple of things -- I have a question relative to the stimulus money that maybe somebody can answer.
CHRISAnd that is, has anyone done any studies to see how many firemen, how many policemen, how many of the public workers who receive -- where the cities and the states received those funds, how many of those folks were actually hired across the country, and then a breakdown of the ethnicity and the gender of those folks who were hired? Because I think that would be a real goal indicator of how the money is actually being spent on a local level.
REHMAny comment, Gary Burtless?
BURTLESSI think the main thing we know is that the people who are on public payrolls -- state and local payrolls -- teachers, policemen, firemen and other public servants, are less likely to have lost their job than would have been the case if states had not received federal aid. That, I think, is -- I don't think that they are -- we know much about who was added to payrolls. What we know is that the ranks of the state and local employees didn't drop.
BOUSHEYAnd so -- and I want to also touch on what Chris said about how important the extended emergency unemployment benefits and the COBRA -- you know, as a part of the Recovery Act, the federal government paid about -- a little bit less than two-thirds of the health insurance costs for families when someone had lost their job. I mean, these things went a long way towards helping families. And those, of course, also helped keep money flowing to communities, which is what helped save or create the millions of jobs that the Recovery Act did save.
REHMAnd to Madison, Conn. Good morning, Jay.
JAYGood morning, Diane.
JAYMy comment was simply this, for, you know, about a generation now, the wealthiest Americans have received a great deal in the way of benefits: tax cuts, bailouts and corporate welfare. And it seems to me that it's well past time that they pay their fair share in the form of higher taxes. And what I would like to see the federal government do with the proceeds from higher taxes on the wealthiest Americans is a modern CCC program. And I'm sure I'm not the first person to suggest this, but...
REHMAnd I think a lot of people have talked about exactly this approach. What's you're reaction, Michael Tanner?
TANNERWell, it's a very short-term approach. I mean, you can go back just to the CCC itself, which did take people off the streets and give them a job for as long as the program lasted. And when the program ended, they were right back unemployed again, and you actually saw a spike on unemployment in the late 1930s as a lot of these programs essentially ran out. At the same time, you're going to be taxing those people who can create private sector jobs that last. So what you're doing is you're...
REHMBut they haven't done that.
TANNERWell, they haven't done that because they know -- as you look down into the future, we are on a path right now in which the government will ultimately spend 45 percent of GDP by the year 2050, according to CBO projections. People look at that and say the tax burden necessary to support that level of spending is intolerable, and they can't create jobs while we're facing that.
BURTLESSI think that this caricature of the new deal has been repeated so often that people have began to lose sight of what the actual history was. In the first four years of the Roosevelt administration, starting in March 1933, the United States saw the fastest peacetime economic growth in its history. There was an enormous rise in employment. Yes, some of it was CCC jobs. But let's talk about what we were left with when the CCC workers did put up their shovels. They created a lot of roads. They created a lot of public buildings.
BOUSHEYWell, and in the late 1930s, of course, we had a second recession in 1937 when the government started paring back on its spending, started being more concerned about deficits than getting the economy back on track. There was actually a second recession, which is, I think, what we need to -- that history, we need to sort of reread and make sure that we all understand that. Because moving forward, we need to make sure that we are doing what we can to push our economy, right now, back on track and that we don't do anything to risk the economic growth that we've already seen and move backwards like they did in the 1930s.
REHMAll right. And one final comment from Mary in Indianapolis. Good morning to you.
MARYThank you so much. I want to make a brief comment. I am a 63-year-old, single female, and I just graduated from college. I got my (unintelligible)
MARYAnd so I have the biggest hurdle in my life. And I am interviewing today for a paid internship at our State House. I wonder if they're listening. But I have two professors who are supporting me, and they're watching to see my process. But I want to quickly say that we older people, we can learn. We can learn this new technology, and I continue learning. And I just want to say that I am in favor of Obama's healthcare because I'm self-employed.
REHMAll right, Mary. I appreciate that. I really want to congratulate you. You've also said you've learned to get around the computer, and I know that that can be a challenge for older people. Again, congratulations. And I want to thank all of you, Gary Burtless of the Brookings Institution, Heather Boushey at the Center for American Progress, Michael Tanner of the Cato Institute. And, of course, at the start of the program, you heard from Valerie Jarrett, senior advisor and assistant to the president. Thanks for listening all. I'm Diane Rehm.
ANNOUNCER"The Diane Rehm Show" is produced by Sandra Pinkard, Nancy Robertson, Susan Nabors, Denise Couture and Monique Nazareth. The engineer is Erin Stamper. Dorie Anisman answers the phones. Visit drshow.org for audio archives, transcripts, podcasts and CD sales. Call 202-885-1200 for more information. Our e-mail address is email@example.com, and we're on Facebook and Twitter. This program comes to you from American University in Washington. This is NPR.
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