John Edwards for President: ARCHIVAL MIRROR-Edwards Unveils Stimulus Plan To Strengthen Economy And Create New Jobs

Edwards Unveils Stimulus Plan To Strengthen Economy And Create New Jobs

Dec 22, 2007 10:50 AM

On final day of the "Fighting for America's Voice" tour, Edwards urges Congress to pass $25 billion job creation plan

Lisbon, Iowa – On the final day of his "Fighting for America's Voice" tour, Senator John Edwards proposed an economic stimulus package to strengthen our economy and create new jobs. Edwards urged Congress to act immediately to pass at least a $25 billion jobs plan in early 2008 and be ready to pass $75 billion more if there is more evidence that we are entering a recession. Edwards believes that every American should have access to a good job and the chance to build a better life. To provide a much-needed boost to a weakening economy, Edwards' economic stimulus plan calls for investing in clean energy infrastructure, increasing federal aid to help states avoid cutting programs that help families through hard times, reforming unemployment insurance and tackling the housing crisis.

Today, Edwards will be joined on the tour by Doug Bishop who, in September 2004, was among the first wave of employees to be laid off at the Maytag plant in Newton, Iowa. Later that month, Doug and his family met Edwards as he was campaigning for the vice presidency on the Democratic ticket. After eight months out of work, Doug found another job and is back on his feet, but many other people in Newton haven't been so lucky – the Maytag plant is now closed for good. Edwards is running for president to make sure the voices of hard-working Americans like Doug get heard in Washington.

"Families across the country are working harder than ever, but in the last seven years, the typical family's income actually decreased – at the same time the costs of health care, energy, and housing are skyrocketing," said Edwards. "The truth is our economy is slowing under the weight of stagnant wages, a major housing crisis and a spike in energy costs. And now, leading economists are saying there's a substantial risk we could enter a recession.

"Hard-working families across America are already struggling to make ends meet. Before things get worse, I urge Congress to take action immediately to strengthen our economy and create new jobs. By taking action now, not only will we promote economic growth and shared prosperity in the long run, but these investments will create jobs and cushion the expected economic slowdown and will lay the foundation for a larger job creation package if we need it."

Edwards' "A Stronger Economy & Good Jobs" plan will:

Accelerate Our Investment in Clean Energy: The crisis of global warming and the high cost of energy require us to invest in a new infrastructure as the foundation for a new clean energy economy. Building this infrastructure will create jobs and spark economic activity, while also investing in our nation's long-term prosperity.
Strengthen the Safety Net for Workers Struggling to Find Jobs: Our nation's unemployment safety net is badly outdated, leaving workers – especially low-wage or part time workers – unprepared for hard times. Edwards calls on Congress to set aside resources now to help states cover additional workers so if unemployment rises, workers won't have to wait.
Help States Avoid Property Tax Increases and Cuts in Critical Programs like Medicaid: Most states are constitutionally required to balance their budgets, which forces them to raise taxes and cut vital programs like Medicaid during recessions. Edwards will increase the federal contribution to Medicaid and provide additional aid to states, helping them avoid cuts to education, health care and other basic services and avoid increases in property and other taxes that disproportionately impact working families and seniors on fixed incomes.
Tackle the Housing Crisis: Edwards believes that Congress must do much more to tackle the mortgage crisis, including creating a Home Rescue Fund to help families avoid foreclosure, giving families the right to rewrite the terms of their primary mortgages in bankruptcy; creating a new federal regulator for financial services products; and passing a strong national law against predatory lending to prevent future crises.
Monitor the Economy Closely and Take Additional Steps if Necessary: If the economy falls into a recession and unemployment rises, as many fear, then additional steps will be necessary. An appropriate package of approximately $100 billion could include additional state relief, additional spending on a new energy infrastructure, accelerating investments in schools, roads, and bridges and temporary tax cuts targeted to the low-income and middle-class families who are most likely to spend money in their pockets.

For more information, please see the "A Stronger Economy & Good Jobs" policy paper included below.

A Stronger Economy & Good Jobs

Our economy is struggling under the weight of stagnant wages, a major housing crisis, and a spike in energy costs. The typical family's income fell $2,400 between 2000 and 2006 – as measured by the median income for working-age families – while the costs of health care, energy, and housing have skyrocketed. Now, more bad news for regular families: the economy is slowing, the job market is weakening, and there is a substantial risk of a recession, according to leading economists.

John Edwards believes that we cannot wait to turn this economy around. Today he called on Congress to pass at least a $25 billion jobs plan in early 2008 and be ready to pass $75 billion more if there are more signs of an economic recession. By accelerating investments that need to be made anyway, America can generate jobs to offset rising unemployment. The Edwards plan will invest in clean energy infrastructure, help states avoid cutting programs that fight poverty, reform unemployment insurance, and tackle the housing crisis. Together, these steps will make important investments in fighting global warming and poverty, provide a much-needed boost to a weak economy, and lay the groundwork for a larger jobs package if it proves necessary.

Leading Economists Warn that the Economy Is Weak and a Recession Is Possible: Alan Greenspan, Joseph Stiglitz and Martin Feldstein estimate that there is a 50-50 risk of a recession. Fifty-two economists surveyed by the Wall Street Journal put the risk of recession at 38 percent, on average, and traders on Intrade put the risk of recession in 2008 at 45 percent. [AP, 12/16/2007; San Jose Mercury News, 11/16/2007; Bloomberg, 12/14/2007; Wall Street Journal, 12/11/2007; Intrade.com, 12/21/2007]
Massive Losses in the Housing Market: More than 2 million families with subprime mortgages have lost their homes or face losing them in the next few years or so. Losses on subprime and similar mortgages are estimated to be as much as $500 billion. Single family home construction has fallen to the lowest level in more than 16 years. Auto loan and credit card delinquencies are also rising and have reached their highest levels in many years. Loans of any sort are difficult to get and are ever more expensive, hurting both consumer purchases and business investments. A recession would cause further defaults and worsen the credit crisis. [ Center for Responsible Lending, 2007; Wall St Journal, 12/18/2007; AP, 12/18/2007; Wall St Journal, 12/6/2007; NY Times, 12/13/2007]
Energy Prices Are Rising: The price of oil is around $90 a barrel; after nearly hitting $100 a barrel in recent weeks, it could pass that mark in 2008. Families are spending $1,000 more a year on gasoline than they did in 2001. Home heating oil costs 40 percent more than it did last year. [AFP, 12/18/2007; USA Today, 5/16/2007; MarketWatch, 12/17/2007]
Job Growth Is Slow and Consumer Confidence Is Falling: Private-sector jobs increased by only 64,000 a month so far this year, less than half last year's rate and the number of new entrants into the workforce. Generally a lagging indicator of economic problems, the job market could be even worse in coming months. Consumer confidence is at its lowest level in 15 years, excluding the immediate post-Katrina report in October 2005. [AP, 12/17/2007; EPI, 12/7/2007; Reuters, 12/7/2007]

The Edwards Plan for a Stronger Economy and Good Jobs

Today, John Edwards urged Congress to act as soon as possible in 2008 to pass at least $25 billion in new investments to create jobs and strengthen our economy. In addition, Congress should set aside $75 billion for additional investments in case the economy does enter a recession. His plan will strengthen our unemployment insurance system and make one-time investments in a new energy infrastructure, state aid and addressing the housing crisis. Acting now will accomplish three things: (1) make needed investments in fighting global warming and poverty, (2) create jobs and cushion the expected economic slowdown, and (3) lay the foundation for a larger job creation package if our economy slides into a recession, as some economists fear.

Accelerate Our Investment in Clean Energy: The crisis of global warming and the high cost of energy require us to invest in a new infrastructure as the foundation for a new clean energy economy. Building this infrastructure will create jobs and spark economic activity, while also investing in our nation's long-term prosperity. Edwards calls on Congress to:
- Encourage wind and solar farms, extend the renewable energy production tax credit and encourage the distributed generation of renewable energy at homes and businesses.
- Weatherize 200,000 homes to reduce energy use and costs and convert schools, hospitals and local government buildings to energy-efficient green buildings.
- Train workers to fill new "green collar" jobs in clean energy businesses and create temporary Stepping Stone jobs for workers who cannot find other employment.
- Support energy-efficient transportation options such as light rail, bus projects and parking lots near existing mass transit stations, prioritizing those projects that can get started within 90 days.
- Help low-income families heat their homes through the LIHEAP program.
Strengthen the Safety Net for Workers Struggling to Find Jobs: Our nation's unemployment safety net is badly outdated, leaving many workers unprepared for hard times. Most unemployed workers do not receive any unemployment benefits. Many who do get help see their benefits run out before they can find another job. In particular, low-wage workers, part-time workers, temporary workers and the long-term unemployed are poorly served. Edwards calls on Congress to help states cover 500,000 more workers a year. He also believes that Congress should pass legislation automatically responding to a spike in unemployment rates by providing additional weeks of unemployment insurance to workers who cannot find jobs. [EPI, 2007; Vroman, 2007; CBPP, 2007]
Help States Avoid Property Tax Increases and Cuts in Critical Programs like Medicaid: Most states are constitutionally required to balance their budgets, which forces them to raise taxes and cut vital programs like Medicaid during recessions, creating hardships for regular families and making economic downturns worse. Already, the current economy is causing many state budgets to weaken, according to recent surveys by the Center on Budget and Policy Priorities, the National Conference of State Legislatures and the National Governors Association. Thirteen states face a combined $23 billion shortfall in 2009 and 11 more expect problems. Edwards will increase the federal contribution to Medicaid and provide additional aid to states, helping them avoid cuts to education, health care and other basic services and avoid increases in property and other taxes that disproportionately impact working families and seniors on fixed incomes. [CBPP, 12/18/2007; NCSL, 12/10/2007; NGA and NASBO, 12/5/2007]
Tackle the Housing Crisis: Far stronger action is needed to help the millions of families at risk of losing their homes and to head off further economic damage from the credit crisis. Edwards believes that Congress must do much more to tackle the mortgage crisis. He will:
- Create a Home Rescue Fund that will help families avoid foreclosure through counseling, bridge loans and modest amounts of financial help and that will help rehabilitate and quickly rent or sell foreclosed homes to stabilize economically distressed neighborhoods.
- Give families the right to rewrite the terms of their primary mortgages in bankruptcy like they already can on investment properties and second homes, writing off debt that exceeds the value of the home and setting fair repayment terms.
- Prevent future crises by passing a strong national law against predatory lending and creating a new federal regulator for financial services products.
Monitor the Economy Closely and Take Additional Steps if Necessary: Edwards also believes that we need to carefully monitor the direction of the economy in the coming weeks and months. If the economy falls into a recession and the job market worsens, as many fear, then a stimulus of approximately $100 billion could be appropriate. Such a package could include additional state relief, additional spending on a new energy infrastructure, accelerating investments in schools, roads, and bridges and temporary tax cuts targeted to the low-income and middle-class families who are most likely to spend money in their pockets.