(Originally written for Malloy for Congress, 2008)
Conservatives often speak as if the choices that confront us in Economic Policy are Socialism and what they insist on calling “free market” ideology. Opponents of using tax money to subsidize the destructive export of entire industries are labeled as enemies of “free” trade and of “free” enterprise, as little better than Communists, adherents of a dead creed best consigned to “the ash heap of history.”
But it’s a strange brand of freedom conservatives offer. People aren’t free to quit their jobs or to organize for better wages and working conditions. Families aren’t free to plan and build a better future. Communities aren’t free to protect themselves from becoming empty, impoverished shells. Meanwhile, America slides slowly, disastrously, into its new status as a second-rate economic power, its currency discarded, it products unwanted, its people tainted with decline and doubt.
The middle class falls further behind every year, real median household income having peaked in the 1970s. Growing indebtedness, spiraling educational costs, and health care spinning out of reach have ended the American dream for millions of families. But not everyone suffers. The top one percent of income earners enjoy a greater share of national wealth than at any time since 1929. The prices of luxury goods, higher education, homes in good school districts, and high-quality health care have spiraled out of reach for everyone but an elite few. The conservatives brought us, not free markets, but rigged markets.
There are more than 35,000 lobbyists in Washington, and tens of thousands more in state capitals across America. Their corporate clients are well-represented in legislation and regulation, which has been diverted from its purpose of protecting our workers, communities and planet. Innumerable subsidies and other favors have systematically twisted our economy into a casino where the house always wins.
Reviving the American economy will be one of the most difficult jobs government has ever attempted. We will have to reduce government spending, and refocus the smaller amount on measures to increase the long-term competitiveness of the American people. We must reduce both public and private debt, and take measures to bolster our manufacturing sector, particularly in high-tech, high value-added goods where we still retain a broad advantage.
The most important factor in twenty-first century competitiveness will be human capital. The ingenuity of its people is all any country will ultimately have to sell. America still enjoys the most productive workers and greatest universities in the world, but our secondary education suffers from real problems that portray our flawed choices over the last quarter-century. Schools funded by property taxes have maximized local control, but only at the price of ensuring that those communities most in need of the leveling effects of high-quality public education have been denied what they need to compete. We need new methods of funding public education that spur greater equality of opportunity.
America needs a first-class national defense, but our defense budget serves what President Eisenhower called the “Military-Industrial Complex,” rather than national security. We spend more than the rest of the world put together on national defense, and we have Virginia-class attack submarines with no Al Qaeda subs to sink, Raptor stealth fighters with no Taliban bombers to shoot down, Trident submarine missiles with no FARC missile silos to vaporize, and a Ballistic Missile Defense with no Hezbollah ICBMs to stop. These programs cost between 35 and 300 billion dollars apiece. If we weren’t fighting a non-existent Cold War and were instead equipping our soldiers for the war they’re actually fighting, we would save hundreds of billions, and hundreds of lives, a year. Our troops wouldn’t have to buy their own body armor. We wouldn’t have to hide thousands of disabled soldiers and marines, crippled for life because we couldn’t or wouldn’t buy them IED-resistant vehicles to patrol in.
The United States of America, with the greatest concentration of scientists and engineers in human history, takes second place to Germany in shipping solar panels, to Brazil in the use of biofuels, to Europe and Japan in fuel-efficient automobiles. Meanwhile, oil rockets past $135 a barrel and the polar ice caps are disappearing before our eyes. There is enormous demand for “green” technologies and we’re in an enviable position to supply them, having educated a huge portion of the world’s engineers and possessing a unique mix of geography that lets us implement every major alternative energy technology. Tax credits for firms and households developing and using these technologies would serve as magnets for these profitable industries, which can strengthen America’s economy for generations.
Health care costs consume more than 16 percent of GDP, more than that of any country in the world. The costs and risks of the American health care system are helping to hobble the rest of our economy, raising the costs of manufactured goods, deterring business formation and labor migration, and sucking capital out of other productive sectors. Health care costs associated with severe and chronic illness are among the largest causes of bankruptcy in America today. Providing American families with universal access to health care would not only be morally right, but economically wise, with benefits to the entire national economy and to every community.
We can, should, and must shift a portion of our tax burden from the middle class onto the top one percent of income earners, who have enjoyed a virtual tax holiday over the last twenty-five years. Middle-class families have seen their real incomes stagnate, if not decline, over the same period. Reducing their tax burden, while addressing their need for greater security and social mobility, would restart the engine of American productivity and allow America to compete in the global marketplace against all comers.
We can and must meet the economic challenges of the Twenty-First Century. Working together as one nation, we will conquer these challenges and help lead the world to greater prosperity and peace. Some vested interests will lose subsidies and tax breaks they thought were keeping them in business, but their defeats will help usher in a new era of shared prosperity that will lift their boats as well. We have no reason to be divided on the issue of restoring America to its rightful place as the world’s sole economic superpower.
