Stimulus Needed Then, Investments Needed Now
Stimulus Needed Then, Investments Needed Now
By Congresswoman Donna F. Edwards
Member of Congress
From 2007 to 2009, the United States suffered through our worst financial crisis since the “Great Depression,” and the effects continue today. At the height of the “Great Recession,” over 750,000 jobs were being lost each month, unemployment hit 10.1 percent, and our economy was on the brink of financial collapse. It was in this environment that required unprecedented stimulus spending. The Troubled Asset Relief Program (TARP) and the American Recovery and Reinvestment Act (ARRA) were necessary to stop the downward economic spiral and save our economy. Thankfully, those efforts proved successful. Today, as talk of deficit reduction rules Washington, we cannot lose focus on job creation. We must stay committed to targeted investments that will help our short- and long-term job growth, increasing American workers’ future competitiveness and prosperity.
In the fall of 2008, leading economists and the Treasury Department warned that a meltdown was imminent if action was not taken. Congress responded by passing TARP, one of my most difficult votes as a Member of Congress, but a necessary one. With the majority of the fund now repaid and costing only a fraction of what was calculated initially, TARP helped stop economic freefall. We then passed the ARRA, an economic stimulus, that helped the economy begin to grow. According to the nonpartisan Congressional Budget Office, the ARRA raised gross domestic product by between 1.1 percent and 3.1 percent, and increased the number of employed by between 1.2 million and 3.3 million workers. Without these measures, this recession would have been deeper and longer.
Today, we’ve had 14 months of consecutive job growth and signs that the economy is slowly on a path to recovery. However, the May jobs report, which showed that job growth slowed and unemployment among African Americans remains dangerously high at 16.2%, is further evidence that we must continue to focus on job creation. Instead, since Republicans took control of the House of Representatives, the only jobs bills to come to the floor are Democratic proposals, and Republicans still voted against each one. Republican’s focus in Washington is slashing spending, reducing the debt, and using the debt ceiling – needed to pay off our bills- as blackmail. It is shameful that job creation is a distant memory for many of my Republican colleagues as they work to protect tax breaks for the rich and for big oil companies and end Medicare. We need to control spending, but we must also raise revenue to invest in America’s future. I believe we should start by investing in education and infrastructure – jobs for today and a strong workforce for tomorrow.
A quality education is a fundamental component for success. However, according to the College Board, the U.S. now ranks 12th among 36 developed nations with adults 25 to 34 years old who have a college degree. The situation is worse for African American students with a college graduation rate of only 41 percent according to the Journal of Blacks in Higher Education. We can and we must do better. We must prioritize investments to increase graduation rates; expand science, technology, engineering, and mathematics fields; and protect Pell grants and student loans. I applaud President Obama’s recent announcement of a partnership between private-sector manufacturing, community colleges, and the National Association of Manufacturing to provide 500,000 community college students with industry-recognized credentials. These types of job training programs will make American workers more competitive in the global economy.
Our nation’s crumbling infrastructure is another opportunity for future success. According to a February report released by the McKinsey Global Institute, “US infrastructure is inadequate to meet the needs of a dynamic, growing economy. At the same time, the quality of infrastructure from transportation to water systems has been in relative decline in the United States, which currently ranks 23rd in the quality of its overall infrastructure, undermining competitiveness.” As a member of the Transportation and Infrastructure Committee, I believe it is critical that Congress make long-overdue investments in our nation’s infrastructure, lay the groundwork for American competitiveness, and help create thousands of new jobs across the country.
The approximate number of U.S. jobs lost in the “Great Recession” was eight million. The financial situation was dire, and the stimulus programs avoided financial and economic disaster. But now is the time for targeted investments that will transform our workforce, rebuild our infrastructure, and grow our economy to ensure job creation and economic prosperity for generations to come.