America’s Jobs Deficit More Important than the Budget Deficit

by Tom Gallagher

Do state-level “job creation” programs work? Hard to say, according to a new study. The belief in cutting business taxes as a reliable method for increasing local employment is so widely shared in the U.S. that every state – plus the District of Columbia – offers financial incentives for businesses to “create jobs” within its jurisdiction. So deep is that belief, in fact, that states frequently don’t even consider a cost/benefit analysis necessary. At least that’s the conclusion that a Washington, DC-based public policy center, Good Jobs First, reached in Money for Something, a review of 238 separate job creation programs cumulatively costing state governments over $11 billion in reduced taxes or direct payments.

With state budgets returning to normal about as slowly as the overall economy, more than a few governors and legislators will face yet another season of trying to bring in more and spend less – just to stay even. Granted, the numbers are not as bad as they were: the Center for Budget and Policy Priorities reports twenty-nine states estimating a combined $44 billion shortfall for Fiscal Year 2013, and even if that grows – as CBPP anticipates it will – it won’t match FY 2010's record $191 billion in combined deficits. Unfortunately, though, it’s also the case that budget balancing gets harder each year as more and more of the “easier” options have already been utilized. All of which should make Money for Something essential reading in state capitals.

The study scored state job creation programs on a scale of 100 according to three basic criteria: actual job creation or other quantifiable performance standards; wage standards above the minimum wage; and health insurance or other employee benefits. Individual scores ranged from Nevada’s 82 to Alaska’s 5 and the District of Columbia’s 4, with an overall average score of 40.

For a sense of how states operate these programs, let’s look at the biggest: California. The nation’s most populous state scored a 23, ranking it forty-second. (And a closer look suggests that even this rating is overly generous.) Not surprisingly, it’s home to some of the nation’s highest dollar value job creation programs. Its Research and Development Tax Credit is the largest, with an estimated annual cost of $1,265,000,000 in foregone revenue, and its $670,000,000 Enterprise Zone Program ranks third. Money for Something gave these programs a 10 and 15 score, respectively.

This was not the Research and Development Tax Credit’s first bad review. In 2003, a California Legislative Analyst's report found the program “appears to have been adopted simply as a means of generally encouraging more R&D activity within the state,” rather than having any “specific economic development goals” and further noted that “we are not aware of economic evidence which, on balance, justifies a state credit in addition to the federal credit.” As a result, the Analyst’s Office recommended “that the Legislature consider reducing the credit or phasing it out over time, especially given the substantial direct revenue losses associated with the program and the state's current budgetary position,” while suggesting that “direct research-related spending (such as through the University of California) may well be a more effective means of achieving the same objective.” The program has, however, survived – along with the state’s budget crisis.

The Enterprise Zone Program has been even more controversial. Like so many of the programs studied, there is no requirement that the jobs supposedly created in an Enterprise Zone actually be new jobs – as opposed to jobs transferred from another already existing facility; they need not last longer than a year; and the program carries no wage or benefit requirements. In 2009, the Public Policy Institute of California concluded that the state’s enterprise zones “have no overall effect on job growth.” Atypically, this assessment was actually taken seriously, to the extent that Governor Jerry Brown’s 2011 budget proposed the program’s elimination. Its backers managed to save it in the legislature, however, despite the fact the California Budget Project found “Corporations with assets of $1 billion or more claimed 70.3 percent of the total dollar value of EZ tax credits claimed by corporations in 2008, even though less than half of 1 percent of corporations that file tax returns in California have assets of $1 billion or more.”

Money for Something also found California’s smaller $100,000,000 Film and TV Production Tax Credit pretty much as lax as the other two programs and gave it a 10 as well. And the only reason the state ranked as highly as it did is that the study took the average grade of the four programs it assessed, and the fourth, the Employment Training Panel, which makes workforce training grants, rated a 58. But, at $36,400,000, the Employment Training Panel accounts for less than 2 percent of the combined cost of the programs under review. Were the state’s overall grade prorated according to dollars actually expended in each of the programs, it would get a 12, a mark surpassing only Wyoming, Alaska and the District of Columbia.

How important is all of this? Well, the nation’s biggest state not only has the biggest budget, but the biggest deficit as well – estimates run from $9 to 24 billion depending upon whom you ask – and when. With California having exhausted pretty much every budget trick in the book and officials facing an uphill ballot fight for a $6.8 billion tax measure, the idea that programs like those discussed here could drain $2 billion a year from state coffers based upon premises of job creation that appear to be speculative at best, would seem to be unconscionable.
And there are fifty other stories told in Money for Something, probably the largest study of its kind ever undertaken yet still covers only a small fraction of the estimated $70 billion a year the states expend – directly or indirectly – in the name of economic development. As anyone familiar with state legislatures may know, it’s a lot easier to create a businesses tax incentive program (which will be hailed as improving the “business climate”) than to eliminate one – or even question it, (which be invariably be called bad for the “business climate.”)

Are job creation tax credits a serious strategy? Or just happy talk – and maybe good for the campaign contributors? There has never been a time when we needed clear answers to these questions more than we do now.

Tom Gallagher is a San Francisco antiwar and Democratic Party activist. He is a past member of the Massachusetts House of Representatives.. Reach him at TGTGTGTGTG@aol.com or TomGallagherwrites.com.

by Greg Kaufmann

In December, there were more than 13 million unemployed workers and about four people looking for work for every available job. According to the Economic Policy Institute (EPI), 5.5 million people have been unemployed for more than half a year, up from 1.2 million in 2007, and the average duration for an unemployed person is over nine months.;

“It is not, of course, that these millions of workers have become lazy, unskilled, or unproductive, it is that there are not enough jobs available,” writes EPI economist Heidi Shierholz. She notes that even new research from the Federal Reserve Bank of San Francisco attributes increased duration in unemployment to “the severe and persistent weakness in aggregate demand for labor.”

So it’s particularly alarming to see Congress playing games with an extension of unemployment benefits that are set to expire at the end of the month. Without an extension, more than one million Americans will be cut off in March, and more than 3.3 million by June 1.

“Instead of offering a hand up and rallying to help those who are most struggling, Republicans and perhaps some Democrats would like to drastically cut down on the maximum number of eligible weeks, and throw up roadblocks to stop many jobless people from getting any benefits at all,” says Debbie Weinstein, executive director of the Coalition on Human Needs.

Some of those roadblocks include stigmatizing drug tests and making people who lack a high school diploma or GED ineligible unless they enroll in classes—though Weinstein notes there are currently about 160,000 people on waiting lists for said classes and Republicans would like to see further cuts to those programs.

For millions of Americans, this isn’t a debate over some abstract benefits extension, it’s a debate over a lifeline.

In 2010, the federal emergency unemployment benefits currently being debated kept 3.2 million Americans from falling into poverty—less than $22,350 annually for a family of four. The unemployment insurance system as a whole kept 4.6 million people above the poverty line. Denying benefits now catches Americans at a particularly vulnerable moment. According to the Corporation for Enterprise Development, 27 percent of American households now live in “asset poverty”—meaning they do not have the savings or other assets to cover the basic expenses a poverty-level income would cover for just three months in the event of a layoff or other crisis. If you take away assets that can’t quickly be converted into cash—like a home, or car—that number jumps to a stunning 43 percent.

“Behind these numbers are very real and often frightening stories,” says Christine Owens, executive director of the National Employment Law Project (NELP). “Millions of midlife and older workers are moving toward retirement with substantially reduced savings because of job loss. The stock market has routed their 401(k)s and their home values are declining. And threats to basic economic security programs continue.”

Those threats aren’t just happening in Congress but at the state level too, creating a perfect storm that threatens the long-term unemployed.

Joan Entmacher, vice president for family economic security at the National Women’s Law Center, notes that South Carolina—which last year reduced the maximum number of weeks for state benefits from twenty-six to twenty—is considering bills that would bar “steady, part-time workers” from receiving unemployment, particularly hurting women who are two-thirds of the part-time workforce in South Carolina as well as nationally. Another bill would make seasonal workers ineligible for benefits during the offseason. Three other bills were approved in subcommittee—drug testing for all applicants, mandatory unpaid community service (burdening workers with caregiving responsibilities and impeding the job search) and complete ineligibility for a worker terminated for even a minor infraction.

“The legislature is blaming the real victims of the recession, the unemployed, for our state budget problems and pursuing senseless cuts and barriers to receiving or keeping benefits,” says Sue Berkowitz, director of the South Carolina Appleseed Legal Justice Center.

Entmacher says the three bills “aren’t moving at the moment” but could be revived if restrictions like the ones being considered at the federal level are passed.

There are, however, opportunities to make your voice heard for a “clean” renewal of benefits through 2012 without cuts or punitive measures. Also today, USAction, NELP and the AFL-CIO begin “Walk in My Shoes” events in front of Congressional district offices across the United State, letting representatives know that people have lost their jobs and homes, now’s not the time to take their unemployment insurance too.

Finally, the GOP would like to pay for any unemployment benefits extension—wait for it… by reducing the number of low-income families eligible for the child tax credit (you can’t make this stuff up). The average impacted family earns $21,000 a year and would lose $1,800 in income. There are indications from people close to negotiations that Democrats might be ready to deal on this. So, when you contact your representatives and ask for that clean extension that will help long-term unemployed people not fall into poverty, make it clear that you don’t want them to do it by throwing kids into poverty.

Homeless, NYC: The New Normal?

New York Times reporter Alan Feuer offers a compelling and poignant profile of a homeless family in New York City and examines city and state homeless policy as well. “Homeless Families, Cloaked in Normality” is an in-depth look at what happens when a couple—a full-time healthcare aide and a maintenance man—lose work and can no longer afford rent. They separate, and the mother and her two boys end up at a shelter, where they try to recover.

Feuer writes that the city’s homeless population is now “higher than it has ever been” at 40,000. That population is comprised of 6,000 homeless men and 2,000 homeless women in facilities for single people, and 15,000 parents and 17,000 children in family shelters. He attributes the rising population to “evictions, many connected to the financial crisis,” the end of a rent-subsidy program and limited Section 8 vouchers.

While there is a “cloak” of normality in the profiled family’s life at the shelter, a new brief from the Institute for Children, Poverty & Homelessness (ICPH) depicts a Bronx and South Bronx where homelessness is all too normal. Indeed, nearly 47 percent of Bronx residents fear becoming homeless, and South Bronx families experience homelessness at a rate three times higher than families in the rest of the city and six times greater than the level nationwide. In 2010, over one-third of all applicants for New York City’s family shelter system were from the Bronx, and 93 percent were either Black (53 percent) or Hispanic (40 percent).

ICPH attributes the homeless epidemic in the Bronx to a 30 percent poverty rate (less than $18,310 annually for a family of three); severe rent burdens with over 55 percent of residents paying more than 30 percent of their income on rent, and nearly one-third paying more than half their income; overcrowding rates that are double the national average; and only 4 percent of rental housing vacant and available.

ICHP spokesperson Diana Scholl says the organization “hopes this brief will continue the dialogue of the need for education, job training, services, and well-paying jobs to reduce poverty in the Bronx and elsewhere.” A draft of ICPH’s “New Path” report proposes “immediate action” to make shelters on-site learning and career-building centers, thereby reducing recidivism.

A Re-entry Model?

Every year, 700,000 formerly incarcerated men and women re-enter society. Within three years, two-thirds are arrested and more than half return to prison. So it’s worth paying attention to a new evaluation of a transitional jobs program run by the Center for Employment Opportunities (CEO) in New York City that shows significantly reduced recidivism and cost savings.

The nonpartisan, nonprofit social and education policy research organization, MDRC, found that program participants were 16 to 22 percent less likely to be convicted of a crime and reincarcerated; and cost savings associated with reduced recidivism were between $1.26 and $3.85 for every $1 in program spending.

“It is very unusual to find recidivism effects like this,” MDRC spokesman John Hutchins told me. “In fact, other research on transitional jobs programs that we’ve conducted has not shown the same results.”

Some of the unique approaches used by CEO include small work crews of five to seven participants, with supervisors who often share a similar background—one-third of CEO staff was formerly incarcerated. These groups seem conducive to developing mentoring-type relationships and peer support. Participants also receive counseling and job search assistance to transition to unsubsidized jobs, and post-placement retention services.

Hutchins says MDRC is currently working on two new projects for the Department of Health and Human Services and the Department of Labor to build upon the success of this program.

Further Reading

“Repairing the Safety Net,” Robert Greenstein
http://www.offthechartsblog.org/repairing-the-safety-net/
Paying for Cancer Treatment for Children in America,” Wendell Potter
http://www.commondreams.org/view/view/2012/02/03-8
Voices of Poverty
http://thevoicesofpoverty.org/
“Dismantling Schools, Disrespecting Communities,” Mark Simon and Leigh Dingerson
http://www.fserjc.org/newyork/
Half in Ten Story Bank
http://www.halfinten.org/stories

Get Involved

Tell Senator Bernie Sanders Your Story: Affordable Dental Care
http://www.sanders.senate.gov/vermont/dental.cfm
Gender Equity in the Restaurant Industry
http://www.iwpr.org/events/tipped-over-the-edge-gender-equity-in-the-res...
LIHEAP Action Day
http://www.nationalfuelfunds.org/NFFN/LIHEAP%20Action%20Day.html
Achieving Full Employment for Black Workers
http://secure.epi.org/page/event/detail/epiforums/jrc
Campaign for Community Change
http://www.campaignforcommunities.org/page/current-initiatives

Vital Statistics

US poverty (less than $22,300 for a family of four): 46.2 million, 15.1 percent.

Kids in poverty: 16.4 million, 22 percent of all kids.

Deep poverty (less than $11,157 for a family of four): 20.5 million people, 6.7 percent of population.

Impact of public policy, 2010: without government assistance, poverty twice as high—nearly 30 percent.

Impact of public policy, 1964-1973: poverty rate fell by 43 Percent.

Number of Americans “deep poor,” “poor,” or “near poor”: 100 million, or one in three.

Quotes of the Week

“Drug testing unemployment insurance applicants is part of a growing pattern of blaming the jobless for their predicament rather than an economic environment where there is one job opening for about every four people looking. [It’s] based on the false assumption that laid-off workers are more likely than others to have substance abuse problems.”
   —Elizabeth Lower-Basch, CLASP senior policy analyst.

“If among you, one of your brothers should become poor, in any of your towns within your land that the Lord your God is giving you, you shall not harden your heart or shut your hand against your poor brother, but you shall open your hand to him and lend him sufficient for his need, whatever it may be.” [Deuteronomy 15:7-8]
   —Interreligious Working Group on Domestic Human Needs, letter to Congress

Copyright © 2012 The Nation
http://www.thenation.com/blog/166175/week-poverty-perfect-storm-threaten...

Greg Kaufmann is a Nation contributor. His column, This Week in Poverty, posts every Friday morning. His work has also appeared on Common Dreams, AlterNet, Tikkun.org, NPR.org, CBS News.com, and MichaelMoore.com. Constructive comments and ideas will also be read at WeekInPoverty@me.com. Please follow him on Twitter as well.

by Mark Weisbrot

President Obama’s proposed budget has a few interesting proposals for reforms over the next decade. Among the best are the proposals to rescind the Bush tax cuts for households with incomes of more than $250,000, and to tax dividends for stockholders among this group as ordinary income. These and a few other proposals would sum up to a small but significant step in the opposite direction from where this country has been going for the past three decades: i.e. a vast upward redistribution of income to the rich and the super-rich.

But those concerned with the immediate future are likely to be disappointed. Most Americans have to work for a living, but there are more than 25 million, or 15 percent of the labor force that are either unemployed, have given up looking for work, or are involuntarily working part time. The main reason for that is quite simple: there is not enough demand for goods and services in the economy in order to employ them.

With private demand still weak from the collapse of the housing bubble, and state and local governments still tightening their budgets and laying off workers, this leaves the Federal government as the spender of last resort. But President Obama’s budget actually reduces spending, adjusted for inflation, for the coming fiscal year (2013). This means that the Federal government will not contribute to resolving the unemployment crisis under this budget.

This is too bad, because the U.S. economy is down 10 million jobs from where it should be, and even at the recent rate of job growth (200,000 per month over the last quarter), it will take until 2020 to get there.

There are some areas where the budget proposes spending that would create jobs in the coming fiscal year, and the administration has touted these proposals: surface transportation projects ($18.2 billion); teachers ($10 billion); and modernizing schools ($6 billion). But these are small amounts relative to the need for job creation, and the latter two are less than for the prior fiscal year.

Unfortunately, President Obama has accepted way too much of the right-wing narrative, which portrays the United States’ budget deficit and debt as the most important economic problem. In his speech today he said: “I’m proposing some difficult cuts that, frankly, I wouldn’t normally make if they weren’t absolutely necessary. But they are. And the truth is we’re going to have to make some tough choices in order to put this country back on a more sustainable fiscal path.”

But in the short run there is no deficit or debt problem: the United States is currently paying about $1.4 percent of GDP in net interest on our federal debt, which is about as low as it has been over the past 60 years. And the long-term deficit problem is a problem of rising health care costs. If we had the health care costs per person of any other high-income country, we would be looking at long-term budget surpluses. That is how the President should frame the budget issue, and his proposals should focus on creating employment, reducing poverty (which is amazingly now back at the level of the late 1960s), and moving toward a more energy-efficient economy – all of which are complementary goals.

And if there are cuts to be made – to free up spending for job creation -- they are not difficult choices at all: who will suffer if we give up on policing the world with hundreds of military bases throughout the globe? As most Americans have now learned, unnecessary, protracted wars such as in Iraq and Afghanistan do not increase our security but rather reduce it. But the President’s budget avoids any serious reduction of this largest and most harmful source of waste of taxpayers’ dollars.

The President’s budget is just a proposed framework and of course many of the positive things in it will not get through Congress. Since that is the case, it would have been worth his while to propose something bold that addresses the most pressing needs of the nation – and make the necessary compromises from there. By starting with something timid, which is already being attacked as “radical” by House Republicans – well, we have seen where this leads.

This article was published in The Guardian (UK) on February 13, 2012.
http://www.guardian.co.uk/commentisfree/cifamerica/2012/feb/13/obama-bud...

http://www.cepr.net/

Obama’s Plan to Save the Military From Cuts—at the Expense of Domestic Programs
by George Zornick

As budget wonks comb over President Obama’s outline for fiscal year 2013, a startling White House plan has become clear: the administration is seeking to undo some mandatory cuts to the Pentagon at the expense of critical domestic programs. It does so by basically undoing the defense sequester that kicked in as a result of the Congressional supercommittee on debt. This wasn’t a featured part of the White House budget rollout, and for good reason—it undercuts the administration’s carefully crafted message of benevolent government action and economic fairness.

The process for this shift is complicated, and has been flagged by the Center on Budget and Policy Priorities. Essentially, Obama wants to eliminate individual spending caps for both military and non-military spending, and institute one single discretionary spending cap instead. Here’s the basic rundown.

To understand how deep the retreat really is, one first needs to understand the difference between security spending and defense spending. Spending on defense applies to the “National Defense Function”—that is, the entire Pentagon budget, plus $24 billion for nuclear weaponry and environmental cleanup programs at the Department of Energy, the defense activities of the FBI, and a small handful of other defense programs. Security spending, on the other hand, excludes some of the Department of Energy money, along with some of the other FBI and small program funding—but includes the Department of Veterans Affairs, the Department of Homeland Security and the “International Affairs” part of the budget, which is mainly State Department funding and foreign aid.

So from a progressive point of view, to cut the most fat from the military budget you want defense cuts, not security cuts—otherwise funding for veterans’ health and diplomatic efforts is also in jeopardy.

Next: when the debt ceiling deal passed in August, it implemented discretionary spending caps through 2021. This meant that if Congress appropriated money above certain levels for discretionary spending—which is basically everything the government spends money on, minus entitlement benefits and interest on the debt—something called sequestration kicks in, which entails automatic, across-the-board cuts to bring the budget back under the spending caps.

Under the debt ceiling deal, those spending caps were split between security and nonsecurity spending areas in 2012 and 2013. Nonsecurity spending is the important domestic stuff: everything besides security spending, entitlement benefits and interest on the debt. Think scientific research, the NASA budget, national parks and forests, environmental protection, social services, Head Start and so on. Then, in every year from 2014 through 2021, there would just be one cap. So starting in 2014, Congress could theoretically take everything from nonsecurity spending in order to maintain a healthy security budget and meet the spending cap.

The failure of the supercommittee changed all this. When the twelve members failed to reach an agreement in November, the budget laws automatically changed—now, there is no single cap starting in 2014, but dual caps in both defense and non-defense spending through 2021. That’s why hawks like Senators Jon Kyl and John McCain were so upset when the supercommittee failed—with mandatory caps in defense and nondefense spending through 2014, it was a worst-case scenario for defenders of the Pentagon budget.

The Obama budget plan, quite disappointingly, proposes to reverse the configuration of these caps. It would have caps in 2013, split between security and nonsecurity spending—not defense and nondefense—and then beginning in 2014, a single cap is reinstituted anyhow. All the firewalls ensuring that defense spending is reduced would thus be torn down.

The president’s budget for 2013 follows this new scheme: Obama proposes around $5 billion in spending above the defense cap, and $5 billion in spending below the nondefense cap. This would violate the current budget laws—unless the categorization was changed to security and nonsecurity spending. Then it would comply. And every year after, the distinction wouldn’t matter anyhow under one spending cap.

This is a dramatic shift in priorities, and one that not many people are discussing. Given the massive lobbying potential of the defense industry—and the comparably weak advocates for things like Head Start funding—it’s a virtual certainty that, under the White House proposal, these strict spending caps would be met by raiding nonsecurity spending heavily in years to come. Even the president’s own budget does that. One shudders to imagine the budget of President Romney or President Rubio.

© 2012 The Nation
http://www.thenation.com/blog/166344/obamas-plan-save-military-cuts-expe...

George grew up in Buffalo, NY and holds a B.A. in English from the State University of New York at Buffalo. Prior to joining The Nation, George was Senior Reporter/Blogger for ThinkProgress.org. He worked as a researcher for Michael Moore's SiCKO and as an Associate Producer on "The Media Project" on the Independent Film Channel.

by Robert Reich

The Obama administration is proposing to lower corporate taxes from the current 35 percent to 28 percent for most companies and to 25 percent for manufacturers.

The move is supposed to be “revenue neutral” – meaning the Administration is also proposing to close assorted corporate tax loopholes to offset the lost revenues. One such loophole allows corporations to park their earnings overseas where taxes are lower.

Why isn’t the White House just proposing to close the loopholes without reducing overall corporate tax rates? That would generate more tax revenue that could be used for, say, public schools.

It’s not as if corporations are hurting. Quite the contrary. American companies are booking higher profits than ever. They’re sitting on $2 trillion of cash they don’t know what to do with.

And it’s not as if corporate taxes are high. In fact, corporate tax receipts as a share of profits is now at its lowest level in at least 40 years. According to the Congressional Budget Office, corporate federal taxes paid last year dropped to 12.1 percent of profits earned from activities within the United States. That’s a gigantic drop from the 25.6 percent, on average, that corporations paid from 1987 to 2008.

And it’s not that corporations are paying an inordinate share of federal tax revenues. Here again, the reality is just the opposite. Corporate taxes have plummeted as a share of total federal revenues. In 1953, under President Dwight Eisenhower, a Republican, corporate taxes accounted for 32 percent of total federal tax revenues. Now they’re only 10 percent.

But now the federal budget deficit is ballooning, and in less than a year major cuts are scheduled to slice everything from prenatal care to Medicare. So this would seem to be the ideal time to raise corporate taxes – or at the very least close corporate tax loopholes without lowering corporate rates.

The average American is not exactly enamored with American corporations. Polls show most of the public doesn’t trust them. (A recent national poll by the University of Massachusetts at Lowell found 71 percent with an unfavorable impression of big business – about the same as those expressing an unfavorable view of Washington.)

The Administration’s initiative doesn’t even make sense as a bargaining maneuver.

Republicans will just accept the Administration’s lower corporate tax rate without closing any tax loopholes. House Republicans have already made it clear that, to them, closing a tax loophole is tantamount to raising taxes. And corporate lobbyists in Washington know better than anyone how to hold tight to loopholes they’ve already got.

Big business will fight to keep their foreign tax shelters. After all, it’s almost impossible to distinguish between their foreign and domestic earnings, which is why the U.S. Chamber of Commerce and other business lobbies have spent the past three years trying to make it even easier for companies to defer U.S. taxes on income they supposedly earn outside the country.

Representative David Camp, a Michigan Republican who heads the House Ways and Means Committee, has already proposed a 25 percent corporate top rate and changes that would let companies avoid paying U.S. taxes on even more of the income they say they earn outside America.

Nothing is going to be enacted this year, anyway, so it would have made more sense for the Administration to support a hike in corporate taxes – and use it to highlight the difference between the President and his likely Republican challenger.

Mitt Romney wants to reduce the corporate tax rate to 25 percent before eliminating any tax loopholes. Rick Santorum wants to cut the rate to 17.5 percent and eliminate corporate taxes for manufacturers. Newt Gingrich wants to cut the rate to 12.5 percent and let companies write off all capital investments immediately.

It’s discouraging. The President gives a rousing speech, as he did on December 6 in Kansas. Then he misses an opportunity to put his campaign where his mouth is.

© 2012 Robert Reich
http://robertreich.org/post/18079650906

Robert Reich is Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written twelve books, including The Work of Nations, Locked in the Cabinet, and his most recent book, Supercapitalism. His "Marketplace" commentaries can be found on publicradio.com and iTunes.