MEMO: Proposals for Sustained Employment Growth and Broad-Based Economic Prosperity
By John Podesta
The U.S. economy is officially now in “recovery”—our nation’s gross domestic product grew by 2.8 percent in the third quarter of 2009, and growth seems to be continuing—but we still face the challenge of how to create American jobs. Since the start of the Great Recession in December 2007, we have not seen net job growth in a single month. There are increasing indications that even if the economy continues to grow it will happen too slowly to absorb quickly the 16 million people out of work and searching for a job. This in and of itself could stall the nascent recovery, as unemployed consumers are unable to consume at the level businesses need to see before they will hire and expand.
Congress and the Obama administration made enormous strides toward a solution to this problem, most notably by passing the American Recovery and Reinvestment Act earlier this year. At the same time, the Federal Reserve has eased credit conditions and continues to keep interest rates low to encourage investment. These actions should be applauded. The fact that we are now emerging out of the Great Recession and not mired in a second Great Depression should not be taken for granted.
But sustained job creation is a long-term problem that cannot be solved with short-term solutions alone. The Federal Reserve believes it may take years before unemployment numbers come down to acceptable levels. Focusing only on short-term and emergency job creation, year after year, will put us in a position of ignoring the long-term investments we need to get our economy back on track. A combination of short- and long-term strategies will begin to ease the unemployment burden on the 16 million people now out of work and on our economy, and will truly allow this country to move forward on a more stable and sustainable economic path.
In short, we must act today to create jobs now and avoid the specter of another “jobless recovery,” but we also must act today to create jobs for next year, the coming decade, and beyond. The Center for American Progress proposes a wide-ranging set of policies to create jobs. These proposals include:
But our focus goes beyond short-term job creation strategies. If we are to move beyond the lingering pain of the Great Recession into truly sustainable, long-term economic growth, we will need to make sustainable, long-term investments.
First and foremost, this means investing in low-carbon, low-waste solutions to our current energy and climate crisis. Investing in renewable and efficient energy solutions moves our country toward greater energy independence and environmental stability. These investments will create jobs across a range of occupations and sectors—from innovation and manufacturing to installation and maintenance.
A comprehensive clean energy investment agenda has the potential to create 2.5 million jobs over the next 10 years while putting the United States on a path toward greater climate stability, energy security, and economic prosperity.
There is much we can do immediately as part of an economic recovery strategy. The Obama administration and Congress should prioritize the following policies to drive job creation in the near term while making structural changes to create the next generation of jobs in the clean energy economy:
These policies, integrated into a broader job creation strategy, would begin to move America from a jobless recovery to a sustainable and prosperous recovery. There is no other choice.