Sunday, September 05, 2010
Getting out of the Great Recession will require substantial changes in tax and public policy, writes Robert Reich, former secretary of labor in the Clinton administration. With job growth too weak to meet demand, Washington needs to make bold moves to put consumers back in a position to drive the economy.
Reich suggests:
1) Extending the earned income tax credit so it applies to the middle class. To fill the lost revenue to the U.S. Treasury from this decision, Washington could put a tax on carbon.
2) The government could exempt the first $20,000 of income from payroll taxes, and pay for it with a payroll tax on incomes over $250,000.
3) “Early childhood education should be more widely available, paid for by a small 0.5 percent fee on all financial transactions….In the longer term, Americans must be better prepared to succeed in the global, high-tech economy.”
4) Make public universities free. But graduates would be required to pay back 10% of their first 10 years of full-time income.
5) “Workers who lose their jobs and have to settle for positions that pay less could qualify for ‘earnings insurance’ that would pay half the salary difference for two years; such a program would probably prove less expensive than extended unemployment benefits.”
-Noel Brinkerhoff
The Real Lesson of Labor Day (by Robert Reich)
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