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Politics : PRESIDENT GEORGE W. BUSH -- Ignore unavailable to you. Want to Upgrade?

To: stockman_scott who wrote (450148)	8/29/2003 10:33:01 AM
From: laura_bush	Read Replies (2) \| Respond to of 769667

Do Jobs Not Matter Any More? Do Jobs Not Matter Anymore? By E. J. Dionne Jr. Friday, August 29, 2003; Page A23 Maybe we should just scrap Labor Day and rename it "Capital Day." After all, aren't we now a "nation of investors"? Isn't most business reporting, especially on television, about stock prices and "returns on capital"? If you care about wages and working conditions, you must be some sort of dinosaur. And, hey, who cares about unemployment? Productivity is growing, which means we're more efficient. Sure, we're losing manufacturing jobs. But worrying about manufacturing is so Old Economy. Yeah, yeah, a lot of those manufacturing jobs helped people build middle class lives. But won't they make it all up in their portfolios? Income is old hat. Wealth is the thing. This Labor Day is as good a time as any to begin rolling back the effects of roughly a quarter-century of propaganda that sought, quite successfully, to diminish the role of labor -- which is to say real human beings living primarily on wages and salaries -- in creating prosperity. Beginning in the late 1970s, the promoters of supply-side economics tried to resell us on the economic ideas of the 1890s and obliterate the assumptions that had dominated thinking about the economy from the election of Franklin Roosevelt in 1932 during the Great Depression. The lesson of the Depression was that if ordinary workers lacked jobs and adequate incomes, the economy would crash because too few people could afford to buy what businesses hoped to sell. This was demand-side economics and it laid heavy stress on spreading incomes and job opportunities broadly. The supply-siders insisted that supply created its own demand. In plain English, this meant we should think less about labor and more about capital -- specifically, investors who created the means to produce the goods. If the New Dealers glorified the role of the worker, the supply-siders glorified the entrepreneur. "One of the little-probed mysteries of social history is society's hostility to its greatest benefactor, the producers of wealth," wrote George Gilder in "Wealth and Poverty," his influential supply-side manifesto published in 1980. "How much easier it is -- rather than learning the hard lessons of the world -- merely to rage at the rich and even steal from them." Supply-side theories on the urgency of cutting taxes on the rich were exploded when Bill Clinton raised taxes on the wealthy and -- contrary to the supply-side predictions -- helped unleash a remarkable period of economic growth. But the supply-siders have had a great run, and their latest rationales focus on how many Americans own stock. The theory is that if we're all entrepreneurs, then all of us benefit from policies that benefit investors. Our role as employees -- as workers -- is shoved up there in the attic with that old lady Ross Perot used to talk about. No one is more evangelical about the new investor nation than Grover Norquist, the conservative activist who has devoted his life to eliminating taxes, especially taxes on savings and investment -- which means taxes on the best-off Americans. Norquist speaks constantly of the 70 percent of voters who own shares of stock. But let's look at those numbers. Norquist speaks of voters. According to the Federal Reserve, half of all Americans have some connection to the stock market, which means that half do not. And even for the happy 50 percent, their major connection to the stock market is through pension funds they do not themselves control. It's still the case that most stock is owned by a small percentage of Americans. An analysis of Federal Reserve data by the Center on Budget and Policy Priorities, for example, recently found that the top 10 percent of income earners owned 70 percent of directly held equities. The bottom 60 percent of earners owned just 9 percent of directly held equities. That's why policies that benefit investors (such as the dividend tax cut) shower huge benefits on a small number of Americans. The simple truth is that the standard of living of most Americans depends on getting jobs that pay well. This means that unemployment matters not just for those out of work but also for those whose wages are depressed when too many people are competing for too few jobs. For most Americans, the best economic policy is still low unemployment. That's why the late 1990s produced income growth for the poor and the middle class as well as the wealthy. I am all for a nation of owners and investors. But most people need jobs. For 25 years, we have been hearing that labor depends upon capital. It's time to resurrect the other, buried truth: that capital depends upon labor. Our prosperity really does require keeping the "Labor" in Labor Day. washingtonpost.com