President Obama’s Middle-Class Economic Strategy: Building on a Uniquely American Recovery
In his State of the Union address and budget this year, President Obama laid out a vision of middle-class economics. In the weeks since, it has been an animating principle of the President’s focused strategy of action. On the eve of the release of Congressional Republicans’ budget this week, it’s worth revisiting middle-class economics and what it’s translating to in practice.
Middle-class economics is the simple idea that the economy performs best when the benefits of economic growth are broadly shared, not isolated to a fortunate few. It is reflected in the uniquely American recovery we have experienced over the past several years. Consider this:
Only in America, businesses are adding jobs at the fastest pace in decades while the deficit is falling at the fastest rate in decades. Indeed, the American private sector has added more than 200,000 jobs in each of the past twelve months — the first time that’s happened in thirty-seven years. And in perhaps the most hopeful sign, wages are starting to rise again: hourly earnings are up 2 percent over the past year, and they’ve risen at a 4 percent annual rate so far in 2015.
Combining this long overdue raise with lower gas prices, paychecks are going further — although there’s much more work to do. This progress shows that we don’t have to choose between stronger growth and asking the wealthiest to pay their fair share; and that we can finally discard mindless austerity and turn our focus toward further accelerating shared growth.
Only in America are we producing more oil and gas than Russia, Saudi Arabia, or any other country, while reducing greenhouse gas emissions more than any country on the planet. That progress is occurring because we’re producing more renewable energy, more efficient vehicles, more low-carbon homes and businesses, and more good-paying jobs in these growing fields than ever before. This progress is putting to rest the false choice between economic growth today and protecting the planet and the health of our children tomorrow. In a striking sign of how U.S. leadership can drive global progress, the International Energy Agency recently reported that 2014 was the first year in 40 years that the global economy grew but world carbon emissions did not. That’s a powerful reason for optimism.
Only in America are we seeing a rapid increase in health care coverage — about 10 million people gained health insurance coverage due to the Affordable Care Act last year alone — at the same as we are seeing health care prices per capita rise at the slowest rate in nearly 50 years. This progress is scrambling traditional cost-versus-coverage debates that said we had to choose between providing more Americans with the economic security of affordable health care and constraining health care costs — in fact showing that these two benefits from health reform go hand in hand.
Only in America have we shown how to build the middle class by leading the world in education. And we are rising again, graduating more of our young people from high school than ever before — hitting an all-time high of 81 percent — while making real progress in closing the national disgrace that is the achievement gap. While the graduation rate for all students increased in 2013, the graduation rate for African-American and Hispanic students increased by more than twice the overall level, putting to rest the idea that closing the achievement gap would be to the detriment of some. And the President has put forward a vision for improving skills and opportunities for Americans at every stage of life, from early childhood education to free community college to supporting a training system that prepares workers for the jobs employers are looking for.
Finally, we are seeing the crime rate and the incarceration rate both fall for the first time in 40 years. This progress is mooting the old view that throwing more people in jail alone is a strategy for keeping our neighborhoods safe. And it’s bringing together a rare coalition of Republicans and Democrats, business and labor, faith and civil rights groups who all agree that this year is the best moment in a long time for us to get serious criminal justice reform done.
These trends show it is not only possible to grow the economy and expand opportunity, we are witnessing it happen in real time. It is why the President is so resolved to aggressively push a middle-class economic agenda. And that’s why, over the past nine weeks since the State of the Union, he has been on offense — using every day, and every tool he has, to increase opportunity for working families. Consider:
Building on a record of protecting consumers, the President recently announced steps to crack down on conflicts of interest in financial advice that sap away families’ hard earned dollars from their retirement accounts. Because of these actions, tens of millions of Americans will have the peace of mind that their retirement advisers are looking out for their interests and a worker with $100,000 in retirement savings at age 45 could end up with tens of thousands more in their accounts come retirement.
The President recently rolled out a new Student Aid Bill of Rights that will provide the 40 million Americans who have student loans with concrete help in responsibly managing their debt.
The President is partnering with local leaders across the country to help connect more Americans to well-paying technology jobs through his TechHire initiative — working with more than 20 communities that have 120,000 open tech jobs and are taking steps with more than 300 employers to fill them.
Answering the call of millions of Americans, we recently saw the Federal Communications Commission take bold action to protect a free and open Internet by preserving net neutrality and to end some of the 19 state laws that harm broadband competition — laws that were driving up cost and limiting options are no more, paving the way for cheaper, faster internet for American families and businesses.
The President is working to unlock the economic contributions of Americans-in-waiting by allowing spouses of certain high-skilled workers to contribute to the economy while they wait to obtain lawful permanent residence status, a step that would help 450,000 people by 2024 and help boost our economy’s growth.
Over these 9 weeks, we’ve seen a different approach from Republicans in Congress. Instead of working with the President to make progress for the middle class, we’ve seen defensiveness and disarray.
Congressional Republicans spent weeks debating how to respond to the President moving the agenda forward on immigration, and in the process put funding for the Department of Homeland Security at risk.
Congressional Republicans spent weeks on a symbolic effort to pass a Keystone Pipeline bill that everyone knew the President would veto, rather than coming together around a serious multi-year infrastructure investment that would create 30 times the number of jobs per year than we’d get from building a single pipeline.
Congressional Republicans spent time complaining about the President’s leadership on net neutrality, throwing snowballs on the Senate floor and — yes — attempting for the more-than-50th time to repeal or undermine the Affordable Care Act.
And that’s just the last nine weeks.
So on the eve of the release of the Republican budget, the question is whether Republicans will put aside ideas of the past — letting go of a strategy that focuses on tax cuts for the wealthy and deep cuts to investments in the middle class — and instead join the momentum around middle-class economics. We hope that’s what they do.
Because no matter what, the President is going to stay on offense, push forward his vision of middle-class economics, and deliver for working families. We’re as well-positioned as we have been in in a very long time and we’re not going to let this moment go.