Speech at the Macomb Business Alliance Luncheon on challenges confronting Congress & the impact of Obama administration policies
Our country remains in the grip of a tumultuous period unlike any we’ve faced in generations. The deep recession, combined with the financial crisis, crippled our economy at a time when we were still involved in two foreign conflicts and grappling with the need to make investments in education, technology and infrastructure to lay the groundwork for the next economic revival.
When you go through such a period of tumult you are going to have major debates about big issues. People look at Washington and they think it is broken. The truth is that a major part of the fracture you are witnessing is a fundamental disagreement about the role of government in our society and in the economy.
I believe that Macomb County residents want government to be effective and on the side of middle class families.
The policies of the Obama Administration have passed this test. We know that times are still tough, but its actions helped stem the downturn and move us forward.
It is important to realize that in 2009 – just months after Obama took office – unemployment in Macomb stood at 17.6%. This March it had fallen to 9.5%.
The Obama Administration invested more than $350 million through the Recovery Act in Macomb County to help stabilize the economy. That included $43 million in transportation projects, $59 million in public schools and a $800 per person tax cuts to help families struggling through the economic crisis. And that’s not counting the $1.3 billion the administration provided through the act to Michigan firms to support advanced batteries and electric vehicle manufacturing – the most awarded to any state.
The Obama Administration took the action necessary to provide the domestic auto industry the support needed to weather the financial crisis and economic downturn. We see this resurgence all around us in Macomb -- at the GM Tech Center that is the center of the technology of the future, and at the Sterling Heights Assembly Plant that is expanding, not closing. Indeed, a recent report by the Center of Automotive Research estimated that the Big 3 would add 30,000 jobs by 2015.
I would caution those that think it was easy or obvious to take this action. It was not. Many others in addition to Mitt Romney were saying, “Let Detroit Go Bankrupt,” and we had to work day and night to convince folks of the vital role the domestic auto industry plays in our national economy.
There was not one private lender at the time willing to provide the debtor in possession – DIP financing – necessary to proceed quickly through bankruptcy. It was either a partnership between the auto industry and government or an industrial catastrophe.
Now we can look forward to the future here in Macomb County built significantly on advanced manufacturing and new technologies.
That effort has been aided by other examples of a government private sector partnership. For example, the Macomb Incubator started with federal funding and the Obama Administrations support for worker training programs reflected in a $5 million grant to train workers in the defense sector.
Unfortunately, this battle over the role of government has led Republicans to allow important programs that were designed to accelerate the economic recovery and transformation fall by the wayside. For example, Build America Bonds was an innovative program included in the Recovery Act that helped state and local governments finance public capital projects at lower borrowing costs. In Michigan alone $2.6 billion in bonds were issued for 70 projects in 2009 and 2010. It was an overwhelming success and provided another illustration of how public-private partnerships can help spur economic growth. And Republicans allowed it to expire.
And under the guise of not wanting to pick “winners and losers,” Republicans let expire the 48C advanced energy manufacturing tax credit that provided $238 million in tax credits to Michigan businesses.
Interestingly, both of the these programs – and the reauthorization of the Transportation bill, another job creator – are supported by the AFL-CIO and the U.S. Chamber of Commerce, but are being held up in Washington by Tea Party Republicans.
It is not only about the role of government. There are major differences about the importance of fairness in our tax code and the impact of widening income equality.
In the last ten years, median income in Macomb has dropped nearly 28%. At the same time, the very wealthiest are taking home the lion’s share of income growth. One recent study showed that in 2010, more than 90 cents of every dollar of income growth went to the top 1 percent.
There are 110,000 families in the 12th Congressional District with incomes between $30,000 and $75,000. Their average annual tax break if the Bush tax cuts are extended: about $1,000.
On the other hand, only 182 households in the district earned more than a million dollars a year. Their average tax cut: over $100,000.
You just can’t credibly sit at the deficit reduction table and not be willing to discuss having millionaires and billionaires pay their fair share of taxes.
I believe that Macomb County residents believe it is reasonable for millionaires and billionaires to pay their fair share and that they oppose cutting Medicare, food programs, health research and education to finance additional tax cuts for the very, very wealthy.
A few weeks ago two of the most distinguished nonpartisan Congressional scholars, Thomas Mann of the Brookings Institution and Norman Ornstein of the American Enterprise Institute wrote:
“When one party moves this far from the mainstream, it makes it nearly impossible for the political system to deal constructively with the country’s challenges."
Over 40 years ago, as a Committee Chairman in the State Senate when George Romney was Governor, he and I negotiated and he signed into the law the right of public sector workers to bargain collectively. During that era, Bill Milliken and I also worked to round up votes for an increase in the minimum wage.
Today, this is “Not Your Father’s Republican Party.”
Macomb County has always been a bellwether of how well government is working to address the issues that matter to middle class families. There is more at stake in this election than any previous one that I remember, and I look forward to making the case for the Obama Administration because their policies are making a difference here.