The right economic investment for America
April 26, 2012
“This pudding lacks a theme,” Winston Churchill once said of his dessert. The same might have been said of Barack Obama’s election campaign, which started strong with his State of the Union address in January and then meandered. It appears finally to have settled on a theme — but it is the wrong one.
Recently the president and his advisers have focused on taxing the rich and tackling inequality. The “Buffett rule” tax on millionaires has become Obama’s bumper sticker. The proposal is reasonable — but does not deserve the attention Obama is showering on it. It raises a trivial sum, $47 billion over the next 10 years, during which period the federal government will spend $45 trillion. It adds one more layer to a tax code that is already the most complex and corrupt in the industrialized world. If the president wants to be bold, he could propose comprehensive tax reform and eliminate the hundreds of deductions, exemptions, credits and loopholes, many of which Congress sells in exchange for campaign contributions.
The focus on the Buffett rule is also bad politics in the long run. While polls might momentarily show that it works, Americans are generally aspirational, not envious. Over the years voters tend to support a government that focuses on creating opportunity rather than one that tries to reduce inequality. Bill Clinton and Tony Blair’s great feat was to position themselves as pro-market, pro-growth progressives. That hard-won image of a new, modern left can easily be lost.
Ironically, Obama has been pivoting at the very moment events are providing the perfect campaign issue. We are four years into the financial crisis. In the United States, the government acted speedily and massively to stimulate the economy, using monetary and fiscal measures. In Europe, governments quickly turned toward austerity programs, cutting spending across the board to reduce budget deficits.
The results are in: The U.S. economy is expected to grow 2 to 3 percent this year. The euro zone is expected to contract 0.3 percent this year; Spain and Britain have officially entered a double-dip recession, the first time major economies have done so in 40 years. The International Monetary Fund’s latest forecast through 2017 predicts that the United States’ economy will outpace every major European one. IMF projections show that even Germany’s average growth rate will be only 40 percent of America’s.
The commission said it would look to things like biased statements and inconsistencies in the hiring process as evidence of unlawful bias.
The new policy updates a policy issued in 1987, when Clarence Thomas, the Supreme Court justice, was commission chairman. Then, as now, the commission stated that blanket exclusions could unfairly hurt black and Latino applicants because they have considerably higher conviction records and the criminal offenses might be long ago and have little bearing on a current job.
In its guidance, the commission stressed that the fact that a job applicant was arrested does not establish that criminal conduct had occurred.
Maurice Emsellem, co-director of policy for the National Employment Law Project, an advocacy group for low-wage workers, applauded the commission’s move.
“It makes a big difference because a lot of employers have very little understanding of the basic guidelines on criminal background checks, and some have ignored them altogether,” he said. “The E.E.O.C. has made a big effort to make it easier for employers to understand the standard and for workers to understand their rights.”
Michael J. Eastman, executive director of labor law policy for the United States Chamber of Commerce, said the new directive would make it harder for employers to use criminal histories in employment decisions. “We’re trying to assess how much harder,” he said.
He noted, however, that the policy approved Wednesday was “much improved” over earlier drafts.