Today America is at risk not only from terrorists who threaten our physical security, but from an economic downturn that threatens the financial security of middle class and working people. Just as we must take effective action to defeat terrorism, we must take prompt and decisive action to prevent the nation from sliding into a serious recession.
Our economy was slowing down even before the horror of September 11. Unemployment in August was at its highest level in almost four years. Housing starts fell by almost 7 percent in August. Industrial production, especially in manufacturing, fell in July and August. Manufacturing output in August was down 5.5 percent compared to last year, and exports fell 2.6 percent. Retail sales declined for four consecutive weeks in late August and early September. During the last year, we have lost more than one million manufacturing jobs. The most recent economic statistics show that new claims for unemployment insurance benefits are rising fast -- 15.5 percent higher than just a month ago, and 75 percent higher than a year ago.
In response to this looming recession the 55 member House Progressive Caucus has developed a $200 billion initiative to revitalize the economy and, at the same time, to protect Social Security and Medicare. This program has four parts:
First, we must protect laid-off workers by extending unemployment insurance coverage to 52 weeks and increasing unemployment benefits by $100 a week. Currently, unemployment benefits are often insufficient to pay for housing, food and other basic necessities. This proposal not only supports the unemployed in their time of need, but it also stimulates the economy by putting money into the hands of people who will spend it quickly.
Second, we must put unemployed Americans back to work at meaningful, decent paying jobs. While we combat recession we can simultaneously address some of the major unmet needs facing our country. Now is the time to tackle the national crisis in affordable housing. Now is the time to move away from our dependency on Mideast oil by building sustainable energy projects with wind turbines, biomass and solar energy. Now is the time to restore clean water with modern water treatment plants for our communities. Now is the time to provide new schools and classrooms for our children.
Third, at a time when programs that protect the children, the elderly and the sick are in danger of being cut because of inadequate federal and state budgets, we should increase funding for health care and social services that protect the weak and vulnerable. We must make certain that the elderly stay warm in the winter and children continue to attend Head Start and childcare. This initiative will also enable families of the unemployed to keep their health care, and workers to receive job training.
Lastly, we must provide tax rebates to workers who do not earn enough to pay income taxes and who did not receive the $300 rebate. I am delighted that President Bush has apparently agreed to this idea. This approach helps workers most in need and, again, provides an immediate stimulus for our economy.
The Progressive Caucus' economic stimulus package is big enough to give the economy the immediate boost it needs, and responsible enough to protect Social Security and Medicare. Unlike the President's proposal, and other Congressional stimulus packages which are paid for by draining the Social Security Trust Fund, the Progressive Caucus' approach will be paid for by freezing the tax cuts for the wealthy that were enacted by Congress earlier this year.
At this moment of crisis in the United States it is time for all to contribute their fair share, to do their part. Thousands of men and women in the National Guard are now separated from their families as they serve their country. The American active duty military has been mobilized, and their lives are at risk. Hundreds of brave firemen and police officers have already fallen. Within that context, we must ask the wealthy to do their part, too. It is time to rescind the hundreds of billions in tax cuts recently provided to the wealthiest one percent of Americans, those earning over $375,000 a year.
The choice is clear. We can pay for a stimulus package and other emergency spending by, once again, running up huge deficits and dipping into the Social Security Trust Fund or we can ask the wealthiest people in America to do without the tax breaks that they will begin receiving in a few years. I think that most Americans will not have difficulty in seeing which approach makes more sense.
If there is a silver lining in the dark cloud that has come over us in recent weeks, it is the increased sense of community that so many Americans feel in the wake of this crisis. This renewed sense of community can, I believe, not only help to protect our national security, but also form the basis for an important national discussion of the pressing economic needs facing our country. The United States is a great nation. Now is the time to develop a vigorous economic program that protects the economic security of all Americans.
Editors Note: Congressman Bernie Sanders (I-VT) has the best web site of any member of Congress - http://bernie.house.gov/