Monday, August 10, 2009

Relief, Recovery, and Reform

Relief, Recovery, and Reform: Echoes of Handling Hard Times

In the grip of the Great Depression, the Roosevelt Administration proposed the New Deal, a program to restore American prosperity. This program followed a three-step course of action to transcend the economic turmoil and suffering of the American people –first relief, then recovery, and finally reform. In recent months I have been thinking of these steps as the United States is once again rocked by a profound economic downturn. These steps to rebuilding a battered country have their echo in the rhetoric and proposals of experts, politicians and citizens everywhere. What can we do right now? What will do to get back on track? And finally, what can we do to avoid this chaos in the future? The new National Issues Forums guide developed by the Center for Civic Engagement at Hofstra University provides an excellent opportunity for people to address these questions in the context of the current economic downturn and to clarify some ways to move from relief, to recovery, to reform.

A small group gathered on Friday, July 31,at the Russell Library to participate in the Russell Forum for Civic Life in Georgia’s informal Friday Forum. The group threshed the approaches proposed in the new Hofstra issue book, which explore strategies for expanding prosperity as the United States rebuilds its economy. The guide starts with a basic question, “Once we restart the economy, how can we build it into a place where we would want to live?” The guide then offers three approaches for discussion purposes that encompass most of the concerns expressed by people through focus groups and surveys and respond to background research data compiled as part of the preparation for the guide. Here are the approaches:

Approach #1: The Enterprise Society
Rewarding ambition and innovation is the best way to spread prosperity to every citizen.

Approach #2: Shrink the Wealth Gap
Too many people have been unfairly shut out of the nation's prosperity. We need to restore fairness to the system.

Approach #3: An Equal Start
We need to ensure that all citizens develop to their full potential. Education is a critical part of prosperity.

I moderated the forum and kicked off the discussion by asking what people’s greatest concerns were about the current state of the U. S. economy. Most of the attendees mentioned the impact furloughs would have in the Athens-area. A few days before the forum, the governor of Georgia announced additional cuts in state budgets that included at least 3 furlough days. In the Athens-area, a large percentage of the population works at the University of Georgia and at public schools so it was not surprising that this topped people’s list of concerns.

Forum attendees did share other more general concerns. One participant remarked that he was very sad to read the high percentage of Americans who no longer believe the American Dream is possible. After some discussion of this statistic, the consensus of the group was that most Americans don’t really understand how great disparities of wealth are in the United States. When I asked if people thought things were getting better yet, they pointed to the rising stock market and some other signs of economic stability, but balanced this with news of job losses. Still they were eager to look ahead to considering strategies to avoid replicating the conditions that allowed this economic downturn to occur and to strengthen people’s foothold in the economy in the future.

In looking at the proposed approaches for rebuilding the U.S. economy, the group found the first approach, which emphasized using free market principles to restore the American economy, to be unlikely to provide broad prosperity. Although not in favor of huge tax increases, most felt strongly that tax cuts to the wealthy would not generate enough well-paid jobs to achieve the sort of turnaround to the economy they saw as necessary. They pointed out that the recent history of low taxes and low regulations had not increased prosperity, but had in fact, widened the gap between rich and poor. Still, several in the group remarked that they felt it was important to keep the country’s entrepreneurial spirit vibrant and that excessive regulation of business wasn’t a good solution any more than few or no regulations were.

Talk of regulations and balance moved the group into discussion of the second approach which emphasized the tremendous imbalances in the tax code and the lack of power most working people had to redress unfairness in their work environment as key problems to tackle. Some participants were quite surprised to realize how high taxes were in the 1960s-1980s in comparison to the last thirty years. Others were aware of American taxation history and pointed out during the period of higher taxes that entrepreneurial spirit had not been appreciably dampened. Others disagreed with this assessment, but in general most agreed that a flat tax model was not going to encourage broad prosperity. At the end of this discussion arc, most participants favored a middle ground on taxes and government regulation. They supported more regulation but not excessive regulation and they favored caps on extreme executive salaries. They supported using taxes as a means to more than just pay for basic government services. They were in favor of taxes if they could be put toward rebuilding infrastructure (like high speed rail lines), exploring and implementing green energy technologies to reduce dependence on foreign fossil fuels, and making education more affordable. No one felt that unions would take hold in the U.S. the way they had in the wake of the Great Depression. Too much negative attention and a lack of a strong union tradition in some of the most economically devastated areas like the South made this idea unlikely to work according to several people who spoke out in this part of the forum.

The group turned its attention to the last approach, which proposes that improving and expanding access and quality of education to learners of all ages from pre-K to adult would solve many of the nation’s economic problems and provide broader prosperity. Although most in attendance at the forum agreed that education plays a vital role in achieving prosperity, most felt that it would be a long term or middle term solution and not immediate panacea for the ailing U.S. economy. They did discuss that the most talented students were not becoming teachers today, because they couldn’t make a decent salary and the working conditions were not great. Two students at the forum acknowledged that teaching was a great way to contribute to making society better, but neither they nor their friends were planning to pursue teaching as a career. One student also pointed out that with escalating education costs, many of their acquaintances couldn’t afford to become teachers and still pay off their educational loans. Ultimately, most in the group agreed that although there was much in the public education system that was broken and needed to be fixed in order to boost education levels, right now, the U.S. needs to focus on tightening regulation of the financial industry and revising the tax code. After these core areas are addressed, then education should be a key part of a plan to rebuild prosperity.

The forum closed with a return to one of the initial personal stake questions, “Where are we now and where are we headed?” The group was cautiously hopeful and agreed that constructive dialogue of how to move forward was heartening even in the face of furloughs.

On the path to relief, recovery, and reform,
Jill Severn

Post by Jill Severn, Head of Access and Outreach, Russell Library

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