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Get Four
|  | FEBRUARY 26, 2004
Jobs: Desperately Seeking Answers Employment and the economy are both parties' issues -- and both parties are pushing plans that are flawed Out on the hustings, everybody is talking jobs, jobs, jobs. Democratic front-runner John Kerry has a 10-point plan to boost hiring and revive U.S. manufacturing. North Carolina Senator John Edwards wants to renegotiate trade pacts and reward companies that expand in America. President George W. Bush says his six-point plan, centered on tax cuts, is the best way to replace the 2.2 million jobs lost since he took office. "Empty talk about jobs won't get anybody hired," he shot back, after weeks of being hammered by Democrats. "The way to create jobs is our pro-growth, pro-entrepreneur, pro-small business owner agenda." Presidential candidates have their ears to the ground, and what they hear is a rumble of fear about the slow recovery in employment. A Feb. 9-12 Gallup Poll found that 41% of Americans view jobs or the sluggish economy as their top concerns -- three times the number for either the war in Iraq, terrorism, or the spiraling cost of health care. Fading hopes for new hiring knocked consumer confidence down to a four-month low in February, the Conference Board said on Feb. 24. "There are real people out there who are really hurting," declares Arizona Governor Janet Napolitano, a Democrat, "and Washington is not coming up with solutions." PRESSURE BUILDS. Maybe not, but do the Dems have a better plan? Economists of all stripes agree that neither Bush's let-'em-eat-tax-cuts stimulus plans nor the Democrats' proposals -- built around targeted tax breaks and a crackdown on trade -- are likely to lift the trend line for employment much anytime soon. Even in the long term, the parties' differing approaches are more likely to affect the mix of jobs more than the number. "There's a puzzling lack of employment growth for this stage of the recovery," says Harvard University professor Lawrence F. Katz. "But the U.S. still has a dynamic economy that hasn't shown any signs of tipping into a long-run decline in jobs." For candidates, the long run is the next eight months -- and on that timetable, Bush is particularly vulnerable. He's likely to become the first President since Herbert Hoover to preside over a drop in employment during his term. Offshoring -- particularly the movement of white-collar jobs in software and services to India, Ireland, and other countries -- has boosted anxiety about employment security up the income ladder. A poll released on Feb. 22 by the University of Maryland shows that only 28% of those earning more than $100,000 voice support for actively promoting free trade -- down from 57% in 1999. That erosion among a traditionally Republican group has to be worrisome for Bush. Adding to Bush's woes: By 51% to 37%, Americans believe that Kerry would do better than Bush at creating jobs, according to a Feb. 10-11 ABC News/Washington Post poll. Nor does the White House's muddled message -- such as its on-again, off-again forecast that the U.S. will gain 2.6 million new jobs in 2004 -- boost confidence. Little wonder that the Bushies are out to undercut Kerry's economic proposals. "John Kerry has said he will raise taxes in the first 100 days of his Administration," says Bush campaign manager Ken Mehlman. "That's a formula for destroying jobs, not creating jobs." INCENTIVE FORMULA. Kerry figures he has the GOP on the ropes over jobs. He's hitting Bush hardest on offshoring -- an area where the President isn't yet counterpunching. Under current policies, "we actually reward people for taking jobs overseas," says the Democratic front-runner. "What I want is to create incentives" to keep employment at home (see BW Online, 2/26/04, "John Kerry's To-Do List"). On Feb. 25, Kerry proposed a package designed to pressure Corporate America to do just that, requiring earlier notification of layoffs, barring tax breaks for companies that move offshore, and limiting government contracting with companies that send work overseas. He has already backed legislation requiring foreign call-center operators to tell customers where they're located. The incentive formula that Kerry has laid out -- and Edwards largely parallels -- gives government a big hand in targeting job creation and protection. The Dems would repeal Bush's tax cuts for households earning more than $200,000 -- though some in the party say the threshold may be $170,000 -- while leaving lower rates in place for middle-income taxpayers. They would direct the resulting revenues toward "investments" in education, health care, and roads.
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