Robert B. Reich, a co-founder of The American Prospect, is a Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. His website can be found here and his blog can be found here.
The L.A. Times
The American economy is so hot that Alan Greenspan, chairman of the
Federal Reserve Board, is worried it's overheating. Dot-com billionaires are
blooming like spring crocuses. The average pay of chief executives of major
companies rose 18% in 1999 to $12 million. Across the managerial,
professional and executive ranks of the United States, pay (including
bonuses, stock options and perks) is skyrocketing. Afraid of losing their
talent to the dot-coms, big law firms just hiked the pay for first-year
associates to $120,000.
Greenspan worries that all this prosperity is causing consumers to buy too
much--more than the economy can produce--which means inflation is just
around the corner. That's why he and his pals at the Fed have hiked
interest rates five times since last June in an attempt to cool things down
and head off inflation.
But wait. What about Los Angeles' striking janitors...
Broadcast October 19, 2001 The American economy is almost certainly in recession right now, and a lot of people are scared not only about terrorism, but also about their economic futures. The good news is that the economic fundamentals--that is, the underlying structures of the American economy--are very strong. Consider employment. Well, undoubtedly, a lot of people are losing jobs, and it's likely that October's unemployment rate will move up a notch from the 4.9 percent it registered in September to about 5 1/2 percent, or possibly even 6 percent. That sounds bad, and it is bad news for the people who can't find a job. But a 6-percent rate of unemployment is still among the lowest we've had over the past 30 years. When I became secretary of Labor in 1993, national unemployment was hovering between 7 percent and 8 percent. Most economists assumed that 6 percent was the so-called natural rate of unemployment; that is, we couldn't get below 6 percent without igniting accelerating...
The Los Angeles Times Not since World War II have Americans felt so unified. We're fighting a war against terrorism and we're fighting to get the economy moving again. And we're all in this together. Except when it comes to paying the bill. The cost of the war on terrorism since Sept. 11 is estimated to be $40 billion, just for this year. That includes at least $20 billion for the military; $7 billion for recovery and relief in New York and at the Pentagon; $3 billion to fight bioterrorism; $2 billion for more security at dams, power plants and federal buildings; and $600 million to secure our airports and aircraft. That's a lot but still less than 1% of our annual national product. To get the economy moving again, the federal government will have to part with a lot more. Ideally, the government would put that added money into the hands of middle-and lower-income people. Not only are they the most at risk of losing their jobs but they're also much more likely to spend additional cash...
Broadcast December 14, 2001 One of the things we're hearing a lot these days from political leaders is "We need to try to get our lives back to normal." None of us can go back to exactly what we were doing before September 11th, of course, and no one's suggesting we should stop grieving for those who died and for the innocence America lost that day. But our political leaders are asking that we at least try to take up where we left off. And step by step, most of us are doing so. . . . Except in Washington. That's the one place in the nation where almost no one is going back to doing what they were doing before September 11th. Prior to that date, you remember the Washington media were obsessed with Congressman Gary Condit and his former intern, who had gone missing. Maybe you know more than I do, but I haven't heard a word since then about the congressman or his missing intern. Meanwhile, you may recall, Democrats and the White House had finally reached broad agreement on legislation...
Broadcast November 16, 2001 We hear a lot about a stimulus package coming out of Congress, eventually. Regardless of what combination of tax cuts and spending increases finally emerges, almost everyone agrees that the government has to spur the economy right now. Alan Greenspan and company can't do it alone. Cuts in short-term rates are helpful, but we can't fight this recession with one hand tied behind our back. We also need government to spend more and tax less now. But the federal government isn't the only government in American whose spending and taxing affects the economy. There are also 50 state governments and hundreds of city governments. In fact, if you add up the budgets of all of America's states and cities, you reach almost the same figure as the federal budget, in the order of some $2 trillion this year. In other words, the fiscal policy coming out of Washington is only half of America's fiscal policy. So what's the story with the other half? Are state and local...