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FAIRFIELD COUNTY, Conn. Nearly two decades after Bill Clinton's famous campaign mantra "It's the economy, stupid" helped propel him to the White House, President Obama is relying on his $450 billion American Jobs Act to reverse a recession and debilitating unemployment rate that has hovered at about 9 percent for three years.
"It's been a terrible recession, and very slow business growth has occurred," said Joe McGee, vice president for public policy of the Business Council of Fairfield County.
With Connecticut's 9.1 percent unemployment rate reflecting the national average, economists as well as state, county and local business leaders say Obama's proposalmade in an address to the nation last weekcould "stimulate the long-term economy" if approved.
But given the ongoing political battle between the Democratic president and Republican-controlled U.S. House of Representatives, few experts believe Obama's proposal can pass without compromises that could render it far less effective.
McGee said several key parts of Obama's proposal would help stimulate the economy and create jobs. "The tax credit for employers to hire is a very good idea, and the whole issue of infrastructure investment is vital. Connecticut needs to double its $40 million investment a year over 20 years just to catch up," he said. "The president's plan would help rebuild our transportation systemrailways, roads and bridges and put people back to work, particularly in the construction industry that has taken a huge hit."
McGee called on politicians to pass the measure. "Closing corporate tax loopholes and lowering our corporate taxes, one of the highest in the world, would also help," he said. "But if the American people feel the economic vitality is being held hostage over petty partisan politics, there will be hell to pay at the polls. The public wants the president and Congress to get their act together and stop bickering."
Floyd Lapp, president of the Southwestern Regional Planning Agency in Stamford, also said the best way to create jobs in Fairfield County would be to invest in transportation infrastructure.
"One of the biggest problems we have in generating jobs and leading the world again is our serous under-investment in transportation," Lapp said. "We should be spending $225 billion a year across the country in each of the next 50 years on infrastructure, according to a major study. Unfortunately, we're probably only looking at spending about $40 billion a year over the next six years."
Lapp said the same study indicated that for every billion dollars spent in transportation, 47,000 new jobs are created.
"If you go back to the [Franklin D.] Roosevelt era in the 1930s, that's exactly what was done. And again during the [Dwight] Eisenhower years, he launched the Interstate Highway and Defense Act of 1956 that put $2 billion out there for 13 years, which at the time was an enormous monetary investment and largest public works program the country ever did."
Lapp said he also supports tax changes for the residents and businesses in the agency's region, which contributes 30 percent to 40 percent of the state's income tax revenue from its eight towns: Greenwich, Stamford, Darien, Norwalk, Westport, Weston, Wilton and New Canaan.
Stanley McMillen, managing economist for the Connecticut Department of Economic and Community Development, said the president's multi-layered proposal to create jobs, invest in infrastructure, save teaching jobs and close tax loopholes can work.
But, he added, there are too many "unpredictable factors" to know when the stagnant economy and high unemployment rate will improve. "So many things are beyond our controlsuch as the economic slowdown in China, possible collapse of the Euro in Europe and how much of the president's proposal will be approved by Congress," said McMillen.
"The 10 million Americans and more than 100,000 people in Connecticut out of work is just the tip of the iceberg," McMillen said. "People aren't going on as many vacations, or spending money to make improvements to their homes ... not while desperately trying to keep from losing their homes."
To reach Richard Weizel, email him at rweizel@mainstreetconnect.us.
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