WHY WON"T WE BAIL WORKERS OUT ?
BY JULIANNE MALVEAUX
The events of 9-11 have had a chilling effect on an already recession-prone
economy. The stock market has stalled, consumer confidence is down, and
consumer spending has dropped. The airline and hospitality industries are
especially affected because these industries rely on discretionary spending.
Already, representatives from these industries are seeking federal bailouts,
and Congress has provided billions in grants and loan guarantees to the
airlines. Amtrak, which is perhaps more deserving, has also asked for
federal subsidies. And Congress has decided, in the sprit of international
cooperation, to pay more than $500 million in back United Nations dues. Many
economists are calling for the federal government to provide a stimulus
package to protect the economy from recession. But while Congress seems to
freely provide billions for the airlines, they seem reluctant to provide help
to the workers that were affected by the aftermath of the terrorist attacks
on the World Trade Center and the Pentagon.
Democrats want to offer $3.75 billion in financial aid; job training and
health-care help for laid off aviation workers added to airline security
legislation. Republicans oppose the measure, with House Majority Leader
Richard Armey (R-Texas) describing such legislation as “labor pork”. Why is
spending pork when it goes to workers but “necessary” when it goes to
industry? And why have Democrats been so tepid with the legislation they
favor, which also includes measure to increase the number of weeks that
people are eligible for unemployment compensation from 26 to 52? Instead of
singling out aviation workers, Congress needs to look at the range of
hospitality and service workers who have been affected by the travel
slowdown. In the food and hotel service industries, many of those who have
lost their jobs have been black and brown, and already concentrated at the
bottom of the pay scale.
It is ironic that this debate is taking place as economic statistics are
being released showing that the gap between haves and have nots remains wide.
Though poverty rates dropped to 11.3 percent in 2000, cuts in food stamps
and cash assistance programs have made it more difficult for the poor to
survive. Indeed, poor people fell further below the poverty line than they
have in the past, and the middle income did not see expected wage gains even
though poverty fell. Median incomes among African Americans and Hispanics
rose to record highs ($33,400 for Hispanics, $30,400 for African Americans),
but remained well below median incomes for whites. Most importantly, though,
wage gains were concentrated among high-income households. There are dynamic
opportunities for people at the top, those who are well educated and well
connected. There seem to be far fewer opportunities for those at the bottom.
If the economy is rigged toward those on the top, so too is the
development of public policy. While a bailout of the aviation industry may
be good for the economy, the focus on workers who have been affected by the
travel industry would also stimulate the economy. But those who oppose
“giveaways” abide by a peculiar double standard that allows corporate
bailouts but opposes bailouts to those who need them most – workers.
For the past year, consumer spending has propped our economy. Sometimes
consumers have spent to their detriment, with the consumer debt and the
number of bankruptcies increasing as people “shopped until they dropped”. If
Congress understood that two-third of our economy is based on consumer
spending, they might be more likely to put a few dollars into people’s hands.
Instead, they seem to be contemplating policy as foolish as a capital gains
tax cut.
In reaction to the crisis, people have talked about national unity and
the many ways we can show it, from waving flags, to donating blood, to
writing checks to relief organization. Differences among us have been
downplayed, with some noting that we are like a family that squabbles but
pulls together when threatened. When threats to the family are countered
with measure that benefit only some members of the family that, too
undermines family unity. The Congressional position of bailouts is analogous
to offering bread to just one or two members of a starving family and telling
the others to go for self. Such measures provoke divisiveness, not unity,
even if those who were offered bread break off a crumb or two to struggling
family members.
All was not well in our economy before September 11, and the attacks on
the World Trade Center and the Pentagon have exacerbated the economic trouble
we were already in. Before September 11, there were income differences, a
racial unemployment rate gap, and too much poverty. The goal of public
policy during this tragic time ought to be to close gaps, not widen them
through double standards and rank favoritism. If we are all in this trouble
together, why won’t the same Congress who voted billions for the airlines
vote help workers survive these tough times?