It’s Jobs Stupid: Obama & McCain Talk Economy, Jobs
As of Monday morning, weary investors woke to more turmoil in the financial markets. Fears of layoffs and recession are running rampant. As Wall Street looks to Washington for help, so do those who have been laid off, or worry their jobs may be in jeopardy. With uncertainty plaguing the job market, what can you expect from the White House come November? Executive search firm, A.E. Feldman, is on top of the latest developments in the financial markets and is constantly researching industry and economic trends. Here is a rundown of how both candidates are responding to the economic crisis and what they intend to do about it…
Bailout Bill Not Enough
With just four weeks until Election Day, Presidential contenders, Barack Obama and John McCain are focused on the economy. Both nominees have proposed plans to stimulate the economy and create jobs. In response to Monday’s sell-off, Obama said, “It is a reminder that the rescue package that was passed last week is not the end of our efforts to deal with the economy. It is just the beginning, according to the AP. Obama also says more stimulus is needed. “I think it is still critical for us to move forward on an economic stimulus package that can provide people with some relief from high gas prices, food prices, help state and local governments maintain their payrolls. I think we have to extend unemployment insurance after the statistics showing that 159,000 additional jobs were lost just last month. We’re going to have to then, move on an aggressive plan to deal with some of the underlying structural problems in the economy including the housing market,” he says.
Meanwhile, Republican Presidential nominee, John McCain says sweeping reform in the way Washington works is needed, according to the AP. The report quotes McCain as saying, “The action Congress took last week to address our financial crisis was a tourniquet, but not a permanent solution… Our economy is still hurting — working families are worried about the price of groceries, the price of gas, keeping their jobs and paying their mortgage — further action is needed. We need to restore confidence in our economy and in our government.”
The U.S. economy lost 159,000 jobs last month, the steepest monthly drop since March 2003, according to the Labor Department. Obama used the latest figures to convince voters that a vote for his ticket is a vote for more jobs. Obama says his economic policies would create millions of new jobs, including five million in clean energy technology and two million in infrastructure. Unsurprisingly, Obama continues to remind voters that just two weeks ago, his rival, John McCain, was saying the fundamentals of the economy were strong. The republican nominee, however, has proposed his own plan for stimulating the economy. Central to his plan are tax cuts and a push for nuclear power.
Infrastructure
Included in Barack Obama’s plans for rebuilding the nation’s infrastructure is the creation of a National Infrastructure Reinvestment Bank (an expansion of existing federal transportation investments) to invest in America’s most challenging transportation infrastructure needs. According to Obama’s plan, the Bank would receive an infusion of federal money, $60 billion over 10 years, to provide financing to transportation infrastructure projects across the nation. These projects will create up to two million new direct and indirect jobs per year and stimulate approximately $35 billion per year in new economic activity.
Republican presidential candidate, John McCain has not proposed a blueprint for road, rail and bridge construction, according to Reuters. He has, however, vowed to seek line-item veto authority on what he calls wasteful spending.
Clean Technology
Democrat Presidential contender, Barack Obama, has said that as president he would spend $150 billion to develop more environmentally friendly energy sources…and in doing so he would create 5 million so-called “green collar” jobs. Under Obama’s proposed plan to “invest in a clean energy economy,” $150 billion would be invested over 10 years to advance the next generation of biofuels and fuel infrastructure, accelerate the commercialization of plug-in hybrids, invest in clean coal plants, begin transition to a new digital electricity grid and promote development of commercial scale renewable energy, such as wind and solar power.
Under his plan, Obama says he wants to establish a federal investment program to help manufacturers modernize infrastructure and adopt clean technology. Obama says his clean energy proposals would create 5 million new jobs and ensure that Americans have the skills and tools they need to pioneer the first wave of green technologies that will be in high demand throughout the world.
Obama says his plan to boost the renewable energy sector and create jobs includes producing new federal policies and expanding existing ones. As President, Obama says he will create a federal Renewable Portfolio Standard (RPS) that will require 25% of American electricity be derived from renewable sources by 2025. According to the Democratic hopeful, this measure alone has the potential to create hundreds of thousands of new jobs.
Another key proposal under Obama’s plan is to extend the Production Tax Credit (PTC) - a credit used successfully by American farmers and investors to increase renewable energy production and create new local jobs. Large scale renewable energy projects rely upon the Federal Production Tax Credit (PTC), which provides incentives for development of renewable energy.
Obama’s rival, John McCain says he too will encourage the market for alternative, low carbon fuels such as wind, hydro and solar power. Unlike Obama however, McCain says he believes in an even- handed system of tax credits that will remain in place until renewable energy has progressed to the point that it is competitive with conventional energy sources.
John McCain, is also a big proponent of nuclear power. On his web site, he says, “Nuclear power is a proven, reliable, zero-emission source of energy, and it is time to recommit to advancing our use of nuclear power.” McCain says he will put the U.S. country on track to construct 45 new nuclear power plants by 2030……with the ultimate goal of eventually constructing 100 new plants… and create roughly 700,000 jobs in the process.
“Every year, these reactors alone spare the atmosphere from the equivalent of nearly all auto emissions in America. Yet for all these benefits, we have not broken ground on a single nuclear plant in over thirty years,” says McCain. “And our manufacturing base to even construct these plants is almost gone.”
Barack Obama has criticized McCain’s proposal, according to Reuters. Obama says McCain lacks a plan for storage of the waste and it was not a “serious” energy policy.
Tax Changes
Obama plans to permanently extend certain provisions of the 2001 and 2003 tax cuts primarily affecting taxpayers with incomes under $250,000, but repeal the cuts in the top two marginal income tax rates ahead of their scheduled expiration in 2010. Senator Obama would also extend the AMT. Obama says he would set the tax rates paid on most dividends and capital gains at 20%.
Barack Obama says he will also increase federal support for research, technology and innovation for companies and universities so Americans “can lead the world in creating new advanced jobs and products.” Obama plans to make the research and development tax credit permanent so that firms can rely on it when making decisions to invest in domestic R&D over multi-year timeframes.
Meanwhile, John McCain says he believes he can spur businesses to create jobs through tax cuts. According to McCain, small business is the key to job growth, and low taxes are essential to creating Jobs…and keeping jobs… in America.
The Republican nominee has some immediate relief measures, such as suspending the 18.4-cent federal gas tax, but many of his proposals center on keeping taxes low. McCain plans to permanently extend the 2001 and 2003 tax cuts, keeping the top tax rate at 35% and maintaining the 15% rates on dividends and capital gains. He also plans to increase deductions for taxpayers supporting dependents, phase-out the Alternative Minimum Tax (AMT) and cut the corporate tax rate from 35% to 25%.
“There is much that needs to be done to get the economy on track,” says McCain’s campaign. “John McCain’s Jobs for America Plan will … keep taxes low to create good jobs here in America, and give American workers renewed confidence in their economic future.”
But as fears of job loss and recession mount, the real questions are: With what speed and sense of urgency will either of these plans be carried out? Who can Americans trust more to handle the unprecedented financial turbulence? Voters will be looking for answers to those question and others tonight when Obama and McCain face off in the second of three presidential debates.
Looking Ahead…
Right now as bad economic news dominates the presidential race, A.E. Feldman, a leading recruiter in the areas of finance, accounting, law, project & infrastructure finance, data center efficiency as well as energy and clean technologies, invites firms to contact its President, Mitch Feldman, its CEO, Carol Schwam, and its highly specialized team of executive recruiters directly to open up a dialogue about the array of issues they face and those they anticipate in the future. Facing a difficult economic climate, job seekers are also encouraged to inquire about existing and future job opportunities. According to Mitch Feldman, “Our lines of communication are open.” Contact Mitch Feldman, and the firm’s expert recruiting teams here.
