Bob Herbert:Caught in the Squeeze, The New York Times, May 29, 2003


One of the things President Bush knows best is when to turn on the klieg lights, and when to keep them off.

On Tuesday, with no fanfare, he signed a bill increasing the federal debt limit by nearly a trillion dollars. You don't want a lot of coverage when you're mortgaging the future.

But yesterday it was high-fives all around as Mr. Bush signed the third-largest tax cut in history at a grand ceremony in the East Room of the White House.

I suppose if your income is large enough, there is every reason to celebrate. After all, the tax cut could save Dick Cheney $100,000 a year, or more.

But given the economic realities in the U.S. right now, I thought the East Room celebration was in poor taste. The enormous tax-cut package (which is coupled with budget deficits that are lunging toward infinity) is a stunning example of Mr. Bush's indifference to the deepening plight of working people.

The economy has lost more than a half-million jobs already this year, and well over 2 million since payrolls peaked two years ago. More than 8.7 million American men and women are officially counted as unemployed. And that figure is artificially low because it does not count those who have become discouraged and stopped looking for work.

The fallout from the continued hemorrhaging of jobs and the swollen ranks of the unemployed is spreading. The Times had an article two weeks ago about college seniors' putting their dreams on hold because they're graduating into the worst hiring slump in 20 years.

"We definitely picked the wrong time to be graduating from college," said Morgan Bushey, a 21-year-old student at the University of North Carolina. She said she planned to go to France, where she would make about $200 a week teaching English.

The jobs squeeze has other effects. "There's been this notion along the way that if you at least kept your job, you'd be O.K.," said Jared Bernstein, an economist with the Economic Policy Institute in Washington. "But now this persistent unemployment is taking a toll on the wages of those who are still working."

Wages, when adjusted for inflation, are falling for workers across the board. An analysis of government data by Mr. Bernstein and Lawrence Mishel, the institute's president, found that the median weekly paycheck fell 1.4 percent over the past year. All the pay grades above and below the median are also sliding backward. White-collar, blue-collar workers in all pay grades are taking a hit. Even wage earners in the highest category have seen their pay slip by 1.4 percent.

"When unemployment got down to 4 percent in the late-1990's, you had broad-based wage growth and it was the first time we'd seen that in decades," said Mr. Bernstein. "That's gone."

The president is not calling his tax package the "Windfall for the Wealthy" act, which is what it is. He calls it the "Jobs and Growth" act, which is what it's not.

He would like us to believe that "with tax relief will come more jobs for the American people." But that's what he said in the last round of tax cuts, and the American people are still waiting.

In fact, the wait is becoming interminable for some. More and more Americans are joining the ranks of the long-term unemployed, those who are out of work for six months or more. A joint study by the National Employment Law Project and the Economic Policy Institute called long-term unemployment "the scourge of a declining economy," and noted that it is taking its greatest toll among those who have traditionally felt economically secure.

"The reality," said the study, "is that the long-term unemployed are better educated, older and more likely to be professional workers."

What the economy needs is a real stimulus that will create real jobs, not an irresponsible package of tax cuts that will inflate the portfolios of the very wealthy while starving the government of the money needed to pay for essential services and to maintain a safety net for the nation's most vulnerable citizens.

We are closing schools and libraries in America, and withholding lifesaving drugs and medical treatment from the poor. The middle class is struggling ever harder to make ends meet, and reshaping its dreams of the future.

In Washington, they're celebrating.