Economic woes require immediate action

On Monday, Northeastern University’s Center for Labor Market Studies released a report revealing that more than one in three young families with children were living in poverty in 2010. The analysis was based on U.S. Census data made available on September 13, which showed that more Americans are living in poverty than at any point since 1959. These numbers are shocking, but elected officials in Washington, especially Republican leaders, have decided that the best thing they can do is nothing at all. Inaction might be shrewd political calculus, but it is terrible economic policy.

Despite conservative rhetoric, the problem with the American economy is a lack of demand, not government intrusion in the marketplace. Nor are our economic woes due to fears about U.S. debt: interest rates on 10-year Treasury bills are at record lows, signifying that investors have not lost faith in America’s ability to repay its debt. The real problem is that with so many Americans out of work and harboring concerns about the strength of the recovery, consumers are hesitant to spend and businesses have little motivation to hire or invest.

With millions in poverty, no sign of economic improvement in the near future, and low rates of inflation and borrowing, it is clear that the government must take bold and decisive action. The American Jobs Act proposed by President Obama, while far from perfect, would certainly help the weak economy. Many of the proposals seem like no-brainers: spending on much-needed repairs to infrastructure and specific tax breaks to promote hiring. Yet Republicans, who initially seemed open to some of the ideas, which they’ve supported in the past, have reverted to their strategy of obstruction and obfuscation.

Their opposition is not based on rationality or reason. Even as they balk at a payroll tax cut that would benefit American workers and support Texas Governor Rick Perry’s assertion that Social Security is a “Ponzi scheme,” they deride any attempt to tax wealthy Americans at a fair rate as “class warfare.” And while they point to deficit concerns as the reason the U.S. can’t afford to fix its infrastructure, they shoot down any measure to close tax loopholes that cost the U.S. billions of dollars.

Georgetown students stand to lose a great deal if the necessary steps to fix this economy are not taken. Families will struggle with tuition payments, and graduating students will enter a stubbornly stagnant job market. The U.S. economy is not necessarily doomed to suffer years of economic weakness, but that’s just what will happen if students fail to demand immediate action from Congress.