The Message Is Clear: Create More Jobs
By Teamsters General President James P. Hoffa
Published by the Detroit News on February 10, 2010.
The message from Massachusetts is clear: Voters want their elected representatives to find ways to create more jobs.
I believe Scott Brown won the Senate race in Massachusetts because of 20 percent unemployment among blue-collar workers. That was the same message Congress heard. Soon the Senate will consider a jobs bill. The legislation will probably include tax credits, spending on roads and bridges, help for the unemployed and financial assistance to the states.
Such efforts will surely help in the short run. The Senate could also boost employment for the next two years by passing a bill that authorizes spending by the Federal Aviation Administration. About 250,000 people would be put to work over two years modernizing our air transportation system.
In the long run, though, lawmakers need to tackle two major tasks to get our economy moving: restoring our manufacturing base and putting Wall Street to work for U.S. businesses.
As Detroit well knows, it isn’t just the assembly line workers thrown out of work when a factory shuts down. It’s the plant manager’s accountant, the workers’ kids’ teachers, the truckers moving product, the waitress at the restaurant at the factory gates.
We must put an end to policies that encourage job creation overseas at the expense of working families here. Tax dollars spent to encourage industries such as clean energy should be restricted to U.S. companies when possible.
But multinationals and their front groups will fight tooth and nail against “Buy America” policies for government spending. They’ll claim such policies will cost jobs. They don’t say those jobs are in China, South Korea and Spain.
Take, for example, stimulus money to encourage the renewable energy industry. ABC News and the Investigative Reporting Workshop found that 80 percent of $1 billion in grants for wind energy went to foreign-owned companies.
Congress has another big problem to tackle to irestore our economic leadership. Wall Street must be reformed.
The link between financial reform and jobs isn’t always clear – until a handful of Wall Street investors invent a complex product that brings them a profit if you lose your job.
That almost happened to 30,000 Teamsters who work for YRC Worldwide, the country’s largest trucking company. The company needed to swap its debt for equity to stay in business. But certain banks and equity firms started to make markets in credit default swaps – essentially, insurance on YRCW’s bonds. It was a high-risk derivative trade that actually encouraged investors to force YRCW’s bankruptcy.
This was perfectly legal. When the Teamsters exposed the banks and equities firms, the banks and equity firms reversed course and YRCW survived.
YRCW’s near-death experience shows how complex financial products don’t spread risk, they concentrate it. They do not serve the purpose of stimulating economic growth. They strangle it. In the case of YRCW, a few wealthy investors would have gotten wealthier, and 30,000 middle-class truck drivers would have lost their jobs.
Wall Street is spending millions of dollars to defeat any attempt to force these credit default swaps to be traded on an exchange, where regulators can keep an eye on them. Congress should resist the lobbyists’ pleas and bring these weapons of mass destruction under control.
Finally, many people are not aware that Wall Street’s recklessness threatens jobs in another way. Wall Street’s financial collapse placed a strain on pension funds, causing them to lose billions of dollars.
Unrealistic funding requirements may force employers to divert money to pensions that they might otherwise use to keep and create jobs. Without funding relief, many jobs will be lost and the economic recovery will be significantly slowed.
Reps. Earl Pomeroy and Pat Tiberi have introduced a bill that will go a long way to solving that problem. The Preserve Benefits and Jobs Act will help many Americans keep their pensions – and many more keep their jobs.