By U.S. Rep. Mike Michaud(D-Maine)
The U.S. Department of Labor recently released its employment report for October. The results were devastating. It showed a loss of another 240,000 American jobs, which brings the total number of jobs lost this year to 1.2 million. Our economy obviously faces serious challenges. People in Maine and throughout our country are hurting. Passing an effective stimulus package could help millions of Americans struggling to make ends meet and help give a much needed boost to our economy. We need to take swift action.
On September 26th, the House of Representatives passed what was dubbed the “Economic Recovery and Job Creation package,” which was designed to provide relief to families and states in order to stimulate the economy. The bill extended unemployment benefits and food stamps. It also provided aid to state governments and investments in infrastructure.
I supported these approaches because they provide an extremely positive return on investment. In fact, Mark Zandi, chief economist of Moody’s Economy.com, estimated that every $1 spent on unemployment benefits generates $1.64 in new economic demand. Similarly, every $1 spent on food stamp benefits generates $1.73 in economic activity, and each investment of $1 in general aid to state governments generates $1.36 in economic activity. These investments would truly stimulate our economy and help struggling families.
I am especially pleased that the bill contained investments in our infrastructure. I worked for months with the Chairman of the Transportation and Infrastructure Committee to make sure that these investments were a part of the package. According to recent Federal Highway Administration estimates, each investment of $1 billion in transportation infrastructure creates about 35,000 jobs and up to $6.2 billion in additional gross domestic product. Funding transportation infrastructure projects that are “ready to go” would not only create jobs quickly, it would also provide each state with much needed infrastructure improvements for the long term.
In the end, despite the positive effects that passing such a package would have on our economy, the bill died in the Senate.
News of a 14-year high jobless rate of 6.5 percent shouldn’t be necessary to spur action in Washington, but it just might do the trick. Congressional leaders have signaled that they will try to pass another economic stimulus package along the same lines, but with substantially more funding.
The Federal Reserve recently came out in support of a stimulus package. The Administration has also signaled that they would remain open to considering one. As I write this, it remains to be seen exactly when a stimulus package will be considered.
It is my hope that the Congress can work with this Administration to pass something quickly. If that doesn’t happen, I am confident that we can work in a bipartisan way with the incoming Administration to help bring this economy out of this downturn. We cannot afford more delays.
