by Faiz Shakir, Amanda Terkel, Satyam Khanna, Matt Corley, Benjamin Armbruster, Ali Frick, and Ryan Powers
The Page That Won't Turn
According to September polling from Gallup, the percentage of Americans who have "negative" feelings about the economy is now at 81 percent. But Sen. John McCain's (R-AZ) campaign admitted this weekend that it is trying to distract the country from focusing on the nation's economic woes. "We are looking for a very aggressive last 30 days," said Greg Strimple, one of McCain's top advisers. "We are looking forward to turning a page on this financial crisis and getting back to discussing Mr. Obama's aggressively liberal record and how he will be too risky for Americans." "If we keep talking about the economic crisis, we're going to lose," admitted another aide. The issue has for months been the number one area of concern to voters. While McCain hopes to avoid talking about the economy -- perhaps because of his poor understanding of economics -- the crisis is quickly altering the lifestyles of working and middle-class Americans and is not going away soon. Consumers are pulling back on their spending, for example, "all but guaranteeing that the economic situation will get worse before it gets better," the New York Times reported yesterday.
AMERICANS HIT HARD: The poor flow of credit in the U.S. economy is affecting virtually all aspects of American life. The Washington Post reports today that "unemployment claims are at a seven-year high, and factory orders are sharply down. ... Small businesses can't get financing." The landscapes of American cities are changing. Because of the rise in foreclosures, the number of homeless people in Massachusetts, for example, is at a record high. The country is seeing a rise in "tent cities" because of rising homelessness. Hourly and weekly wages in July 2008 were at their lowest levels since October 2005. As a "result of the worsening economy," Medicaid enrollment has risen 2.1 percent this year, with a projected 3.6 percent increase for next year -- the highest rate in five years. In the meantime, the McCain campaign announced yesterday that it would cut $1.3 trillion from Medicaid and Medicare.
STATE-LEVEL FINANCIAL CRISIS: The slow economy is also paralyzing the spending of state governments, forcing massive budget cuts. According to a July survey by the National Conference of State Legislatures, states are being forced to slash spending and cut jobs "in order to close a projected $40 billion shortfall in the current fiscal year," more than triple the size of the previous year's. New York Gov. David Paterson (D) predicted that the 2009-10 state deficit will be a record $8 billion, calling on lawmakers to make $2 billion in cuts. With concerns about their states' ability to access credit markets for short-term borrowing, both California and Massachusetts have asked the U.S. treasury for similar bailouts as given to Wall Street banks. The Department of Labor reported last week that the country shed 159,000 jobs in September, and the unemployment rate has increased to its highest level in five years. "The increase in the rate of job loss may well be rooted in credit market tightening," Michael Ettlinger and Amanda Logan of the Center for American Progress observed. The worker is hit doubly hard, as state jobless funds are drying out, too. According to the National Employment Law Project at least 11 states are facing financial challenges paying their jobless benefits.
STIMULUS NEEDED: Last week, Congress passed a financial rescue package that failed to sufficiently address the underlying problem of creating a mechanism that ensures the restructuring of home mortgages to help homeowners. Today, the country needs a second stimulus package, as CAP has outlined, which would help stimulate the economy and stem the tide of job loss. The second stimulus package should jump-start a low-carbon economy, invest in infrastructure, expand unemployment insurance, increase energy assistance, and boost food stamp support. Contrary to McCain's plan to cut Medicaid, the stimulus package should also expand Medicaid aid to the states. "A proactive Medicaid policy would help preserve health coverage, jobs, and state financial stability -- all of which will help an economic recovery," Ettlinger and Logan noted.
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The European Parliament has "refused to dilute pollution reduction targets," instead backing a tougher Emissions Trading Scheme and planning to install carbon capture technology.
THINK PROGRESS: Lynne Cheney: Right-wing blogs are "centrist."
WONK ROOM: House conservatives oppose regulations because bankers will just "find ways around" them.
YGLESIAS: Adventures in conservative paranoia.
TAPPED: Why we need regulation.
NEW JERSEY: Gov. Jon Corzine (D) yesterday "committed to tripling the state's offshore wind goals, calling for enough capacity in 2020 to power 800,000 homes."
ALASKA: "The federal government will designate 'critical habitat' for polar bears off Alaska's coast," which could limit "future offshore petroleum exploration or drilling."
GEORGIA: State Supreme Court "ruled in favor of a transgender politician who was slapped with a lawsuit by two political opponents who claimed she misled voters by running as a woman."
"Our economy continues to face serious challenges."
-- President George W. Bush, 10/04/08
VERSUS
"This economy is going to be just fine."
-- Bush, 10/06/08
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