Obama's Public Works Project

The economic news continues to herald even more horrible times up ahead. If only January were here, already! If President-elect Barack Obama manages to pull off the public works improvements he is proposing, maybe blue skies are on the horizon.

On January 6, Obama laid out his expansive plan to revive the economy through a job-creating public works project on a scale not seen since the building of the interstate highway system in the 1950s. According to the plan, millions of jobs will be created across a wide range of sectors, from construction jobs working on the improvement of the highways, to high tech jobs working on expanding broadband Internet access and improving the IT infrastructure at healthcare facilities. The expansion of broadband was on the slate during the Clinton administration, but the effort never came to fruition. And hospitals and doctors' offices have been making do on antiquated systems running ancient applications for decades.

The plan also includes details about green-job programs and energy efficiency improvements in the efforts to both address global warming and stimulate the economy. The program would include weatherizing homes, installing monitors in homes to monitor and reduce energy use, and upgrading federal buildings to enhance their efficiency. It would also include tax breaks and subsidies to encourage clean energy projects like wind farms, solar, biofuels, and technology for capturing carbon dioxide emitted by power plants.

This initial plan looks smart, progressive, and frankly pretty exciting. But will it work? Just a month ago, in the weeks prior to the election, John McCain was arguing that the economic crisis could only be resolved by putting a freeze on federal spending. Since that time, however, economists such as Robert Pollin, writing for The Nation, spelled out a different plan. He argues that money must be spent by the federal government in order to maximize the number of jobs created, to increase the long-term productivity of the economy, and to reduce our collective carbon emissions.

But the deepening economic crisis is pushing the working poor into complete destitution, and how will this stimulus proposal help them? Looking at statistics from 2007, more than 37 million Americans live in poverty, meaning they earn less than $21,200 a year for a family of four. And unemployment is on the rise, and with it food stamp usage and the demand for social service agencies and shelters. The USDA's annual report on food security reported that almost one in eight Americans were "food insecure," meaning that they have trouble getting enough food as a result of a lack of resources.

Preventing the human suffering brought on by the recession will have to be yet another item on the long list of must-haves in the Obama proposal. Bolstering food stamp funds, rental assistance, and extending unemployment benefits will be critical to stabilizing distressed households. And the effect of this should likewise provide a boost to the economy. Focusing the economic policy on only the middle class won't be enough as the economy continues to deteriorate and more and more of the middle class falls into poverty.