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Kerry Offers Plan for a 21st Century Economic Strategy

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Location: Boston, MA


Kerry Offers Plan for a 21st Century Economic Strategy

Today, in Boston's historic Faneuil Hall, Senator John Kerry laid out a 21st Century economic strategy for America's middle class in a globalized world - including universal health care, tax reform, green jobs, home ownership, and a renewal of the international labor movement.

Below are his remarks as prepared for delivery.

Thank you for coming. Gathering here is special - Faneuil Hall is more than an historic building. This birthplace of American freedom has also been a keeper of the American conscience. Here, where we assemble today, abolitionists dreamed of and demanded a nation that would live out its founding ideal that all are created equal. From the fight for women's suffrage to the fight against Fascism, from McCarthyism to civil rights to Vietnam, these walls have rung with words of honor, dissent, courage, and principle.

In the last decades, we've worked hard to live up to that heritage even if sometimes we've fallen short of it—or of victory. I began my presidential campaign here - and three years ago next month, I ended it here, and yes, the loss still exacts its price.

And I'm not talking about me. I'm talking about all the hard working families whose lives would've been better, all the young American soldiers whose lives were and are on the line, and all those—here and across the world—who yearn to see America move in a new direction.

So on that hard November afternoon, I had no doubt of one thing: my resolve, as I said then, "that what we started in this campaign will not end here." I pledged that, rather than walk away, "in the years ahead" in whatever was ahead for me, I would "fight on for the people and for the principles that I've learned and lived with here in Massachusetts." And that's exactly what together we are doing.

That is why, with actions not words, on the floor of the Senate last week, we reminded Rush Limbaugh and all those who think patriotism belongs to one political party, that just saying you support the troops doesn't make it so. You don't support the troops if you force their families to take up a collection to buy body armor for a son or daughter in the service, you don't support the troops if you deny veterans health care, no - you support the troops by doing what it took a Democratic Senate to do in the last months and just last week: pass my amendment to fund the vet centers that help returning soldiers heal PTSD and the hidden wounds of war, and make sure that for a generation of veterans returning home with eye injuries, their government will guarantee they get treated. That's how you keep faith with those who wear the uniform of our country.

Again and again since then, I have returned here to address the great issues facing our country.

In this hall, we've talked about the need to end a war in Iraq that was rooted in deception and waged with self-deception. I argued here and in the Senate and across the country that we will be stronger when we stop a policy that has not weakened terrorism but worsened it, and when we stop helping attract Al Qaeda where it wasn't, in Iraq, and instead fight Al Qaeda where it plotted and planned the attacks of 9/11. And here again we continue to fight to make America safer not by perpetuating a broken policy for the sake of politicians' pride, but by pursuing diplomacy to end an Iraqi civil war and bring our heroes home from the wrong war in the wrong place at the wrong time

Last April, I returned here to defend the deeply American principle that dissent is not a danger—but the very safeguard of democracy. That it is right to stand up to a President who ignores the Constitution and a Vice President who acts as if he had never read it - to insist that our leaders are strongest when they believe the future belongs not to fear but to freedom. We reaffirm today: America is strongest when we don't just tolerate free speech-but listen to it.

I also joined you here to set out a strategy to make America energy independent - to propose specific steps for an energy revolution as far-reaching as the industrial revolution—a revolution that can not only light our land, but protect our air, our water, and our environment - a new America that relies on its ingenuity and innovation, not the Saudi royal family.

And I came here to discuss health care - the great unfinished business of half a century a fundamental moral commitment that at long last must be kept.

These are the great challenges of our time, and they deserve a President committed to meet them head-on.

Today we return to Faneuil Hall—this time in keeping with this building's first and founding contribution to the American nation. This is where America's first middle class gathered—Boston merchants, mechanics, printers and craftsmen—they came here because they were fed up with a leader named "King George." Fed up with rule from an ocean away, that seemed as remote then as Dick Cheney's undisclosed locations do today.

They believed that rather than the rules working for them, improving their lives, they were working for the rulers —and that a distant government was doing the bidding of the powerful few—not the people who paid the taxes and played by the rules.

Sound familiar? Well I think so, too. And just as it did then, it's going to take more than a tea party to put this country and our economy back on course.

Today we're in the middle of another revolution - a whirlwind of technological innovation that constantly shrinks our world, widens our horizons, and flattens out global competition. We've heard a thousand times how we live in a "new economy"— but we remain prisoners of old economics: Regulators that don't regulate. Politicians who say education is the key, but make educators beg for the resources to open that door. A growth in GDP, but a larger growth in inequality. A middle class steadily falling behind. And trickle-down tax cuts for the rich that left most Americans feeling trickled on.

Ten years ago, we were ending a decade of sustained prosperity in which middle-class Americans, and particularly minority Americans, made big gains in real income and wealth. Those were the Clinton years. Now we are in the middle of an era of not only stagnant real incomes for most Americans but a vast erosion of benefits and security. These are the Bush years—good for Halliburton and Blackwater, and bad for hardworking Americans.

Ten years ago, we were talking about retiring the national debt. Now we are talking about public and private debts of an unprecedented magnitude, financed by foreign governments which can hold our economy hostage—or buy it up piece by piece. That is the Bush legacy to America's economy.

Ten years ago when the tech bubble burst, the losses were mainly on paper. Now our losses are in homes, health care, pensions, and jobs. A decade ago, investors lost the illusion of pain-free, perpetual super-profits. Today we are ridding ourselves of the Cheney illusion that "deficits don't matter," and the Bush illusion that you can borrow, deregulate, devalue and subsidize your way to growth by letting moneyed interests feed at the trough of government favors and borrowed money. That is Bushonomics: those at the top get the benefit. You and future generations get stuck with the bill.

But there is more here than just a partisan divide. For too long, Washington has been caught in old debates - Democrats forced to defend the gains of the twentieth century against Republicans determined to take us back to the nineteenth century. And while politicians debate whether to move left or right, too little is being done to move the middle class forward.

We're now as many years away from the New Deal as the New Deal was from the Civil War. But we've been responding to transformations in our economy with tinkering around the edges of past policies. It is now time for progressives to match Franklin Roosevelt's vision, not just mimic his rhetoric.

We need fundamental change— not bite sized ideas that are poll tested, sound-bite ready and destined to be mere footnotes to the times we live in. It's time we end the era of incrementalism and begin a bold new age in progressive politics.

We can't have the economy Americans deserve unless we finally have what we should've had for decades and generations: universal health care for all. And we need that not just for the health and moral benefit to our citizens, but because that is the only way to streamline and liberate our economy.

This can't be just a plan in a campaign - another political box to be checked off. It has to be a top priority for the next President and the next Congress- and it must become a reality for every American family.

Today's broken system is an economic disaster. It forces businesses into untenable choices: the GM model of crushing health care costs and the Wal-Mart model of minimal or no health coverage at all. The public message to business right now is cut coverage at home, or go to China where you don't have to give your workers health care at all.

Our current system is offering more and more middle-class Americans the equally lousy choice of clawing to hold onto inadequate insurance at skyrocketing prices, or simply praying for good health. Real leadership should be making the system efficient and effective, and making American businesses competitive at the same time.

Truly universal health care is the way, and the only way, forward for businesses and families alike. I'm proud that every Democratic candidate for President is - without exception - committed to that goal, as I was in 2004. And I can't help noting that Mitt Romney, the only Republican who's even lifted a finger in that direction—where the wind was already blowing strong, right here in Massachusetts—is running away from his own record so fast that it seems he was for his health care plan before he was against it. In fact, he seems to have turned away from his own record so fast he's going to need a good health care plan to treat him for whiplash.

The progressive economic agenda of our time must also demand and deliver energy independence, and an answer to climate change as serious—as real—as the problem itself. After years of evasion and denial, George Bush and his administration now pay lip service to the issue, but the rules are still being written in the Vice President's office, by the special interests, for the special interests, to serve the special interests. It's time to worry about the next generation's world, not the next quarter's bloated profits for big oil.

Every economist tells us that clean energy will be one of the most dominant drivers of economic growth in this century. But Washington still hasn't figured out how to make that an American century. After years of denial and delay from this Administration, these green jobs are being created in places like Germany and Japan. The choice is simple: we can lead or be left behind. The apologists of the status quo say we cannot afford to act on carbon emissions. The inescapable truth is that we cannot afford not to act. We cannot accept an America mired in fossil fuel dependency while other nations are beginning to leave us in our own polluted dust as they develop clean energy.

We passed a bill in the Senate this year to invest billions of dollars in clean energy. Last year the oil companies collectively made $253 billion, the most profitable companies in America, and we paid for the clean energy bill by repealing over $23 billion in tax giveaways to those most profitable companies. But you know what? Even with these record profits from Exxon Mobile and others- Republicans are still blocking the bill from passing. That's another reason to block them from being re-elected.

Over the last six-and-a-half years, we've witnessed in Washington a remarkable backwards-leaning experiment in which our environmental, tax, budget, trade, regulatory, labor, and social policies have been almost entirely subject to the most short-sighted interests of the most privileged Americans, and the most influential corporations.

They smear their critics by waving the flag of class warfare, while themselves all the time waging an assault on the middle class and the workers struggling to join it. What America needs is neither class warfare nor business-bashing but a battle for common sense, and an end to the reverse class warfare of the current administration. Thomas Jefferson's credo should again become the foundation of our strategy for prosperity: "equal opportunity for all, special privileges for none."

And nowhere has that credo been more absent, or has the assault on the middle class found more favor, than in our tax code itself. Taxes have never been absent from the debate between citizens and their government. When King George chose to raise taxes on paint, paper, and tea in the American colonies rather than tax those in Britain, he unwittingly lit the fires of revolution that burst into flames just blocks away from this hall in the Boston Massacre. Just over one hundred years later, no less a Republican than Teddy Roosevelt said that "the first requisite of a good citizen in this republic of ours is that he shall be able and willing to pull his weight." America has always stood for shared sacrifice - and fundamental fairness.

No wonder Americans are fed up with a system where the idea of shared sacrifice has been turned on its head. After four years of war, the income gap between CEOs and Army privates is 308 to 1. The army private makes about $25,000 a year and puts life and limb on the line. The average defense CEO makes $7.7 million.

This didn't happen by accident. It is long past time to roll back this President's unfair, unaffordable tax cuts for those who make more than $200,000 a year. In 2008 alone, these tax cuts give $49 billion to people making a million dollars a year or more. That's 20% of the whole tax cut to the one third of one percent of the population that doesn't need it at all. Those of us lucky enough to be in a high-income bracket ought to be content, and lucky as we are, Teresa and I don't need - and didn't ask for - a tax cut then more than 46 million Americans need health care coverage.

So now it falls on us to do more than correct the mistakes of the last seven years. We need to readjust the entire tax code to reflect who we are and what we value: opportunity for the middle class, honoring work not just wealth, and closing the loopholes that reward CEOs for sending American jobs overseas.

We need to make it equitable and we need to make it radically simpler. In 1940, instructions to the Form 1040 were about 4 pages long. Today the instruction booklet fills more than 100 pages, accompanied by more than 10 schedules and 20 worksheets. It takes the average person 28 hours to file a tax return. You shouldn't have to hire a CPA just to get your tax refund back from Uncle Sam.

We also have to reform the Alternative Minimum Tax which has metastasized into the "family tax." Back in January 1969, Americans were outraged to learn that 155 of the wealthiest citizens somehow paid no federal income tax at all. Congress received more letters of protest about that than about the Vietnam War, and Washington responded with the AMT. In 1970, 20,000 Americans paid the AMT. In 2007, 23 million will. Who are they? Teachers, police officers, nurses and hard-working families. Now some people want to patch the AMT and punt this problem down the road. But we shouldn't just band-aid an unfair tax—we should bury it altogether.

It's also time we end the "separate and unequal" system that taxes money earned by wealth so much more favorably than it does money earned by work. Anyone who tells you that wealth is the source of work probably thinks the New York Yankees need a bigger payroll. We need to encourage entrepreneurship - not just comfort the comfortable. The tax code should help more families save for college and retirement, not help millionaires hide their money offshore.

As we fix the code, we also need to finally put an end to a corporate tax system that rewards sending American jobs overseas. It's just plain wrong to tell American workers to dig their own occupational graves by subsidizing the export of their own jobs.

We must also restore accountability and bring today's underground economy into the sunshine. Too many sectors of our economy are moving off the books and working for cash under the table, and everybody loses when that happens.

Putting an end to the underground economy will actually save jobs and bring in tax revenue at the same time. You know all of us take pride when corporations produce great products and great jobs, but we should take equal pride when corporate America pays its fair share of the costs of making America strong.

It's hard to remember that there was a time not too long ago when this President talked about creating an "ownership society." But as the mortgage foreclosures start to pile up, we're learning who gets to do the owning: big banks!

Buying your own home has always been the foundation of the American dream - but when more than 2 million Americans—including thousands in Massachusetts—risk losing their homes, for too many the dream of home ownership is becoming a nightmare.

Why is that happening? Because we have a sub-prime mortgage market that's been abused by lenders' deceptive practices and abandoned by the federal bank regulators who looked the other way: in the Bush economy, anything goes— but for families in danger of losing their homes, the question "why" is less important than: "What now?"

Today families fighting to hold onto their homes also find themselves fighting the federal government. When a bank does the right thing to try to lighten a family's mortgage burden, the federal government turns around and taxes this assistance as if it were real income. This is just plain wrong. The government should be helping families pick themselves up, not kicking them when they're already down. That's why I'm fighting in the Senate to change the law so families don't have to fight the IRS while they're fighting to keep their homes.

We also see that too many families can't get a mortgage at a fair price on the open market. To help them here in Massachusetts and across America to find a way out of the abusive loans that now hold them hostage, we should immediately increase federal loan limits and lower down payment requirements.

And third, we should make sure regulators do their job: stopping abusive mortgage practices and guaranteeing that anyone buying a home gets good information and responsible advice. Instead families have been lied to; they have been misled; and it's long overdue for Congress to lead by making sure that lenders actually tell Americans the truth.

In the end, as we know all too well, owning a home is just one part of an ownership society. Most importantly, the promise means having a sense of ownership over your whole life: being able to save for college, save for retirement, put money away to care for an aging parent, earn a decent living. No amount of White House spin can build an ownership society out of Republican policies that make those things impossible and are really telling most Americans "you're on your own."

For the first time since the Great Depression, our personal savings rate is less than zero. Since the year 2000, household debt has increased by more than $26,000.

And our nation's debt—public and private- is out of control. One answer is creating automatic individual retirement accounts—and helping Americans invest in them. Every worker should be able to send part of their salary directly from their paycheck into retirement accounts—without even writing a check each month.

And if we want more Americans to take the risks that spark our economy, we can't hold them back at the starting gate with students leaving college burdened with mountains of debt. Two-thirds of college students graduate with $23,000 in student loans.

After World War II, we invested in those who kept us safe from fascism, and I believe we ought to be making the same kind of deal by sending young people today to work to save post-Katrina New Orleans from extinction and to become Big Brothers, Big Sisters and mentors in communities of need. It's high time we made a new deal with America's young people, with a new Service for College program. If you serve your country for two years, we will cover the cost of a four-year public university.

Finally, you can't build a modern economy without universal broadband access. Just as FDR fought to bring electricity to rural America, just as Eisenhower had a vision for our highways, we need to bring the Information superhighway - high-speed internet - to every home. Three years ago, President Bush talked about delivering universal broadband access by 2007, but here we are- 2007 almost over- and less than half the homes in Massachusetts- which is a leader in the nation- have broadband—even fewer in Western Massachusetts. Instead of marching forward, as a nation, we're falling behind: We've slipped from fourth worldwide to 21st - behind Estonia and tied with Slovenia. Well, I don't think the United States should be second to anyone on the planet. Bottom line, our economy can only go as far as our high-tech infrastructure will take us— and we have to insist that we take it all the way, right away, to our economic future, because if we build it, the jobs will come.

These are the choices we must make to create an economy that works for all Americans again. But more than these choices we must restore a fundamental social contract.

Everyday millions of Americans get up and go to work to a job that brings with it a pension, health care, high wages, and safety standards. But fewer and fewer of these workers have joined a union. Let me tell you something, they all owe those benefits to the labor movement in our country.

What was true in Roosevelt's day is just as true today: we must promote the right of employees to collectively bargain for better wages and benefits—at home and abroad.

There's nothing anti-business about being pro-union. And there's nothing that contributes more to a socially responsible corporate community than workers who know they have a place at the table in key corporate decisions.

Under the Bush administration, the federal government has pursued the most strident anti-union policies in memory. I doubt they've appointed one judge who has voted for workers one time in their lifetime. Then how can they talk about spreading democracy to other countries and then tell workers that they don't have the right to sign a card and elect a union to bargain for a better wage here in America? Congress needs to finally enact basic labor law reforms like the Employee Free Choice Act, which preserves the right of workers to organize without intimidation. And just as important, we have to promote workers' rights abroad—because it's right - and because it's the only way to create a level playing field for U.S. exports. American labor leaders understand this. Andy Stern, head of SEIU, has been to China six times in five years. As President, George Bush has only been there once—and I'm sure he didn't once mention worker's rights.

James Hoffa, of the Teamsters union, sees China as a new frontline for the labor movement. He understands that, at its worst, the global economy is a race to the bottom that pulls the rug out from under American workers.

So we have to make it a race for the top—because globalization isn't going to go away. We need to put our stamp on it and create a fair playing field - - because empowering America's workers means stepping up to bat for workers everywhere.

When Democrats took over Congress we said to this President - - "no more trade deals unless you fight for workers' rights." We held his feet to the fire in a trade deal with Peru that does protect workers. But it's not enough to have labor rights written on a piece of paper signed in the Rose Garden. We need countries to start enforcing them—and we need a President who actually wants them enforced.

44 years ago, a very different kind of president, John F. Kennedy, went to Pueblo Colorado and assured America that a "rising tide would lift all boats." Back then Pueblo had a steel mine with over 14,000 union workers. Now there are only a thousand. It used to be an industry town. Now it has an industrial museum.

Pueblo isn't alone. Look in the Merrimack Valley; which was once the home of our textile industry with 40,000 mill workers in Lawrence alone—immigrants who walked a picket line during the winter of 1912 for a fair days' pay. Union members rallied right here in Faneuil Hall to support them. Today we have a State Heritage Park in Lawrence but not enough living wage jobs for the new immigrants who live there.

No, we don't live with the same economy that President Kennedy talked about: as he once said, "the world is very different now." But the ideal he spoke of must endure. The economy will never be the same as it once was, but America always needs to stay true to America.

Today our economy is living on borrowed money, and on borrowed time, and both will run out soon if we don't get serious about changing course in Washington.

We must end the assault on America's middle class and we must begin to make our economy fair again. The great American middle class doesn't ask for much, but it counts on: leadership that honors work as much as wealth; and leaders who will make economic growth not a spectator sport, but a common endeavor.

Our mission is as clear and the cause is just: Health care for all. Energy independence. A tax code that works for working people. Stop making a mockery of the phrase "ownership society." A fair shake for the workers who ultimately create our wealth. And a society where wealth comes with responsibility, and not just a ticket to power and privilege.

All these goals are within our grasp if we really want them. Those proud Massachusetts patriots of 1776 didn't plead for permission to govern themselves, and they didn't wait to be told what to do by those who misgoverned them. They acted, and now so must we. Thank you.


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