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- iHaveNet.com: Economy
by Jesse Jackson
Even while we see jobs coming back, the tsunami created by the Great Recession is now hitting cities and counties with full force. Suffolk County, one of the largest New York counties, has declared a financial emergency. Stockton, Calif., a city of 300,000, is on the verge of bankruptcy. Jefferson County, Ala., declared bankruptcy in November, the largest municipal bankruptcy in history.
As the cities go belly up, the 1 percent are back. A new report by Emmanuel Saez, the nation's leading academic expert on income inequality, shows that the top 1 percent captured a staggering 93 percent of all the real income growth in 2010. The bottom 99 percent captured only 0.2 percent after losing nearly 12 percent from 2007-09, the worst two-year drop since the Great Depression. For the 99 percent, the loses in the Great Recession erased all of the income gains since the last recession in 2002.
In cities, the crisis is forcing harsh cuts in services. As New York City Mayor Michael R. Bloomberg put it, "Towns and counties across the state are starting to have to make the real choices -- fewer cops, fewer firefighters, slower ambulance response, less teachers in front of the classroom."
Cities and counties could muffle the effect for a couple of years after the crash, drawing on "rainy day funds" and creative financing maneuvers. But now, the day of reckoning is hitting - and hitting hard.
Lower property values, the result of the housing bubble crash, are now being registered in tax valuations. Millions were lost as the banks trampled the law while dodging recording and transfer fees on mortgages. Unemployment and poverty put greater pressure on budgets, particularly on health care through
Across America, cities and counties are cutting bone and muscle, not fat. Teachers and police are being laid off. Parks are closing. Badly needed sewer and road repairs are being put off. And brutal battles are beginning with public workers, who are now forced to pay for a crisis that they did nothing to create.
America is a rich nation, but our wealth is now too concentrated among the few. As in Iraq, we squander trillions in foolish wars of choice abroad. The wealthiest Americans pay lower tax rates than their secretaries - as Mitt Romney's 13.9 percent effective tax rate demonstrates.
These should not be controversial statements. We can't simply tell a young generation that the American Dream is a nightmare for them. We can't have a prosperous economy if the middle class is sinking. We can't have a great nation if we have hollowed out our economy, and starved schools and vital public services. We will not long be a democracy if the wealthiest pocket the rewards and check out of building the nation.
Yet it is striking how many in both parties are in denial. All of the Republican candidates call for more top end tax cuts, more military spending and even harsher cuts in schools, infrastructure and support for children. Congressional Republicans block even modest support for cities to keep teachers and cops on the job. Democrats like Steny Hoyer call for a grand bargain that begins by raising the retirement age on the next generation, a cruel reform that hits the poorest workers the hardest.
We can't go on this way. We have to choose. Do we assume that a recovery that benefits the few will eventually trickle down to the rest of us? Do we so hate government that we let cities go bankrupt and starve vital services like schools and parks and police? Are we so divided that we don't care if poor children have health care or a fair start?
We face the reckoning. We can keep going on the path we've been on, or change our course. To do that, Americans will have to mobilize, take on the entrenched interests and demand a change.
We have to choose.
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America's Day of Reckoning is Here