Our economy is a tale of two cities. On the good side, the national unemployment rate is low, 3.9 percent, and job growth is strong.
From 2012 to 2016, we added an average of 216,000 jobs a month. In 2018, job growth is slightly lower, 207,000 a month. However, wages are stagnant and good jobs continue to be lost and replaced with part-time and minimum-wage jobs.
The rich are doing well, but the middle class is struggling.
The tax cut was supposed to help working families. But, 80 percent went to rich people and to corporations who have used almost all of their tax cut to boost their stock price. Wealth and income are more skewed toward the rich than at any time since the 1929 crash. The tax cut is it worse. We are in dangerous territory and could see another crash.
We have had tax cuts for 35 years. What are the results? The top 1 percent have made out like bandits. The top 10 percent have done OK and the middle class got nothing.
After inflation, wage gains since 1980 are almost zero. In 1980, a single worker could support a family. Now, families have to work two, three and four jobs just to make ends meet.
The federal deficit has doubled and interest rates are going up.
Meanwhile, automation has ripped through our economy and replaced workers. Factory production is at an all-time high, but factory jobs have declined 40 percent. Low-skill jobs with good pay are not coming back. Robots are great at low-skill, repetitive jobs.
Automation has replaced coal miners. Cheaper natural gas is replacing coal. Automation has replaced steel workers. Automation has replaced secretaries and most middle managers. Online shopping and automated warehouses are replacing retail stores. Soon, self-driving trucks will replace truck drivers.
The solution is we need to invest in our infrastructure and in our people.
We need to fix roads, bridges and dams. This investment pays for itself. Bad roads damage cars and threaten lives. The savings on tires and wheel alignment is greater than the cost of fixing roads.
Old, weak dams can break, wash away our homes, and kill us.
Wild weather is the new normal. In 2017, the U.S. spent $300 billion on weather-related destruction. Insurance companies spent much more. The U.S. needs to invest in water storage, fire prevention, flood control and higher sea walls.
California is burning. In 2017, we spent $1.8 billion fighting fires and another $10 billion in home insurance claims. We need to create and maintain fire breaks and thin our forests to protect our homes, bring back affordable home fire insurance, and save lives.
These infrastructure investments will pay for themselves and create good-paying jobs immediately. We will put our construction teams and loggers back to work and create new jobs for many more. These are good jobs with good pay. We will boost our economy directly for the middle class and lay the foundation for economic growth.
With a skilled workforce, we will compete in the world and win. Without skills, we will hunker down behind walls and tariffs and become as poor as a third world county.
China, Japan, Korea and others are investing in the education and skills of their people. We must do the same. We need better pre-schools to support working moms and make sure our kids get a solid foundation. We need K-12 schools that build hands-on skills with classes like wood shop, auto shop, and design competitions; creative thinking with classes in art, music and design; and cognitive skills with classes in computers, science, history, and other academics. We need affordable college and vocational training, plus continuing education to improve the skills of our existing workforce.
Finally, like we did after Sputnik, we need to invest in more university research. Japan, Taiwan, and Korea are turning new technology into good jobs. Our trade imbalance with China is actually a trade imbalance with Japan, Taiwan, and Korea. China imports the parts from those countries and assembles the products.
Those three countries are capitalizing on U.S. inventions, while our companies minimize their investments and focus on boosting their short-term stock price. We need to change the holding period for long-term capital gains to five years so that our companies will invest and create jobs.
Marvin Keshner, who holds undergraduate and graduate degrees from MIT, worked for 26 years at Hewlett Packard, founded OptiSolar, which pioneered low-cost, utility-scale solar, and has been a consultant to the solar industry.