By Robert J. Kleine
Michigan State Senator
The national economy could be facing a downturn as serious as the painful back-to-back recessions experienced in the early 1980s. At that time, national employment declined by almost three million with the unemployment rate peaking at 10.8 percent. In late 1982, Michigan’s unemployment rate stood at nearly 17 percent.
Fast forward to the present – economic conditions today aren’t quite that dismal, but with the national economy mired in a recession likely to continue well into 2009, and the domestic auto industry struggling to survive, it is important that history is not allowed to repeat itself.
The Federal Reserve and the U.S. Treasury have responded forcefully and creatively to the crisis, although belatedly. The actions of the last few months have not yet had time to work, but should help limit the damage. Still more must be done.
As Governor Granholm noted in a recent letter to Congressional leaders, without the recognition that real economic recovery must address the needs of working families who are suffering the brunt of this crisis, there will be no true economic recovery for America. To put economic recovery for people first, Governor Granholm and I believe any economic stimulus package must do the following:
Create Jobs - Investments in infrastructure projects are cost-effective and will create high-paying jobs.
Invest in New Energy Technologies – These investments cannot only create jobs, but will also help our nation develop the technologies needed to break our dependence on foreign oil.
Help Families Make Ends Meet – Action should include new requirements for loan modifications under the Troubled Asset Relief Program, additional counseling funds so states can help troubled borrowers engage with mortgage companies and funding for legal services for homeowners who have fallen prey to predatory lending.
Assist the American Automotive Industry – Assistance must be provided to this critical industry to avoid unthinkable layoffs that would devastate the middle class in Michigan and in other auto-reliant states.
Here in Michigan, we are moving forward with our own economic stimulus plans. Governor Granholm has directed me to make $150 million available to state banks and credit unions to help spur economic growth in Michigan. The state will purchase certificates of deposit at participating banks and credit unions, so they have capital to lend. A lack of available credit has created difficulties for citizens and businesses alike. Many small firms use short-term borrowing to cover payroll or stock their shelves.
The governor has also encouraged state lawmakers to focus on legislation that can spur economic development, expand access to higher education and help Michigan homeowners avoid foreclosure.
This is a critical time in our history. It is going to take leadership, vision and shared sacrifice to put our economy back on track. We have little time to act, but much to lose.
Robert J. Kleine was appointed Michigan’s 43rd state treasurer by Governor Jennifer Granholm beginning in April of 2006. As treasurer, Kleine oversees the collection, investment, and disbursement of all state monies. The treasurer administers major tax laws, safeguards the credit of the state, and distributes revenue sharing monies to local units of government.