The Big Winner in Obama’s Jobs Speech? Small Thinking.

In closing his jobs speech last night, President Obama challenged Congress to imagine where the U.S. would be if their predecessors had balked when asked to think big.

He listed historic government initiatives: the push to build the transcontinental railroad and establish land grant colleges during the 1860s, the passage of the GI Bill and the construction of the interstate highway system in the mid-20th century, and more recent support for basic scientific research that made the computer chip and the Internet possible.

“What kind of country would this be if this chamber had voted down Social Security or Medicare just because it violated some rigid idea about what government could or could not do?” Obama asked. “How many Americans would have suffered as a result?”

Unfortunately for the president, the comparisons only served to highlight how puny his jobs proposals are when measured against this short list of successful government investments.

Obama tried to give an election-season speech filled with policy proposals Republicans might actually vote for, ending up with the worst of both worlds. The content was short on inspiration for an increasingly disaffected base—especially among union folk, who are beginning to openly voice their frustration with Democrats.

Compared with the big talk on green jobs and renewable energy that candidate Obama routinely engaged in 2008, this outing was like soggy toast, satisfying only when compared to the bile coming from presidential wannabes like Rick Perry who called Social Security (with its $2.3 trillion surplus) a Ponzi scheme.

After this summer’s debt-ceiling circus, where Tea Party conservatives ginned up a phony crisis and used it to hold the government hostage, it seems unlikely that Congress will actually pass much of what Obama laid out, whatever the merits of his proposals.

But for folks who still believe the government can and should do more to address our recession-induced jobs crisis, Obama's speech was far more disappointing. It crystallized the small thinking that dominates Washington—and the Obama administration in particular—not just about what government should do, but more fundamentally, what it’s capable of.

In light of last month’s employment report, which showed job growth flat-lining, that is really bad news for the 25 million people who are out of work, are not able to find a full-time gig, or have given up looking all together.

Tax Cuts Don't Create Jobs

The details of the American Jobs Act are built on principles that Ronald Reagan would embrace. Half of the $450 billion package is composed of tax cuts, and Obama went to great lengths to assure us he’s committed to finding additional cuts—including to Medicare and Medicaid—to offset new spending.

And Obama didn’t miss the chance to take his share of potshots at government itself, promising to slash red tape and bureaucracy that supposedly stand in the way of business. He already got a head start last week when his administration retreated from new pollution standards that the EPA says would prevent 12,000 deaths every year.

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Almost as bad is the fact that Obama’s proposals can’t make a dent in the nation’s job gap.

As the last stimulus package demonstrated, tax cuts won’t spur spending but will allow people to pay down debts and allow corporations to add to their huge cash reserves. Those vaunted “job creators” are already sitting on close to $2 trillion.

After Wall Street and the rest of Corporate America were done raking in record profits last year, what money they did spend went to double-digit raises for CEOs and hefty fees for the lawyers and consultants who make sure corporations pay next to nothing in federal taxes.

Companies were not investing, or hiring folks who have less than five zeros on their pay stubs. They were back to business as usual, and there was nothing in Obama’s speech—or this year’s White House corporate charm offensive—that will change that.

So where is this century’s interstate highway system? After a nuclear power plant incident blacked out most of the Southwest last night, we could sure use big and bold investment to make solar and wind power technologically and economically viable.

Where is this century’s equivalent to rural electrification? The Korean government has a plan to bring high-speed internet to every household in the country. The U.S. is definitely not going to pull it out of the back of a Time Warner or Comcast contractor’s truck.

What about a high-speed rail system? China is already hard at work on the world’s largest high-speed rail network, a point Obama highlighted in his speech. Meanwhile Obama tinkers with modest upgrades and small-minded governors set their states on “fail” by rejecting rail investments.

Solutions like these aren’t going to come from the private sector, but the resources to pay for them can and should.

Big ideas—and a 21st century government not afraid of bold action—could create millions of jobs and build a new, more sustainable economic base.

Unfortunately, ambition and big thinking were painfully absent last night. They’ve been missing from Washington for more than a generation, and now, lawmakers are competing with each other to ratchet down our expectations.

It’s up to activists in the labor movement and beyond to make these facts plain, and clobber the self-defeating fiction that corporate control and austerity are the only road to economic revival.

Mark Brenner is the former director of Labor Notes.