TOPICS > Economy

Previewing Democrats Economic Platform: Supporting Small Business, Education

August 31, 2012 at 12:00 AM EST
Democrats plan for the economy is twofold: provide entrepreneurs and business owners with the tools and resources they need, and ensure the growth of a strong middle class. Paul Solman reports from Charlotte, N.C., on the Democratic Party's economic platform in before the 2012 Democratic National Convention.
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JUDY WOODRUFF: And we come back to politics.

Last Friday, NewsHour economics correspondent Paul Solman looked at how Mitt Romney’s policies could affect the economy, as seen by businesspeople in Tampa.

Tonight, he visits the host city for the Democratic National Convention for some perspective on the president’s record.

Our story is part of Paul’s ongoing reporting Making Sense of financial news.

PAUL SOLMAN: Five hundred and seventy-five highway miles due north of Tampa, Fla., and the Republicans, Charlotte, N.C., a hub of the new South, very new.

And in this self-dubbed World Center on Monday, the Democrats will convene. Vice President Joe Biden’s first economic adviser, Jared Bernstein, joined us here.

So that’s where the convention is going to be next week. What’s the essence of the Democratic economic platform?

JARED BERNSTEIN, former chief economist to Vice President Biden: I think the essence is twofold, first, to build an economy where our businesses and entrepreneurs can grow and flourish, where they have the tools and the resources they need, and second, to ensure that that growth helps to build a strong middle class.

PAUL SOLMAN: Tim Mullaney is the kind of middle-class businessman the Democrats are pitching, and one of the interviews they lined up for us. He owns a printing business his father started in the 1960s. A loan from the Obama Small Business Administration allowed him to buy this $100,000 four- color printer.

TIM MULLANEY, Consolidated Printing: It was an SBA express loan that I had never heard of. My banker was telling me about it. About four hours later, she called, and she said, OK, we have got approval. Are you coming into the bank or am I coming out there to you with some papers?

And I just kind of took a deep breath and said, how about tomorrow? How about I sleep on this and make sure before we spend $100,000? Two days later, it was sitting here on the floor.

PAUL SOLMAN: The president’s so-called Recovery Act beefed up the SBA and its express loan program, enabled the accelerated depreciation, so that Mullaney could deduct the entire purchase from his business income in the very first year.

In Tampa last week, talked to a couple of small businessmen, one of them a printer like yourself. They said, Romney-Ryan is all about small business, that’s the distinction between the Republicans and the Democrats this time around.

TIM MULLANEY: I’m not sure that they support small business any better than the president supports small business. We need the tax incentives. We have got tax incentives.

PAUL SOLMAN: But the Republicans say they are going to cut taxes even more.

TIM MULLANEY: Well, I would always like for my taxes to be less. Nobody wants to pay any more than they absolutely have to. But with the current president, we have managed to invest in two new people and bring them on and put them to work.

PAUL SOLMAN: Bringing the total number of workers to nine.

So you heard that and you’re thinking?

JARED BERNSTEIN: A lot of people seem to think that President Obama raised taxes on businesses. In fact, he was quite an aggressive tax-cutter, particularly when it came to small businesses.

PAUL SOLMAN: So then it’s not fair for the Republicans to identify themselves with small business, in contrast to the Democrats?

JARED BERNSTEIN: It’s not fair, but it’s also factually inaccurate. You heard about the small business express loan, the 100 percent expensing. These are Obama policies targeted at small businesses.

PAUL SOLMAN: As for Obama policies targeted at larger businesses, Jared Bernstein decided to pick up the pace. And so, he took us to one of Charlotte’s major attractions, the NASCAR Hall of Fame.

I know NASCAR is here in Charlotte, where the convention is, but it doesn’t seem like the traditional Democrats’ venue.

JARED BERNSTEIN: I have to disagree, when I think about an American auto industry that’s not only key to the nation, but key to North Carolina. It’s actually the eighth largest auto employment in the nation.

But I think the important point, especially with all of these American cars around here, is that had the administration not acted to rescue GM and Chrysler, their liquidation was pretty certain. And it’s a stark contrast with the Republicans, who basically argued that, you know, they just should have been able to liquidate.

So it’s kind of like this market solution at a time when it really could have meant the end of the American auto industry as we have come to know it. And here in a state like North Carolina, where there are tens of thousands of auto jobs, they would be lost.

PAUL SOLMAN: Now, the Hall of Fame is known for its interactive exhibits. And though this next sequence may seem over-the-top, there was a method to the madness of vying for the museum pit crew record of nine seconds.

JARED BERNSTEIN: This thing is heavy.

PAUL SOLMAN: To Bernstein, it was a double exercise, fitness…

JARED BERNSTEIN: I’m breaking a shvitz here.

PAUL SOLMAN: … and, more to the point, Keynesian economic stimulus.

JARED BERNSTEIN: You have an economy that’s zipping along, doing fine, but it gets a flat tire or it runs out of gas. It pulls into the pit, gets some stimulus by a bunch of folks working together to temporarily help boost its activity, and they get out of the way and it’s back off and running.

PAUL SOLMAN: It’s this notion of public-private partnership that Bernstein and his Democratic allies emphasized all day long.

The mayor of Charlotte, Anthony Foxx, provided the next testimonial.

MAYOR ANTHONY FOXX, Charlotte, N.C.: The relationship between business and government has to be close.

PAUL SOLMAN: Foxx took office back in December of 2009, at the height of unemployment in Charlotte, 28,000 jobs lost in just 14 months.

ANTHONY FOXX: We have scratched and clawed our way back. One of the things I’m proudest of is we have got a Cultural Campus down on South Tryon Street, and we had to raise $83 million of private money to match the public sector investment.

We have two companies, Siemens, and Celgard, that have gotten investments through the Recovery Act, and they have doubled their capacity in their plants. They’re hiring more people at very good price points.

PAUL SOLMAN: But might not this be making the mistake of the government picking the winners, as opposed to letting the market decide?

ANTHONY FOXX: As a mayor, I don’t have the luxury of going and passing off to someone else the job of getting my people back to work. I want to see them getting back to work, and I know the president’s done a great job of doing it.

PAUL SOLMAN: A great job? Unemployment north of 8 percent, and if you’re using a more inclusive number, as we do, it could be 27 million Americans now who are either un- or under-employed.

ANTHONY FOXX: Well, the president has taken us from losing three-quarters of a million jobs every month to now growing jobs. The private sector has grown jobs 29 successive months.

PAUL SOLMAN: On the other hand, Mayor Foxx and Jared Bernstein both acknowledge how tight the job market remains, and, thus, the campaign’s focus on education.

At the University of North Carolina’s 25,000-student Charlotte campus, public policy graduate student Kristen Clanton will have borrowed nearly $50,000 by the time she gets her master’s. An Obama volunteer, her gratitude stems from the administration’s push to keep the interest rate on federally subsidized loans from doubling.

KRISTEN CLANTON, graduate student, University of North Carolina: It’s enough to think about the debt I have currently, but to have to think about, you know, the debt I’m going to accrue by the time I finish graduate school, and then if that were to increase or even double because of, you know, the increase in the interest for student loans, that would be, you know, very difficult.

PAUL SOLMAN: But it’s not just student loans that differentiate the Democrats from the Republicans, says Jared Bernstein, but Pell Grants.

JARED BERNSTEIN: This is financial assistance very important to middle- and lower-income students. The president doubled Pell Grants. The Republican agenda is to cut those quite severely.

PAUL SOLMAN: And, says Bernstein, it would also cut educational aid to veterans like 35-year-old David Miller.

DAVID MILLER, U.S. Military veteran: It used to be, as a disabled veteran like myself, you only got roughly $500 a month for disability. Who can live off that?

PAUL SOLMAN: Miller says he wouldn’t have been able to afford school without government assistance. Before President Obama, he says, the Veterans Administration was an underfunded mess.

DAVID MILLER: You could not even get anybody on the phone. You could not see anybody in person. You had no clue.

PAUL SOLMAN: But the president reorganized the VA and increased funding substantially. David Miller went back to school.

You’re here as a case in point for the Democratic argument. Do you actually think that if there were a Republican administration, you would be cast out, you would no longer be able to go to school here?

DAVID MILLER: No, I don’t want to say I would be cast out, but look at the Romney-Ryan 50-point plan. It doesn’t mention veterans. It doesn’t mention us at all.

PAUL SOLMAN: So that’s why you had us talk to him?

JARED BERNSTEIN: I mean, that’s part of the reason.

If you actually look at the House Republican budget authored by Paul Ryan, it implements significant cuts in the Veterans Administration, something like 20 percent. And that’s just this kind of across-the-board spending cuts that hit everybody, including the kinds of services we just were talking about.

PAUL SOLMAN: Last stop, back at the Convention Center with Jared Bernstein, the trappings finally going up.

We have been a lot of places today, and what I have kept hearing is let’s protect what we have done, as opposed to, here’s what were going to do in the next four years.

JARED BERNSTEIN: I think protecting what we have done and implementing it in full is very much part of the agenda over the next four years. The Affordable Care Act, financial regulatory reform, neither of those are anywhere near fully implemented, and both of them are on the Republican chopping block.

PAUL SOLMAN: At some point today in the car, you said you thought you could tweet the entire difference between the Democrats and the Republicans.

JARED BERNSTEIN: Yes, I think I can get that in under 140 characters. Republican economic platform: Markets rule. Democratic economic platform: Markets rule, except for when they fail, and when they do, we have got to do something about it.

PAUL SOLMAN: Well, 165 characters, it turns out, but in far longer form, the theme we will be hearing in Charlotte next week.