Restoring Middle Class Depends On Investing In The Future Says New Economic Agenda

Economic Plan Seeks to Stem the Rise of Inequality and Mend the Broken Link Between Wages and Productivity Growth

“Prescription for Prosperity” Is Endorsed by Business, Labor, Faith, Community, and Environmental Leaders

Harrisburg – Representatives of over 20 organizations today released an economic plan that would lead to economic growth and support a better quality of life for all Pennsylvanians.

The “Prescription for Prosperity” argues that investing in education and skills, growing good jobs linked with key industries, and promoting the security of the middle class through comprehensive health care reform are necessary for Pennsylvania to compete in the global economy and share the benefits of growth more equitably.

"There was a time in America when a strong economy translated into rising wages and a better life for all,” said Sandy Strauss of the Pennsylvania Council of Churches.  "But now, despite robust growth, many Americans are uneasy about their future and their children’s.  The link between economic growth and the American Dream has been broken.  By following the Prescription for Prosperity, Pennsylvania can restore the American Dream and make the economy even stronger."

The coalition released the Prescription for Prosperity together with a policy brief highlighting new wage figures for 2006.  These figures show that wages in Pennsylvania and nationally remained stagnant in 2006.  In the same four-year period, U.S. productivity increased by 15% and corporate profits by over 60%.

At the release of the agenda, Rick Bloomingdale of the Pennsylvania AFL-CIO said “our agenda focuses on exactly the priorities that the new IssuesPA poll highlighted are on the minds of Pennsylvanians – health care, jobs, and education.” 

“Governor Rendell has already begun to invest in these key areas,” added Bloomingdale, “and Pennsylvanian’s apathy and cynicism is turning to optimism that a better future is possible. Our agenda outlines how to build on this progress with a long-term plan that is equal to the challenge of the global economy.”

Other speakers highlighted that much remains to be done in Pennsylvania.

“A more skilled and educated workforce is critical to growth and to opportunity,” said Robin Greene, a Southeast Pennsylvania business leader. ”While the state has made some progress, only eight states have a smaller share of workers with education beyond high school. More investment in postsecondary education must change that.”  (The eight states are Alabama, Arkansas, Kentucky, Louisiana, Nevada, Mississippi, Tennessee, and West Virginia.)

“Despite our strong economy,” said Carol Goertzel, director of PathWaysPA, “fully a quarter of Pennsylvania’s working families with children don’t earn enough to cover the costs of a bare bones family budget.  We must invest in Pennsylvania’s families to fix this unacceptable picture.”

In the last year, conservative economists and business publications have recognized the increasingly skewed benefits of U.S. economic growth.  Earlier this month, Federal Reserve Chairman Ben Bernanke noted that inequality could undermine basic American values, including the beliefs that hard work should be fairly rewarded and that opportunity should be widespread.

"Inequality has grown," said Stephen Herzenberg, an economist with the Keystone Research Center (KRC), "because the economic world has changed while policies have stood still.  The good news is that state government can take action to help our businesses compete and to expand opportunity for our workers."

“For too long, Pennsylvanians have been offered false choices,” said John Hanger of PennFuture. “A strong economy or a clean environment.  A clean environment creates good-paying jobs and a competitive business environment.  With this agenda, Pennsylvania can renew itself economically and improve its quality of life.”

The coalition will work together to advance the policies in the Prescription for Prosperity in Harrisburg and to build consensus on the need for a comprehensive long-term plan to achieve the twin goals of a competitive Pennsylvania and a strong middle class.  Via the Keystone Research Center website, groups may provide electronic feedback on the agenda and on a KRC policy report that backs up the agenda.  Groups may also request speakers for town meetings on the agenda.  Groups and individuals may also endorse the agenda on the KRC website.

The complete Prescription for Prosperity agenda together with supporting materials can be found at www.keystoneresearch.org.

A complementary report, Investing in Pennsylvania Families, was released in January and highlights how elements of the Prescription for Prosperity can lift more Pennsylvania families to self sufficiency.  Investing in Pennsylvania Families, produced by PathwaysPA in cooperation with KRC, can be found on the KRC website and at www.pathwayspa.org.

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