Remarks at the University of Texas San Antonio, College of Public Policy Distinguished Lecture Series, San Antonio, Texas, September 23, 2013
[as prepared for delivery]
Thank you, Dean Saenz, for that wonderful introduction and for the gracious invitation to speak today. I couldn't be more thrilled to be here in San Antonio, and that's not just because I plan on heading over to Mi Tierra after this for some of that famous menudo I've been hearing about.
I want to thank Professor Roger Enriquez, who was instrumental in putting this event together. Thank you for your impressive stewardship of the Center for Policy Studies here at UT-San Antonio. It's clear to me that you and Dean Saenz are building an impressive center and an even more impressive college, and I'm honored to be a small part of them today.
I also want to acknowledge your fantastic President here at UT-San Antonio, Dr. Ricardo Romo. Not only is Dr. Romo leading one of the fastest growing institutions of higher learning in Texas, but he's doing so by focusing on science, technology, and increasing opportunities for Hispanic youth. That's not only important to your students' futures, Dr. Romo, it's also critically important to the future of this country. On behalf of the President: thank you.
Lastly, I want to thank your incredible mayor, Mayor Julian Castro. We just finished an event together at San Antonio College highlighting the Affordable Care Act and the important benefits of enrollment. I can't say enough great things about him. Not only is he a gifted leader, but he's also a wonderful person who simply wants to make a difference in his community. And you know what they say: great leaders have impeccable judgment. And Mayor Castro decided to skip my speech, which only reaffirms everything I've just said about him.
In all seriousness, we need more leaders like Julian Castro. I'm proud to call him a friend, and you should be proud to call him your mayor.
Thank you to all of you faculty, students, members of the community, state and local officials for joining me here today. You know, I'm relatively new to this job, and I still find myself struggling to understand why several hundred Texans could possibly care what some guy from Buffalo has to say...
But in many ways, Buffalo's story is the American story. It's a gritty, hardworking, humble place one where country and community trump party or religion; where idealism and pragmatism are not mutually exclusive; and where, above all else, we are defined by our common values and loyalty to one another.
And it's more than just our values that make Buffalo's story the American story. It's also what we've been through, the experiences we've overcome... together. We've had no shortage of trials and tribulations. We've been punched in the gut, knocked down, and occasionally kicked while we're there. But in the words of Vince Lombardi, it's not whether you get knocked down it's whether you get back up.
In Buffalo, like America, we always get back up. We suck it up, regroup, and re-emerge a stronger, more unified community. And when we do, don't bet against us.
My family knows this all too well. My grandfather was the Dominican Ambassador to the United States in the 1930s until he spoke out against the brutal dictator and was declared non grata. He fled to the U.S., where America and its people welcomed him with the open arms of opportunity. It would welcome my father just a few years later, when he fled as well.
After serving with distinction in the U.S. Army, my father went to work at the V.A. hospital in Buffalo.
The Buffalo that my parents made their home was one of middle-class security and opportunity. Machine shops hummed their shop floors filled with workers and their front office filled with orders; auto plants made cars as quickly as their workers built middle class families; the grain elevators that lined the Buffalo River were always full.
A thriving middle class was the engine of economic growth. And Buffalo and America offered you a basic bargain. It was a simple yet powerful idea the notion that hard work was rewarded with fair wages and decent benefits; that if you took responsibility, played by the rules, and gave back to your community, you'd be able to buy a house, save for retirement, and leave your kids with a few more opportunities than you had as a child.
But over time, technology and computers replaced manpower. Globalization sent jobs overseas. Machine shops ground to a halt. Shipping lanes were as empty as the grain bins they hid beneath. The footholds of middle class families in places like Buffalo began to slip, and that basic American bargain slipped along with it.
Buffalo's story is America's story. The Buffalo of today is fighting back, and the resilience I see in my hometown is the exact same resilience I've seen as I've crisscrossed America in my first few months on the job.
From Maryland to Manchester, Sacramento to right here in San Antonio, what's struck me most is the common resilience we share as Americans. That spirit of revival, the American comeback it's once again shining through the clouds of recession that formed in the midst of the worst financial crisis in our lifetimes, almost exactly 5 years ago.
American businesses have created 7.5 million new jobs in the last 42 months. This year, we're off to the strongest private sector job growth since 1999. The stock market is soaring; businesses are relocating to America, choosing our productivity and ingenuity over our foreign competition; and consumer confidence is near its highest level since before the President took office.
But if our North Star is a thriving middle class with ladders of opportunity for everyone willing to work to get there...
If our North Star is an opportunity economy, one that grows from the middle-out and not the top-down...
If our North Star is, quite simply, a better bargain for the middle class...
Then we're not there yet. We have more work to do.
Just last week, a Census Bureau report found that despite promising gains in our economy, the poverty rate in 2012 remained unchanged at 15%. Fifteen percent.
Despite record corporate profits, a soaring stock market, and a steadily growing economy, some 46-and-a-half million Americans are stuck at or below the poverty level. And it's been that way for 6 years running.
Nearly all of the income gains in America over the last 10 years have continued to flow to the top 1 percent, and while the average CEO has gotten a raise of nearly 40 percent since 2009, the average American earns less than he or she did in 1999.
For the richest nation on earth, that is simply inexcusable. We can do better. We must do better.
So who's going to make up the ground where we've fallen short? Who must play a key role as we confront the challenge of income inequality, secure a better bargain for the middle class, and build ladders of opportunity with sturdy rungs that all people can reach?
I am here to communicate in the clearest terms possible that the Department of Labor can, must, does and will play that role.
Boiled down to its essence, the Department of Labor is the Department of Opportunity. As we emerge from the worst recession of our lifetime, I like the President who hired me will make it my top priority to expand opportunity. Here's how.
First, we must invest in our workforce. In an increasingly sophisticated economy, equipping workers with the skills both they and their employers need isn't just a workforce development issue, it's an economic development issue. Building human capital is critical to continuing our recovery and unleashing the economy's full potential.
Skills development is one of the pillars of President Obama's strategy to grow the economy not from the top down, but the middle out. We know we have the best workers in the world, but they need us to invest in their ability to compete now and in the future. Helping people acquire new skills and access new training programs allows them to climb ladders of opportunity and secure a foothold in the middle class.
Many partners have to be in the huddle, with the Labor Department playing quarterback and executing a game plan for a demand-driven workforce investment system that serves the needs of businesses and workers alike. Just last week, I announced the third round winners of our innovative grant program that perfectly captures this approach.
The TAACCCT program that's an absurd acronym that only the federal government could come up with, and it stands for Trade Adjustment Assistance Community College and Career Training is one of the Labor Department's most powerful tools for building a sturdy skills infrastructure. Over the last two years through TAACCCT, we've invested $1 billion in community colleges nationwide, with grants that build the institutions' capacity to serve the American workforce and allow them to expand innovative training programs.
But here's the most important part: they do so in direct partnership with local employers, the local workforce system and other community groups. And TAACCCT is targeted in particular to help those workers who have lost jobs as a result of foreign trade. We can't be spending valuable time and resources training widget makers if the no one is hiring them or the widget companies have moved abroad and aren't coming back.
So this grant program incentivizes innovation, catalyzes new methods of collaboration, and targets workers who lost their job through no fault of their own. And it does all of this while ensuring the training is localized and addresses the realities of the local workforce and the needs of business.
In all, Round 3 of TAACCCT includes a total of 57 grants that will support 190 projects in at least 183 schools in every state plus the District of Columbia and Puerto Rico. As we continue to evaluate these programs, we'll know even more about what works and what doesn't. My Labor Department will be a data driven, results-based enterprise, so I'm thrilled at the possibilities for scaling up programs that work around the country, while putting an end to their wasteful and ineffective counterparts.
I can't stress this enough this isn't just about workforce development. This is about American economic development. It's about our competitiveness, not just today but for decades to come. In an age when jobs know no borders and companies move fluidly, they seek out the countries with the most talented, well-trained, productive citizens. And they'll reward those workers with good pay today and jobs that will still be here tomorrow.
Second, we must do everything in our power to ensure a safe and level playing field for American workers. We do that by fighting for gender equity in the workplace. We do that by ensuring that people with disabilities and veterans have access to equal employment opportunity. We do that by protecting workers and achieving record low fatality rates on the job. We do that by securing hundreds of millions for Bernie Madoff's victims. We do that through enforcing wage and overtime laws, recovering a record $280 million in back pay in 2012. All of this, I'm proud to say, we've done.
And just like investing in skills development, leveling the playing field benefits businesses, too! When we protect workers with sensible safety regulations, or when we address the fraud of worker misclassification, employers who play by the rules come out ahead. You can't win a race against someone who cuts the course short, and businesses that play by the rules deserve a fair, level shot at winning that race.
Leveling the playing field doesn't just mean protecting workers, either. It also means closing the inequality gap I talked about earlier. The trend towards a winner-take-all economy one where a few do better and better and everyone else just treads water was made worse by the recession.
But that's no excuse. Growing inequality isn't just morally wrong. It's bad economics, pure and simple. When families have less money in their pockets, they spend less at the grocery store or on school supplies. When businesses have fewer customers that spend less, they hire fewer workers and growth is near impossible. Wealth becomes concentrated at the very top, and the rungs on the ladder of opportunity grow farther and farther apart.
To put it simply, inequality undermines the basic bargain of America that no matter who you are or where you're from, you can make it if you work hard.
As a country, we can do something about that. And as an administration, we are.
Just last week, the Labor Department issued a final rule that extends minimum wage and overtime protections to direct care workers who provide essential services to elderly people, as well as those with injuries, illnesses and disabilities.
There are nearly 2 million direct care workers in our country. Roughly nine out of ten are women. Nearly half are minorities. And yet, for almost 40 years, direct care workers have been denied the basic employment rights too many of us take for granted, with many forced to rely on public assistance despite long hours of challenging, often heroic, work.
They do much more than just provide fellowship and protection. They perform vital tasks to help people live in their homes, go to work and lead productive lives.
They are certainly kind, patient and compassionate. But they are also skilled, capable, increasingly trained people providing a vital service... and it's time we started paying them like it. In so doing, we can immediately address income inequality for 2 million deserving Americans.
And in August, with the help of Vice President Biden, we announced an update to Section 503 of the Rehabilitation Act of 1973. This prohibits employment discrimination against individuals on the basis of disability by federal contractors and subcontractors, and requires affirmative action to recruit, employ, train, and promote qualified individuals with disabilities. But for the first time ever, we're placing a number on that value.
It's a privilege to be a federal contractor, and as taxpayers, we ought to expect model hiring practices in return for our business. With this 7% goal, we're laying down a long overdue marker. Two out of every three working age persons with disabilities are not in the labor force. That's a pool of talented, hardworking individuals with plenty to contribute to our economy, but we're keeping them on the bench! This rule will help make that a reality and take a small but meaningful step towards closing the income gap.
These are just a few examples of actions we're taking at the Labor Department to address income inequality. But a true opportunity economy one with a better bargain for Americans willing to work hard and take responsibility is going to require so much more.
Big, complicated problems can't just be solved by one government agency or even one government. They require us to innovate, collaborate, and work together to solve them. People don't just have DOL problems, or HHS problems, or Texas problems, or San Antonio problems... By and large, people just have problems.
A better bargain will require us to overcome them together. So President Obama and his entire administration stand ready to work with anyone who's ready to put politics aside, come to the table, and get to work finding common sense solutions that build this better bargain for American workers.
A third way to do just that: We have to fix our broken immigration system. It's an economic, law enforcement, and humanitarian imperative. Not only would we bring 11 million people out of the shadows... we would create economic growth, promote entrepreneurship, strengthen Social Security and help reduce the deficit.
And the values powering this effort are universal, central to the better bargain and opportunity economy we owe American workers — rewarding hard work; respecting the rule of law; promoting entrepreneurship; growing our economy; bringing people out of the shadows and fully into the American family.
Fourth, we must raise the minimum wage. Nobody who works a full time job should have to live in poverty. And I categorically reject the choice between paying our workers a fair, living wage and continuing to strengthen our economy. History has shown that we don't have to choose we can and must do both. When we raise the minimum wage, it doesn't just help working families; it helps the local small business whose customers now have more money to buy more goods and services.
No less a capitalist than Henry Ford understood this. In 1914, he doubled the wages of workers on his Dearborn, Michigan assembly line. This is what he said: "If we can distribute high wages, then that money is going to be spent and it will serve to make storekeepers and distributors and manufacturers and workers in other lines more prosperous and their prosperity will be reflected in our sales. Countrywide high wages spell countrywide prosperity." Henry Ford understood that his success depended on the ability of his employees to afford the very cars they were making.
To give you a more modern example, Costco is one of the nation's most successful retailers. Their longtime CEO Jim Sinegal believed that he could sell good products at competitive prices and pay his workers a living wage and benefits. Costco workers make a minimum of $15 to $20 per hour, plus benefits. Real wage, middle class jobs, and if you invested in Costco stock when Jim became CEO in 1985, you would be a much richer person today. We can have living wages and competitive growth.
Lastly, in the richest nation on earth, no one should have to die or go broke because they couldn't afford health care. It's not who we are as a country. It's not the better bargain we deserve.
Middle-class families, small business owners, mothers and fathers: they all deserve the security of knowing that no accident or illness can compromise their dreams or the dreams of their children.
So, despite unprecedented political attacks aimed purely at sabotage... despite the singular focus of our opposition on repealing without a plan to replace... we're well on our way to fully implementing the Affordable Care Act. We're going to implement the Affordable Care Act.
If you don't have health insurance, then starting on October 1st private plans will compete for your business. That's not socialism that's a marketplace! All you have to do is go to www.healthcare.gov and sign up.
It's efficient, it's fast, and it's easy. I just learned how to "copy-and-paste" a few months ago, and even I can do it.
Despite what critics may say, we're already seeing the positive effects of Obamacare. If you're one of the 85 percent of Americans who already have insurance from your job, or Medicare, or Medicaid you don't have to do anything! But you already have new benefits and better protections than before. Free checkups, mammograms, discounted medicines if you're on Medicare; no lifetime limits on your coverage; and for many of the students in the room, you can stay on your parents' insurance until you turn 26 at no additional cost.
New York State recently announced that premiums for consumers who buy insurance in their state marketplace will be AT LEAST 50 percent lower than what they're paying today. Fifty percent.
And yet, despite the overwhelming progress we're making, opposition persists. In their right mind, who could possibly turn down a 50 percent reduction in their states' premiums? I know of one person, and I'm guessing you do, too.
Texas may have a tough talking Governor, but you also have the highest rate of people without health insurance in the nation; you have the largest number of children without health insurance in the country at almost a million; and Texas has the highest rate of poor adults without health insurance.
This is even more egregious: in 2012, Texas also had the highest rate of adults making below 138 percent of the federal poverty threshold who lacked insurance. Some 55 percent. Those people would have qualified for Medicaid coverage if the state had chosen to expand eligibility under the federal Affordable Care Act.
The decision not to do so was politics at its worst quite literally sacrificing the long term health of this country and its people in exchange for a few political points.
You can't buy a better bargain for the American people with political points. This country wasn't made great by people who simply stood against something. This country was made great by people who also stood for something: opportunity; upward mobility; the chance to make it if you work hard and take responsibility.
It made us great back then; if we work together, it will keep us great today.
The truest measure of our economic success as a nation is not abundance, but widely-shared prosperity and a robust, thriving middle class.
An economy that grows not from the top down, but from the middle out, fueled by opportunity and hard work; a country that grows older, but always remains true to the timeless compact with its people: the idea that no matter who you are, or what you look like, or where you come from, or who you love, you can make it if you try.
That's America at its strongest. That's the better bargain we're after. Let's get to work.