The economy is humming along quite nicely, but for it to continue, federal tax cuts enacted three years ago need to be extended or made permanent, U.S. Treasurer Anna Escobedo Cabral told an audience Friday at Arizona State University.
Cabral was one of several Bush administration officials touring the country Friday to explain what they say is good news concerning the economy. She appeared before a crowd of business leaders and W.P. Carey School of Business faculty, students and alumni. Cabral’s speech came on the heels of the government’s release of its employment report for December, which showed that job growth slowed from a big hiring spurt in November. There was a gain of just 108,000 jobs in December, about half of what economists were expecting. That compared with 215,000 jobs created in November.
The nation added 4.6 million jobs since May 2003, and unemployment is 4.9 percent, lower than in the ’70s, ’80s and ’90s, Cabral said. The economy is growing at 4 percent a year, she said.
"The tax cuts have worked to stimulate the economy and they have created more jobs and put more people to work," Cabral said, adding the tax package benefited small businesses and allowed families to save.
The cuts are still scheduled for the next few years but there is talk in Congress of cutting them short or not extending them, Cabral said.
Democrats are concerned about high prescription drug costs and confusion about the new Medicare prescription drug plan, high heating bills, displaced workers in the Gulf Coast and rising federal deficits.
‘‘What we have here is the very definition of a middleclass squeeze — college tuition is way up, heating prices are at record levels and health care and prescription drug prices are through the roof,’’ said Sen. Chuck Schumer, D-N.Y. ‘‘For the administration to be out there saying things are great shows just how out of touch they are with the average American.’’
Cabral said suspending the tax cuts to create revenue will hurt small businesses and families and Congress will simply spend the additional resources on something else.
The administration plans on increasing job training and will soon come up with a sound immigration policy, Cabral said. She said there are many families who need resources when it comes to financial education.
"We have 50 million unbanked Americans," she said. "That’s a challenge for us."
Many people need basic education in using direct deposit instead of relying on paper checks, which cost the federal government 75 cents more to mail, Cabral said. And there are initiatives planned to provide greater capital and opportunities for minorityowned businesses, she said.
The country needs a greater level of education in the future, particularly since many of the new jobs are in the services sector, Cabral said.
She was nominated by President Bush and took office in December 2004. Prior to joining the Treasury Department, Cabral was director of the Smithsonian Institution’s Center for Latino Initiatives.
The government will issue a new $10 bill on March 2 and the $100 bill is being redesigned for release in the next two years, Cabral said.
The $10 bill will feature color-shifting ink, a security thread and water mark to thwart counterfeiting. As for the look, there will be orange and red in the background to help the visually impaired. The bill will have two Statues of Liberty and Alexander Hamilton will get a face-lift.
Cabral said the public ought to ready for changes in currency because it will be changed every seven to 10 years to keep ahead of counterfeiters. She said plans also call for a new $1 presidential coin.
"It will feature every dead president, no living ones," she said, adding a president must be dead five years before getting on the coin.