In early August, President Bush’s new treasury secretary, Henry Paulson, acknowledged that the growing economy is not benefiting all Americans. Wages for many American workers “are being eaten up by high energy prices and rising health-care costs, among others,” he said.

Paulson’s comments were a rare moment of candor from the Bush administration about the true state of the U.S. economy. Usually the president and his appointees simply insist that everything is fine, since the economy is growing. Since the end of the 2001 recession, it has been growing. But the majority of American families are losing ground despite that economic growth.

Between 2004 and 2005, the median income for American households headed by someone under the age of 65 fell by $275, according to the latest statistics from the U.S. Census Bureau. Since 2001, median income for these households has fallen by $2,000. The Census Bureau also revealed that the number of Americans who lack health insurance has grown by 1.3 million. Since 2001, 6.8 million Americans have joined the ranks of the uninsured. And there are now 5.4 million more Americans living in poverty than there were in 2001.

Most distressingly, these trends have been happening during an economic recovery, not a downturn. Since the recession in 2001, corporate profits have surged and the stock market has fared well. In the past, when the economy did well, most Americans tended to benefit – their paychecks got bigger and they were more likely to receive benefits like health care.

But not this time. As The New York Times recently reported, wages and salaries now make up the lowest share of the nation’s economy in nearly six decades. Meanwhile, corporate profits make up a higher share of the economy than at any point since the 1960s. So what gives?

Many things have likely contributed to this increased economic inequality, including growing global competition. But there is no question that government policy plays a significant role in whether or not all Americans can expect to benefit from a growing economy. And under the Bush administration and Republican Congress, federal policy – consisting mostly of trillion-dollar tax beaks – has consistently benefited the wealthiest Americans at the expense of everyone else.

What we need

We need a new direction for the American economy. If Democrats gain control of Congress in November, we have pledged to make raising the minimum wage one of our top priorities. If you work full time for the current minimum wage of $5.15 per hour, you earn just $10,712 per year. No one can get by on that income.

But raising the minimum wage should be just one part of a plan to make sure not only that the economy grows but that everyone benefits when it does.

We need to prevent U.S. employers from undercutting American workers’ wages and working conditions by exploiting cheap immigrant labor. This means we need to address the immigration crisis in a comprehensive way. In that same vein, we need to stop signing international trade agreements if they don’t respect the rights – and improve the living standards – of all workers.

We need to invest in our schools and make college more affordable. Students are graduating from college with record levels of debt. By cutting college loan interest rates in half, we can greatly reduce the cost of those loans for parents and students.

We need to ensure that all Americans have high-quality, low-cost health care. We need a comprehensive energy policy so that American families won’t be so vulnerable to surges in gasoline prices like the ones this summer. And we need to preserve Social Security, the only sure thing left in bringing Americans a true measure of financial stability in their golden years.

After Paulson allowed himself that brief moment of candor, he slipped right back into the spin. He said that Republicans don’t deserve the blame for America’s growing economic inequality. But Republicans control the White House, the House and the Senate, and the policies they have aggressively promoted have certainly made things worse. And for that, they ought to be held accountable by the voters this November.

Rep. George Miller, D-Calif., is a member of the House Education and the Workforce Committee. Readers may write to him at: 2205 Rayburn Office Building, U.S. Capitol, Washington, D.C. 20515.