Thursday, September 15, 2011
Sep 15: In a lengthy address to the Economic Club of Washington, House Speaker John Boehner (R-OH), basically offered an alternative to the President's American Jobs Act and called for bipartisan action to "Liberate America's Economy" from "the shackles of excessive regulation, higher taxes, and out-of-control spending that are stifling private-sector economic growth and job creation." The Speakers proposal comes as Republican opposition to the President's plan is growing [See WIMS 9/13/11] and some Democrats are also beginning the to question the proposals. Speaker Boehner proposed eliminating a number of regulations, revising the tax code and reducing spending. He also laid out an agenda for the Joint Select Committee of Congress now meeting under the Budget Control Act to identify $1.5 trillion in deficit reduction by Thanksgiving. He said tax increases are off the table and they should focus on principles for tax code revisions and reforms to Social Security, Medicare, and Medicaid. The Speaker's Plan directly confronts the President's Plan in many areas and generally assures that the Joint Committee and American Jobs Act are headed for serious political confrontation and deadlock.
Speaker Boehner said, "We all know the economy is stalled, and it's been stalled. And it's not because the American people have lost their way. It's because their government has let them down. Last week the president put forth a new set of proposals. The House will consider them, as the American people expect. Some of the president's proposals offer opportunities for common ground. But let's be honest with ourselves. The president's proposals are a poor substitute for the pro-growth policies that are needed to remove barriers to job creation in America the policies that are needed to put America back to work.
"If we want job growth, we need to recognize who really creates jobs in America. It's the private-sector. This building is named in memory of President Ronald Reagan, who recognized that private sector job creators are the heart of our economy. They always have been. That was the America I was raised in. My father and grandfather were small businessmen. They ran a tavern in Cincinnati that my grandpa started in the 1930s. I worked in that tavern growing up. I ran a small business myself. I know what it takes to meet a payroll, hire workers, and create jobs in the private sector.
"There's a fundamental misunderstanding of the economy that leads to a lot of bad decisions in Washington, D.C. The reality is that employers will hire if they have the right incentives, but the incentives have to outweigh the costs. Businesses are not going to hire someone for a $4000 tax credit if government mandates impose long-term costs on them that significantly exceed the temporary credit. In recent years, such mandates have been overwhelming. Private-sector job creators of all sizes have been pummeled by decisions made in Washington. They've been slammed by uncertainty from the constant threat of new taxes, out-of-control spending, and unnecessary regulation from a government that is always micromanaging, meddling, and manipulating. They've been hurt by a government that offers short-term gimmicks rather than fundamental reforms that will encourage long-term economic growth. . .
"I can tell you the American people -- private-sector job creators in particular -- are rattled by what they've seen out of this town over the last few years. My worry is that for American job creators, all the uncertainty is turning to fear that this toxic environment for job creation is a permanent state. Job creators in America are essentially on strike. The problem is not confusion about the policies. . .the problem is the policies.
"We need to liberate our economy from the shackles of Washington. Let our economy grow! . . . The first aspect of this threat is excessive regulation. . . We all know some regulations are needed. We have a responsibility under the Constitution to regulate interstate commerce. There are reasonable regulations that protect our children and help keep our environment clean. And then there are excessive regulations that unnecessarily increase costs for consumers and small businesses. Those excessive regulations are making it harder for our economy to create jobs."
"At this moment, the Executive Branch has 219 new rules in the works that will cost our economy at least $100 million. That means under the current Washington agenda, our economy is poised to take a hit from the government of at least $100 million 219 times. I think it's reasonable to ask: is it wise to be doing all of this right now? The current regulatory burden coming out of Washington far exceeds the federal government's constitutional mandate. And it's hurting job creation in our country at a time when we can't afford it.
"Government's threat to job creation has two other components. One is the current tax code, which  discourages investment and rewards special interests. It strikes me as odd that at a time when it's clear that the tax code needs to be fundamentally reformed, the first instinct out of Washington is to come up with a host of new tax credits that make the tax code more complex. The final aspect of the threat is the spending binge in Washington. It has created a massive debt crisis that poses a direct threat to our country's ability to create jobs and prosper. . ."
"The Budget Control Act of 2011, signed into law last month, establishes a Joint Select Committee of Congress for the purpose of identifying $1.5 trillion in deficit reduction. . . The Joint Select Committee can tackle tax reform, and it should. It's probably not realistic to think the Joint Committee could rewrite the tax code by November 23. But it can certainly lay the groundwork by then for tax reform in the future that will enhance the environment for economic growth. . . Tax increases, however, are not a viable option for the Joint Committee. It's a very simple equation. Tax increases destroy jobs. And the Joint Committee is a jobs committee. Its mission is to reduce the deficit that is threatening job creation in our country. The Joint Committee can achieve real deficit reduction by reforming entitlements and taking real action to preserve and strengthen Social Security, Medicare, and Medicaid. . ."
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