Commentary: Forget Stimulus 2.0. Reform tax code, cut regulations
By Rep. Tom Rooney
Sept. 14, 2011
Listening to President Obama's address to Congress, as he called for a new $447 billion stimulus package, I had a sense of déjà vu. Massive federal spending on construction projects and aid to states: Haven't we heard all this before?
The president's new stimulus plan looks like a smaller version of his last stimulus plan, which cost $830 billion. His advisers said it would keep unemployment below 8 percent. Instead, it has stayed above 8 percent for 31 straight months and remains above 10 percent in Florida.
Rather than abandon these failed policies, President Obama wants Congress to pass a second stimulus, without explaining how this one will succeed where the first failed so miserably.
I disagree with President Obama that more spending is the best way to create jobs. However, he has made concessions in other areas that I hope will lead to opportunities for agreement.
For example, the president recently agreed to the House's request to withdraw proposed ozone regulations, which the EPA estimates would have cost $90 billion. He indicated that he would look at other mandates that are hurting small businesses and costing needed jobs.
I appreciate the president acknowledging the toll that regulatory overreach has on economic growth and job creation. Unfortunately, he has also proposed 4,257 new regulations, 219 of which his administration estimates will cost more than $100 million each. The White House estimates that seven will cost more than $1 billion apiece, and as much as $100 billion total. These regulations range from coal residue standards to rearview mirror requirements.
To get serious about reducing the burden of Washington mandates, he should accept our proposal to subject all regulations costing more than $100 million to congressional approval. He should urge the Senate to follow the House's lead as we repeal many of the costliest, most unnecessary federal regulations.
The president now talks about the need to keep taxes low for small businesses and working families. Last year, I supported an extension of payroll tax relief, which the president has advocated. However, we need more than one-time, targeted deductions if we want to see long-term growth. What happens when these temporary programs expire? Small-business owners already are asking, and the uncertainty is stopping them from investing and hiring.
Rather than focus on temporary solutions, the president should work with us on tax code reform that would eliminate certain deductions and replace them with permanent reductions in rates for families and businesses. A flatter tax code would allow small businesses to grow and compete. Tax rate relief would increase demand by giving families more money while giving job creators the certainty they need.
Rather than throw billions at "shovel-ready" projects, we should look at more cost-effective ways to improve our infrastructure. For example, federal law requires states to set aside 10 percent of surface-transportation funds for projects like transportation museums and educational programs. Waiving this requirement would allow states to use these funds for infrastructure needs without adding to the deficit.
Expanding markets for U.S. producers will help small businesses, manufacturers and farmers in Florida create jobs right away. I again urge the president to send Congress pending trade agreements with Colombia, Panama and South Korea, so we can pass them quickly.
We can also work together on reforms to assist the long-term unemployed. President Obama cited the "Georgia Works" program, which connects employers with job seekers.
Finally, I agree with the president that any new package must be paid for, but I don't think we should wait years to do it. We cannot tax, borrow and spend our way to job creation.
We've tried the stimulus approach, and we've seen the results. We need a pro-growth agenda that focuses on relief from costly mandates, permanent reforms to the tax code, and real cuts in spending. Short-term, government-centered fixes are not the solution.
U.S. Rep. Tom Rooney, R-Tequesta, represents Florida's 16th Congressional District.