Ryan: Economic Recovery Alternative Creates Twice as Many Jobs at Half the Cost
Trillion dollar spending bill is "not worthy of our new President's signature"
1st District Congressman Paul Ryan voted against a trillion dollar spending bill today in the U.S. House of Representatives, expressing grave concerns that the wasteful spending spree will exacerbate the worst economic recession in generations. As a member of the Republican Economic Recovery Working Group, Ryan and his colleagues proposed an alternative recovery package using fast-acting tax policy, while providing much needed assistance for those hit hardest by our deepening recession. Based on the Obama Administration's methodology, Ryan's alternative recovery legislation creates twice the number of jobs at half the cost.
Brought to the floor without any Republican input, H.R. 1 - the so-called "American Recovery and Reinvestment Act of 2009" - passed the House today by a vote of 244 - 188, without a single Republican in support. H.R. 1 is currently pending in the U.S. Senate. Regarding the severity of our economic crisis and the merits of H.R. 1, Ryan issued the following statement:
"This is the worst recession we've seen in generations. We're losing tens of thousands of jobs a week and communities in Southern Wisconsin continue to be hit especially hard. Congress is making matters worse with a fiscal response that is slow, wasteful, and will leave us a nasty debt hangover for years to come. This bill is not worthy of our new President's signature.
"This trillion dollar spending bill misses the mark on all counts. This is not a crisis we can spend and borrow our way out of - that is how we got here in the first place. Yet this is precisely the path the Majority chose today. We're repeating the mistakes of a flawed economic doctrine that deepened our depression in the 1930s and prolonged the economic stagnation in Japan in the 1990s."
Among the most troubling flaws of H.R. 1, Ryan highlighted the following:
Trillion Dollar Price Tag: The $816-billion package will be financed by borrowing, which will result in additional interest costs of $347 billion - putting the total cost of H.R. 1 to over $1 trillion.
Does Very Little to Help Protect and Create Jobs: We need to help small businesses, entrepreneurs and the self-employed survive this recession and give them incentives to expand. 70% of our jobs in America come from small businesses. Yet there are more taxpayer dollars dedicated to arts and culture, cars for federal employees, and renovating federal buildings, than to helping small businesses grow.
Wasteful Spending: $54 billion is spent on 19 programs deemed "ineffective" or "results not demonstrated" by the Office of Management and Budget.
Special Interest Wish List: $600 million for brand new "green" cars for Federal government employees; $650 million for digital TV coupons; $7.7 billion to improve federal buildings; $200 million for sod and beautification of the National Mall; $50 million for the National Endowment of the Arts; and other dubious special interest projects.
Not So "Timely" After All: Even if borrowing and spending is the answer to our economic crisis, only a small fraction of the spending in the Majority's bill will take place in 2009. By the start of fiscal year 2011, roughly half of the spending from this bill will remain unspent.
Another Round of Rebate Checks: The tax provisions in this bill do not encourage risk-taking; they do not encourage investment and job creation. The bulk of the tax cuts' are simply rebate checks - $10/week for individuals and $20/week for couples. We tried rebate checks last year, and they simply don't work.
Guarantees Future Tax Hikes: The calls for new record spending would only exacerbate our exploding budget deficit, a national debt nearing $11 trillion, and well over $50 trillion of unfunded promises. By adding over $1 trillion dollars to this abysmal fiscal situation, we are guaranteeing tax increases in the near future. To hit a recovering economy with massive tax increases is a recipe for disaster.
Congressman Ryan fought to improve the stimulus bill with amendments and alternative proposals aimed to empower the engines of economic growth. Before the House Ways and Means Committee and the House Rules Committee, Ryan offered amendments aimed to boost incentives to expand business operations and create jobs (click here for video). Because the Democrats' legislation provides no relief from the tax increases facing families and small businesses and not enough relief for small businesses to keep and create more jobs, Ryan proposed to extend for two years the individual marginal income tax rates (which is the tax small businesses pay), provide for two years of full expensing for businesses, and make permanent the 15% tax rates on capital gains and dividends, indexed to inflation, rather than allow massive tax hikes to hit Americans at the end of 2010. The Democratic Majority, however, rejected his efforts to improve the legislation.
Tapped to serve in the Republican Economic Recovery Working Group, Ryan helped craft an alternative based on fast-acting tax policy along while strengthening and expanding unemployment assistance. Based upon the same model used by the Obama Administration - which claims H.R. 1 would preserve or create 3 million jobs - the Republican Alternative would create 6.2 million jobs. Even if the Democrats' bill produces 3 million jobs, it would cost taxpayers $275,000 per job. Alternatively, Ryan's substitute would produce twice the jobs at half cost. Following tonight's disappointing result on the House floor, Ryan added the following:
"It is not enough to simply oppose flawed legislation. I believe that the party of ideas must propose alternative solutions. I helped craft an alternative focused on fast-acting tax policy to boost incentives for business expansion and job creation. Using the President's own measuring stick, our proposal will create twice as many jobs, at half the cost to taxpayers, compared to the Majority's trillion dollar spending bill. Unfortunately, because the Majority shut out the Minority from the legislative process, the House passed a far inferior piece of legislation today.
"These are painful economic times, and the desire for an immediate economic recovery is shared by all. Additional assistance to those hit hardest by this recession - including families in Southern Wisconsin coping with painful layoffs - is an important part of any recovery effort. We missed an opportunity today to enact an economic stimulus package that empowers the engines of economic growth, tackles the fear and uncertainty gripping the marketplace, and encourages sustained economic growth and real job creation. I will continue to fight on behalf of those I serve, and believe in the strength of the American people to overcome this recession."