The President and Congress have responded to a crisis brought on by too much spending and too much debt with even more spending and even more debt. Unfortunately for the nation, they have little to show for it.
The President's economic advisors warned that if Congress did not pass the $787 billion stimulus bill in February 2009, unemployment would rise above 8 percent. A full year after passage of the massive spending legislation, unemployment surpassed 10 percent--the highest in a generation. It is almost 11 percent in Kentucky.
Since the stimulus bill was enacted, over 3 million jobs have been lost nationwide--and nearly 60,000 in Kentucky alone.
At a time when unemployment is at the highest rate in a generation, Congress should be focused like a laser on the economy and jobs. Employers are not hiring now in large part because of the proposals coming out of Washington--proposals that would allow the Bush tax cuts to expire, do away with the secret ballot in workplace elections, increase energy costs through a new cap and trade system for carbon emissions, result in a government takeover of healthcare with massive new taxes on businesses and individuals, and levy a series of new taxes on the financial services industry.
Over the course of the past year, politicians in Washington have perpetuated an environment of economic uncertainty by promoting oppressive regulations and red tape, skyrocketing deficits, and tax increases which will prevent job creation.
During this President's first year in office, our economic freedom has diminished considerably. According to the 2010 Index of Economic Freedom, published by the Heritage Foundation and the Wall Street Journal, the United States suffered the greatest loss of economic freedom among the world's largest countries in 2009. Sadly, Canada has now moved ahead of the United States as the most free economy in North America.
To put this into perspective, the American economy will need to create over 250,000 jobs each month for the next five years in order to return to full employment -- an improbable scenario unless politicians in Washington change course.
So the first step in getting Americans back to work would be to abandon the tax increases proposed in the health care legislation pending in Congress, defeat proposals to increase taxes on capital gains and dividends and prevent existing tax relief from expiring at the end of this calendar year. The prospect of higher taxes will make it much less likely that small businesses and entrepreneurs will hire new workers.
Next, I believe the best way to grow the economy and create jobs would be to cut taxes and get the government out of the way. We should make the Bush tax cuts permanent, extending the 2001 and 2003 tax cuts for all taxpayers. We should reduce the number of tax brackets and lower marginal rates on those that remain to allow families and small businesses keep more of what they earn. Ultimately, we should abandon our needlessly complex and unfair tax code with an alternative system that promotes work, saving and investment.
Because small businesses must be able to access capital to expand their operations and hire new workers, it is imperative that Congress promote healthy credit markets. Proposals to modernize financial regulation should not overregulate our markets, eliminate risk taking, or add to uncertainty in a way that would prevent banks from lending to credit-worthy entrepreneurs.
Finally, we need to promote more domestic energy production from multiple sources to reduce our dependence on foreign oil and create jobs. Expanding nuclear power as a reliable and efficient source of clean energy is an important long-term goal. In the meantime, I vigorously oppose the Environmental Protection Agency's undue interference with surface mining permits in the Appalachian coal basin; we should aggressively promote Kentucky's coal industry as a source of high paying jobs and an integral part of our nation's overall strategy to achieve energy independence. Likewise, we should ease federal restrictions on domestic oil and natural gas production and make more U.S. lands and waters, such as the Arctic National Wildlife Refuge (ANWR), accessible for appropriate exploration and production.