By Rep Pat Tiberi
President Barack Obama slipped his re-election campaign into high gear this month, offering Congress a bill he insists will stimulate job creation. With this proposal, he threw down the challenge that partisanship be pushed aside because too many out-of-work Americans no longer had the luxury of time to keep their heads above water.
He's right about the immediate needs of the struggling unemployed, but his well-intentioned plan offered little to build their confidence. Offering tax breaks for companies to boost their payrolls at a time when they simply don't need to add workers remains a theme of his efforts that, frankly, is mystifying.
In a report last week in Columbus Business First on what small-business operators thought of the president's American Jobs Act, some offered up what many think should be obvious to the administration. "Demand is still a big problem for a lot of small-business owners," one tax expert said. "Until that bounces back, I don't know if these tax breaks would be enough of an incentive to get a small-business owner to hire a new worker."
Indeed, the payroll tax reductions and tax credits based on hiring smack of the stopgap efforts that have marked the White House's response to the nagging downturn. At a time for lasting initiatives, the act offered only incremental help.
But let's be fair -- government can do only so much to create jobs outside of adding to its own ranks. Business creates jobs, and these days private enterprise simply won't because it can't. As consumers continue to get their teetering financial houses shored up, they remain judicious in how and where they spend. The B2B market remains similarly constrained by caution and economic reality.
Which isn't to say executives aren't eager to rev up business, putting more people on the payroll.
What business was hoping for from the president was a shift in thinking that would encourage entrepreneurship, giving risk takers and companies eager to get back on a growth track incentives to create economic sparks. That is where policymakers can offer the most assistance: Helping prime the economic pump by encouraging investment with thoughtful, long-term regulatory, tax and spending policy.
Tax incentives sound nice, but they can't supplant solid policy aimed at giving companies an atmosphere in which they can thrive.
For instance, small-business operators embrace Obama's offer to extend accelerated depreciation, but they lament it isn't permanent. "It's hard to make any long-term plans if these kinds of things keep coming and going," the tax lawyer told a Business First reporter.
The way out of this economic funk cannot come with government holding tight to the reins. Business does best with a government knocking down barriers for it and giving it a supporting hand. Washington might look at how some governors have forged ahead with economic development in their states, rather than waiting for the help their federal brethren seem unable or unwilling to supply.