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My Plan for Fighting Poverty and Creating Jobs


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Soon after this economic downturn began, I decided to visit as many food cupboards and homeless shelters as I could. It is one thing to sit in Washington and debate statistics. It is another thing entirely to visit with those who are hurting and to talk with those who are helping.

One woman, who runs a longstanding food bank in Lancaster County, told me with tears in her eyes that families that used to bring her donations of food were now coming to her to ask for help. Throughout the recession and this painfully slow recovery, nothing has clarified for me the reality of what we are facing more than that one conversation.

And nothing has tugged more at my heart than the reality that government arrogance not only led to the situation we're in, it has also hampered the recovery. That's why I have written my own plan for economic recovery that takes a humble view of what the government should do and instead places government in the position of sensibly helping and wisely regulating employers.

The recession was sparked by the bursting of the housing "bubble." That bubble was created by government policies dating as far back as the Clinton Administration that bullied banks into giving loans to people who were bad credit risks. When lenders discovered they made money whether the borrower paid or defaulted, the lid was blown off the market and we began to see things like "interest-only mortgages" and Wall Street trading in securitized subprime mortgages. Efforts to stop this madness were blocked in Congress, primarily by former Senator Chris Dodd and by Congressman Barney Frank. Regulators under President George W. Bush, like the Securities and Exchange Commission, missed the boat entirely.

Early in 2009, Congress enacted a "stimulus" bill that borrowed nearly a $1 trillion to revive the economy. Yet, nearly all of the money went to bailout state governments and to the pet projects of politicians. Solyndra, much in the news today, is the most notorious example. But the Wall Street Journal called the entire bill "a political wonder that manages to spend money on just about every pent-up Democratic proposal of the last 40 years."

We were promised the bill would prevent unemployment from exceeding eight percent. Within three months of the bill's passage, unemployment had shot up to nine and then ten percent, and remains over nine percent today.

Over the following two years Congress fought over a series of highly ideological issues like union election rules, cap and trade, and healthcare reform. Ideology and partisanship aside, the effect of these debates was a prolonged recession. Employers simply will not invest and hire unless they know they can afford to. The government takeover of healthcare (which succeeded) and the cap and trade national energy tax (which failed) both constituted huge new tax and regulatory burdens on almost every American business, the details of which were left to bureaucrats to figure out over time. Employers from coast to coast decided to hoard their cash and wait it out. One businessman from Berks County told me a year ago he could easily hire 20 people the very next day, but felt he had to wait and see what the President's healthcare law was going to mean for him first.

Today, 15.3 percent of Americans live in poverty, a full point higher than it was two years ago. It would be an overstatement to say this is entirely government's fault. Clearly, though, Washington has made some bad decisions and failed to improve things. It is time for us to turn to the real problem solvers: the American people.

Unless each of us is going to be a soldier or a postal worker, Washington cannot create jobs or prosperity. It can, however, do things to help and encourage the real job creators. And it should.

This week I released a revised and updated version of my plan for job creation and prosperity. It takes that modest view, realizing that Washington often does more damage than good when it interferes too much. Much of it is bipartisan. It does not promise any magic solutions, but it does promise solutions that will work. I hope you'll read it at

Congressman Joe Pitts represents the 16th Congressional District of Pennsylvania.

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