While President Barack Obama’s jobs plan contains some ideas that American business supports, it falls short by focusing too much on government spending and temporary tax breaks and too little on the trade, energy, tax, regulatory and entitlement reforms we need.
The proposed payroll tax cut might give some small and medium-size businesses relief. But temporary tax breaks won’t create new jobs in significant numbers — and unfortunately, neither will the plan as a whole. It fails to adequately address the fundamental challenge facing our economy — too little growth — or the business reality that keeps companies from hiring — too few customers.
What’s worse, not one dime of spending will be cut to offset the $447 billion package. Instead, successful small businesses — especially those filing taxes as individuals — and productive industries will foot the bill through major tax increases. Any jobs that might have been supported under the plan would be wiped out by these hikes.
Though President Obama was on the right track with some of his proposals, such as passing the free-trade agreements with South Korea, Colombia and Panama, he stopped short of an aggressive trade agenda that would open more markets to American goods and services. He also proposed more infrastructure investment, but he failed to call for multiyear reauthorizations of our nation’s core transportation programs that would allow communities to plan and hire.
We could create hundreds of thousands of jobs and secure our energy supply by responsibly producing more American energy, which we have in abundance on federal lands and offshore. The Obama administration has yet to seize this extraordinary opportunity, and it should.
Finally, the president touched only briefly on the tax, regulatory and entitlement reforms that should be the centerpiece of an American jobs plan. Congress and the president should negotiate and pass comprehensive pro-growth tax reform that lowers individual and corporate rates and broadens the tax base.
While the administration has taken some steps to rein in regulations, many of its new rulemakings are killing business confidence, expansion and jobs. Nearly 150 regulations costing $100 million or more are in the pipeline. The president should issue an executive order to declare a timeout on new major discretionary regulations.
And without meaningful entitlement reform, runaway costs and unsustainable obligations will continue to push us toward insolvency. No economy can grow or create jobs at its full potential when faced with such massive and expanding claims on its capital, credit and other resources.
Bottom line: The president and Congress must act faster, be bolder and put their faith in free enterprise, not in bigger government.
— Tom Donohue is president and CEO of the U.S. Chamber of Commerce.
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