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Retooling Obama's Jobs Bill




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The author of this entry is responsible for this content, which is not edited by the Wilson County News or wilsoncountynews.com.
October 31, 2011 | 1,122 views | 1 comment

By Kmele Foster

Earlier this month, the President's jobs bill failed in the Senate. Now the White House intends to break up the bill and gin up sufficient Republican support to pass key pieces. "We will now work with Senator Reid to make sure that the individual proposals in this jobs bill get a vote as soon as possible," said President Obama in a statement released shortly after the Senate vote.

This piecemeal approach might be politically expedient, but the provisions the White House is pushing are still a whiff policy-wise. They're just too superficial. Extending unemployment benefits and cutting the payroll tax aren't going to fuel the sustained, robust job growth Americans are so desperate for.

What the President can and should do is immediately rework his bill to pursue a structural realignment of the tax and regulatory burden facing American business.

Mr. Obama should focus his attention on reducing the tax burden faced by consumers and businesses. The proposed legislation takes some steps in this direction. It cuts the payroll tax in half to 3.1 percent in 2012 and institutes a temporary tax credit for businesses that hire new workers or buy new equipment.

But these cuts have already been tried and they don't go far enough. Temporary cuts are no substitute for comprehensive tax reform, and they mean even less without commensurate spending reductions. Washington should be taking steps to simplify the tax code, broaden the base, and lower rates on corporations and individuals.

It's time to stop tinkering around the edges of our Byzantine tax system and fundamentally reform it -- it's no longer controversial to admit that America's tax code is impeding our ability to compete in the global economy and create jobs.

The half trillion-dollar jobs bill also contains billions in new spending. The president's bill calls for public investments directed at sectors that are politically popular among Democrats. For example, it earmarks $25 billion for investment in school infrastructure and $35 billion to state and city governments to prevent public teacher layoffs.

But these "investments" reflect the philosophy of previously failed efforts to stimulate the economy. At best, short-term spending by government will produce short-term employment opportunities. And these temporary jobs often come at the expense of sustainable new employment in other parts of the economy.

Rather than focusing on short-term solutions, the administration should be empowering executives and entrepreneurs to create viable patterns of employment. If more government spending could turn around our desperate economic situation, then surely the first $1.5 trillion stimulus would have solved the problem already.

Finally, a recalibrated jobs bill must eliminate regulatory impediments to industries that are proven job generators.

One sector that could generate hundreds of thousands of new, high-paying jobs is domestic energy production. Research suggests that opening up known offshore resources would generate 144,700 new positions and expanding access to federal lands for energy exploration would create 500,000 more.

The President could immediately encourage investment and job creation in the energy industry by simplifying permitting and reducing the number of new regulations.

Private companies should be allowed to explore and develop domestic energy resources without undo interference or assistance. The Solyndra scandal and the lackluster jobs numbers posted by other federally backed "green jobs" initiatives illustrate the governments inability to engineer a solution to the country's employment crisis. Opening new domestic frontiers for traditional energy production would generate the jobs that other politically popular programs have manifestly failed to produce.

Obama's jobs strategy is more of the same. Even if this new piecemeal strategy works, the results will be just as underwhelming as the White House's previous efforts to stoke employment. A truly effective jobs initiative would permanently cut, taxes, and reduce spending, while curtailing unnecessary regulations, and empower industries that are proven to create jobs.

Kmele Foster is the co-founder and vice president of TelcoIQ, a telecommunications consultancy. He is also the chairman of America's Future Foundation.
 
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Elaine K.  
Floresville  
October 31, 2011 2:09pm
 
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