Issue Position: The Economy
Issue Position
During this election year, the state of the economy has become one of our country's major concerns. That is because everyone has a stake in a healthy economy. As individuals, our ability to plan for the future depends on having faith that our jobs, income and retirement benefits will not be threatened, and as a nation, a growing economy is essential to provide the resources necessary to confront the many other challenges we face.
From the middle of 2003 through the end of 2007, we experienced the longest uninterrupted period of job growth on record, but job creation has slowed recently, and as we all know, the housing market is declining. Unless the economy rebounds quickly and decisively, we may very well find ourselves in a recession.
To prevent the economy from taking that decisive dip into recession, or at least to mitigate any downturn that does occur, the congress and president joined together in early February to pass legislation--in almost record time--to provide rebates averaging approximately $600 for most taxpayers. These checks should be in the hands of the recipients by May or June.
Although I had concerns about adding to the deficit in order to provide tax rebates, I felt that it was far better to let the American people use their own money to stimulate the economy than to allow the Democratic-controlled Congress to use taxpayers' money to fund government programs to provide a stimulus. The final bill not only returns hard-earned money to the American taxpayer, but it also allows for quicker business expensing for America's employers.
Whether this stimulus package is enough, or too little, too late to turn the economy around remains to be seen, but it is clear that things will remain jittery until the Congress takes decisive actions on some more fundamental issues, such as making the Bush tax cuts permanent and simplifying our horrendously complicated tax system.
Ironically (but not surprisingly) the two longest periods of economic growth in the last 50 years came after major tax cuts and reform.
In 1981, newly elected President Ronald Reagan refocused fiscal policy on the long run. He proposed, and Congress passed, sharp cuts in marginal tax rates. The cuts increased incentives to work and stimulated growth. These were fundamental policy changes that provided the foundation for the Great Expansion that began in December 1982.
Reagan's economic program included sweeping economic reforms and deep across-the-board tax cuts, market deregulation, and sound monetary policies to contain inflation. His policies resulted in the largest peacetime economic boom in American history and nearly 35 million more jobs.
Nearly two decades later, in May 2003, President George W. Bush proposed a reduction in the tax rates on dividends from 39.6% to 15% and on capital gains from 20% to 15%. These sharp cuts in the double tax on capital investment were intended to reverse the 2000-01 stock market crash, which had liquidated some $6 trillion in American household wealth, and to inspire a revival in business capital investment, which had also collapsed during the recession. The tax cuts were enacted despite the usual complaints from the "greed and envy" lobby about "tax cuts for the super rich."
The result of the Bush tax cuts has been an increase in federal tax revenues and the longest continuous period of job growth in history. Once again, tax rate cuts have created a chain reaction of higher economic growth, more jobs, higher corporate profits, and more tax receipts.
As a businessman, I have tremendous sympathy for entrepreneurs, particularly those who own small businesses, during periods of little or no economic growth. It is hard enough for a small business to thrive when the economy is growing at a modest pace, but it is extremely difficult to expand a business when the entire nation's economy is flat or declining.
In spite of clear evidence that lowering taxes actually raises revenue, there will be tremendous pressure this year from the Democratic majority to raise taxes in order to pay for additional domestic spending on the environment, "affordable" housing, Medicare, Medicaid, universal healthcare, education, and the list goes on and on. Once the Democrats have nominated their candidate for president, Speaker Nancy Pelosi and Senator Harry Reid will turn the House and Senate respectively into chambers of propaganda for their standard bearer. You can be certain that there will be a tremendous push to pass costly legislation to appeal to various populations of the Democrat's constituency and those independents to whom they hope to appeal.
At a time when our economy is slowing and threatened further by high energy costs, the last thing the American people need is a higher tax bill. I have consistently voted--and will continue to vote--against all such misguided efforts to take more money from hardworking taxpayers.
The upcoming election will determine what approach will be taken to stabilize and energize our economy. If the Democrats maintain control of both houses of Congress and capture the presidency, they will attempt to increase government spending and, in order to keep the deficit from spiraling out of control, raise taxes on individuals and businesses. If Republicans can maintain control of the White House, a presidential veto can prevent tax increases, and if we can also regain control of one or both houses of Congress, we can bring the deficit down by lowering taxes and curtailing government spending. If I am given the opportunity to return for the 111th Congress, I will do everything in my power to follow the successful Reagan and Bush policies of keeping taxes low to stimulate economic growth.
Source