A Double Dip?

Statement

Today, the Commerce Department announced that our nation's economy declined sharply in the second quarter. According to revised estimates, Gross Domestic Product growth slowed to 1.6%, down from 3.7% growth in the first quarter of 2010 and 5.7% growth in the last quarter of 2009.

Continued high unemployment and slowing economic growth is sparking concern from some economists that we may be headed for a double-dip recession.

This is unacceptable. Millions of Americans need jobs, and that means that American businesses must be able to grow and invest to hire more workers. Congress has the responsibility to end its failed regulate, tax, and spend policies that are inflating the size of government and discouraging economic growth in the free enterprise system.

In addition to historically high unemployment, our nation's growing trade deficit is a primary factor in our declining economic growth. In the second quarter, America 's trade deficit spiked 16%, marking the largest increase in imports in 26 years. The bottom line is that we continue to import far more than American manufacturers and businesses are exporting. Far too many American products are subject to tariffs around the world while American producers are saddled with the second-highest tax rate in the world.

A driving cause for the structural trade deficit is this Democrat-controlled Congress' failure to move forward with a proven job creator and economic stimulus: passing free trade agreements. Free trade agreements (FTAs) are essential for American products to avoid costly tariffs and be competitive in a global marketplace. While Congress stalls on trade agreements, other countries and the European Union are moving forward on their own trade agreements. If the United States does not act quickly, we run the risk of being crowded out of global markets by other foreign companies. Trade is critical to our nation's economic stability.

Another factor in declining economic growth is our struggling housing market. In July, existing home sales hit a record low -- falling 27.2% -- in large part due to the expiration of the homebuyer tax credits.

Since 2008, the housing market meltdown has been mitigated by the first-time homebuyer tax credit (up to $8,000) and repeat homebuyer tax credit (up to $6,500) -- providing critical incentives for home purchases and lessening the decline in home values.

As an original sponsor of the first-time homebuyer tax credit, I strongly support empowering Americans to keep more of what they earn to invest and grow our economy. While the housing market has endured tumultuous years, I believe that the tax credits helped save the industry from systemic meltdown.

Unfortunately, the hallmark of this Congress has been creating too much uncertainty in the marketplace. Congressional Democrats have failed to renew the tax credits, sending home sales plunging and disrupting the labor market by preventing people whose houses are "underwater" from moving to a new location to pursue employment. Of course, home values decline as well when neighboring homes sit on the market too long -- driving a downward spiral in the housing industry.

It's past time to have leaders in Washington who are serious about growing our economy, creating jobs, and making America competitive with the world. Over 15 million unemployed Americans deserve better than the job-killing policies coming out of Congress.

Leading by Serving

On Thursday, I met with members of the CEO Netweavers Dallas chapter -- small business owners and business leaders who are committed to pursuing an "others first" approach to business and investment in the community. In addition to establishing networking relationships, CEO Netweavers' members can share ideas and experiences regarding "Servant Leadership."

I was honored to be their headline speaker and to discuss how the concepts of Servant Leadership have influenced my own approach to public service. From helping constituents with federal agency issues to promoting policies that empower people from all walks of life, I take very seriously my responsibility to represent the interests of North Texans. I also believe that mentoring is an important part of Servant Leadership. While coaching provides primarily tactical learning, mentoring takes an additional step of investment for life application.

In addition to our discussion on Servant Leadership, policy questions from attendees included impending tax increases and regulations on businesses and the importance of American competitiveness.

NTMA

Also on Thursday, I met with the North Texas chapter of the National Tooling and Machining Association. About 50 people from small- and medium-size manufacturing businesses attended the monthly chapter meeting. As the keynote speaker, I recognized the challenges facing the industry as well as solutions for the future.

In the last 10 years, our nation has lost nearly a third of its total number of jobs in manufacturing -- a decline facilitated by the fact that the United States has the second highest business earnings tax rate in the world. Additionally, onerous government regulations and permitting processes further discourage manufacturing in America .

This job loss has further structured our economy as a nation of consumers -- not producers. For a sustainable, healthy economy, America needs to make manufacturing a priority.

I fully support reducing the tax rate on business earnings, reforming the tax code to reward saving and investment, making permanent the Research & Development tax credit, and allowing manufacturers and businesses to depreciate assets according to an individual business plan.

It's time to champion manufacturing as a key for jobs, economic growth, and American competitiveness.

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