Click below to read sections of Roy's Jobs Plan. Or, to read on your iPhone, iPad, or other mobile device, download the PDF.

1. Chapter 1 - Cut Spending and Reduce the Size of Government
2. Chapter 2 - Establish More Certainty in the Marketplace
3. Chapter 3 - Promote American Energy
4. Chapter 4 - Increase Access to Credit for Businesses
5. Chapter 5 - Expand U.S. Exports
6. Chapter 6 - Pursue Creative New Policies to Protect Small Businesses, Promote Growth
7. Appendix

Roy Blunt's Jobs Plan - A Real Solution to Create Private-Sector Jobs

Everywhere Roy Blunt goes Missourians tell him they are concerned about the state of our economy, especially jobs. Hard working Missourians are finding it more difficult to secure good-paying, sustainable private-sector jobs. Read Roy's jobs plan and the real solutions he is offering to help create private-sector jobs.

Full Text of the Plan

Click on the navigation links to the left to quickly find the section you are looking for, or download the jobs plan.

JOBS FOR MISSOURI:

Roy Blunt’s Jobs Plan

Real prosperity starts with a good job, but too many Missourians cannot find the kind of real, sustainable, private sector work that will fulfill them and help support a family.

For more than a year, Missourians have heard President Obama and Washington Democrats talk of their plans to “create jobs.”  But in spite of all their rhetoric, the unemployment rate has remained stuck at over 9%.

Why? Because Washington Democrats don’t understand that the biggest obstacle to job creation is the mix of liberal policies they’re promoting.  Private sector job-creators are ready to invest in the kinds of job-creating activities we need to recover fully from this economic crisis and help millions of middle class families get back to work. 

We need to remove the stumbling blocks to job creation, cut taxes, and reduce regulation, so Missouri’s job creators can create the jobs that will power Missouri’s future without the government looking over our shoulders.

Here is my plan to get the government out of the way and let our nation’s large and small businesses and entrepreneurs create real, sustainable private sector jobs.

1. Cut Spending and Reduce the Size of Government
2. Establish More Certainty in the Marketplace
3. Promote American Energy
4. Increase Access to Credit for Businesses
5. Expand U.S. Exports
6. Pursue Creative New Policies to Protect Small Businesses, Promote Growth

Cut Spending and Reduce the Size of Government

I will cut spending and reduce the size of government. Record deficits and debts and out-of-control federal spending have created a frightening climate for job creators.  We must put a stop to this reckless and embarrassing culture of running up the bill and passing it along to our children and grandchildren.

This recklessness has led many experts to conclude that the federal government is likely to address its deficit problems either by raising taxes or by inflating the dollar. We cannot let that happen. Even the threat of such actions in the future is a drag on the current economy.

Since they took control of Congress, Washington Democrats have raised the debt ceiling by more than 59%, including a 26% increase in the past 18 months alone.  The deficit now stands at an eye-popping $1.5 trillion, a 239% increase since Barack Obama took office.  This is simply unsustainable.

One of the Obama Administration’s “proudest” accomplishments was the $862 billion, so-called “Stimulus” plan that it promised would keep the unemployment rate under 8%.  But what the president and his advisors don’t seem to understand is that government spending doesn’t create jobs, or at least not good, sustainable private sector jobs.  Those kinds of jobs are created by private businesses and individual Americans who invest their money in the economy with a reasonable expectation of a return on that investment.  Job creators are telling me they are concerned the government will need to tax or inflate our way out of our current spending crisis.  That’s why so many businesses are hoarding capital that could be used for job creation.

Spending is out of control, and it is crippling our economy today, hurting middle class families, and piling tons of debt on our children and grandchildren.

Click here [APPENDIX V] to see some of the ways I will cut spending and reduce the runaway size of government.

Establish More Certainty in the Marketplace

I will pursue concrete changes to establish certainty and get Missouri’s job creators back to creating jobs.  Ask any employer what the key obstacle to job creation is today, and the answer will be: uncertainty.  When you don’t know how much your utility bill will be, how high your taxes might go, or how the new government-run health care plan will impact you, it’s scary to create a job.

On June 21^st, the leaders of the Business Roundtable sent the President a 49-page letter detailing areas where the Administration is undertaking policies that are impeding job growth and economic recovery.

Nowhere is this problem more apparent than in the record amounts of cash some companies are sitting on, rather than re-investing it in sustainable growth and job-creation.  Non-financial companies are sitting on an astonishing $1.84 trillion in cash reserves, because there is no safe way to use the cash given the uncertainties created by Washington.

Cut Job-Killing Taxes

Missouri’s families and businesses know how to spend their own money, and they certainly do it better than the federal government can do it for them.  When we return Americans’ hard-earned dollars to their pockets, an amazing thing happens:  they invest in their own priorities, and the jobs will follow. 

This is the reason the government should never raise job-killing taxes during periods of high unemployment.  But Washington Democrats are about to impose the largest tax increase in the history of the country.  I will fight all tax increases, especially those that hurt the middle class and those that make it harder for Missouri job creators to hire new workers.

Click here [APPENDIX I] to see the kinds of cuts to job-killing taxes that I will push.

Repeal and Replace the Job-Killing Health Care Law

I will work to repeal the Pelosi-Reid-Obama health care law, which unfairly creates onerous new rules for job creators and then expects them to foot the bill, often at the expense of hiring more workers or investing in the economy. 

I support more than a dozen reforms to the health care system, including Small Business Health Plans.  All of these reforms will lower costs and increase access without cutting Medicare, rationing care or bankrupting the country.

Click here to see my Real Health Care Solutions.

Roll Back Onerous Rules, Red Tape, and Mandates

One-size-fits-all rules from Washington, DC are furthering this climate of uncertainty.  I will make sure that we make it easier – not harder – for a business to create a job for a Missourian, so we can pull our economy out of recession.

The Obama Administration has proposed numerous new mandates on states, localities, and private entities that will continue to create an environment of uncertainty for Missouri’s job creators.  These new requirements, red tape, and paperwork drive up the cost of doing business, making it harder for employers to hire workers, grow their businesses, and pull our economy out of recession. Click here [APPENDIX III] to see the kinds of new mandates I oppose.

The Obama Administration has considered more than 100 regulations that impact the economy in excess of $100 million. Many, if not all, of these rules will directly impact small businesses, and I’ll keep fighting to block these job-killing rules and regulations. Click here [APPENDIX II] to see the kinds of rules I will fight because they cause job creators to stash their money instead of investing in job creation.

Government bureaucrats pile hundreds of new regulations onto job creators every year.  These are rules created by federal bureaucrats, not elected officials who are accountable to the people. Onerous federal regulations cost our economy an estimated $1 trillion a year, and that number is rising.  In 2009, the Obama Administration implemented new rules and regulations that piled approximately $13 billion in new costs on our already struggling economy.

I will work to repeal these kinds of job-killing regulations. [APPENDIX VII]

Smart, Low-Tax, Pro-Growth Policies

I will advance positive, job-creating policies that benefit the middle class, stabilize the marketplace and create a better long-term environment in which employers invest in jobs. 

Click here [APPENDIX IV] to see some examples of policies that that would help free up capital and give job-creators the confidence they need to grow more jobs.

Promote American Energy

The United States needs an all-of-the-above energy policy that will sustain our needs, end our dependence on foreign energy sources, and invest in the future.  In addition to traditional sources of energy, we need to improve energy conservation, develop alternatives, and invest in new technology to move America toward energy independence.  Promoting American energy resources of all kinds will help lower the cost of energy and lead to more American jobs.

I support the American Energy Act (H.R. 2846), which is an all-of-the-above solution that offers energy independence, good jobs and a cleaner environment for our nation. The American Energy Act promotes new, clean and reliable sources of energy.  At the same time, this legislation accepts the reality that in states like Missouri, which is more than 80% dependent on coal, coal must be part of our affordable energy equation for the foreseeable future. 

That’s why I will continue to fight the job-killing National Energy Tax known as “Cap and Trade.”  This plan is another huge government program designed to tax energy production, and it’s wrong for Missouri.

Click here [APPENDIX VI] to see how the American Energy Act promotes more American energy and American jobs.

Increase Access to Credit for Businesses

One of the most egregious results of the economic downturn has been the freezing of credit markets to loan-seeking individuals and businesses.  This freeze has had a domino effect, resulting in fewer capital investments and business expansions and resulting in fewer available jobs.

In particular, the downturn in the commercial real estate market is impacting not just businesses that must roll over their loans, but also community and regional banks that have significant exposure in commercial real estate. Because commercial real estate loans are generally written for a five-year term, and many are coming to term over the next several years, approximately $400 billion in loans must be refinanced each year for the next several years. Many economists have cited the problems in the commercial real estate market as a major hindrance to economic recovery.

Successful businesses of all sizes must have access to credit in order to grow the economy and create jobs.  As long as Washington is creating regulatory policies that cause banks to remain tight with credit, it will be harder for job-creators to invest in the kind of job creation our economy desperately needs.

Click here [APPENDIX VIII] to see some of the ways in which the new financial services bill, which I opposed, will negatively impact the economy.

Expand U.S. Exports

Our modern economy must find markets for our products.  President Obama himself announced earlier this year that increasing U.S. exports by just 1% would create over 250,000 jobs. The independent International Trade Commission has estimated that implementation of the three pending trade agreements would increase U.S. exports by more than 1% (using separate studies for Colombia, Panama, and Korea). In fact, the U.S. Chamber of Commerce estimates that by failing to act on the U.S.-Korea trade agreement alone, Washington Democrats and the president are preventing the creation of more than 345,000 jobs nationwide.

Missouri’s farmers and agribusinesses depend on exports, and opening new markets for their products is perhaps the most important way to ensure that agriculture in Missouri continues to thrive.  The United States Department of Agriculture has estimated that the U.S.-Korea trade deal will increase Missouri farm exports by $1.9 billion.

Click here to see how export-driven job creation positively impacts Missouri’s economy.  Click on these links to see how the U.S.-Colombia and the U.S.-Korea trade deals would impact Missouri’s economy.

Pursue Creative New Policies to Protect Small Businesses, Promote Growth

 

The government needs to get out of the way of the nation’s job-creators, so they can get back to doing what they do best:  creating jobs and fueling a vibrant economy.

 

Click here [APPENDIX IX] to see just a few ideas I have to control spending and promote job growth.

TAX CUTS

 

The government should never raise taxes during periods of high unemployment.  I will fight to cut the kinds of taxes that make it harder for employers to hire new workers, such as these tax increases proposed by the Administration:

 

• Allowing Current Tax Cuts to Expire – Washington Democrats have failed to enact extensions of the current tax rates that have been in place for nearly a decade, which are scheduled to automatically increase at the end of the year.  Among these are the Death Tax, the capital gains tax, and income taxes, particularly for many small business owners whose business and personal income taxes are conjoined.  The combination of these tax increases amount to the largest tax increase in American history and will cause drastically lower investment and job creation in the broader economy.

 

• Tax Hikes on Health Care – The Obamacare bill passed this spring contains numerous tax hikes on job-creators that will more than offset the health care subsidies the government plans to provide.  In some cases those effects are already being felt, as major employers have already begun reconsidering their projected earnings for this year.  These health-related taxes are having a negative impact on the economy and will continue to stifle job creation.

 

• Tax Hikes on Charitable Contributions – The Obama Administration has proposed to increase taxes on many of the biggest charitable donors by reducing the percentage of each contribution that can be deducted.  At a time when giving is already down due to the economy, the Obama plan would reduce the operating budgets of thousands of organizations employ millions of workers in churches, universities, and community centers across Missouri and across the country.

 

• Tax Hikes on Investment Partnerships – One of the ways that Washington Democrats are proposing to pay for their massive expansion of government is to drastically raise taxes on certain partnership profit interests.  These tax hikes will hit critical job-creators like venture capital firms and small entrepreneurial partnerships.

 

PROPOSED RULES

 

A responsible Administration would declare today that it will not allow new proposed regulations to take effect that have significant costs on job creators.  Since taking office, the Administration has considered over 100 regulations that are deemed economically significant, meaning they have an impact on the economy in excess of $100 million. Many, if not all, of these rules will directly impact small businesses.

 

Here are just a few examples of the kinds of regulations that are currently under review by the Obama Administration that should be suspended or reformulated to lessen their impact on job-creators:

 

• Regulating Carbon Emissions Under the Clean Air Act – Congress has demonstrated that it is deeply divided over the idea a cap should be placed on carbon outputs. But the Administration has signaled it wants to press ahead without Congress and the Environmental Protection Agency (EPA) has announced plans to regulate carbon emissions under the Clean Air Act.  This would be an unprecedented abuse of a law intended to protect our communities from truly dangerous pollution and would represent a “backdoor” effort to implement the Administration’s planned cap-and-trade scheme, which would cost more than 32,000 Missouri jobs in the first year alone.

 

• The Drilling Moratorium – In the wake of the Gulf oil spill, the Administration implemented a six-month moratorium on further deep-water drilling.  This executive action is already costing the region thousands of jobs, will drive up the cost of energy, make us more dependent on overseas oil, and has been overturned by a federal court.  It’s hard to see what benefit this moratorium accomplishes.

 

• “Ergonomics” Regulations – In 2001 Congress exercised the Congressional Review Act to overturn a Clinton-era regulation that would have given workers wide lattitude to sue employers over “ergonomically”-sustained injuries.  The costs to employers would have been enormous and resulted in slower economic growth and fewer jobs. Unfortunately the Department of Labor has begun rethinking this regulation and has proposed a similar rule in 2010.

 

• FCC Regulation of the Internet – Over the past two decades, the country’s telecommunications providers have taken advantage of a light regulatory environment to invest in and expand access to wide varieties of high-speed communications.  Unfortunately certain voices within the Democrat-controlled Federal Communications Commission (FCC) are determined to impose sweeping government regulations on the Internet. This will result in slower investment and innovation in this critical industry and fewer jobs of all levels.

 

The President should issue an immediate Executive Order halting any proposed regulations expected to impose net costs on the economy in either the near or long-term or that negatively impact small businesses or result in a net loss of jobs.

MANDATES

The Administration has proposed numerous new mandates on states, localities, and private entities that will continue to drive an environment of uncertainty for our job creators.  These new requirements and paperwork drive up the cost of doing business, which in turn makes it harder for employers to hire workers and grow their businesses.  I will fight against these mandates, which include such measures as:

 

• Obamacare Mandates – The new Obamacare bill contains thousands of new employer mandates that will increase the cost of providing insurance to employees.  It’s very likely that a combination of higher costs and burdensome mandates will cause employers to drop coverage. Additionally the rigid requirements of the bill will likely cause many companies to either lay off employees to get under certain thresholds or simply not hire employees to avoid penalties.

 

• New Burdensome Contractor Rules – The President’s budget contained language to increase reporting and paperwork mandates on firms that use small contractors.  Tens of thousands of small- and micro-businesses rely on contracts that, according to the National Association for the Self-Employed, larger firms would be 41% less likely to use under the proposed change.  These kinds of unnecessary new burdens on small businesses will cost jobs among the smallest and most entrepreneurial companies.

 

• Offshore Drilling Moratorium – The Obama Administration has implemented new job-killing restrictions that shut down deepwater drilling in the Gulf of Mexico.  It has also failed to lift most of the existing restrictions on offshore drilling in much of the rest the country.  These are real American jobs.  It’s time to give the states the ability to lift these moratoriums and create jobs, rather than leaving in place these job-killing federal mandates.

 

SMART, LOW-TAX, PRO-GROWTH POLICIES

 

I want to advance good policies that create stability in the marketplace and a better long-term environment in which employers invest in jobs.  Here are some examples of policies that I’ve heard from small business owners and other job-creators that would help free up capital and give them the confidence they need to grow more jobs:

 

• Permanently Extend the Home Owners’ Tax Credit – Recently it was announced that new home purchases had fallen off more than 30%. Clearly people respond to tax incentives and the recently-expired home owners’ tax credit is no exception.  Encouraging people who can afford it to purchase homes helps employ homebuilders, real estate workers, bank employees, and keeps liquidity in the market.

 

• Bonus Depreciation – Small businesses are facing a credit crunch.  We should lower the after-tax cost of commercial properties through a reduction of the depreciation schedule from 39½ years to 20 years, or even less to allow them more capital to invest in job-creation.

 

• Tort Reform – While Congress took a big step in 2005 with the Class Action Fairness Act, many employers (particularly in the health care field) still face economic obstacles, because of the high cost of class action insurance. Doctors, for example, face huge malpractice insurance bills that are putting many of them out of business. Meanwhile, Washington Democrats continue to push for legislation that encourages frivolous lawsuits to help their trial lawyer allies. While consumers must always be protected, we need policies that ensure that employers are not crippled by hefty legal insurance burdens.

SPENDING CUTS

 

The federal government is simply growing too quickly and its size and intrusion into the marketplace is crowding out the kind of private investment and job-creation that the economy needs for a sustained recovery.  Here are some measures I would undertake in order to reduce the deficit:

• Don’t spend remaining Stimulus Funds – As of this Spring, more than a year after the $862 billion stimulus, more than $300 billion had yet to be spent by the federal government.  That money should be returned to the taxpayers.

 

• Real Entitlement Reform – In 2005 I led the successful effort to cut nearly $40 billion from federal entitlement programs, the first such reform in nearly a decade.  Nearly all of those reforms have been reversed by Washington Democrats in recent years.  Our long term budget problems won’t be resolved until we find ways to reform our entitlement programs in a way that keeps our promises to seniors while ensuring these programs don’t bankrupt the next generation.

 

• Repeal and Replace Obamacare – The Democrats’ Government Takeover will cost at least a trillion dollars, according to the Congressional Budget Office.  I’m for repeal of this massive spending bill and replacing it with common sense health care solutions that will create jobs and drive down health care costs.

 

• Cut Wasteful Welfare Program – This program incentivizes states to increase their welfare caseloads without requiring able-bodied adults to work, get job training, or otherwise prepare to move off of taxpayer assistance.  This violates the spirit of the successful Welfare Reform Plan that was implemented in the 1990s. Implementing this spending cut would save taxpayers $25 billion.

 

• Reform Fannie and Freddie Mac – These two huge “government-sponsored entities” were chiefly responsible for the housing crisis, due to government policies that pushed them into irresponsible lending practices.  Reforming these entities would save taxpayers $30 billion.

 

• Sell Excess Federal Property – The government owns as much as $18 billion in excess and mostly unused real estate around the country.

 

• End Taxpayer Subsidies for Unions – The government spends $120 million a year to pay individuals to work on behalf of public sector unions.

 

• Stop Paying for Unnecessary International Organizations – We could save nearly $500 million a year by pulling out of such international organizations as the International Coffee Organization and the International Rubber Study Group.

 

• End Duplicative Federal Advisory Groups – We spend $342 million a year on 917 federal advisory groups, many of which rarely meet or do little constructive work.

In addition to finding the right programs to eliminate, we need to freeze our future spending.  I have advocated, at the very least, a freeze in domestic discretionary spending at the 2008 level.  Since the Obama Administration has already increased spending by over $738 billion since taking office, the savings provided by such a freeze would be considerable.

 

THE AMERICAN ENERGY ACT

 

I am a proponent of the American Energy Act (H.R. 2846), which is an all-of-the-above solution that offers energy independence, good jobs and a cleaner environment for our nation. The American Energy Act promotes new, clean and reliable sources of energy.  At the same time, this legislation accepts the reality that in states like Missouri, which is more than 80% dependent on coal, that form of energy is going to be part of our affordable energy equation for the foreseeable future.  Here are some ways that the American Energy Act promotes more American energy and American jobs:

 

• Nuclear –
  The 104 nuclear reactors in America today provide the United States with 20 percent of its electricity and 73 percent of its CO2-free electricity, yet no new reactors have been ordered since 1978. The American Energy Act establishes a national goal to safely bring 100 new nuclear reactors online over the next 20 years to strengthen America's commitment to clean, reliable energy.

 

• New and Expanded Technologies –
  The American Energy Act creates a Renewable and Alternative Energy Trust Fund to provide funding for energy programs authorized by federal law, such as biomass, hydroelectric, clean coal, solar, wind, geothermal and other forms of renewable energy. The fund will encourage the development of renewable, alternative and unconventional fuels, and new energy sources, using receipts from the new federal and oil gas leasing in the Arctic Coastal Plain and the Outer Continental Shelf (OCS).

 

• Alternative Fuels –
  The bill spurs the development of America's alternative fuels by repealing the "Section 526" prohibition on government purchasing of fuels derived from sources such as oil shale, tar sands and coal-to liquid technology. The bill also encourages the use of clean coal-to-liquid technology by allowing federal agencies to enter into long-term contracts to buy coal-derived fuel and by authorizing the Secretary of Energy to enter into loan agreements with coal-to-liquid projects.

 

• Tax Provisions –
  The bill encourages new and expanding energy technologies by making permanent tax credits for the production of renewable electricity, including wind, solar and biomass. The bill also makes permanent investment tax credits for solar energy and for fuel cell properties and extends the biodiesel and renewable diesel tax credits.

 

• Promoting American Energy –
  The Interior Department estimates that the Outer Continental Shelf (OCS) holds up to 86 billion barrels of American oil and 420 trillion cubic feet of natural gas.  The Administration has actually moved backward on the approval of exploration activities since the Gulf oil disaster, a move which stands to cost American workers hundreds of thousands of jobs.  Even before the oil spill, significant portions of the OCS remained unavailable because the Obama Administration has continued to delay leasing activities. The bill increases the supply of American energy by immediately moving forward with a leasing program on the OCS in a safe and efficient way.  It simplifies and harmonizes the OCS mileage restrictions, expanding state territorial waters to 12 miles offshore (most state borders stop at three miles), and gives coastal states a share of the receipts from such energy exploration. A portion of the revenues created by OCS exploration would go to a renewable energy trust fund to pay for a variety of renewable, alternative and advanced energy programs.

 

EXISTING JOB-KILLING REGULATIONS

 

Government bureaucrats pile hundreds of new regulations onto our employers every year.  These are rules created by federal bureaucrats, not elected Members of Congress. While some of these regulations may make sense, many of them are serve to simply increase the cost of doing business with few concrete benefits to taxpayers.  Onerous federal regulations cost our economy an estimated $1 trillion a year and that number is rising.  In 2009, the Obama Administration implemented new rules and regulations totaling approximately $13 billion in staggering new costs to our struggling economy.  Here are just a couple examples of regulations we should immediately terminate in order to reduce costly regulatory burdens on America’s job creators:

 

• The Lead; Renovation, Repair, and Painting Program – This Environmental Protection (EPA) regulation, which requires specially-certified technicians to do any home repairs on windows or painted walls, went into effect in the Spring of 2010 even though there are practically no certified technicians in existence.  The result? Fewer home renovations, fewer sales of home renovation products, and of course fewer jobs for renovation specialists.

 

• Rule Implementing the Consumer Product Safety Improvement Act (CPSA) – This Consumer Product Safety Commission (CPSA) regulation, purportedly implementing congressionally-approved laws regarding consumer product safety, is so out-of-touch that it would require pants zippers and ATV parts to be held to the same standards as children’s toys to prevent lead poisoning.  The result?  Massive new burdens on diverse manufacturers, driving up costs for consumers, and leading to layoffs in the manufacturing industry.

 

• “Critical Habitat” Designations – This series of Department of the Interior regulations affects businesses, landowners, and entire communities.  For example, one community in the San Joaquin Valley in California has lost more than 40,000 jobs as a result of rules put in place to protect a certain kind of fish.

 

In instances where federal regulations have recently been put into effect, Congress should examine the applicability of the Congressional Review Act, which allows Congress a certain window of time to review and overturn onerous federal regulations. Where the Congressional Review Act is not applicable, Congress should examine ways of overturning or amending these job-killing regulations through statute.

THE RECENTLY-PASSED FINANCIAL REGULATORY OVERHAUL BILL

 

The Financial Reform Bill recently passed by passed by the Congress over the summer is a good example of the misguided policies of Washington Democrats.  Here are some examples of how the new law will negatively impact economic growth and job-creation:

 

• Doesn't End Too Big To Fail –

The new bill sets up a funding source through the Department of the Treasury to front money to "wind-down" failing firms, claiming that the money would be repaid through the sale of the firm’s assets.  History is not kind to this plan, which was the same plan that lost billions when the government sold off Bear Stearns for $2 per share.  The new bill expands the power of the Treasury to take over failing firms when they believe it’s in the public interest. And even if a firm is not failing, it can be taken over if the Treasury decides it’s ‘at risk’ of failure.

 

Because of this legislation, the FDIC and the Treasury Secretary would be solely authorized to use taxpayer funds to bailout financial institutions.  The FDIC, rather than an objective court with established rules, would be empowered to determine which creditors are made whole and which are not.

 

The result is an institutionalized role for taxpayers to bail out or intervene financially in the activities of major firms, meaning that government intervention in the economy is likely to be even more substantial in future financial crises than it was in the last one.

 

• Allows Fannie and Freddie to Continue Dangerous Policies –

Fannie Mae and Freddie Mac are “Government-Sponsored Entities” (GSEs), which means that they are private companies that operate at the behest of the federal government. Before the last financial crisis, federal laws encouraged these two entities to make dubious loans to individuals with subpar or non-existent credit, which led directly to the disastrous housing bubble. But Washington Democrats reformed neither of these two GSE's in their signature financial reform legislation.  Together, the mortgage portfolio's of these two giants is over $6.5 trillion.  The taxpayer is also on the hook to backstop them for any losses, which have been in the hundreds of billions of dollars so far.

 

The result of this failure to reform the GSEs is the likelihood of continued distorted housing policies that could lead to a second collapse in housing prices in the future.  The economy continues to be weighed down by great uncertainty in the lending markets, which will continue to depress growth and job-creation.

 

• Consumer Financial Protection Bureau (CFPB)

The bill creates a massive new, independently funded agency under the Federal Reserve that will be in responsible for setting new rules for the banking sector in its entirety.  This new regulator will only answer to the newly-created Financial Stability Oversight Council, which will be chaired by the Treasury Secretary and has the ability to overturn all rules that the CFPB sets if its members feel the new rules risk institutional stability. 

 

This immense power in the hands of unelected government regulators will further give pause to the kinds of investors that we need to be putting capital into the economy right now.  That’s how jobs are created and by suppressing investment, this bill will suppress job-creation.

 

• New Layers of Regulation and Compliance

 

After examining this legislation, many small banks are already in talking about selling out to larger institutions because they do not currently have and cannot afford to deal with the massive value of new reports and rules.  The costs borne by banks, especially community and regional banks, to comply with the massive new layers of regulation will be passed on to their customers and result in higher fees and fewer services, not to mention stagnate growth for banks and provide even less liquidity and credit available in the market than the low levels that currently exist.

 

• Energy Costs Will Increase

Many utility and energy providers believe that the conference report does not include a commercial exemption for their unique circumstances.  These companies typically hedge their commodity costs as a way to create stability and certainty for themselves and their bottom lines, which provides a stable cost to their consumers.  This legislation may make this kind of hedging impossible.  As a result, their working capital budgets will be drained, jobs will be lost and expansion will be stifled, because these firms will now have to keep more money in reserve.  Additionally, utility bills may very well increase because of new volatility in the commodities markets.

 

On top of other Washington Democrat efforts to regulate carbon emissions and penalize the production of our most common forms of energy, this bill will hurt every American consumer or business that turns on a light switch.

I want to help mitigate the credit crisis for small businesses by lowering the after-tax cost of their properties through a reduction of the depreciation schedule from 39½ years to 20 years, or even less.

I also advocate policies to require bank regulators to improve transparency and ensure flexibility in underwriting and appraisal standards.  This will ensure that financing is available for those properties with the promise of generating revenue. At a minimum would standardize reporting on the number of performing loans per institution that are not renewed. That in turn would ensure that regulators in our communities are living up to the commitments of regulators in Washington not to deny renewal of loans simply because of a fall in the value of the collateral.

 

It’s critically important that successful businesses of all sizes have access to credit in order to grow the economy and create jobs.  As long as banks remain tight with credit due to regulatory policies in Washington, it will be harder for job-creators to invest in the kind of job creation our economy desperately needs.

APPENDIX IX: NEW INITIATIVES

 

We need creative policies to truly get the government out of the way of the nation’s job-creators and give workers what they need to get new jobs.  Here are just a few interesting ideas:

 

• Develop a process to allow for a privileged resolution on the House or Senate floor whenever a proposed rule is determined by the agency to negatively affect small businesses. These determinations are already made by the rulemaking agencies and published in the Federal Register.

 

• Implement H.R. 3765, a bill sponsored by Rep. Geoff Davis, to automatically require an up-or-down vote in Congress on any proposed rule that is deemed “major,” defined as having an economic impact of $100 million or more.

 

• Create an Office of Repeal, which would be responsible for examining existing federal regulations for their impact on business and job-creators and repealing those that are duplicative or unnecessarily burdensome.

 

• Implement H.R. 5823, The United States Covered Bond Act, sponsored by Rep. Scott Garrett.  According to expert testimony, covered bonds also represent a cost-efficient form of on-balance-sheet financing for financial institutions that, in turn, can reduce the cost of credit for families, small businesses, and the public sector.

 

• Make job retraining work.  Reform existing job training and retraining programs to target those who need them most to save money for taxpayers.   Reform Trade Adjustment Assistance to target low-income workers and those whose industries are most impacted.  Develop tax-free dislocation savings accounts for unemployed workers who seek work in other parts of the United States.