Bailing Out States Could Stunt Economic Growth
This week, House Democratic Leadership reconvened the chamber for a special session to vote on legislation that would provide another bailout costing $26 billion. Instead of a bailout to corporations – which I oppose – this bailout was for states that have not displayed the will to balance their budgets. We’ve seen less than satisfactory results from previous corporate bailouts, and now Democratic leadership is determined to spend billions more on this. We can’t keep going down this reckless path because it’s unsustainable.
Remember when we were told by the President that we needed a $700+ billion “economic stimulus package” to keep unemployment from climbing above 8 percent? With the unemployment rate stagnate at 9.5 percent, all we have to show for the billions of government spending is more people out of work and a deficit that’s threatening our national security. If we were supposed to measure the stimulus bill by job creation, the bill has not succeeded, while the amount of spending on programs that have done nothing to reduce unemployment have tied our hands on allocating resources in the future to policies that might help. This lack of foresight in all of these policies has lead to growing frustration and declining confidence. Now, Americans are asking the federal government to reduce spending, but I have not seen anything from the Democratic leadership that they are willing to curb the spending spree at all.
I keep hearing from people back home that we need jobs, and that the government needs to get out of the way and let our small businesses create them. Further government intervention may actually prolong the down economy we find ourselves in now.
This latest spending bill is supposedly to help states with their Medicaid budgets and teacher salaries. But many states – who unlike the federal government are actually required to operate balanced budgets – will simply shift money around and be able to spend these funds on anything. As usual, the Democratic leadership barred any amendments to this bill. Republicans tried to include an amendment that would provide some accountability to this legislation by requiring states to only use this funding for Medicaid, but the answer was NO.
Worse still, rather than offsetting the cost of this new spending by finding some spending to cut, the Majority instead chose to raise taxes on American companies that also have international operations. What they called “tax loopholes” are actually real-world tax increases that mean the private sector will, once again, have less capital available to create new jobs in order to pay the costs of bigger government. When we are trying to create jobs, why do we make the cost of employment higher?
My policy to promote job growth is to create an atmosphere that rewards hard work, keeps government out of the way of innovation and incentivizes our businesses to invest in new jobs and equipment. I believe our economy works best when we reduce regulations, lower taxes and allow families to keep more of what they earn.