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  • The 2014 State of the Union and Policies for Economic Growth

    Tonight President Obama will stand before Congress to take stock of where we’ve been as a nation and where he envisions America going. After five and a half years of a technically recovering economy, many Americans have yet to see any evidence of economic health. If history serves as a guide, he will again advocate for big government programs that, regardless of good intentions or which political party they come from, will shrink Americans’ freedoms and opportunity to better themselves. From addressing the national debt, to climate change policies and cutting red tape for entrepreneurs, economic growth will come from the ingenuity of the American people and government policies that grow freedom.

    Detailed below are the issues and research behind some first steps towards getting America back on track to real economic recovery.

    Regulatory Burden

    The burden of federal regulations has eroded freedom and diverted investments in job creation and innovation to regulatory compliance. During President Obama’s first four years in office, 131 major rules were issued by agencies, conservatively estimated by the federal government to impose $70 billion annually in regulatory costs. Many more new costly regulations are in the pipeline. By comparison, about 50 such rules, with about $15 billion in new annual costs, were imposed during President Bush’s first term. Congress needs to reign in the flood of regulations and bring accountability to the process.

    Red Tape Rising: Regulation in Obama’s First Term

    May 1, 2013 James Gattuso and Diane Katz

    Tax Code Reform

    The current tax code lacks transparency, is full of political favors in the form of credits and exemptions, and inherently discourages Americans from working, saving, investing and taking risk – the ingredients for economic growth. The top tax rate is now over 50 percent and America has the highest corporate tax rate among developed nations. There were 13 tax increases for Americans this year and more on the way for 2014 thanks to Obamacare. Tax reform is ultimately about reviving economic growth, not about increasing government revenues to increase government spending.

    The Dos and Don’ts of Tax Reform

    April 9, 2013 Curtis Dubay

    These 13 Tax Increases Hit in 2013

    December 31, 2013 Curtis Dubay

    Federal Spending and Economic Recovery

    2013 saw modest improvement in the federal deficit as spending cuts came into effect and Congress again raised taxes. However, the federal government does not have a revenue problem – it has a spending problem. America has sustained four straight years of trillion dollar deficits and total federal spending has ballooned 40 percent since 2002, even while Americans face $3.2 trillion in tax increases over the next decade. Federal spending and chronic debt are sapping economic health, and European nations have foreshadowed the end of road the U.S. government is walking towards. Smart and aggressive reforms now to the programs driving federal spending will result in greater economic growth later.

    Cutting the U.S. Budget Would Help the Economy Grow

    November 20, 2013 Romina Boccia

    Federal Spending by the Numbers, 2013: Government Spending Trends in Graphics, Tables, and Key Points

    Romina Boccia, Alison Acosta Fraser, and Emily Goff

    Saving Social Security

    After three years of running deficits, the President and Congress have too long ignored the fact that Social Security is going bankrupt. If the current trend holds, the Social Security Trust Fund will be exhausted by 2033 and is already putting a heavy burden on the federal budget. There are common sense reforms – such as focusing benefits on seniors who need them the most and moderately increasing the early and full retirement ages – that can protect this program for generations to come if action is taken now.

    Time to Address the Retirement Savings Crisis

    October 18, 2012 David John

    Social Security Benefits and the Impact of the Chained CPI

    May 21, 2013 Romina Boccia and Rachel Greszler

     

    Energy and Environmental Regulations Through the Backdoor

    Regardless of what one believes about the impact of climate change, legislation and regulations allegedly addressing global warming have negligible environmental impacts at high costs and limit individual freedom and consumer choice. In President Obama’s last state of the Union address he promised to act on global warming if Congress didn’t, and in July released his Climate Action Plan to work through executive agencies and executive action. As part of this plan, the EPA is poised to implement regulations that would effectively eliminate the use of inexpensive, efficient coal as a source of electricity. Such a plan would make an unnoticeable improvement in environmental quality while eliminating more than half a million jobs economy-wide by 2030 and give Americans fewer financial resources with which to actually improve the environment. Congress must reengage in the regulatory process and prevent executive agencies from regulating greenhouse gases.

    EPA Power Plant Regulations: A Backdoor Energy Tax

    December 5, 2013 Nicolas Loris, Kevin Dayaratna, and David Kreutzer

     

    Protecting Entrepreneurs

    Entrepreneurs and small businesses are a vital source of economic growth and new jobs. In a decisive bipartisan decision, Congress cut regulatory tape to empower entrepreneurs and small businesses to innovatively raise capital with the JOBS Act of 2012. However, proposed regulations from the Securities and Exchange Commission implementing the Act threaten to undo the good progress that had been made.

    Regulation D Rule Would Harm Entrepreneurs and Economic Growth

    November 13, 2013 David Burton

     

    Stabilizing the Housing Market

    The housing system in America has been broken for many decades. Since the 1990’s the government has propped up the housing market largely through Fannie Mae and Freddie Mac, the two enterprises under government control since 2008. This government intervention has not led to any measurable improvement in Americans’ ability to own homes, but it has left taxpayers responsible for trillions of enterprise debt. Fannie and Freddie should be eliminated and should not be replaced by a new government entity if the housing market is to ever get onto solid ground.

    Fannie and Freddie: What Record of Success?

    November 7, 2013 Norbert Michel and John Ligon

    GSE Reform: Affordable Housing Goals and the “Duty” to Provide Mortgage Financing

    November 12, 2013 Norbert Michel and John Ligon

     

    Transportation and the Federal Government’s Role

    Exaggerated claims of “crumbling infrastructure,” followed by calls for massive federal cash infusions, recall the days of Obama’s massive stimulus bill which, well, failed to get the economy growing. Such efforts also politicize the true transportation priorities in states across the country. Washington’s recent track record of poorly prioritized Highway Trust Fund dollars and the bureaucratic hoops states must jump through to plan and construct transportation projects with federal money confirm the failures of the current Washington-knows-best approach to solving the states’ congestion and mobility challenges. A better approach is direct: scale back the federal program and empower the states to make their own transportation funding and management decisions.

    Empowering the States by Turning over the Federal Highway Program

    November 15, 2013 Emily Goff

    Posted in Capitol Hill, Economics [slideshow_deploy]

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