This column by Eric Cantor appeared on Townhall today
“A national debt if it is not excessive,” Alexander Hamilton advised, “will be to us a national blessing.”
Today, Hamilton must be turning over in his grave. Congress is moving forward with an economic stimulus plan that will swell this fiscal year’s deficit to roughly $2 trillion, or an astounding 13 percent of GDP. Adjust those dollars for inflation, and even our nation’s earliest and most iconic proponent of a national debt would cringe at the danger we are creating for our economy and for future generations.
As it hammers out the final details of the stimulus bill, Congress should pay more than lip service to Hamilton’s words. We must reconcile the nation’s need for quick action with the need for prudent policies designed to spur sustainable job creation here in America. That means not only tax relief for working families but in particular for the small businesses, entrepreneurs and self-employed that create well over half of the jobs in our country. Given the choice, Americans would prefer a permanent job in the private sector to temporary work courtesy of the taxpayer dime.
Unfortunately, the stimulus bill that has emerged falls hopelessly short of the mark, crippled by non-stimulative spending and insufficient tax cuts. How can we expect Republicans to vote on a bill that spends $12 on new cars for the federal government for every $1 in tax relief to small businesses?
Two weeks ago, after the House GOP hosted a hearing on the stimulus with former Massachusetts governor Mitt Romney and former eBay CEO Meg Whitman, we sent the president-elect a letter detailing our findings. Today House GOP leadership met with President Obama to outline more of our ideas and concerns.
House Republican leaders conveyed our desire to work with him and the Democrat majority to improve the stimulus package. But with a watchful eye toward the ballooning deficit, we made clear that we strongly oppose any wasteful spending that disregards the genuine path to economic growth and only establishes the need for future tax increases.
Nor will we quietly swallow the $219 billion House Democrats have proposed in infrastructure and so-called discretionary spending that the Congressional Budget Office says won’t be spent by Oct. 1, 2010. That’s because House Republicans have different ideas over how we stem unemployment and promote lasting job growth. We are inherently skeptical of promises that three million sustainable jobs will fall from the sky like manna simply by spending hundreds of billions.
In the end, it is businesses – driven to innovate, invest and grow – that will regenerate the millions of sustainable jobs we so desperately need. The stimulus must take bold steps to encourage work, investment and business expansion, something that government spending too often fails to provide.
These are some of the remedies the House GOP proposed to President Obama on Friday:
- Small businesses, entrepreneurs and the self-employed employ about half of all Americans, yet they can be subject to tax rates that siphon away one-third of their income. We support allowing small businesses to reduce their tax liability by a minimum of 10 percent. This will immediately free up funds for small businesses to retain and hire new employees.
- Rather than a one-time tax break, we also want tax cuts for families that pack lasting punch. We propose to cut the lower marginal income tax rates, providing all taxpaying families with a minimum increase in income of approximately $500 per year.
- For the unemployed, we want to dispense with the taxes the federal government levies on unemployment benefits. Individuals between jobs should be able to focus on providing for their families.
- Also critical will be addressing the housing crisis. The real-estate market is paralyzed as potential buyers wait on the sidelines for prices to find their bottom. In order to encourage responsible buyers to enter the market and stabilize prices, we propose a home-buyer’s credit for those buyers who can make a minimum down-payment. As home prices stabilize, complex securities tied to mortgages can also finally find a level that clears the market.
Finally, we must ensure that vast government spending doesn’t lead to rampant inflation in the future. At $825 billion, this Democrat stimulus proposal causes us great concern. While the Fed remains rightfully concentrated on fighting deflation, uncontrolled spending and borrowing will most ultimately lead to inflation if the spigot is not turned off in time. That could trigger a flight of foreign capital and a steep drop in the purchasing power of the dollar for the American consumer. As interests rates rise to keep foreigners financing our debt, the pain dealt to businesses and families alike promises to be sharp.
Alexander Hamilton expressed his views at a critical juncture for our young nation. Over two centuries later, at another critical time for America, his words still resonate.
January 28th, 2009 at 10:26 pm A suggestion for your attempt to help fix the “stimulus packageâ€. I would like to suggest on a temporary basis (start with 6 month?) increasing unemployment compensation by at least 50%, that way you are benefiting the people directly hurt by this recession and know the money will be put to an immediate use.
January 28th, 2009 at 11:25 pm Mr. Cantor,
I am so proud of your outspoken and strong opinion on the outrageous state of our economy. I appreciate that you and ALL the Republicans in the House voted against the latest bailout bill today. Keep the faith and continue to give us something to keep our conservative hopes alive.
January 29th, 2009 at 8:28 am congrats on the vote outcome, you held your ground well and with strong rational — not partisan bickering.
January 29th, 2009 at 2:47 pm Bravo! If there was ever a Bill more hostile to Republican principles, the stimulus package is it. I’m not the only one who is relieved to see Republicans finally stepping up the plate!
It’s not just the money, though, and Republicans have got to figure out how to make that clear. The $200 Billion supposedly destined for Education is really the Feds taking over education and trying to run our lives from Washington.
Plenty of people think redistributing wealth is just fine. There’s only one way I’ve ever made any inroads with my liberal children. When they are fuming about having to deal with bureaucratic red tape of one kind or another, I tell them they’re going to love how Congress runs universal healthcare.
I’m glad to see some high profile leadership and solidarity. We also need to be cultivating serious resistance at the state & local levels — in the same way we saw states pushing back against Kelo v New London with legislation on eminent domain. I’d also like to see Republicans start naming some names! How can Christopher Dodd and Barney Frank possibly still be out front selling the idea of Democratic financial “reform”? There’s a news making opportunity in that story that Republicans have completely whiffed.
January 30th, 2009 at 7:25 pm I agree with your efforts to limit the size of Federal government intervention while focusing any fiscal stimulation on segments that will generate jobs and keep them viable in the U.S. To this end, what’s wrong with the idea of giving business that bring jobs that have been moved outside the U.S. back to our shores to provide jobs to Americans a tax cut for the business? A sliding scale for the proposed cuts could be implemented to provide incentives for growing more jobs for Americans.
And what about the notion of offering tax rate cuts to companies that are creating new jobs to provide alternative energy sources to Americans in order to make us less dependent on foreign oil?
Note that my suggestions are examples of focusing on policy changes that can change our economic environment to create and retain jobs for Americans while increasing the tax base as more Americans go back to work.
February 5th, 2009 at 3:04 pm Yes, Yes, Yes!!!!!!!!!!!!!!
Thank you Eric….
February 12th, 2009 at 3:46 pm Congressman Cantor,
Thank you for your heroic efforts to save our economy….I really think that is the case. If this spending nonsense is voted into law, generations will be saddled with the bill for all the liberal junk they haven’t been able to get passed for years.
It may be time to march on Washington and take the country back!!!
February 12th, 2009 at 3:48 pm Congressman Cantor,
Thank you for your heroic efforts to save our economy….I really think that is the case. If this spending nonsense is voted into law, generations will be saddled with the bill for all the liberal junk they haven’t been able to get passed for years.
It may be time to march on Washington and take the country back!!!
February 24th, 2009 at 1:54 pm This country has always been a great country, people took pride in their lives, helped others, fought to save it and their countrymen. The economy has had it’s ups and downs, but we pulled through. Then, somewhere along the line, we made it more fesible for our businesses to work outside of the states, thereby, less jobs available here. Then we gave mortgages to those not qualified and wondered why they got behind.
If the government wants to help the people, give them, the people, some money to work with–maybe no taxes to pay for awhile, or other arrangements. And let them, the people, be responsible for their own actions.
Instead, our representatives (mostly Democrats) decided THEY wanted everything, and despite telling the people there would be no pork barreling in any stimulus, gosh, did they decide to sock it to us. They can’t seem to understand that people are struggling — food and shelter is needed, not fish barriers and tennis courts and golf carts and the other items they managed to include without being honest with the people, and yet crying transparancy.
We do thank you Mr. Cantor, for representing Virginia and although Barack Obama says he hopes to change your mind, I hope you will hold strong with the values we have seen in you, and change his mind.
As for the American people not caring about pork projects – that’s a bunch of baloney.