CENTREVILLE Responding to President Barack Obama's televised speech on Thursday, U.S. Rep. Andy Harris, R-Md.-1st, said much of the president's proposed $450 billion "American Jobs Act" looks like another failed stimulus plan. He's calling it "Stimulus II."
The White House has issued a fact sheet outlining proposals in the act, but the legislation has not been forwarded to Congress. In a telephone interviewm Harris said several proposals in the bill appear to have merit, but he said overall the plan represents more government bureaucracy without money to pay for it.
In a press release Thursday, Harris stated his general opposition to the bill.
"Over Labor Day weekend I met with many small business owners on the Ocean City boardwalk a common theme I heard from those potential job creators was their desire to get government out of the way so that they could do what they do best: grow their businesses and create American jobs. President Obama's newest spending plan is nothing more than a second stimulus bill.
"Just like the first stimulus passed by the previous Congress, it will not create jobs, but instead delay recovery, increase the debt and grow the size of government. I believe that common sense ideas like a balanced budget amendment, elimination of job-destroying regulations and making America energy independent will create American jobs and get us out of this recession."
According to Harris' press secretary, Ryan Nawrocki, the congressman spoke with representatives of the Harrison Group Resort Hotels, Park Place Jewelers, and several other businesses while in Ocean City.
On Friday, Harris spoke in more detail about the president's speech.
"I was disappointed that the president didn't suggest any new ideas in terms of getting our economy and the jobs situation improved," he said. "It really was more of the same, another stimulus bill that we would have to borrow money to implement. I don't think it would create the jobs that the president had hoped for."
The Obama administration says the bill will be fully funded. According to a White House fact sheet, the president "will call on the Joint Committee to come up with additional deficit reduction necessary to pay for the Act and still meet its deficit target. The President will, in the coming days, release a detailed plan that will show how we can do that while achieving the additional deficit reduction necessary to meet the President's broader goal of stabilizing our debt as a share of the economy."
Harris said the bill will have to be examined when Congress gets a chance to read it. He said the bill will likely get fast-tracked but disagreed with the president's repetitive rhetoric to pass it "right now."
"We really do have to examine where the president is going to suggest that the money for this comes from, because if he doesn't have funding then we actually have to borrow this money from the Chinese in order to implement the bill, and I don't think that would be sound policy."
Harris said he thought two proposals Obama spoke about in his speech could gain bi-partisan agreement. The first is a tax credit for hiring veterans returning from war.
"I think we do owe that to our veterans, and I think we should do that," said Harris.
Another proposal mentioned closing corporate tax loopholes, although it lacked specific details, Harris said. "It would allow us to bring down our corporate income tax rate so that we could be competitive in the global economy, and I think that's very important. But again, the speech lacked any specifics as to how far he was suggesting that we lower that corporate tax rate."
Harris said Obama's proposal to expand the payroll tax cut for small businesses would not provide long-term benefits.
"When I spoke to some small businessmen and women about whether that really would help them create jobs a one-year temporary cut in payroll deductions they felt that that really wasn't very helpful. What businesses needed was a long-term assurance, not just a one-year stop-gap measure. That's where although on the surface it would seem that a Republican would naturally support that kind of tax cut, in the end, if we're going to cut taxes, and therefore increase the deficit by cutting taxes, we better be certain that it's for a policy that we feel confidently will increase jobs in America."
Harris reacted positively to Obama's proposal to extend the first-year expensing incentive, which encourages businesses to invest in their business and to expand. Under that incentive plan, included in the Tax Relief Act of 2010, set to expire Jan. 1, 2012, businesses investing in new equipment can deduct 100 percent of that investment immediately.
"But that's a relatively minor part of the bill," said Harris. "The major part is the short-term payroll tax cut, which really is not going to stimulate the economy the way, I believe, the president thinks it will. We've already tried it and it hasn't."
Harris said the country couldn't afford another large plan that fails.
"This is $457 billion. We worked really hard and the nation watched us toil to get our deficit below $1 trillion. The last projection is that next year's deficit, for the fiscal year starting October 1, will actually be just under $1 trillion. If we don't find a way to pay for this, the president's plan will balloon that deficit back up to $1 trillion and all of our work will have been for naught in terms of getting our debt and deficit under control."
Harris and fellow conservative Republicans believe improving the country's finances will increase optimism in the worldwide financial markets and trigger an upswing in the global economy.
Harris disagreed with Obama's hard stance on maintaining collective bargaining rights.
"In the fiscal situation that many states and localities find themselves, I think that collective bargaining agreements really have to be revisited, just like every other aspect of the budget has to be revisited."
Harris said everyone agrees that entitlement programs need to be preserved, but he questioned how Obama expects to do that with his proposed plan.
"In the same speech where he said he wants to reform Medicare and Medicaid to preserve it for the future, the president put out a payroll tax holiday scheme which will actually make Social Security insolvent faster.
"If we're going to spend that kind of money, is there any evidence that it's going to work any better than it did last time? The evidence from last time I think is pretty dramatic that the $800-plus billion stimulus bill of 2009 really did not deliver on the promise of increased jobs and decreased unemployment."