In the past two years, there has been a stream of frustrating news regarding the state of our economy.
Since March 2009, unemployment has averaged 9.5 percent. With those sobering facts in mind, our federal government is expected to hit the national debt limit at the end of this month, meaning we will reach the legal limit that our country is allowed to borrow.
Current ongoing negotiations to raise the national debt ceiling have revealed fundamental differences in opinion about what steps our country needs to take to jump start the economy and ensure America’s future is bright for the next generation.
Washington has a spending problem, not a revenue problem. Under both Democratic and Republican administrations, the federal government has spent too much. I have repeatedly said that any increase in the debt limit must be accompanied by spending reforms and cuts equal to or greater than the debt increase.
However, now the president and congressional Democrats continue to insist that the way to fix our debt crisis is with new, higher taxes. First and foremost, raising taxes will destroy jobs. If we want people to hire new employees, invest and expand, raising taxes will accomplish the opposite. Presidents who raised taxes during tough economic times paid for it down the road with higher unemployment and reduced payrolls.
Instead, history has shown us that reducing tax rates stimulates growth, reduces tax avoidance, and can actually increase the amount and share of tax payments generated by the highest earners.
House Republicans already passed a House budget plan, which I supported, to put our nation back on a path of fiscal sanity and promote future economic growth. This budget closes special-interest tax loopholes, while lowering our corporate tax rate.
Because we have the highest corporate tax rate in the industrialized world, American companies currently keep their revenues in foreign countries. By bringing our corporate tax rate in line with the rest of the world, companies will repatriate their profits and pay taxes here in the United States. In our global economy, we need to make America more competitive, not less so.
We cannot continue to spend money we don’t have and pass the burden on to the next generation. And we certainly should not be discouraging job creation and growth with new taxes.
As debt limit negotiations continue, I hope that the president will show leadership in recognizing our need to cut up the credit card and enact policies that encourage job growth from the private sector. This is an opportunity to set our country back on a sustainable path and restore fiscal responsibility to Washington.