Congress Must Tackle Regulatory and Tax Reform
Robert Luddy is the president of CaptiveAire, and a Job Creators Alliance member.
Now that Congress is back in session, there is a renewed focus on the so-called “fiscal cliff” that’s quickly approaching at the end of this calendar year. There has been substantial media coverage and attention surrounding the uncertainty that this looming cliff has been causing in the business community. Not knowing for sure whether tax rates will be the same, somewhat higher, or significantly higher has had a paralyzing effect on business investment, growth, and hiring.
But as we near the fiscal cliff, the debate has also shifted focus to the issue of our nation’s tax structure–and the need for comprehensive tax reform. The most common complaint from small businesses is that the current tax structure is too encumbering and costly to comply with because it’s overwhelmingly complex. Moreover, now that the United States has the highest corporate tax rate in the world, it is becoming clear that our tax structure is making it more difficult for us to compete in the global marketplace.
It is appropriate that our government consider the challenges job creators currently face. Although we have experienced some economic improvement over the last year, we are still nowhere close to where we want–or need–to be with regard to economic growth and job creation. Many companies are presented with opportunities to expand but can’t commit to such risky behavior due to tax and regulatory uncertainty on Capitol Hill. Many business owners are capable of creating more jobs but are reluctant to do so because there is no clear vision as to what the future might hold.
The need to address both the fiscal cliff and comprehensive tax reform is compounded by the urgency brought on by a sluggish economic recovery. Last month saw a meager 96,000 jobs created in the private economy while nearly 370,000 people gave up looking for work altogether. The unemployment rate has been higher than 8 percent for 43 consecutive months.
Congress and the administration should make it a priority to meet with real world job creators–the small business owners and entrepreneurs in our communities–and learn exactly which regulations are holding back their ability to increase employment and generate more output. If policymakers had a clear understanding of the rules and regulations that impede growth, our nation would be on its way to a faster recovery.
Until our elected leaders remove D.C.-fueled uncertainty and implement commonsense, progrowth regulatory and tax reform, not only will America’s self-defeating business environment persist, but job creation will remain stalled. Job creators’ message to Congress as they return to Washington this week is: “Do the work of the people, so the people can get back to work.”