Forum on Job Creation
On March 16, the House Republican leadership hosted a forum on job creation with business leaders from across the country discussing the obstacles to growing their companies. Majority Leader Eric Cantor said, “We believe that you need to listen to those who are willing to take a risk and bet on America.” He added that we should ensure that we best position our country for entrepreneurship. Speaker of the House John Boehner said that many Americans continue to ask, “Where are the jobs?” In response, the House will focus on four areas to help promote economic growth and job creation: (1) “Stop the spending binge” in Washington and maintain fiscal discipline, (2) hold agencies accountable in the regulatory process and strive for a more collaborative process in drafting new rules, (3) promote free trade, and (4) bring about comprehensive tax reform that promotes growth and entrepreneurship.
Carl Schramm noted that policymakers should be aware of the wisdom of Ewing Marion Kauffman, who said, “Make a job, don’t take a job.” One takeaway from current research, from the Kauffman Foundation and others, is that policies should be centered on new firm formation. In many ways, his comments echoed those from the last month’s State of Entrepreneurship address, which also highlighted a number of recommendations for creating new ventures.
Darlene Miller, the President and CEO of Permac Industries, a manufacturer of precision machine products, said there are opportunities for growth but her company is stymied by both uncertainty and regulations. Her comments set the tone for much of the forum. On taxes, for instance, she said that there needs to be greater long-term certainty in the tax code. Safra Catz, the President of Oracle, went a step further. She noted that capital goes where it gets the best return, a central tenet of finance. The United States has not put itself in the best position to compete for that capital. “We need to change tax laws to encourage us to invest here,” she said. Rep. Jeb Henserling (R-TX), the Vice Chairman of the House Financial Services Committee, reiterated that comment by saying that “you cannot have the benefits of capitalism without capital.”
On regulatory matters, Speaker Boehner noted that the regulatory process in the U.S. is too often adversarial, which he said needs to change. Indeed, many of the participants cited examples where regulations stood in the way of their being able to effectively conduct their business. Ignacio Urrabozzo, Jr., the President and CEO of IBC Bank, said that he was spending more time with bank examiners than before. Belinda Schafer, the owner of Schafer Brothers Construction, told of her struggles with environmental permits. The risk of losing these permits has impacted her ability to get sufficient capital for her business, limiting her ability to grow. Meanwhile, Aris Papadopoulos, the CEO of Titan America, a cement maker, said, “It costs twice as much to invest in the U.S. because of regulation.”
Rep. Cantor used these comments to advocate for the “Regulations from the Executive In Need of Scrutiny (REINS) Act of 2011” (H.R. 10), which was introduced in the House by Rep. Geoff Davis (R-KY). This bill, if enacted, would require Congressional approval of significant regulatory actions. Major rules would be those that would impose annual burdens of $100 million or more, result in a major increase in prices, or adversely impact the competitiveness of American businesses. The REINS Act was one of the components of the “Pledge for America,” the Republican agenda for the 2010 election. Cantor said, “We have to get back to the American notion that if you work hard, you should be able to get ahead.”