Tuesday, February 08, 2011

GUEST COLUMN: "State of the Union Missed the Mark on Spending" by Rep. Jean Schmidt

Rep. Jean Schmidt (R, OH-02)
By Rep. Jean Schmidt

President Obama has built a reputation for delivering an eloquent speech. In that respect, his State of the Union message did not disappoint. The President spoke of a future where cars don’t pollute, energy is abundant, schools are smart and effective, and America regains its footing as the financial and industrial powerhouse of the world. I’m all for that. The question is: How do we get there?

The President proposed more federal “investment” to reach our goals. But, investment is just a focus-group tested word for spending and people are already worried about all the money that has been spent to fix the economy – and the fuzzy math that has been pushed at us as proof that it has been effective. The facts show that we have added more than $3 trillion to the national debt since the President was sworn in a little more than two years ago. And, the unemployment rate continues to hover between 9 and 10 per cent. In parts of the Second Congressional District, it is much higher.

I believe the private sector holds the key to expanding our economy and growing jobs. But businesses are looking for something a bit more tangible than a hopeful speech before they make major purchases, hire new employees, or otherwise prepare for conditions to improve. According to Moody’s Investors Service, “. . . companies are looking for greater certainty about the economy and signs of a permanent increase in sales before they let go of their cash hoards, which they suffered so much to build.”

The federal government can help provide that certainty and instill confidence in the business community. The House started this process when we voted to repeal the recently enacted job-killing health care bill and, although the Senate refused to follow, I am hopeful that we can begin to chip away at it by other means. Just as important to instilling confidence in the private sector is that Congress act to get the federal government’s fiscal house in order. We must show that we are committed to getting the budget balanced. Simply freezing federal spending, as the President proposed, won’t reduce the massive federal deficit built up over the last few years. Since 2009, discretionary spending has increased by almost 25% and, if you count the so-called stimulus bill, it has increased by 84%. At a very minimum we need to cut federal spending back to the 2008 levels, so that we can see a significant reduction in the federal deficit.

I am ready to work with the President on other proposals he made, such as simplifying the tax code and keeping our companies competitive in the global marketplace. And, I stand ready to work with my colleagues to achieve the vision of a better America that we all share. But, more government spending will not lead us where we want to go. To get there, we must instill in private companies the confidence that allows them to begin investing again.