Members of the House Republican leadership gathered yesterday to announce their new proposal for job growth. In the 2010 midterms, Republicans continually hammered Democrats for not focusing 100 percent of their time on job creation, though once elected, the GOP has spent the majority of their time gutting funding for liberals' favorite programs rather than restarting the economy. Republicans are likely shifting attention back to their pledge on jobs after Rep. Paul Ryan's budget plan imploded, with the party losing a traditionally Republican House seat in New York when Democrats successfully campaigned against Ryan's proposal to destroy Medicare and turn it into a voucher program.
The timing of the jobs plan might be a political stunt, but unemployment is still the most concerning economic problem for the country, so it's good for the Republicans to focus on the issue, right? Not exactly; their bold new plan is in fact just a slate of old ideas that lack specific details.
The proposal, titled "A Plan for America's Job Creators," is a brief 10-page document filled with more pictures and vague drawings than words. It trades in broad generalities rather than policy proposals. Following the disastrous rollout of the Ryan plan, the jobs proposal avoids making any grand, controversial changes when it does actually delve into specific topics. In their strategy to "Increase Competitiveness for American Manufacturers," the Republicans call for passing free-trade agreements with Colombia, Panama, and South Korea, each of which has been favored by President Obama. Or it suggests easing the visa system for highly skilled foreign workers, a cause frequently trumpeted by Democrats in the immigration debate. The plan calls for an investigation of unnecessary regulations, something the Obama administration is already internally examining; White House official Cass Sunstein in fact laid out the administrations progress toward that goal just yesterday in an editorial for the Wall Street Journal.
In one of their bolder claims, the Republicans call for lowering the corporate tax rate to 25 percent. The 25 percent mark is probably lower than Democrats would like in an ideal world, but reducing the corporate tax rate has appealed to both parties. The U.S. tax code is riddled with loopholes, creating a system in which the effective taxation rate for corporations is almost always far below the statutory 35 percent rate. Studies have indicated that closing all those loopholes would allow the government to reduce the tax rate to 27 percent without a loss in revenue collected. In fact, Democratic Sen. Ron Wyden called for a flat 24 percent rate for corporations in the overhaul of the tax code that he wrote with Republican Sen. Dan Coats.
While a few changes like these seem likely to garner bipartisan support, the plan is largely devoid of specific figures and details will likely muck up the process. Reducing the corporate tax rate would benefit both corporations and the U.S. government, but only if all the deductions are stricken from the books. And even if every measure from the plan is accepted, it would likely have next to no impact on the 13.7 million unemployed Americans. For them, the most troubling part of the plan may be the document's last page, which hits the Republicans favorite talking point: bringing down the national debt. The proposal calls for a $6 trillion reduction in government spending over the next decade. When the private market is still only beginning to crawl out from the recession, the government needs to continue to use its borrowing power to prop up the economy. More stimulus spending would be the biggest help for the unemployed, though that is essentially off the table at this point because there's no political will to push for it.
But the least the government can do is wait to reduce spending until the economy has righted itself. If Obama signed every aspect of the Republicans job-growth plan into law tomorrow, businesses would get a few items on their wish lists checked off, and the unemployed would still be left to fend for themselves.
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