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Meehan Says State of the Union Should Address Job Creation, Controlling Government Spending
Urges consideration of a payroll tax holiday to stimulate consumer spending,
as well as other initiatives to encourage small business job growth
DREXEL HILL, PA – On the eve of President Barack Obama’s State of the Union address on Wednesday evening, former U.S. Attorney and candidate for Congress Pat Meehan called on the President to focus heavily on economic and jobs creation issues, as well as specifics of a potential spending freeze on discretionary spending to control federal deficits.
“The nation is in desperate need of a broad-based plan to stimulate the economy and create jobs,” said Pat Meehan, who is running for Congress in Pennsylvania’s 7th Congressional District. “When you look at the major economic stimulus efforts that have come out of Washington over the past year, they have been far too targeted to specific sectors of the economy, such as automobile manufacturing. But that is only a small percentage of the whole -- far more has been going to states such as California to fill holes in their budgets. These types of targeted efforts leave the general public with the impression – right or wrong – that special interests in Washington are picking the winners and losers of the federal government’s stimulus efforts.”
“It is my hope that the President will use this opportunity to lay out an economic recovery plan that has a far broader impact on the economy, with an emphasis on small business,” said Meehan, noting that small business has accounted for two-thirds of jobs created over the past 35 years.
Specifically, Meehan said he would like to see the following concepts he has proposed for economic recovery and job creation addressed in the State of the Union address:
- Suspension of the payroll tax for a set period of time, placing more money in the hands of workers to spend locally. This will create an impact through a much broader variety of economic sectors that have not seen the benefits of previous stimulus efforts.
- A job creation tax credit of 25 percent for small businesses hiring their first or second employee, an initiative that would incentivize solo practitioners to create hundreds of thousands of new jobs. Such a targeted tax credit is needed to provide the federal government with the biggest impact for its investment, since studies have shown that larger employers usually only hire employees that they would have hired regardless of the existence of the tax credit.
- Increase the tax write offs that a new business can take in its first year. With so many well-qualified and experienced Americans in their 40s and 50s laid off in the current economy, we should be fostering their entrepreneurial spirit, especially considering that new firm formation is a major factor in new employment growth and most employees are generated in the first few years of a firm’s existence. Major Fortune 500 companies such as Disney, Burger King, Fed Ex, and Microsoft all started during periods of economic downturn. Meehan said that by providing the incentives for experienced workers to dream big and start their own business, we can help fuel job creation through the creation of new innovative businesses.
“In talking with small business owners, it is clear that their top concern is depressed spending by consumers and lower sales, which is hampering their ability to grow and create jobs,” said Meehan. “Suspension of the payroll tax for a designated period of time will put more money directly into the hands of workers to spend in their local communities in a variety of business sectors. In the process, we will provide a much-needed boost to a broader-range of businesses that have not benefited from previous stimulus efforts.”
“Similarly, a job creation tax credit for the hiring of a first or second employee and increasing tax write offs for new business start-ups will have a much more far-reaching impact than we witnessed from targeted stimulus efforts like clash for clunkers,” said Meehan. “The federal government needs to be encouraging innovation and entrepreneurialism and stop focusing on a handful of favored industries.”
Meehan also said he would like the President to spell out in greater detail how Congress and the federal government can rein in federal spending.
“Reports indicate that the President will propose a freeze on discretionary spending,” said Meehan. “While I support such a proposal, the American people need to hear in far more detail what such a freeze means and entails. The rhetoric needs to match up to the specific details of such a policy. For example, will such a spending freeze apply to all types of non-security federal spending, or will certain types of spending be exempted? Will the spending freeze apply to 2008 or 2009 budget levels, or will it apply to fiscal year 2010 budget figures, spending that Congress increased by 16.8 percent over the past two years? While very appealing as a talking point, the truth is that only a very small percentage of the overall federal budget will be impacted by the freeze.”
“Of equal concern to me are the dollars coming back from the large banks and financial institutions that received bailout funds from American taxpayers,” said Meehan. “It is imperative that those funds be used for true reductions in deficit spending and are not dumped back into pet projects of legislators. We need to keep a close eye on Congress to ensure they do not use this repaid money to fund new backdoor government spending increases for special interests.”
“As they say, the devil is in the details,” said Meehan. “There will be tough choices in the months and years to come. We need to make the right choices that will have a genuine impact on controlling the deficit and putting people back to work.”
About Pat Meehan
A former U.S. Attorney for the Eastern District of Pennsylvania and the former District Attorney of Delaware County, Pat Meehan has a proven record of rooting out government waste and corruption, prosecuting tough criminal cases, and implementing innovative new programs to make our communities safer. As U.S. Attorney, Meehan helped coordinate the region’s terrorism preparedness and response, held manufacturers responsible for illegally discharging hazardous materials into the region’s waters, and established a group to crackdown on predatory lending. Pat, his wife Carolyn and their three sons Patrick, Jack and Colin, reside in Drexel Hill, Delaware County. For more information, please visit www.meehanforcongress.com.
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