Reviving a Sluggish Economy

 

 

By Thomas J. Donohue, President and CEO, U.S. Chamber of Commerce

 

With the U.S. economy struggling, we need policies that will spark immediate business investment and consumer spending.

 

To encourage capital investment, policymakers should consider enhancing the cost-recovery period for business investment by enacting some form of bonus or accelerated depreciation. Increasing Section 179 small business expensing and making it more widely available would spur investment. Carefully constructed investment tax credits would have a similar impact.

 

To get cash immediately into the hands of consumers, policymakers should consider retroactive marginal income tax rates for individuals or, possibly, tax rebates. However Congress decides to help consumers, it must do so quickly. Cash needs to find its way into their hands by spring to have any mitigating effect on the economic slowdown.

 

Policymakers should also act to improve the long-term health of the U.S. economy. U.S. corporate tax rates-the second highest in the world-should be lowered.

 

We must continue to create overseas opportunities for U.S. companies, starting with congressional approval of pending trade agreements with Colombia, Panama, and South Korea.

 

Finally, we need to keep chipping away at the deficit by taking steps to control wasteful government spending.

 

Measured steps to ensure greater investment, consumption, and job growth-rather than a bailout of individual sectors or a dramatic increase in government spending-will get our economy humming again.