Jobs and Growth
Overview and Principles
Job creation and economic growth is my top priority. As the CEO of Points of Light, I spent years working with business leaders across the country. It's innovative entrepreneurs, hard working small business owners, business executives and managers that create jobs in America. But our government can help create the conditions in which businesses can thrive.
Even with our serious challenges, Georgians have much to be grateful for and to be optimistic about. With upticks in housing construction, increases in real estate and stock prices, and more credit availability, our economy is gaining strength. We now lead the world in oil and gas production. We have the best higher education system in the world. We Americans are hardwired to seek opportunity, to be innovative and hardworking and to get things done.
As we move out of this recession, albeit too slowly, we are poised to lay the foundation for our future prosperity. We need government policies that promote a strong middle class, build self-sufficiency for low-income families, and ensure that every Georgian has a chance to become a productive and engaged citizen. We must invest in our infrastructure, ensure that our educational system at every level is teaching the skills our young people need to succeed in a rapidly changing economy, and reverse the downward trends in basic research and development funding. We also have to create a simpler tax code and roll back unnecessary regulations that impede business development.
In order to afford these necessary investments, we have to make tough choices and cut spending. Federal budget deficits and rising debt inhibit our ability to make long-term investments critical to growing our economy, including in education, research, infrastructure, and workforce training. We need to be making decisions now to address the long-term growth of entitlements. We need to make smart short and mid-term investments to drive growth, and make long-term fiscal decisions that will ensure a strong economy and expanded opportunity for the next generation.
Georgia's Economy Is At A Crossroads
Georgia is blessed with vast natural and human resources. Our state is home to top-tier aerospace and agribusiness sectors as well as a port and airport that are among the nation's best and busiest. We have world-class universities and strong technical education and workforce development programs. According to the US Chamber of Commerce, we rank in the top 10 among states that do the best job of nurturing entrepreneurs and startup businesses.
The recession hit Georgia businesses and families hard. Georgia's unemployment rate remains higher than the national average - 8.7% compared to 7.2% nationally in August 2013. On average, Georgians make less than other Americans (per capita income in the US was $42,693 and Georgia's was $36,869 in 2012). Recent studies have shown that Georgia children born into low-income families are finding it harder to make it into the middle class, and our young people trail the national average for on-time graduation from high school. Those who attend college struggle to pay for the education they need: the average student debt of a Georgia college graduate was $22,000 in 2011.
It is time for us to invest smarter, fix our long-term fiscal problems, streamline and strengthen markets and foster innovation to make us even more competitive in a complex and highly interconnected global economy.
Creating Growth & Opportunity In Georgia
Get Our Fiscal House In Order
Budget deficits. In order to grow our economy and create jobs, we must rein in federal spending. Every government program must be weighed: Is it essential? Does it get results? Is it redundant? These hard questions must be asked of every discretionary, federal expenditure. But as we cut spending, we need to use a scalpel, not an ax. Sequestration is the perfect example of "doing something that we needed to do in the worst possible way…in the worst possible way."
Our investments should be targeted to grow our economy, encourage growth and jobs, and ensure our national security. And we must confront the difficult choices that are necessary to cut our 17 trillion-dollar debt and get our country back on a responsible fiscal path.
Entitlements. Approximately 60% of the budget is mandatory spending programs, including entitlement programs such as Social Security, Medicare and interest on the debt. As a result of rising health care costs and the higher numbers of Baby Boomers reaching retirement age, Medicare spending alone is now 3.6 percent of our GDP and is projected to continue to rise. The trustees of the Medicare trust project that the hospital insurance portion of Medicare could be depleted by 2026, and Social Security will be forced to cut benefits by 23% in 2033 if nothing is done. We must pursue bipartisan entitlement reform to preserve Medicare and Social Security for those currently in or near retirement, take action to strengthen these programs for the future and do both in an affordable manner.
Tax Reform. To spur job creation, we need to have a tax code that is simple, fair and fuels economic growth. We need to lower our corporate tax rate, permanently extend the research and development tax credit and assess other provisions to ensure our tax policies promote innovation and growth.
Infrastructure. We need to upgrade our aging roads, bridges, mass transit and rail, water and sewage lines, and port infrastructure. We should do this because our businesses depend on reliable infrastructure. If we cannot get our people to their jobs and our goods to market in a speedy and effective way, we cannot compete in a global economy. China spends three times more on infrastructure than we do; Europe spends twice as much. Our economy is capital intensive, and yet we are making spending decisions that undervalue infrastructure. This not only inhibits our growth but costs Georgia jobs.
Research and development funding. According to the American Association for the Advancement of Science, "federal spending on research and development has declined by 16.3% since 2010, the fastest drop in a three-year period since the end of the space race in the 1970s." We cannot continue to lead the world in innovation and entrepreneurship unless we fund basic R & D. Google's search algorithm was developed as a result of a National Science Foundation grant -- we cannot let our research-funding decline if we are to compete internationally.
Education. Georgia has almost 90 accredited universities, colleges and technical colleges that produce 50,000-plus graduates a year. Georgia's young people can become the highly skilled, technologically savvy employees our economy needs. To do that, however, we have to improve the performance of our schools at every level, set high standards for success and make sure that college and skilled training is accessible and affordable.
Workforce Development. We need to do a better job of connecting our young people with jobs. As I travel around the state, business leaders consistently tell me that they need workers, but that they often can't find those with the right skills. We must work to expand public-private partnerships to provide our young people with training, experiential learning and apprenticeships that better equip them to meet the needs of employers in Georgia.
Entrepreneurship. According to the US Chamber of Commerce, Georgia is 9th among the 50 states in fostering innovation and entrepreneurship and 5th in growth among the self-employed. New startups and high-growth businesses are job generators- they create 88 new jobs a year compared with an average of two to three jobs among all businesses, according to the Kaufman Foundation. These entrepreneurs also bring multiple benefits to communities: more income, stronger local and state tax bases, and greater investment in their communities through schools, volunteer service, and charitable giving. The best environment for encouraging entrepreneurship in Georgia and across the country includes a simple and fair tax structure, strong educational and training systems, and creative business accelerator programs.
Streamline and Strengthen Markets
Trade. We must continue to seek trade agreements that provide international market opportunities for American products and services and grow good-paying American jobs. From the European Union to China, we must continue to be partners as well as competitors and challenge any trade barriers that unfairly disadvantage our American farmers or businesses.
Energy. The US now leads the world in oil and gas production, surpassing Russia and Saudi Arabia. North America could become energy secure by 2020, ensuring our independence from Middle Eastern oil. New energy technologies will further strengthen our position and deliver competitive advantages to both our energy companies and those that rely on affordable and sustainable sources of energy. Our energy policy must ensure that we maintain this competitive advantage internationally while we ensure that this growth is sustainable and environmentally sound.
Deregulation. We need to make is easier for self-employed workers and small businesses to work and create jobs. They are often overwhelmed by complicated regulations. We need to do a better job of assessing the cost of government regulations before any new ones are imposed as well as undertake a thorough review of the regulations that impact all businesses to ensure that they are necessary, streamlined, and have a minimal impact on job creation.
Research & Development. Our economic prosperity is based on our ability to bring new technologies and innovations to market. We must provide funding streams and tax credits for research and development, reduce the federal regulatory and tax burdens on businesses large and small, and develop public-private partnerships that improve access to higher education and better equip our students to meet the needs of employers.