Congress Still Has Work to Do--This Year

No matter which candidate you supported, we can all agree that restoring economic growth and creating jobs should be the nation's top priority. The U.S. economy is in a recession and continues to be buffeted by the collapse of the housing market, a severe liquidity crisis, and the deleveraging of financial markets. Experts predict this downturn will last longer and run deeper than the last two recessions. We agree.

 

At the time of this writing, it's unclear if Congress will convene a lame-duck session. But sooner or later, Congress must enact a second stimulus package to bolster our economy, stem job losses, get Americans spending, and shore up key industries.

 

Congress must assist weakened industries whose health is important to economic recovery. Take housing, for example. A bursting housing bubble was primarily responsible for this downturn, and recovery depends on clearing the market of excess housing inventory. This can be accomplished through the revival of tax credits to encourage home sales. Such credits were instrumental to resolving the 1975 housing crisis and would dislodge the current logjam in the housing market while providing relief to American homeowners.

 

Next, consider the auto industry--an essential segment of America's manufacturing base and national security infrastructure. U.S. automakers have suffered plummeting sales as a consequence of the credit crunch and are floundering. The ramifications of their collapse would reach far beyond Detroit to parts manufacturers, car dealers, and others in the supply and distribution chain. Millions of jobs are at stake. By enacting provisions to restore liquidity to the automotive industry's financing sector, Washington can help keep the factory doors open and satisfy customer demand.

 

We must also spur consumer spending. A second round of taxpayer rebate checks would provide the economy with a much-needed shot in the arm. Also, immediate funding of ready-to-go infrastructure projects could create thousands of good-paying jobs while meeting America's economic, safety, and energy needs.

 

There will be no recovery until America's businesses start doing better. A series of commonsense tax reforms could ease liquidity pressures and spur business investment. Reducing the corporate capital gains rate to 15%, for instance, would unlock appreciated assets held by companies, providing capital that could be redeployed more effi ciently into the economy. Adopting a temporary investment tax credit would promote investment during the downturn.

 

Some would argue that after a long and hard-fought election, we should just leave things to the new Congress when it convenes in January. We strongly disagree. During this time of economic crisis, there can be no delay--Congress has work to do.