Geoff Davis RSS Articles

The Difference between Lists and Action on Jobs

Mon, 14 May 2012 04:00:00 GMT

President Obama recently announced that he has a “to do” list for Congress on jobs. The list is posted to a virtual bulletin board and consists of five ideas for job creation, none of which balance the budget, reform the tax code, cut red tape or secure our energy future.

While the President was working on his five-point list, the House has been working over the past sixteen months to pass actual bills — more than thirty of them — to accomplish those goals. Call it our “done” list.

In March, we approved the “Path to Prosperity” budget plan, which recognizes that overspending is ineffective and hinders job creation. The bill cuts more than $5 trillion over ten years relative to the President’s budget, without budget gimmicks, and balances the budget minus interest payments on the debt by 2015.

Cutting runaway spending would help free up the private sector to create jobs. A 2010 study from Harvard Business School found that increased federal spending actually causes businesses to “significantly cut physical and R&D spending, reduce employment, and experience lower sales.”

In addition to budgeting responsibly, the Path to Prosperity puts forward a framework for tax reform, which will help job creators save money and incentivize growth by lowering rates and broadening the base. The budget plan closes tax loopholes and reduces the number of individual income tax brackets, which will help to decrease the hundreds of billions of dollars in tax compliance costs that Americans face each year. Additionally, businesses would face a maximum flat tax rate of twenty-five percent under this plan, which will help them hire and expand.

The House has also moved to cut unnecessary red tape and reform the regulatory process. The Regulations from the Executive in Need of Scrutiny (REINS) Act, which the House passed in December, would require congressional approval of all major regulations costing more than $100 million per year. The Obama Administration has proposed 212 such rules, which could come at a steep cost to businesses. The Phoenix Center for Advanced Legal & Economic Policy Studies estimates that for every $1 million in new regulatory spending, the private sector loses 420 jobs.

Additionally, the House has voted to fully repeal the President’s job-killing and tax-heavy health care law. According to a U.S. Chamber of Commerce study of small businesses, Obamacare is increasing uncertainty and reducing hiring, with 74 percent of businesses saying that the law makes it harder for their firms to hire new employees and 30 percent not hiring at all as a result. In addition to full repeal, the House has been working to repeal particularly onerous components, including a new 2.3 percent tax on medical devices that will increase costs for consumer and new taxes levied on employers who do not offer health insurance and individuals who do not purchase it.

Another prong of the House’s jobs strategy is adopting a true “all-of-the-above” energy plan that incorporates the full range of American resources. Recently, the House passed a transportation bill with the support of sixty-nine Democrats that mandates construction of the Keystone XL pipeline. This pipeline would create 20,000 direct jobs and 118,000 spin-off jobs, and it has broad, bipartisan support across the nation.

The House also approved the PIONEERS Act in February, which increases oil and gas development in the West, the Gulf and the Arctic National Wildlife Refuge (ANWR). The mining, oil and natural gas industries have generated 500,000 new jobs over the last five years, and continuing to incorporate these industries into a national energy strategy will help put people back to work.

All of the aforementioned House-passed bills are currently stuck in the Senate. The most relevant jobs “to do” list is for the Senate to get to work on the House’s “Done” list.

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If You Like It, You Might Not Be Able to Keep It

Mon, 07 May 2012 04:00:00 GMT

If you like your health care plan, you can keep your health care plan.” That is what we were all promised during and after the health care debate. Many were skeptical, and it turns out they have good reason. A new report shows that many of the 170 million American workers covered by their employers might not be so lucky.

A recent survey of seventy-one Fortune 100 companies commissioned by the Ways & Means Committee reveals that the health care law actually incentivizes employers to drop coverage through what was known as the employer mandate. Starting in 2014, this mandate was supposed to force employers into providing coverage by imposing a $2,000-per-employee fine on businesses that do not offer “affordable” health insurance for their employees.

So what happened? Economics.

In 2014, the bulk of the health care law — and the exorbitant costs that come with it — will go into effect. When the mandate goes into effect, it will be cheaper for many businesses to pay a fine than to offer health insurance. The seventy-one businesses surveyed for the report would spend $38.4 billion on insurance for active employees in 2014, as opposed to $9.9 billion in fines for dropping insurance coverage altogether.

The difference is $28.6 billion in savings, or about $400 million on average per business, for choosing to pay a penalty instead of offering insurance. The discrepancy is expected to grow even wider in the future. Even if an employer wants to continue to offer quality, affordable health care as a benefit and service for employees, he or she would probably find it difficult to make the math work when competitors drop insurance coverage in the face of rising health insurance costs in favor of the cheaper penalty.

For the seventy-one businesses surveyed, they would have a choice from the years 2014-2023 of spending an estimated $550.6 billion on health care for employees or $128.3 billion in fines. That is a $422.4 billion difference, or $5.9 billion per business surveyed — savings that are too large for most businesses to ignore.

Eighty-four percent of employers surveyed in the study believe that their health care costs will be higher than what they have paid in the last five years. It comes as no surprise then that consulting firm McKinsey and Co. found that thirty percent of employers will likely stop offering their employees health coverage after 2014. Additionally, eighty-four percent of businesses surveyed in a PricewaterhouseCoopers study said that they are likely to re-evaluate their benefits programs as a result of the health care law.

No one could blame them. Since the health care law increases insurance costs and financially incentivizes businesses to drop coverage for employees, the decision of offering prohibitively expensive insurance or paying a comparatively modest fine is unfortunately all too simple. So where does that leave an employee? Good luck finding a new health care plan you like in an insurance exchange system by paying out of your own pocket.

Effective health care reform should make it easier to access quality, affordable health care, not take it away. As we continue to work to repeal this disastrous law, Republicans are focusing our replace efforts on ways to do just that by bending the cost curve, increasing competition to lower prices, and cutting down on waste, fraud and abuse.

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REIN IN THE $10 BILLION REGULATION

Thu, 03 May 2012 04:00:00 GMT

While the Obama Administration claims they are cutting down on regulatory red tape, they are busy implementing an expensive, anti-growth, anti-jobs regulatory agenda.

Take the Environmental Protection Agency’s (EPA) Utility Maximum Achievable Control Technology (MACT) regulation, the most expensive rule ever imposed by the EPA on the power sector. Written by unelected bureaucrats, the Utility MACT regulation would set emission limits for coal and oil-fired power plants, as well as New Source Performance Standards for electric generating units.

By the EPA’s own estimate, the regulation will cost $10 billion.

These extraordinary costs will be passed on to consumers in the form of higher electricity prices. Already burdened by rising energy costs, the Utility MACT regulation will make it even more difficult for families to make ends meet and businesses to grow during our slow economic recovery.

The administration claims the benefits of the regulation will outweigh the costs, but an independent analysis of the rule found the administration wildly overstates the benefits of the regulation. This same independent analysis estimated the net employment impact of the Utility MACT regulation in 2015 would be equivalent to 200,000 full-time jobs.

Despite having tremendous consequences on our economy, the EPA has done this on its own without any congressional direction or approval. The Regulations from the Executive In Need of Scrutiny (REINS) Act would change that.

The REINS Act would require all major regulations, those costing more than $100 million, to be subject to an up or down vote in Congress before they can go into effect. Before expensive, job killing regulations written by unelected, unaccountable bureaucrats (like Utility MACT) can be implemented, REINS would provide a much-needed accountability check.

While the President claims he is cutting red tape, expensive rules like Utility MACT demonstrate his true agenda. The REINS Act will deliver the accountability the American people deserve.

Frankfort Spending Federal Transportation Funds on the Wrong Priorities

Mon, 30 Apr 2012 04:00:00 GMT

Lawmakers in Frankfort just concluded work on Kentucky’s transportation budget and Road Plan for the next two years. Unfortunately, they failed to prioritize sufficient funds to keep the Brent Spence Bridge project moving forward without delay.

Many may rightfully wonder why a bridge carrying an interstate highway across the Ohio River is an issue for Kentucky’s General Assembly. Kentucky’s Road Plan for the next two years determines which projects will get funding. This transportation budget spends $4.5 billion — including about $2.4 billion in federal funds — to pay for the projects detailed in the Road Plan. These dollars are the primary funding source for a project like the Brent Spence Bridge.

I support quick passage of a fiscally responsible, long-term federal highway bill. However, due to the congressional ban on earmarking, State governments will decide what projects are funded by the money provided in the federal bill.

Simply put, the ball is in Frankfort’s court. And while replacement of the Brent Spence Bridge is one the Commonwealth’s most pressing transportation needs, the General Assembly and the Governor have adopted a strategy of delay.

Absent from the tumultuous debate over the recently passed two-year Road Plan (HB 267) was a modest allocation of additional funds to keep the Brent Spence project on schedule. Governor Beshear’s budget request for fiscal years 2012-2013 for the project was $43.78 million, which was $24.22 million short of the $68 million needed by this July.

Frankfort never addressed the shortfall, despite the urging of eighty-five organizations, businesses and government officials from our region.

At this point, the General Assembly is conditioning funding on Kentucky and Ohio’s transportation departments producing a detailed financial plan by December 31, 2013. Without the needed funds for the next phase of the bridge project (the detailed design phase), which was scheduled to begin this July, the path forward is unclear. This could come at an unacceptable cost to taxpayers and the economy.

According to a recent report, the bridge project’s cost inflates $8 million each month the project is delayed. As such, delaying the project until after a financial plan is completed in December 2013 could add more than $150 million to the total cost. Although this alone is an eye-popping figure, even more money is at stake.

Each year, the Brent Spence Bridge carries $400 billion of freight. A study from the Texas Transportation Institute (TTI) estimates that this figure will more than double by 2030. However, the National Bridge Inventory classifies the Brent Spence Bridge as “functionally obsolete,” which means that the bridge fails to adequately accommodate traffic due to insufficient capacity, sight distance, and safety.

The same TTI study states that congestion attributable to the Brent Spence Bridge costs commuters 3.6 million hours of delay each year for passenger cars, and 240,000 hours for commercial vehicles. Completing the bridge project would reduce both problems by at least eighty percent.

All of these numbers provide plentiful evidence as to why the Brent Spence Bridge project is crucial. Since Frankfort controls the federal and State funds needed to move the bridge project forward, it can and should provide the funding necessary to move the project forward while additional financial planning is conducted.

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Davis Introduces Legislation to Incentivize Construction of Clean, High-Efficiency Coal Plants

Thu, 26 Apr 2012 04:00:00 GMT

With energy prices and regulatory burdens on the rise, Congressman Geoff Davis introduced legislation today to encourage clean, low-cost electricity production using the country’s most abundant energy resource, coal. The Supercritical Advanced Coal Project Incentive Act (H.R. 4826) creates an investment credit for power plants that use a high-efficiency method of coal-based power generation called “supercritical” technology.

“As older coal-based power plants reach retirement, this legislation provides an opportunity to help spawn a new fleet of plants for baseload generation,” Congressman Davis said. “Not only would this create jobs, but supercritical coal technology can reduce energy costs and emissions by increasing the efficiency of power generation compared to that of traditional coal plants. Incentivizing supercritical coal technology would promote job creation and reduce the electricity bills of families and businesses.”

“Instead of destroying America’s coal power plants and raising household utility bills, Rep. Davis would modernize them with targeted incentives that will reduce emissions through greater energy efficiency and put the U.S. squarely in the forefront of global clean coal technology development,” said National Mining Association CEO Hal Quinn.

Background:

Supercritical is a scientific concept that refers to the state at which high amounts of heat and pressure cause the liquid and gaseous phases of a substance to be indistinguishable. This helps fuel generate a greater amount of power than traditional plants.

The high heat and pressure allow supercritical coal plants to operate with greater efficiency. As a result of their increased efficiency, supercritical coal plants typically reduce emissions of carbon dioxide over a traditional coal plant by at least fifteen percent.

The Supercritical Advanced Coal Project Incentive Act would apply to coal-fueled boilers that reach thirty-six percent efficiency and operate at a minimum of pressure of 3,200 PSI. The amount of the credit would be equal to thirty percent of the taxpayer’s investment in the qualifying project, and the total amount of the tax credits under this proposal is capped at $1.25 billion.

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Tweeting Your Government

Mon, 23 Apr 2012 04:00:00 GMT

When it comes to the relationship between government officials and their constituents, Twitter is a key source for communication and sharing information. Since joining this social medium a little over a year ago, I have come to value the interaction and feedback Twitter allows with followers.

Elected officials are responsible for communicating with constituents to keep them informed. Twitter’s widely accessible characteristics helped to push an idea that originated with a Fourth District constituent to a broader audience across the nation.

Twitter helped to spread the word about the REINS Act in the lead-up to its passage last December. Those following my feed had easy, real-time access to a series of opinion articles on the bill — one written with Senator Rand Paul, another from the Wall Street Journal, an additional piece from Forbes contributor Wayne Crews and more — which stressed the need for regulatory reform and how the issue affects families and businesses. Additionally, to catch a glimpse of the House’s legislative activity before the vote on the legislation, users could access floor video via my Twitter feed. Leading all the way to the final vote in the House followers were able to track progress of the bill.

Amid the fast, whirlwind debate of the Stop Online Piracy Act (SOPA) in January, Twitter was a key tool for opponents of the bill to communicate with their representatives in Washington. Opinions from college students and others concerned about SOPA appeared in my Twitter feed, affording them the opportunity to engage directly in the debate and make their voices heard. Based on widespread engagement with Congress by Americans using Twitter as well as other traditional communications tools, SOPA was sent back to the drawing board.

While Twitter helps to communicate the goings-on in the legislature, it can also be useful at more unexpected moments.

Last month, a round of extreme weather pounded Kentucky with tornadoes and severe storms. Twitter proved to be a key communications tool as the storms moved through, and it was especially useful in the aftermath for volunteer and assistance coordination.

By Tweeting news from volunteers on the ground, my feed joined scores of others that shared recovery and relief information among constituents. Social media has proven effective on this front before, such as the disaster in Haiti, and it did so again with the Twitter activity of local news outlets, officials and Good Samaritans in the Commonwealth and beyond. Interaction with individuals as varied as a Kentucky meteorologist and a California Red Cross volunteer underscored how Twitter can bring people together to help a community after a disaster.

I invite you to follow me on Twitter at @RepGeoffDavis and share with me your thoughts on the issues most important to you. Congress has a number of matters to address in 2012 that affect families and businesses — reducing waste, fraud and abuse in our government by promoting better data sharing among agencies, continuing to advocate for regulatory reform, reducing our mammoth debt burden — and your input is a big contribution to the debate.

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The EPA is Wrong on Coal -- Again

Mon, 16 Apr 2012 04:00:00 GMT

Since assuming office in 2009, President Obama has piled billions of dollars in unaffordable burdens on electricity generation. Now his team of regulators at the Environmental Protection Agency (EPA) has launched another misguided assault on coal with no regard for the cost to American families and businesses.

The EPA’s most recent regulation prohibits any new power plant from emitting more than 1,000 pounds of carbon dioxide per megawatt hour of electricity produced. Today, the average coal plant emits 1,768 pounds, making compliance with this regulation next-to-impossible. EPA Administrator Lisa Jackson even admitted that the technology power plants would need to comply may only be available “within the next ten years.”

This represents another effort by the President to accomplish through regulation what he could not get approved by the people’s elected representatives. Congress has rejected cap and trade and other efforts to regulate carbon in the past, knowing the dramatic impact such burdens would have on energy prices, family budgets and our economy. The EPA, however, disregarded Congress’ will with its latest regulation, which is why Congress needs to reassert its control of the regulatory process from unelected, unaccountable bureaucrats.

The proposed regulation poses a serious threat to America’s energy future by making new coal plants economically infeasible and subjecting many current plants to extinction by regulation. Given the enormous contribution of coal to our country’s energy supply and the lack of suitable replacements for baseload generation, the price spikes in our energy bills and on almost all consumer goods would be unaffordable.

Coal is remarkably abundant: it accounts for ninety-four percent of the United States’ fossil energy reserve, which at current consumption rates is a 235 year supply. It is found in thirty-eight States, from the Rocky Mountains to the Appalachians. Significant deposits — more than eighty billion tons combined — sit underground in both the west and east ends of the Commonwealth.

This wide availability contributes to coal’s critical role in generating electricity. Almost half of U.S. electricity comes from coal, far more than any other natural resource. Because of its low price, it is easy to see why: coal has been the most affordable fossil fuel in this nation since 1976. Traditionally, it is less than one-fourth the price of petroleum and natural gas.

The coal industry employs 136,000 Americans, including 23,000 in Kentucky. According to the National Mining Association, anticipated increases in demand could lead to an additional 50,000 jobs within the next ten years.

Coal provides low-cost power and thousands of jobs; all of which will be difficult to replace. The Administration has continued to oppose the expansion of oil drilling, and although natural gas is at its lowest price in a decade, households and business cannot fully rely upon one energy resource to generate electricity.

The Energy Information Administration has found that when oil prices rise, consumers demand more natural gas instead of oil, which makes natural gas more expensive. If consumers switched their demand from coal to natural gas, as well — the result of the EPA regulating coal out of the market — the price of natural gas would soar even higher.

Energy prices are a major factor in determining the cost of living and cost of doing business. Substantially increasing the cost of energy through unreasonable regulation is a drag on our economy and a burden on our families.

Our country has a tremendous variety of natural resources, and our energy strategy should incorporate all of them, including coal. Democratic lawmakers like Senator Joe Manchin (D-WV) and Governor Earl Ray Tomblin (D-WV) agree that the Obama Administration has gone too far in regulating this resource. A vast supply of coal is in their backyard, as it is in ours in Kentucky. But the importance of coal to our economy stretches far beyond these two States. The EPA is out of line and out of touch and needs to be reined-in.

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Regulations Blog: The EPA is Wrong on Coal -- Again

Mon, 16 Apr 2012 04:00:00 GMT

by Congressman Geoff Davis

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(Congressman Davis published this column April 16, 2012.)

A Choice Between a Responsible Budget and an Unsustainable Debt

Mon, 09 Apr 2012 04:00:00 GMT

House Budget Committee Chairman Paul Ryan put it best: “This coming debt crisis is the most predictable crisis we’ve ever had.” We have a choice of two directions for our country: we can adopt a responsible budget that preserves our future or continue to spend ourselves into a Greek-style disaster.

In the House, Republicans for the second straight year passed a long-term, fact-based budget plan that addresses our debt burden. Chairman Ryan’s budget, “The Path to Prosperity,” grabs control of our deficits now and reins in exploding health care costs — all without raising taxes. The President is constantly in search of a “fair” solution, and we have one with this blueprint.

The Path to Prosperity treats our debt burden as the spending problem it is instead of an excuse to raise more revenue from job creators. With four straight years of trillion-dollar deficits and a total debt in excess of $15 trillion, Washington has spent well beyond its means for far too long. The House Republican plan cuts spending by over $5 trillion relative to the President’s budget, and it does so in a responsible manner that protects seniors.

This proposal does not alter Medicare for current beneficiaries or those nearing retirement. In addition, it gives future retirees the flexibility to choose the plan that best fits their needs or to stick with the traditional Medicare plan, and it does so without bankrupting the system. By ensuring that Medicare is on a more sustainable path, we can preserve and strengthen the system for current and future beneficiaries.

The budget also proposes to strengthen our economy by enacting pro-growth tax reform. The Path to Prosperity simplifies the tax code and reduces rates for everyone. This plan moves from the current six individual tax brackets to two at rates of ten and twenty-five percent. In addition, it reduces our corporate tax rate — currently the highest in the industrialized world — to a competitive twenty-five percent. In these times of financial strain and low growth, this tax reform proposal would get our economy moving again and keep more money in the pockets of hardworking Americans.

The Path to Prosperity puts us on the road to a balanced budget, a growing economy, and a smaller, more manageable debt. These are the goals we need to achieve to position our nation for a stronger future.

Unfortunately, the President and the Senate are on a different page. The President’s blueprint, which imposes $2 trillion in tax increases and adds $11 trillion to our debt, falls woefully short of addressing our fiscal or economic challenges. The President’s budget has not received a single “yes” vote in Congress.

While the President’s budget proposal is impractical and unpopular, the Senate Democrats have not even bothered to offer one. They have not passed a budget in over 1,000 days.

By the year 2037, the nonpartisan Congressional Budget Office projects that the U.S. economy will collapse — if we fail to adopt a solution to our fiscal challenges. Given the options before the Congress, the question of which budget is our best choice is clear: The Path to Prosperity.

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It's Never Too Early to Learn Financial Literacy

Mon, 02 Apr 2012 04:00:00 GMT

Maintaining good personal financial practices and planning for the future can provide the foundation for lifelong security and stability. National Financial Literacy Month is a great time to learn more about ways to make these important habits easier.

By establishing good habits, individuals can protect and maximize the value of their dollars. A number of public and private organizations provide a wealth of tools to aid the learning process.

MyMoney.gov, the Financial Literacy Education Commission’s website, is an online handbook that helps consumers handle financial decisions both big and small. One of the website’s most useful tools is the “Life Events” page, which categorizes financial information by personal circumstances. Whether planning for the birth of a child or the end of a career, MyMoney.gov can advise people of all ages.

While financial education is important at any age, our nation’s youth face particular challenges. Young Americans are entering adulthood in uncertain economic times, and beginning their adult lives with knowledge of responsible money management is crucial. Mismanaging income and debt early in life are hindrances that can plague a young person for decades.

The Federal Deposit Insurance Corporation (FDIC) has a program entitled “Money Smart” that caters to individuals ages thirteen and over. This guide lets users learn at their own pace the basics of handling money and interacting with financial institutions. The FDIC offers the self-taught program on CD-ROM free of charge.

Other free resources include the instruction guide “Banking Basics” from the Federal Reserve Bank of Boston, which provides an overview of the banking system for young people; and the National Public Radio series “Money Counts: Young Adults And Financial Literacy,” which has a vast collection of articles on personal finance that detail real-world stories and the importance of budgeting.

Monitoring your credit record is also a key component of personal finance for all ages. In 2003, Congress passed a law that allows every American to annually obtain one free credit report from each of the three top credit reporting agencies: Equifax, Experian and TransUnion. In addition to providing an overall picture of your financial standing, reviewing your credit report regularly can help you detect identify theft and fraud if something unfamiliar shows up on the report.

Unfortunately, there is a degree of risk in a world where many financial transactions take place online and technology is rapidly changing. That is why the FDIC has an Identity Theft & Fraud page to help individuals guard against criminal behavior before it happens. In the unfortunate event that a person falls victim to identity theft, the Federal Trade Commission has a how-to guide for fighting back. While vigilance alone cannot stop criminals from bad behavior, it can help reduce instances of identity theft

Financially-sound households contribute to family stability, personal responsibility and solid footing for your family’s future. Financial literacy is worth it — and April is a great time to learn why.

For more tips on financial literacy, visit:

U.S. Financial Literacy and Education Commission
http://www.mymoney.gov/
888-MyMoney (696-6639)

Jump$tart Kentucky
http://www.jumpstart.org/states-kentucky.html
502-573-3390

Federal Deposit Insurance Corporation (FDIC)
http://www.fdic.gov/consumers/consumer/moneysmart/index.html
877-275-3342

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