Friday, April 20, 2012

Conyers: Trickle-Down Economics Inspired “Small Business” Tax Cut a Giveaway to the Wealthy That Does Not Create Jobs

WASHINGTON) – Representative John Conyers, Jr. (D-Mich.) released this statement following the House’s passage of H.R. 9, the “Small Business Tax Cut Act”, a trickle-down economics inspired tax giveaway to the wealthy that does little to spur small business growth or create jobs.     

U.S. Representative
John Conyers, Jr.
“Disguised as a small business tax cut, H.R. 9 is yet another attempt by the Republican Majority to create a new windfall tax break for the wealthy.  H.R. 9 is a fiscally irresponsible $46 billion tax gimmick which will increase the deficit and not guarantee any new domestic job creation or economic growth. This bill does not provide any incentive for employers to create jobs in the United States, and therefore will have no meaningful impact on our economy.  In fact, this bill still provides the tax break to companies that outsource the jobs of American workers.

“Congress should be passing measures such as infrastructure spending, which have a lasting impact on the economy.  Instead, the Republicans push H.R. 9, which according to the nonpolitical Joint Committee on Taxation, has an impact on the economy ‘so small as to be incalculable.’  There are far more effective ways to encourage job creation and economic growth than found in H.R. 9.  Last year, the Congressional Budget Office analyzed more than a dozen policy proposals for their impact on economic growth and job creation based on their budgetary costs.  It concluded that the policy reflected in H.R. 9 ranked next to dead last.  For $46 billion, the American people expect more than one new job for every $1.1 million in tax cuts in this wealthy business tax cut bill.

“The Republicans claim that H.R. 9 will help small businesses.  But instead of targeting those small businesses which could truly use a tax break, the Republicans have chosen to define a ‘small’ business simply by its number of employees rather than by any other descriptor.  Such a broad definition will include 99.6% of all American businesses, including those so-called ‘small businesses’ owned or managed by multimillionaire hedge fund and private equity managers, law firms and lobbyists, owners of sports teams, and companies which ship jobs overseas.  In fact, only 16 percent of the tax cut would benefit the 76 percent of small business employers making less than $200,000, while nearly half of the tax cut would benefit business owners with incomes exceeding $1 million.

“H.R. 9 is an ineffective proposal to maximize benefits for those small businesses – the local restaurants and mom-and-pop shop owners on Main Street – which create jobs and have a vested interest in our local communities.

“Bruce Bartlett, a former advisor to Presidents Reagan and George H.W. Bush, said it best when he wrote recently that H.R. 9 ‘will do nothing whatsoever to increase employment.  It is nothing more than an election year giveaway to a favored Republican constituency and should not be taken seriously.’  I could not agree more. 

“H.R. 9 is simply a handout of taxpayer money to the wealthiest Americans at the expense of the middle class.”

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