The Key to Economic Growth Statement

Apr 27, 2017
Small Business: The Key to Economic Growth 
Statement
Hon. Dwight Evans, Ranking Member 
United States House of Representatives, Committee on Small Business
Subcommittee on Economic Growth, Tax, and Capital Access
Thursday April 27, 2017
 
 
Ten years ago, our nation was hit with the largest economic disaster since 1929. During the financial crisis of 2007-2008, we saw housing prices drop and unemployment skyrocket. By 2009, unemployment had reached ten percent nationally.
 
Fortunately, today, several years of steady and sustained growth have put our economy on the right track. Unemployment has remained below five percent for well over a year. In fact, last November, the employment rate dipped to 4.6 percent, the lowest it had been since 2007.
 
We have also seen considerable job growth. Over the course of the Obama Administration, America gained over 11 million new jobs. His presidency saw 75 straight months of job creation, the longest continual stretch of job growth in the US since 1939. Finally, median household income surged in 2015, rising by 5 percent, for the first time since 2007. 
 
These economic markers indicate that our nation has made great progress, yet, we are still feeling the effects of the great recession. Access to capital remains a major challenge for small business and business formation is at a historical low. GDP is growing at an average of just two percent, and many economists do not believe a significant increase is likely.  That is why it is so critical we examine our current economic situation and the policies that will boost economic growth.
 
Unfortunately, as the Trump Administration approaches its 100 day mark, policies that are likely to reverse these trends are scant. The Administration has offered proposals that rely on failed economic theories that will help the wealthy at the expense of the middle class. He has irresponsibly slashed regulations, proposed huge tax breaks for the wealthy and proposed major cuts to funding for education, health care, and programs small businesses rely upon – all while likely raising the deficit. 
 
In order to truly grow our economy, we need to invest in our nation’s infrastructure, our human capital, and our small businesses. Due to chronic underinvestment, America’s infrastructure is crumbling. The state of infrastructure has a big impact on the economy’s ability to function and grow. 
 
Investing in infrastructure creates jobs. Increasing spending by just 1 percentage point of GDP would create 1.8 million jobs with 1.3 million in the construction industry alone, one of the industries that was worst hit by the financial crisis.
 
Small businesses have been called the backbone of the American economy. As we evaluate tax policies and the effectiveness of regulations, we must ensure that small firms have a seat at the table. By supporting small businesses and entrepreneurs, we will spur job creation and economic growth.
 
Finally, as we develop policies to spur economic growth, we must ensure that all Americans can benefit from it. That means ensuring economic opportunity for all individuals. Barriers to economic opportunity can include a lack of access to quality education, health care, employment, housing, and equal pay.  All of these issues directly impact our economy and our small businesses and their workforce. We must examine policies that directly address these barriers to not only create a more equal society, but a stronger one. 
 
I look forward to today’s hearing and thank the witnesses for being here.