Tax hikes equal jobs lost

Photo of Rep. Joe Pitts
Rep. Joe Pitts
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      Rep. Joe Pitts

      Joe Pitts represents the 16th Congressional District of Pennsylvania, a diverse district stretching from the western Philadelphia suburbs further west into the Pennsylvania “Dutch” Country. Joe Pitts’ life and career have been wide-ranging as well: he has worked as a teacher, a small business owner, an Air Force officer, and a legislator. In addition to Pennsylvania, he has lived in Kentucky, the Philippines, and the various places the Air Force sent him.
      Joe brings this rich and varied background into his work as a legislator. The fact that he joined the Air Force because he couldn’t afford to raise his family on a teacher’s salary helps him understand the hardships many people are going through. His combat experience gives him an appreciation of the sacrifices of our men and women in uniform. His time as small business owner gives him a better understanding of how government policies can help or hurt job creation. His time living abroad gives him sensitivity and insight into how our nation is seen abroad and a strong desire to fight for human rights.

      Joe is an independent-minded conservative who knows that Republicans lost their moral authority during the last years of the Republican majority. He has a record of making up his own mind about legislation. He voted against one-third of his own party’s appropriations bills because they spent too much. He doesn’t do “earmarks.” He opposed President Bush’s signature legislation, the No Child Left Behind Act, because it spent too much and did too many things that were best left to states and school districts. Once, on the floor of the House, he stared down then-Speaker of the House Dennis Hastert, Majority Leader Dick Armey, and Republic Whip Tom DeLay and successfully defeated a major bankruptcy reform bill because he found it discriminatory.

      Joe is a family-oriented conservative who believes strong families are the key to America’s prosperity. While others debate whether more or less regulation, this or that government program, or higher or lower taxes will make America stronger, Joe knows that the family is the fundamental building block of society. No amount of government spending can make a child succeed unless that child has the values and desire to succeed that only a strong family can instill.

      Joe is the son of an army officer who returned to the Philippines after World War II as a missionary. Joe spent much of his youth in Philippines, where some of his childhood friends had spent their earliest years in Japanese detention camps. He attended Asbury College in Kentucky, where he met his wife Ginny. Joe received a Master’s Degree in Education from West Chester University in Pennsylvania.

      Joe and Ginny taught school in Kentucky until the birth of their first child. Not long after, Joe volunteered for the Air Force, serving from 1963 to 1969. He rose to the rank of Captain and flew 116 combat missions on B-52s during Vietnam. He was a navigator and electronic warfare officer. It was that experience that led him to found the Electronic Warfare Working Group in Congress, advocating for critical technological investments that are currently saving lives in Afghanistan and Iraq.

      After leaving the Air Force, Joe returned to teaching math and science at Great Valley High School in Chester County, Pennsylvania.

      At the urging of his friends, Joe unexpectedly ran for the Pennsylvania House of Representatives in 1972 and won. His candidacy was part of a reform movement within the Chester County Republican Party known as the “Independents.” His victory sent a powerful message that from then on democracy, not machine politics, was going to rule in Chester County.

      Joe served for 24 years in Harrisburg, eventually chairing the House Appropriations Committee—a position he attained specifically because of his reputation for ethics and fair dealing. In that position, he worked with governors and colleagues in both parties to balance eight state budgets in a row, even during the recession of 1990-1991—without a federal bailout.

      In 1996 Joe was elected to Congress after winning a five-way primary election and a well-funded Democrat in the general election. Before his appointment to the important Energy and Commerce Committee, Joe served on the House Budget Committee, the International Relations Committee (now known as the Foreign Affairs Committee), the Small Business Committee, the House Armed Services Committee, and the Transportation and Infrastructure Committee.

      As a member of the Budget Committee, he co-wrote the only four balanced budgets enacted into law since the Lyndon Johnson Administration. Each of those budgets, negotiated with President Clinton, actually paid off some of the government’s debt.

      Joe is now a senior member of the House Energy and Commerce Committee, one of the most powerful committees in Congress. He serves on the Health Subcommittee, the Energy and Environment Subcommittee, and the Commerce Trade and Consumer Protection Subcommittee.

      Joe is an advocate for fiscal responsibility, refusing to request earmarks and voting against Democratic and Republican legislation if he feels it is irresponsibly expensive.

      Joe is an advocate for truly bipartisan health reform, working with New York Democrat Nydia Velazquez, chairwoman of the Small Business Committee, to introduce the Small Business CHOICE Act, which would make it easier for small businesses to offer health insurance for their employees.

      Joe is an advocate for conservation, the environment, and clean energy. He convinced Congress to protect the White Clay Creek and the historically important open space surrounding the Brandywine Battlefield in Chester County. He introduced the SAFE Nuclear Act to help transition away from fossil fuels. He co-chairs the Conservation Caucus in the House.

      Two other important caucuses he chairs are the Values Action Team and the Electronic Warfare Working Group. The Values Action Team advocates for pro-family legislation in the House, while the Electronic Warfare Working Group helps preserve America’s technological edge when it comes to military technology and the electromagnetic spectrum.

      Joe is also an active member in the Republican Study Committee (the conservative caucus in the House) and the bipartisan Pro-Life Caucus. He sits on the Helsinki Commission, the Tom Lantos Human Rights Commission, and the Congressional-Executive Commission on China; these commissions provide him with a forum from which to advocate for human rights internationally.

      At home, Joe is a member of the Brandywine Valley Association, the Po-Mar-Lin Fire Company, his local Rotary Club, and the Veterans of Foreign Wars.

      Among the many award and honors he has received are the Guardian of Small Business Award from the National Federal of Independent Business, The Taxpayer Hero Award from Citizens Against Government Waste, the Hero of the Taxpayer Award from Americans for Tax Reform, and the William Wilberforce Award from Prison Fellowship Ministries. He received special recognition from the North Korea Freedom Coalition for his role in passage of the North Korea Human Rights Act, and from the Brandywine Conservancy for his leadership in Congressional efforts to aid in conservation of open space.

      Joe and Ginny have three grown children and four grandchildren.

“In short, tax increases appear to have a very large, sustained and highly significant negative impact on output… the more intuitive way to express this result is that tax cuts have very large and persistent positive output effects.”

– Christina Romer and David Romer, “The Macroeconomic Effects of Tax Changes,” American Economics Review June 2010

On January 1, 2010 Americans could see the largest tax increase in the history of our nation—$3.8 trillion over ten years. Every single tax bracket would be increased, child tax credits would be slashed and the estate tax would return in full force, if Congress does not act.

This tax hike will affect every American individual and business. Most in Congress agree that we shouldn’t sit by idly and let the economy grind to a halt, but there is sharp disagreement about whether some Americans should have to pay more next year.

Treasury Secretary Timothy Geithner recently said that the American economy could “withstand” tax increases supported by the Obama administration. In the country’s deepest recession in decades, I don’t think tax policy should be about what we can withstand. It should be about what can actually grow our economy.

That’s where Dr. Christina Romer comes in. Dr. Romer is the Chair of the President’s Council of Economic Advisers. The quotation above is taken from a recently published paper that she and her husband, also an economist, co-wrote.

They conclude that tax increases reduce economic output. Economic output has a direct relationship with employment, because it is profitable businesses who typically hire new workers.

Secretary Geithner and President Obama contend that it is no big deal to raise taxes on those that they call “rich.” Unfortunately, their caricature of the rich is not based in reality. Americans in the top tax bracket are not uniformly Hollywood celebrities and sports stars.

According to the non-partisan Congressional Joint Committee on Taxation, 50 percent of those in the top individual tax bracket are small business owners. A survey by the National Foundation of Independent Business found that 75 percent of their members are organized in a way that they pay taxes at the individual rate.

President Obama claims that his tax increase will not affect small businesses currently struggling through the recession. That may be true, but it is not struggling businesses that hire new workers. Hurting successful small businesses that are turning a profit means taking away resources from the very businesses that are most likely to hire new workers.

But small businesses aren’t just imperiled by the impending increase in the marginal rates. On January 1, the estate tax will increase to 55 percent for estates valued at more than $1 million. The value of an estate is not just how much cash is in the bank. Business assets and property are included. They are asset rich and cash poor.