16 January 2003
NAM sees powerful business spark
Washington D.C. – President Bush’s economic stimulus plan "offers a creative mix of incentives that will encourage more aggressive investment in the stock market and new capital investment by business, which will create more jobs," said Jerry Jasinowski, president of the National Association of Manufacturers.
"The President has proposed a big, bold plan because that is what is needed to get growth high enough to put people back to work," Jasinowski said. "The cut in individual tax rates will help shore up consumer and investor confidence and income. It’s important to remember that individual rate cuts are a powerful stimulant to small business investment and job creation.The Labor Department employment report for the final month of 2002 showed that overall payroll employment fell by 101,000 and manufacturing lost another 65,000 jobs.
"That was the 29th consecutive monthly decline in manufacturing employment and the largest in the last 10 months," Jasinowski said. "Since July 2000, we have lost more than two million manufacturing jobs. These are the people who transform raw materials into finished products. They are the most skilled industrial workers, the very heart of our economic power and critical to our competitive leadership in the world marketplace.""This is a balanced mix of incentives that clearly has been well thought out and offers excellent prospects for increased investment, productivity and economic growth," Jasinowski said. "In particular, the elimination of taxation on dividends will boost the stock market by making stocks a more attractive investment. This will boost business and consumer confidence, reduce the cost of investment capital and encourage business to invest more in new plant and equipment.
"One of the most compelling features of this stimulus is the badly-needed support for small manufacturers through the individual rate cuts and the increased allowance for expensing capital investments from $25,000 to $75,000, indexed to inflation," Jasinowski said. "These tax breaks for small firms will provide a powerful incentive for small manufacturers to increase investment and create jobs.
"The President’s emphasis on extending unemployment compensation, creating reemployment accounts and state aid are good ideas," Jasinowski said. "We especially appreciate the President’s recognition of the loss of manufacturing jobs. The President’s proposal will deliver direct aid to the displaced workers who have been hardest hit by this downturn and help them weather the storm."
Jasinowski expressed special appreciation for the President’s support for making the 2001 tax cuts permanent, including repeal of the estate tax. "Today’s Commerce Department report that new orders for manufactured goods fell 0.8 percent in November underscores the compelling need for the President’s plan which will "sustain healthy long-term growth by encouraging companies to finance their capital investments through equity instead of taking on excessive debt.
"Finally, we support the President’s strong endorsement of regulatory and legal reforms as another critical key to economic growth and job creation," Jasinowski said. "Removing unnecessary impediments to growth is as important as providing economic incentives.
The National Association of Manufacturers is the nation’s largest industrial trade association. The NAM represents 14,000 members (including 10,000 small and mid-sized companies) and 350 member associations serving manufacturers and employees in every industrial sector and all 50 states.
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