The president of the U.S. Chamber of Commerce said today that President Obama has held back economic recovery with over-regulation and obstructionist policies.
During the Chamber's annual State of American Business address, president Tom Donohue delivered a list of broad areas in which he believes the U.S. can create real economic progress.
Donohue called on lawmakers and the president to address areas including energy, innovation, international trade, and entitlement reform in order to promote economic growth this year.
"2012 must not be a wasted year simply because it is an election year. There's no justifiable reason why it should be," he said.
The Keystone XL pipeline is one key area in which the Chamber says the administration has hindered growth. The proposed pipeline would run from Canada to the Gulf of Mexico, carrying Canadian oil to U.S. refineries. Though the Department of State found that the pipeline would pose no significant environmental impact, pressure from environmental groups last November helped push the Obama administration to delay a decision on approving the pipeline.
"This project has passed every environmental test. There is no legitimate reason—none at all—to subject it to further delay," he said, also noting that Democratic-friendly labor unions and the business community alike have pushed for pipeline approval.
Though environmental groups dispute the figure, the Chamber estimates the pipeline could create up to 250,000 jobs.
The relationship between the White House and the Chamber has been strained over the last three years. The president and the chamber clashed early on with healthcare reform and climate change, and Obama also criticized the millions of dollars in anonymous donations that the Chamber spent on ads in the 2010 midterm elections. The president has since reached out to the Chamber, but they remain at odds on many key economic issues.
At a press conference following the speech, Chamber Executive Vice President for Government Affairs Bruce Josten took aim at the President's "Insourcing American Jobs" initiative, unveiled yesterday.
"The president missed the biggest insourcing opportunity yesterday, and it's called the Keystone pipeline," Josten said.
Donohue added that the White House's increased regulations on business is "a big drag on our economy." Donohue pointed to the Environmental Protection Agency, the Labor Department, the National Labor Relations Board, as well as two of the president's signature initiatives.
"Dodd-Frank requires 447 rules, 63 reports, and 59 studies," Donohue said, referring to the 2010 financial regulatory reform law. "The healthcare law established 159 new agencies, panels, commissions, and regulatory bodies."
It is a common complaint from the business community that excessive regulation holds back growth and that the proliferation of regulations create uncertainty that make growth difficult.
The Chamber sees the Consumer Financial Protection Bureau, which would regulate consumer protection, as particularly alarming. Donohue characterized the president's recent recess appointment of Richard Cordray as the Director of the CFPB as "deeply disappointing." However, the Chamber has a more fundamental problem with the structure of the Bureau, arguing that a single director would exercise too much power. The chamber has advocated instead that the agency be headed by a bipartisan commission.
Donohue also cautioned that the administration may be taking on a too-limited economic agenda for 2012. Citing an administration spokesperson's comment that a further extension of the payroll tax holiday is the sole item on the president's "must pass" legislation slate, Donohue chided: "With all the challenges facing our economy and our country, it's inconceivable that the president would agree with that—and I trust that he doesn't."
Along with energy and deregulation, Donohue also highlighted other areas that the Chamber says could promote job growth—cutting the country's corporate tax rates, which are the second-highest in the world, as well as entitlement reform, to keep ballooning national debt under control.
Donohue bolstered his exhortations for policy change by emphasizing predictions for anemic growth: "We expect growth to average about 2.5 percent in the first half [of 2012] and then work its way back to about 3 percent by the end of the year." Many economists agree with that prediction; here's hoping Washington can agree on how to make it better.