Government’s Latest Attempt to Drive Job Growth…

Sept. 9, 2010 - PRLog -- Andover, Massachusetts September 9th, 2010 –  Over the past week the US government has proposed a new batch of spending projects and tax credits/cuts for certain industries with the goal of boosting short term job growth and increasing the long term competitiveness of the US economy. While the debate over the effectiveness of the TARP bill of 2009 continues and will likely never end, its effects are starting to run out as much of the money has already been spent. While it was hoped that the first stimulus bill would jump start and maintain economic growth this clearly has not happened. Many things outside of Washington’s control have impacted and limited the effectiveness of the increased government spending. This new round of “Stimulus” is expected to lead off where the last bill ended and hopefully drive the US economy out of its current uncertainty and into a strong leadership position on the international level.

The new proposals have two main parts to it. The first is another round of spending on infrastructure projects throughout the country. The emphasis is being placed on repairing the aging interstate system and also building new high speed rail lines in select, high population areas throughout the USA including Southern California, Central Florida, and the Northeast. Infrastructure spending might not create new skilled jobs but it does put many out of work laborers, construction workers, electricians, etc. back to work. Not only that, but the current state of our nation’s highways, railways, and airports is quite poor. For the USA to remain competitive its infrastructure system needs to be upgraded to meet the needs of the 21st century economy. Railways are an effective way of moving large amounts of people and more importantly cargo without clogging up the already congested interstate system. Our current highway network needs a major facelift to deal with the realities of a much larger population than was planned for in the 1950’s when many of our nation’s highways were designed and constructed. While some politicians, particularly on the right see this as another favor being passed along to unions, I do think that everyone can agree that our nation’s infrastructure has not kept pace with our economy over the past 30 years.

The 2nd part of the new proposal involves granting a large tax cut to businesses nationwide to spur investment and growth. The largest part of this proposal is a 200 billion dollar tax cut that will allow business to write off 100% of all new investments in plant and equipment between now and the end of 2011. Not only will this significantly lower the tax burden facing businesses but it should also remove any hesitation that businesses are currently showing to expand and invest in their operations. Knowing that there is an incentive not to wait for the economy to fully return to normal should lead to increased investments and job growth nationwide. If companies can build more factories and purchase more equipment they will also have to hire more workers to run these factories and equipment. A smaller part of this proposal is making the current tax credit for R&D permanent. Currently this is set to expire at the end of this year but the White House is proposing to make these permanent at a price of $100 billion. Encouraging R&D is one of the easiest ways for the government to increase innovation in our economy so that we can continue to be the leaders in high technology, pharmaceuticals, engineering, and any other industry that is on the brink of a breakthrough.

Readers, have you had enough government spending or do you think that these steps are necessary to propel the economy out of its current state? Have you seen the first stimulus bill make a difference in your area?

Preferred Financial Services is a debt reduction firm certified by the CFC (Center for Financial Certifications) and accredited by U.S.O.B.A. (United States Organizations for Bankruptcy Alternatives). Headquartered in Andover, Massachusetts, Preferred Financial Services has been a leader in the debt reduction industry since 2003. Preferred Financial Services has acquired some of the best experience in the industry over the past 7 years. In 2009 alone Preferred Financial Services reduced over $16.5 million worth of consumer debt for just $6.4 million, for a savings of about 60%- and over 2,900 accounts were settled on behalf of their clients.

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