Made in America: Innovations in Job Creation and Economic Growth

Testimony Before the House Committee on Energy and Commerce

SOURCE: Center for American Progress

CAP Senior Economist Heather Boushey testifies before the House Committee on Energy and Commerce. Read the testimony (CAP Action).

Thank you, Chairman Bono Mack and Ranking Member Waxman for inviting me here today to testify on the innovations in job creation and economic growth. My name is Heather Boushey and I’m a Senior Economist with the Center for American Progress Action Fund.

The challenges workers face today are tougher than they’ve been in generations. The Great Recession wrought havoc in the lives of millions of families, and the ensuing economic recovery, while gaining strength, offers little hope of sustained job creation without targeted government investments. The policies that will create jobs are those that will increase aggregate demand by making investments that not only boost employment in the short term but also lay the foundations for long-term economic growth.

Until we fill this demand gap, we will continue to have unacceptably high unemployment, which in turn will continue to drag down economic growth. Unemployment—the ultimate unused capacity—is a terrible thing. Allowing it to fester when you have tools at your disposal to alleviate it sends a message that government policymakers don’t really care about the very real hardships families are facing or don’t recognize the enormous waste of human potential.

The real question, then, is whether policymakers will focus on not repeating the mistakes of the Great Depression and rather continue to focus on boosting government investments until the economic recovery solidly takes hold. Jobs will not be created by limiting necessary government regulation, repealing the Affordable Care Act, cutting spending, or focusing on the short-term federal budget deficit. In particular, I would caution all of you about focusing too much on the short-term deficit, which is not due to overspending but rather due to the failed economic policies and two unfunded wars of the Bush administration, and the higher costs and lower tax revenues caused by the Great Recession and the Bush-era tax cuts that were then extended this past December.

We need to ensure that government programs operate effectively and efficiently. But pursuing these necessary reforms should not be done in lieu of making the kinds of investments our economy and our nation need to create millions of new jobs to boost future tax revenue and long-term, sustainable economic growth.

CAP Senior Economist Heather Boushey testifies before the House Committee on Energy and Commerce. Read the testimony (CAP Action).