For Economic Recovery, Remember First Principles

I am fond of a quote by Winston Churchill that reads: "In critical and baffling situations, it is always best to return to first principle and simple action."

Today's economic conditions, though not comparable to what Churchill faced in World War II, are among the most challenging in American history, with rising unemployment, an ailing housing market, declining stock market, credit crunch, high energy prices, and out-of-control government spending.

Like Churchill suggested, I believe we should address our economic crisis with decisive action grounded in proven American principles of fiscal discipline and the free market. Instead, Congress has taken a series of hasty, undisciplined steps, feeding the "bailout fever" that has paralyzed Washington, D.C. for the past six months.

The latest example is President Obama's $1 trillion pork-laden spending bill, which was signed into law this week on the heels of the massive $700 billion taxpayer-funded bailout of Wall Street and the banking industry. These, along with taxpayer-funded bailouts of Fannie Mae, Freddie Mac, Bear Stearns, and the American International Group (AIG) have culminated in a six-month federal spending spree that is unparalleled in American history.

Bailouts are a band-aid, not a long-term solution. Since heading down the bailout road, one rescue request has led to another. Not surprisingly, none of the efforts have worked. Congress and President Obama are trying to "pick winners and losers" with their legislation, but the only losers are the American taxpayers, as trillions have been added to the national debt, while the artificial duress under which the bailouts have been created has led to increased waste, fraud and abuse.

The stimulus bill was a good example. While the country waited on a stimulus package to emerge from Congress, they were met with 1,100 pages of legislation that was not revealed to members of Congress or the public until 12 hours before the final vote. I suspect that over the next few weeks and months, the American people will be disappointed to learn of even more wasteful pork-barrel spending inserted into the bill in the dark of night.

As for the plan itself, the non-partisan Congressional Budget Office projects that the bill may have a one to three percent annual impact on the economy between now and when President Obama runs for reelection, after which the tide will turn and our economy will begin to feel the real pain of the increased national debt that the bill creates. If increased government spending was the answer, then we would have solved the problem a year ago.

I support a different approach, based on fiscal responsibility and conservative economic principles. Rather than charging trillions of dollars on the nation's credit cards, the alternative stimulus bill I cosponsored calls for tightening our belts and cutting unnecessary government spending to balance the federal budget and begin making a dent in the overwhelming debt that we now face.

Though our bill was denied a hearing and a vote, it would have provided immediate tax relief for every taxpaying American by reducing the bottom two brackets, saving the average American family $3,200 per year in taxes. I am convinced that money in the pockets of everyday Americans is better than any stimulus plan ever devised by government.

For that matter, I believe our free-market alternative would have worked better than the $700 billion taxpayer-funded Wall Street giveaway as well. Our plan, which again never received a hearing or a vote, would have taken the burden off the American taxpayer by providing incentives for private capital to purchase the so-called "toxic assets" from banks. In short, it trusts that the American people know better than the federal government how to turn the economy around.

Finally, I was disappointed that the federal stimulus bill does little to stimulate the economy and addressing the pressing needs our country faces. One easy example of this is energy. We should be pursuing energy independence with the same fervor as we did when gasoline was $4.00 a gallon. Much of the progress we made last year towards expanding American oil exploration has been brushed aside since bailout fever captured Washington D.C. Affordable, sustainable energy is a critical component to economic recovery, particularly for the American auto industry.

Moving forward, I believe increased openness and transparency can help us stop such egregious examples of waste, fraud and abuse in the future. Through an uphill battle, I will continue pushing for an open and fair process in which taxpayers can hear their Congressmen debate and vote on more than one plan.

Had our legislation been allowed to be considered on the House Floor, I am confident that favorable public opinion would have helped us stem the one-sided approach that led to a $1 trillion spending bill with only ten percent "stimulus".

In due time this downturn will end, and the resilient economy of the United States will return to normal. As is the case with most misguided federal government policies, our economy will surge in spite of it, not because of it. This is why we must return to first principles, and this is why we must change course and instill new fiscal responsibility to avoid saddling our children and grandchildren with an insurmountable national debt that will darken their future.

Rep. Jim Jordan, R-Urbana, represents Ohio's 4th Congressional District in the U.S. House of Representatives.