Jeff Bingaman United States Senator from New Mexico

WASHINGTON – U.S. Senator Jeff Bingaman today outlined four steps Congress can take to help create jobs in this economic downturn.

"We find ourselves in an economic situation that is worse than almost anyone predicted.  And while I believe the American Recovery and Reinvestment Act is helping, it wasn't intended to tackle an economic problem this size," Bingaman said.  "It's my belief that we need to do more to create good jobs."

In a speech on the Senate floor, Bingaman said there is no danger of doing too much to create jobs.

"We should learn from Japan's Lost Decade.  Japan was plagued by weak economic growth and lackluster job creation all through the 1990s.  Its Lost Decade was caused by the bursting of an asset price bubble, similar to what triggered the financial crisis last year.  A primary lesson from Japan's Lost Decade is that intermittent stimulus policies are ineffective.  We need to take sustained and overwhelming action to reenergize our economy," Bingaman said.

In addition to passing an extension of unemployment insurance, which the Senate is now debating, Bingaman said we should do the following:

• A Job Creation Tax Credit worth 10 to 15 percent of the cost of creating new jobs.  The proposal could create 2.8 million new jobs in 2010 and 2.3 million jobs in 2011.
• Enhance the investment tax credit for manufacturing.  Such a credit would subsidize the cost of building new factory space or purchasing new machinery.  Manufacturing jobs are critical to the long-term health of our economy, and additional policies are needed to create them.
• Additional aid to states, in the form of education funds, health care funds, or other direct grants.  Without additional help, states will have to cut services and raise taxes, making the recession worse and slowing down job creation even more.  Enacting additional aid to states could have immediate benefits by curtailing plans to cut state programs.
• Providing emergency bridge loans to families to help them stay in their homes.  The amount of the loan would be equal to up to two years of mortgage payments and could be repaid over 10 or 15 years.  These bridge loans would complement the Job Creation Tax Credit and Manufacturing Investment Tax Credit by preventing a fall-off in the demand for consumer goods and services.

"The four proposals I have outlined today are just some of the ideas that could create jobs in the short and medium term.  Congress should hold hearings on these and other job creation proposals, and quickly enact the best of them.  If we do nothing, unemployment is projected to climb past 10 percent next year, more families will lose their homes, and our economy will grow weaker, making it more difficult for the United States to compete in the global market," Bingaman said.

"Even as Congress continues working on other strategic challenges like health care, energy, and climate change, we must give renewed priority to job creation to strengthen the long-term competitiveness of the United States and the prosperity of the American people," he added.