McKinley’s Memos

Paul McKinley - Senate Republican Leader

Concerns about the economy, job security, retirement savings, health costs, higher taxes and the consequences of inflation as a result of too much government spending are prevalent on the minds of Iowans right now. Disappointing news reports of more job layoffs, plant and business closures, worker furloughs, wage cuts and hour reductions are leaving Iowans searching for answers. John Deere cut 700 in Ottumwa, Principal Financial Group let 140 go in Des Moines, Electrolux downsized in Webster City, H&H; Foodservice in West Union said goodbye to 90 employees, Rockwell Automation announced they are closing a plant in Sumner and there are many other small employers throughout Iowa who have felt the economic strain even if the cutbacks did not make the news headlines.

With over 90,000 Iowans unemployed and more newly minted high school and college graduates now joining the job market, Iowans are looking for economic leadership in creating jobs and opportunities and I have been working hard to answer that call.

I believe we must be committed to working to remove many of the roadblocks and barriers that are hindering – not helping – to create and retain jobs in Iowa. Earlier this year the news magazine U.S. News & World Report released a study noting that Iowa is now the second worst state in the United States when it comes to business climate as determined through indicators by several esteemed and respected business indexes. Only West Virginia had a employer climate less desirable than Iowa’s. In making their pronouncement, they cited Iowa’s high government interference and very high, burdensome taxes.

Throughout Iowa’s history, there have been many wonderful examples of employers, businesses, inventors, entrepreneurs and manufacturers who have taken a dream and vision and built a legacy that has shaped our communities and touched generations of Iowans. Many of these successful individuals have created wonderful opportunities for many fellow Iowans. However, they did not get their start by first coming to the capitol with a glossy brochure to see what kind of deal or handout they could get from legislators or bureaucrats – they got their start because they found local investment and worked hard to build the business into a success from the bottom up. I know that every big business once started as a small business and every smaller businesses once started as a good idea.

As elected officials, it is essential we do not do any more harm to Iowa’s economy by imposing new taxes or regulations on our small businesses, manufacturers, employers and entrepreneurs. The key to creating a more vibrant economy in Iowa is to unleash the ingenuity that exists in our private sector and in the free market. After all, it is economic opportunity that is the great equalizer in a free society. If Iowa is to create more jobs and attract and retain the kinds of investments, employers, manufacturers, businesses and talent to compete not only with the other states but also with other countries, we must not wait to act.

Senate Republicans have not waited to act – we announced a bold set of fresh new job creation initiatives this spring that would provide an immediate jolt of adrenaline to Iowa’s economy as a result of aggressive, limited, one-time tax credits. In our plan, we have also addressed the need to plan for the economic future because the economy is constantly evolving and our state needs to be prepared to adapt for the new jobs that will be coming in the years and decades ahead. Our ambitious proposal is aimed at re-establishing the principle of free market capitalism as the engine of economic growth in Iowa. Unfortunately, because we are not yet in control of the Legislature, the current majority party refused to even allow our initiatives to be discussed – let alone voted on.

During the past decade, Iowa has drifted away from supporting existing and potential employers that dot the landscape of Iowa and has instead focused on chasing a few elite and already established mega corporations. I believe it is time to make Iowa open to all – not just a select and elite few - and we must move away from the mentality of having government serve as the arbiter of economic development by allowing bureaucrats to pick which businesses will win taxpayers dollars for their project and which will miss out.

This stark difference in philosophy was prevalent during this year’s legislative session when Governor Culver and his legislative allies voted to borrow and spend $1.7 billion dollars to create a few thousand temporary government make-work positions and then grow government yet again through the creation of a politically appointed commission who decides who will win the taxpayer funded projects and who will lose out. In addition, Iowans witnessed many attempts to make Iowa’s business and employer climate increasingly less friendly to current and potential employers and entrepreneurs. This past legislative session, the governor and members of his party in the Legislature actively pursued four major pieces of anti-jobs legislation lobbied for by union bosses that would strip away important worker freedoms, take more money out of the pockets of middle-class families, reduce the quality of health care for employees and drastically increase property taxes.

Iowans also remember that the governor and his legislative allies also looked for any way possible to eliminate federal deductibility – thus forcing hundreds of thousands of Iowa families and employers in every tax bracket to experience a massive tax increase and pay a tax on a tax. Iowa’s own Department of Economic Development website prominently touts federal deductibility as a major selling point to businesses and industries looking to make Iowa their home. Aided by the support of thousands of Iowans concerned about their and their children’s economic futures, we were able to stop Governor Culver and legislative Democrats this session from enacting their higher tax, anti-jobs agenda. Yet, next year’s session is already quickly approaching and Iowans must stay active and vigilant.

Common sense, hard work and Iowa ingenuity have come to define this state and it is time to get back to the economic traditions that have allowed so many employers and businesses to positively impact our state, our communities and our families. We must keep Iowa open for business so we can grow our economy, help our communities and put our citizens back into good paying Iowa jobs again. I remain optimistic that Iowa will weather this current economic storm because there is a strong economic foundation to build upon. We must always remember that two out of every three new jobs that are created in Iowa are created by small businesses and employers. We know it is time to reverse these startling economic and unemployment trends and work to get more Iowans into jobs again. With the right principles, the right policy initiatives and the right vision for Iowa, there is no reason why the newspaper headlines cannot soon be crowing with good news of new businesses and employers, new manufacturing and more job hires right here in Iowa.

Our state is uniquely situated to weather this current economic storm because Iowans are blessed with common sense and we still cherish freedom, understand personal responsibility and value hard work, honesty and a belief in self reliance. I know that while these are challenging times, challenges always provide opportunities. As Iowans, we should take this opportunity to grow our state and provide a future for our children and grandchildren that all of us can be proud of. When we pursue the right priorities, like growing Iowa’s economy instead of Iowa’s government, we can be assured that our best days will be yet to come.

As always, I welcome hearing from my constituents and can be reached by phone at 515-281-3560 or by e-mail at paul.mckinley@legis.state.ia.us

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