Chamber CEO: We Must Pass Free Trade Deals

Tom Donohue on U.S. economy, jobs summit, small business

CHRIS COTTER, GUEST HOST: Well, forget about hiring. How about freezing and firing? A new Chamber of Commerce survey showing nearly two- thirds of small businesses are not expecting to add jobs in the next 12 months, 12 percent actually looking to cut jobs.

My guest announcing his plan to get those jobs going on.

First on Fox, Tom Donohue, president and CEO of the Chamber of Commerce.

Tom, welcome to the show.

I’m all ears, because I talk about this subject every day, and I have yet to hear a real, credible plan to turn this labor market around. What do you have in mind?

TOM DONOHUE, PRESIDENT & CEO, U.S. CHAMBER OF COMMERCE: Well, we talked about short-term and long-term steps to create jobs in America, the great preponderance of which must be created by the private sector.

The first thing is right in front of us today. We need to move those free trade deals up to the Congress, pass them, and get them implemented. Failure to do so will cost us almost 400,000 jobs by midsummer, because the fact the E.U. and Canada have made deals with Korea and Colombia.

And, at the same time, there are a number of other trade agreements that are in the TPP deal in the Pacific, which it can be done by November. All of these issues will create significant numbers of jobs. Failure to do this will cost you jobs.

The second thing, which is really fun, expand tourism. People come here and bring their money. It is just like selling a product overseas to which they send money. And they create thousands and hundreds of thousands of jobs. And we just have to fix the visas a little and be very encouraging about that.

And we have got to take a careful look at what we can on -- on energy. I wrote to the president a few weeks ago. He is talking -- saying the right thing. The only trouble is, everybody that works for him is not. We can dig our own gas, dig our own oil, sell our own timber. We would create hundreds and hundreds and thousands of jobs, pay a lot of taxes and pay a lot of royalties.

Infrastructure, reducing regulations, resolving some of the housing issues, all of these questions, properly handled in a cooperative way, business up their money, and energy, government taking away obstructions and moving corrections in...

COTTER: Yes.

DONOHUE: ... the government, we could make a lot of jobs in a big hurry.

COTTER: But what about some of these bullet points that the administration comes out with? You mentioned the free trade agreements, but what about -- or the trade agreements, I should say -- but what about like an infrastructure bank, for example? Are these -- these points that the president has made over the last couple of days, are these really going to make a big, impactful difference?

DONOHUE: We support an infrastructure bank.

What you really have to do first, though, is deal with your highway bill, your aviation bill, and your water bill. They all are trust funds. There is money there to be spent. But the people in the states and on the local level are not going do put up their matching funds until they know it is not a six-month extension, but it’s a long-term bill.

And let me say it has been 18 years since we had an increase in the federal user fee on the highways. And if we want to recognize that the miles per gallon in trucks and cars are twice what they used to be, this is something we could do, put more money to work, create a lot more jobs.

And you know who is going to get some of these jobs? The people that cannot work in the housing industry, because we are not building housing right now, and they will have a shot at these construction jobs.

COTTER: Tom, what about China? That still remains to be the thorn in the side, when you talk about all the cheap Chinese goods on our shelves. We are losing manufacturing jobs to China. And they are artificially keeping their currency down. Doesn’t the administration have to address that?

DONOHUE: That is not the problem in this country.

Sure, there are China issues, but our exports to China are growing like a weed. And they are wonderful opportunities for us. The big issue that we face and one of the issues we have to take care of to get rid of the uncertainty in the minds of people that are going to put their money down and create a job is, are we going to default on the debt or are we not? And we can’t.

Are we going to fix our expenditures in this country and our deficits or are we not? Once that becomes very clear, then all the things I was just talking about a minute ago get a lot easier to make happen. But when you’re running a company, large or small -- and you saw all the surveys we did with -- that’s what you started on.

COTTER: Yes.

DONOHUE: People want to know that it is a stable environment in which they can invest their money and get a return.

COTTER: Been a big part of...

(CROSSTALK)

DONOHUE: That is what we need to do.

COTTER: Well, a big part of that, Tom, is taxation. I mean, how do you view these debt talks moving forward, as one side continues to say we need more taxes and the other side is steadfast against that, with the backdrop a 9.2 percent unemployment rate?

DONOHUE: Oh, you know, it is just amazing. I just heard what Democrats in the Senate are talking about is a $4 trillion bill with $2 trillion worth of real tax increases.

Get serious. You can’t pass that out of either house. We do need additional revenues. You get revenues from the energy activities. You get revenue from what you are going to do in infrastructure. You get revenues from taking away certain deductions.

But to increase either corporate taxes or personal taxes in the middle of a major recession is not a very smart idea. Will we get revenues in these bills? Yes, we will.

COTTER: Are you in favor of simplifying the tax code and reducing the corporate tax rate? I believe we have the second largest corporate tax rate in the world right now.

DONOHUE: Well, we do. And I am in favor of a restructuring of the nation’s tax system.

We need -- you know, we have a very simple set of issues. Five percent of the people pay almost 50 percent of the taxes. Fifty percent of the people that have -- that are employed pay no taxes at all, except Social Security taxes.

We are the highest taxed nation in the word in terms that we pay double taxation. If I sell something in Europe, I have got to pay a tax there if I build it there and sell it there. Plus, I have got to pay a tax back here. Only country in the world that does that.

Do we need reform? Yes. I don’t think you can get real tax reform done between now and August 2, so we are going to have to have some agreements on what we do on spending...

COTTER: Yes.

DONOHUE: ... which, by the way, nobody has put on the table. And we are going to have to have agreements if there is need for revenue, but not tax increases.

COTTER: Well, Chamber of Commerce president and CEO Tom Donohue, thank you so much, sir.

DONOHUE: Thank you very much.

COTTER: All right.

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