WASHINGTON, D.C. — Joint Economic Committee Vice Chairman Pat Tiberi (R-OH) delivered the following opening statement during a hearing entitled “Encouraging Entrepreneurship: Growing Business, Not Bureaucracy”:

 

“Good afternoon. I would first like to thank Chairman Coats for giving me the opportunity to hold this hearing and, along with his staff, in helping to prepare for today’s hearing on the importance of entrepreneurship to our economy. He unfortunately had another commitment this afternoon but turned the gavel over to me for what I expect will be a thought-provoking conversation about encouraging entrepreneurship.

“Entrepreneurs put ideas into action, and the businesses they create make up a major component of America’s job growth engine.

“Entrepreneurship also contributes to our standard of living. By boosting job creation, entrepreneurs drive economic growth, offer consumers better goods and services, and allow Americans to move up the economic ladder through their innovations.

“America was once considered by far the best place for someone venturing out on their own. It was a place for taking a risk to build something new, to improve the lives of all Americans. And in many places across the country, that’s still the case, as you’ll hear from our witnesses today.

“However, our current economic recovery has been relatively slow and geographically uneven. In my home state of Ohio, as Mr. Walker will testify, Columbus has enjoyed great success in attracting new business and encouraging innovation. Other parts of the state, however, including many rural areas, have still not recovered from the recession. Overall, we’ve seen a decline in the rates of startup companies and an increase in the average age of companies compared to previous decades.

“It is our role as federal policymakers to foster a free-market economy in which Americans enjoy ample opportunities for employment, and we must not forget that the private sector is the true driver of economic growth.  Government can’t tax and regulate its way to American prosperity.

“Every day, entrepreneurs launch new companies and decide where to place the headquarters. Those who incorporate here will face the highest corporate rate in the developed world, while those who structure to pay individual tax rates will grapple with mind-numbing complexity and tax rates that have risen substantially under this Administration.  Our uncompetitive tax code makes America less attractive as a place to do business.

“As if taking a risk on the success of an idea were not challenging enough, today’s entrepreneurs also face a series of government-imposed market barriers. These include banking regulations that make it harder to get financing and harder for community banks to operate and make loans, archaic licensing and permitting rules, and complex labor and health care requirements.

“Each of these requires using precious resources, often to hire professionals just to help navigate through all of it.

“As our witness Andrew McAfee said in a previous hearing on automation, ‘entrepreneurs are facing an increasingly dense thicket of things that an employer or worker has to confront before they can start something up... and it looks like more and more people are saying, “I’m just not going to bother with it.” ‘

“A friend of mine in Columbus, Ohio—an Italian immigrant—started a family-owned business 40 years ago, and he has told me that he wouldn’t make the same choice today to start his business. Given all of the government regulations and mandates, the risk to reward gap is too high.

 

“We must continue to focus on ways to reduce the barriers to innovation, giving entrepreneurs the tools they need to succeed. That doesn’t come from picking winners and losers with direct subsidies or carved-out tax breaks. Instead, that comes from preserving competition and removing restrictions that only serve to protect established companies and hinder startups with new ideas.

“We also need to remove barriers for those who want to invest in entrepreneurs and startups. My legislation, the Investing in Opportunity Act, will make it easier to invest in areas that need it most.

“Congress should boost entrepreneurship by reducing the thicket of bureaucracy that is strangling private initiative. It is my hope that here in America we can retain a strong entrepreneurial spirit rather than cause it to wither away.”