Remarks to The Ridgewood Chamber of Commerce

Apr 18, 2017

April 18, 2017

Thank you, Amy, for that kind introduction. And thank you, Fred Rohdieck from the Paramus Chamber, Paul Vagianos and Joan Groome from the Ridgewood Chamber, and Tom Bracken from the New Jersey State Chamber.

What better day than tax day to talk about the need to cut taxes and get our economy moving for all.

It’s an honor to be here with the Ridgewood Chamber and New Jersey Chamber of Commerce. Thank you for your leadership helping to promote our local businesses, for highlighting their innovation and ingenuity, and for advocating and unpacking the issues they face.

Thank you, also, to my friends at the U.S. Chamber for coming to New Jersey. For more than a hundred years, you have been the voice for economic growth and a champion for opportunity and prosperity for all Americans and businesses of all sizes.

Let me say something to the scores of businesses here that people in shoes like mine just don’t say often enough: Thank you. Thank you for doing business here, for making investments in our state, and for creating jobs. I’m grateful for what you do, because, as we all know, businesses — not the government — creates economic opportunity and growth in America.

I’d like to begin my speech this morning with the good news: because of you, we’ve got a lot going for us here in New Jersey — a remarkable number of assets on our side, including the businesses right here in my District. You are the backbone of our economic engine, from Ridgewood Cycle, a place I spend too much time and money, to It’s Greek to Me, owned by the Ridgewood Chamber President, which, by the way, has some of the best hummus around.

The Mayor of Paramus is always crowing that his town is the top retail spending zip code in the nation. And less than an hour from here, Mars makes the most peanut M&Ms in the world, including the ones they serve on Air Force One. Thanks to our long legacy with Ma Bell, AT&T, and Verizon, we also have some of the fastest wired broadband, ranking the third most connected state in America.

On the manufacturing front, New Jersey is often considered the birthplace of the industrial revolution – and 10,000 manufacturers are still operating in our state. We also have some of the smartest minds in the country, ranking second in the “Chance for Success” education index and third in K-12 achievement. And we have the highest concentration of scientists and engineers per square mile in the entire world.

But, even with all that’s going for us, let’s face it — it’s hard doing business here. We should be making life easier for you to grow and prosper – cutting red tape, lowering taxes, training workers, and investing in infrastructure. That’s why, after hearing from many of you, I’m proposing a Five Point Economic Growth Plan to help make a difference to your bottom line – and benefit New Jersey taxpayers at the same time.

Let’s be honest, all too often, New Jersey makes it like you’re doing the state a favor for operating here — and many of our state’s decisions, regulations, and costs have pushed jobs to Pennsylvania, Florida, Texas, and Georgia. Governors from other states are literally luring many of you away with incentives, lower taxes, new roads, and – gratitude for what you do. It’s no wonder that we are net losing companies and jobs, like Mercedes and Hertz, not to mention thousands of workers.

A new report released just yesterday found that our economic outlook ranks forty-eighth out of the fifty states.

New investment in our state is among the lowest nationally, and we’re ranked forty-ninth out of fifty for business friendliness. While many other states have bounced back since the recession, New Jersey not only remains stuck in place, but appears to be moving backwards. We’ve recovered only two-thirds of the jobs lost from the Great Recession, while Pennsylvania and New York have actually gained jobs since then.

We are also losing population, putting further stress on revenue. From 2010 to 2015, New Jersey lost more than a quarter of a million people. Millennials just aren’t moving to the suburbs the way prior generations did, because, like older folks, they want to be closer to city centers – and avoid those property taxes.

It’s also no secret that our infrastructure is failing and costing us in economic opportunity. The Association of Engineers recently gave our transit system and levees a “D-.” Our state is second-in-the-nation for the percent of commuters who rely on public transit; yet, NJ Transit had more trains breakdowns last year than any other commuter railroad in America. And we have the eighth worst roads in the nation, costing our average motorist $667 in repairs each year.

No one likes spending their precious time sitting in traffic instead of being home with their families. It’s actually a tax on our drivers and economic productivity. And our state is burdened with some of the highest property taxes and regulatory bureaucracy in the country.

So, what should we do? How do we get back to three percent GDP growth? How do we reboot investment? As Tom Donohue, the CEO of the US Chamber, recently said, “Every proposal should be subjected to the growth test: Will it speed growth or will it impede growth? … Growth is good for everyone. It’s good for every state. It’s good for every business … Growth is not something handed down from on high in an edict from Washington. It comes from the bottom up … [And] our lawmakers must … choose growth.”

I couldn’t agree more. So, here’s my Five Point Economic Growth plan for New Jersey.

First, we have to look for growth opportunities around the corner. While New Jersey has a strong tradition in life sciences, we’ve largely missed the boat on key growth sectors where we have a strong legacy. Take biotech. Despite our strong presence in pharmaceuticals, when it comes to biotech, most of our companies put their operations in the Route 128 Corridor in Massachusetts, in North Carolina, or in Silicon Valley.

With our presence of top schools, top hospitals, pharmaceutical leaders, and expansive leadership in life sciences, I believe we should double back – and double down – on biotech as a potential growth sector for New Jersey. Government can work with our universities and companies to support incubators. With the likes of Becton Dickenson and Stryker, there is no reason that if we put our minds and muscle behind it, we can’t plant a serious flag in the biotech space.

This a concept Meg Whitman, the CEO of HP Enterprise, recently stressed to me – we need to find the spaces where, through R&D and ingenuity, we can compete and win here at home.

So, where else do we have an edge for the future? Interestingly, we have a cluster developing in photonics at Thorlabs in Newton and at Inrad Optics in Northvale. They are providing lasers and crystals used in everything from our military planes to fiber optics. Photonics involves retooling and advanced manufacturing – and so does another natural area – the green energy economy. Our state already ranks fifth in solar power, and we still have room to grow. And these are high-skilled jobs that will help our state and our economy adapt to the realities of the 21st Century.

Given our super-high speed broadband, engineering talent, and the world’s premier banks and exchanges within miles, there’s also room for New Jersey to lead in FinTech, where companies like Wealth Front and PayPal are making headway.

As we grow these new clusters, the multiplier effect will set in, helping small and medium size businesses like law firms, dry cleaners, gyms and restaurants flourish.

But, we must start planning now to attract and retain the talent we’ve already trained here.

To that point, and the second part of my plan, growth comes from capitalizing on our top-shelf talent. We have exceptional schools in New Jersey, but we need to make sure that the skills we’re teaching our students are actually aligned with those that our employers need — and will need — as we move further into the 21st Century. That requires more coordination between our companies and our schools, and government should help play the role of matchmaker.

Here in the hub of hospitals – we have four excellent ones right here in Bergen — we’re facing a major nursing shortage, with tens of thousands of additional nurses needed in New Jersey alone, a number that will continue to grow as our population ages.

And, it’s estimated that by 2018 there will be 2.4 million unfilled STEM jobs. I saw these openings first-hand when I worked at Microsoft. We need more engineers and programmers to maintain our edge in the Apps economy.

Many of our local educational institutions get it. For example, Bergen Community College has a new innovative, state of the art facility to help its students prepare for careers in health care. Fairleigh Dickinson University is moving aggressively to expand its STEM programs and is enhancing it hands-on hospitality program, partnering with local hotels.

Ramapo College’s partnership with the Bergen County Small Business Development Center is partnering to enrich both students and local companies. I believe that we’d be well served by incentives for local businesses, be it in finance or food, to put our students, including our student veterans, in internships and apprenticeships, so businesses can shape them for their particular needs.

Third, to grow, we need to reorient the suburbs for the future. The way people work, live, and play is shifting and it doesn’t bode well for our state, the king of the suburbs. Millennials want to walk to dinner and the movies and to the train, and are less interested in working in the traditional car-centered office parks. We need to look at developing hubs, business districts, and new housing around rails in our towns, so they are more walkable and transit friendly.

In the Fifth Congressional District, it also means increasing transportation options to and from Bergen, Sussex and Warren Counties – where we have the longest commute times — and improving our roads in and around the District. We also must build new light rail, new stops, and the Gateway Project, because it’s outrageous that are relying on hundred-year old tunnels — badly damaged in Sandy — to handle all of our daily traffic into New York City. Because of the damage, we can only get twenty-one trains in and out of the city in an hour; that’s outrageous. And we’ve all seen the headlines and experienced the terrible delays. No one wants to sit in two hours of traffic driving or on a broken down train. How can we attract new businesses and people with a Nineteenth Century transit system? This is something Republican President Eisenhower understood, when he built the interstate highway system.

I recently helped introduce the bipartisan Partnership to Build America Act, which creates incentives for companies to repatriate funds from abroad in exchange for bonds to help fund infrastructure at home. This is a market-based solution everyone from the business community to unions can get behind – and, mind you, we have the best building trades in the country here.

Fourth, we must cut taxes up and down the line, cut out-of-date regulations, and get a better return on investment. All will lead to broad-based growth. It’s just plain too expensive to operate here. This is an issue Tom Bracken, the president of the NJ State Chamber, has brought up repeatedly and even commissioned a survey on the topic. He found that ten of the fourteen New Jersey business leaders considering relocating their businesses blamed high taxes or high cost of living as their reason.

That’s why, starting at the federal level, I’m working with Democrats and Republicans on comprehensive tax reform to close loopholes and shelters and lower our corporate tax and pass through rates for small businesses and partnerships. We have the highest corporate tax rate of all OECD industrialized countries – and it’s costing us in jobs, revenue, and innovation.

As Co-chair of the bipartisan Problem Solvers Caucus – comprised of twenty Democrats and twenty Republicans – we’re meeting weekly on legislation that would lower taxes and invest in infrastructure. I believe we to move to a territorial system, but we should avoid gimmicks like the border adjustment tax, which would send consumer prices sky-high and decimate many of our great American companies. It would jack up the price of a pair of jeans at your local store from twenty dollars to forty dollars nearly overnight.

While we work to cut our taxes, I believe we can provide property tax relief here in the Fifth District by bringing back more of those tax dollars we send to Washington. We are one of the top three percent tax-paying Districts in the Country, yet we only get 33 cents back for every federal tax dollar we send to Washington. West Virginia, for instance, gets $4.23 cents for every tax dollar they send. In short, we’re sending our New Jersey tax dollars to Washington to subsidize other payee states – or what I call the “moocher states.” I recently found out that forty-four percent of Louisiana’s revenue comes from federal funds, yet each Louisianan only contributes $2,400 a year – far less than the ratio in New Jersey. Louisiana is the poster child of a moocher state.

That’s obviously a raw deal for us. I’m working with every town and mayor to get more of our federal taxpayer dollars back home by applying for more grants to pay for things like public safety, transportation and education. That will ease the burden on our local taxes. These are already earmarked dollars that will get spent. Why should they go to the moocher states?

I’m introducing a new bill later this month – and here’s new news — that will make sure that these “moocher states” pay their fair share. My Anti-Moocher Bill will simply calculate which states are “payers” like us and which ones are the “moochers” – like West Virginia — and put the difference back into the pockets of New Jersey’s residents through tax credits. Why should Alabama get our federal tax dollars and get a free ride, while we’re left holding the bag with higher property taxes? It just doesn’t make sense.

Now, let’s get to out-of-date and unnecessarily burdensome regulations.

We need to cut bureaucracy at all levels, so businesses don’t need to fill out seventy-two forms to open a new warehouse or add an employee. My dad ran a small business here in New Jersey; it was like a constant game of gotcha with more paperwork, more licenses, and more fines. Like our federal tax code, you need an advanced degree to figure it all out and the deck is stacked against you. That’s not way to show our businesses that we love them and want them to stay and grow here.

At the federal level, I recently introduced a bipartisan bill that will purge the books of out-of-date, dinosaur-era regulations that are killing jobs and will identify duplicative regulations for consolidation. The Regulatory Improvement Act creates an independent Commission – modeled on BRAC that we used with the military base closings – that’s tasked with looking at the cumulative impact of regulations across agencies. With a surgeon’s scalpel precision, it will identify which ones can be consolidated and eliminated, because they no longer serve their purpose. Their recommendations will spur economic growth, but not at the cost of necessary guardrails and protections like clean drinking water for our children.

We should use a similar approach to get federal spending and the national deficit under control.

In all, our economy has been hamstrung for too long. As you know, one of the most important factors for businesses and consumers is access to capital at reasonable prices. From starting a business to buying a home, people need loans at affordable rates.

It’s why I support reforming Dodd-Frank Reform, which was put in place as a necessary response to the economic crisis, and, as most banks will tell you, helped implement several essential guardrails. But, in many ways, it swung the pendulum too far and has slowed growth by contracting lending throughout the economy — be it in the financial system, mom and pop businesses, or potential homeowners – and adding way too much unnecessary bureaucracy.

Consumers who qualify can’t get mortgages and there’s just too much confusion and unnecessary paper work that nobody needs.

Make no mistake, we need to have tough regulations on financial transactions, but they have to be sensible ones that protect consumers without driving up costs.

I’m hoping those of us on the Financial Services Committee, on which I sit, can get smart reforms done in a bipartisan fashion.

Fifth and finally, government — at all levels — needs to be a champion and ally of business, not the answer. The private sector is where the growth and ingenuity is and what drives our market and job-creation. Government has a role to play as a facilitator for your success – to help you prosper, to keep our communities safe, and to prevent bad actors from polluting our waters and ripping off consumers. It is not – and should not – get confused with where jobs and innovation come from.

One example where the government can help is the Export-Import Bank. This bank helps American companies do business overseas, it makes a profit, and has helped support $827 million in exports in the Fifth Congressional District alone, helping dozens of businesses, many of them small businesses grow, hire, and strengthen our communities. In the last decade, EXIM has supported more than 1.7 million jobs in all 50 states.

You, as business owners, community leaders, and citizens also deserve a government that works together. When I worked at Microsoft and Ford, I saw first-hand the benefit of coming to the table to negotiate and get something done. But too often in Washington, a desire to work together is seen as a sign of weakness. That’s why we need political leaders who are willing to work together, regardless of party labels, who understand the value of principled compromise, and are willing to accept eighty percent solutions to move the ball forward. If you want to build a stronger future, you can’t take a “my way or the highway” approach.

For nearly three months during the Constitutional Convention, George Washington sat in the same chair with a large sun etched in its back. Ben Franklin, one of our earliest entrepreneurs, later said, “I have often looked at that [chair]… without being able to tell whether it was rising or setting. But now I… know that it is a rising…sun.”

We live in the greatest country in the world – a nation of boundless opportunity. If we work together, and remember how we got here, the sun will always be rising on America.

Thank you, God bless you, and may God bless the United States of America.

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