Economic hardships brought about by severe inflation and supply chain challenges continue, creating an ongoing affordability crisis in our country. Small businesses and families across the nation have had to make difficult choices and dig into savings to make ends meet in recent years. Inflation hits hardest those who can least afford it: those on fixed and low incomes. Seniors struggling to stretch their savings have little recourse when prices go up but their earnings do not.
Job creators are forced to make hard decisions because of the economic environment, often resulting in layoffs and closures. According to the Bureau of Labor Statistics, the U.S. civilian labor force participation rate – 62.8 percent in September of this year –remains below its pre-pandemic level of 63.3 percent and far below its level in September of 2008, 66 percent. This indicates we still have too many Americans sitting on the sidelines of our economy, and we must carefully consider how we can connect them with good jobs.
Comparatively, Nebraska’s unemployment rate remains low at 2.1 percent. While this is good news for job seekers, this is a double-edged sword, as I often hear from Nebraska employers desperate for workers about the difficulty they face bringing workers into the state because affordable housing is so hard to find. This is a serious need in Nebraska and in many parts of the country. In 2006, the Federal Reserve Bank of Atlanta began maintaining a Home Ownership Affordability Monitor Index. The index, which has plunged 36 percent since President Joe Biden took office, is at the lowest point in its history, showing it now takes 44 percent of median income before taxes to afford a median-price home.
Housing affordability and availability challenges further contribute to our inflation and supply chain problems. Still, we must ensure we are carefully addressing needs on a regional basis, not painting with too broad a brush when making policy changes.
This week in a hearing held by the Ways and Means Subcommittee on Work and Welfare, I raised concerns with a proposed change to the Census Bureau’s official measure of poverty, which is used by federal programs such as Medicaid, the Supplemental Nutrition Assistance Program (SNAP), and Obamacare subsidies. Despite wide diversity in lifestyle, cost-of-living, and demographics from state to state and within each state, the proposed Supplemental Poverty Measure (SPM) would produce an estimate of the poverty line which could dramatically alter the poverty line and create disparities directing funding away from states with lower incomes.
The American Enterprise Institute estimated this proposed change could increase government spending by $124 billion over the next decade. It’s clear that this effort to change our primary federal poverty measure is the latest in the Biden administration’s ongoing efforts to unilaterally expand the scope of federal social programs against congressional intent.
In order to rebuild our economy, we must return to policies which have been proven to drive economic growth and economic opportunity. The 2017 Tax Cuts and Jobs Act (TCJA) showed how beneficial tax policies which reward work and domestic economic investment can be to the American people. To build on those successes, the Ways and Means Committee, on which I serve, passed the Tax Cuts for Working Families Act earlier this year, which would build on TCJA successes and leverage tax relief policy to increase take home pay for working Americans by $4,000, while ensuring businesses have the certainty they need to invest in their workers.
Throwing more taxpayer dollars at a problem is wasteful and counterproductive. To foster opportunity, prosperity, and success for Americans, we must work together to implement appropriate designations for federal funding and spur economic growth.