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Gerlach Votes to Bolster Economy, Cut Taxes
Washington, Oct 3 -
Congressman Jim Gerlach (PA-6th District) on Friday voted to make sure small businesses can continue paying workers and adding jobs, families can continue getting loans to send their children to college and millions of middle-class taxpayers avoid a crippling tax hike. “Our nation is facing historic economic challenges that demand leaders to step up and put America’s interests ahead of petty partisanship or political ideology,” Gerlach said. “Community banks from Penn Street in Reading to Lancaster Avenue in Ardmore and small business owners from Spring Township to Spring City have said Congress needed to act swiftly. The cost of this package may be as much as $700 billion, but the toll that inaction would take on the American spirit and our economic security is infinite.” This bill (H.R. 1424) represents a significant improvement over a previous measure rejected on Monday. First, the measure includes a badly-needed patch to the Alternative Minimum Tax. This will allow more than 120,000 middle-class taxpayers in my district to keep more of their paychecks. The bill also would improve the security of senior citizens savings’ accounts and others with savings accounts such as DNB First in Downingtown and dozens of other community banks in the region. That’s because the Federal Deposit Insurance Corporation will more than double the amount of deposits that are insured to $250,000 from $100,000. "We are also no longer giving Treasury Secretary Henry Paulson and the administration the blank check they sought two weeks ago," Gerlach noted. Paulson has all but guaranteed that these mortgage-backed assets will increase in value and that the American taxpayer will be repaid. The Treasury also will have to report back to Congress on how the money has been spent and how the spending has improved economic conditions. “I have worked diligently to make sure that taxpayers money will be handled prudently and that any gains from this strategy are returned to taxpayers instead of funneled to political activists and others,” Gerlach said. The Securities and Exchange Commission will also take a critical step that should ease the credit crunch affecting everyone from banks to small businesses. The SEC will do this by changing a burdensome bookkeeping regulation known as Mark-to-Market accounting. And finally, as our nation moves toward independence from foreign sources of oil, developing renewable energy sources such as wind, solar and biothermal will be crucial. This bill will make sure that tax credits do not expire at the end of the year for small businesses and entrepreneurs working to develop renewable and alternative energy. “Had we rushed this bill to the president’s desk on Monday, Congress would have missed an opportunity to help about 20 million Americans avoid landing in higher tax brackets and to move our nation closer to breaking our dependence on foreign oil,” Gerlach said. Unfortunately, our colleagues in the Senate could not resist the urge to add some controversial provisions not directly related to shoring up our economy. Congressman Gerlach joined a group of Republican House members led by Rep. Steven LaTourette of Ohio to strip those provisions from the final bill. Despite those efforts, the House Rules Committee rejected the suggested improvements late Thursday. “I know my constituents have expressed feelings ranging from outrage to anxiety to outright exasperation at the current state of our economy and the events in Washington this week,” Gerlach said. “Indeed, these are trying times that demand difficult choices. If I had my way, this bill would be written differently. However, there is no other viable option on the horizon, and the risk of doing nothing is too great.” “Members of Congress would be unable to look a construction worker in the eye and tell them that we passed on our opportunity to do something to save his or her job. We would be unable to explain to a mother and father why their son or daughter will have to give up their dream of a college education and bright future because we wanted to score political points. That’s why I voted to act rather than to sit by and hope for the best." Federal Reserve Chairman Ben Bernanke laid out the consequences of inaction in a conference call that Congressman Gerlach and other members of the Pennsylvania delegation demanded on Wednesday. “Chairman Bernanke told us that financial markets are under enormous stress, credit markets are nearly frozen and our financial system is extremely unstable,” Gerlach added. “A severe downturn in the economy is almost certain without any action.” “If Wall Street executives broke the law or lenders preyed on borrowers, they must be prosecuted,” Gerlach said. “Our financial markets rely on transparency and honesty, and we must do everything within our power to make sure those principles are in place.” Here's what some in the 6th District had to say about the need for Congress to act: “We commend Congressman Gerlach for recognizing that a failure to pass this emergency legislation would have put our entire economy at risk. I know he shares our concern about the turmoil in the financial markets. I also know he voted today with America's best interests in mind. His vote protects Berks County, our company, our customers and our associates and families." -- Brian Hard, President Penske Truck Leasing, Reading. “Vanguard thanks Congressman Gerlach and congratulates the U.S. Congress for passing essential financial recovery legislation that should restore confidence in the markets, ensure proper credit flow, and ultimately safeguard the financial future of all Americans.” -- Jack Brennan, Chairman, Vanguard, based in Valley Forge. "The new rescue bill with the enhancements made in the last few days by Congressman Gerlach, the House Financial Services Committee and members of the Senate have made this bill palatable to Community Bankers and Main Street. I strongly support the passage of the revised rescue plan.” -- Ted Peters, Chairman and Chief Executive Officer, Bryn Mawr Trust. "On behalf of the Pennsylvania Chamber of Business and Industry and our thousands of large and small business members across Pennsylvania, we would like to thank Congressman Gerlach for his courageous vote today. While we know the vote was a difficult one, failure to pass this measure could have meant disaster to businesses and individuals. Throughout this week we continued to hear stories from our members of difficulty in obtaining credit, a situation that endangered jobs throughout the Commonwealth and the nation. This affirmative vote puts our country on the right track to stabilize our markets and safeguard the assets of businesses and individuals." – Gene Barr, Vice President, Government and Public Affairs Pennsylvania Chamber of Business and Industry. ###
The rescue plan calls for giving the Treasury a $350 billion installment to purchase assets valued below market rates in hopes of restoring investor confidence and calming the credit markets.
Clearly, this must not be the last step Congress takes. Lawmakers will continue working to keep taxes low and to hold those responsible for the current instability accountable.
“The events of the past several weeks have had a profound impact on the economy, both domestically and globally. We are living in historical times and there are fundamental changes taking place on how business is done in this country and the world and the role that government plays. Our country has been blessed with abundant natural resources and a sound infrastructure. What is needed at this moment is personal and public responsibility and leadership. The proposed TARP legislation is a necessary first step on the path to recovery. -- William S. Latoff, Chairman and Chief Executive Officer, DNB First, Downingtown.