For Immediate Release
January 31, 2007
Fact Sheet: The State of the Economy
President Bush Delivers State of the Economy Report
State of the Economy 2007
In Focus: Jobs & Economy
"A future of hope and opportunity begins with a growing economy and that is what we have.
This economy is on the move, and our job is to keep it that way, not with more government, but with more enterprise.." President George W. Bush, State Of The Union Address, 1/23/07
Today In New York, President Bush Delivered A Report On The State Of America's Economy. The President highlighted our strong and dynamic economy, and discussed the challenges we face in keeping the economy growing. The U.S. economy is resilient and responsive, adding more than 7.2 million jobs since August 2003 despite numerous challenges including a recession, corporate scandals, the 9/11 attacks, and the worst natural disaster in American history.
American Workers Are Finding Jobs And Taking Home More Pay
- Our Economy Has Created More Than 7.2 Million Jobs Since August 2003. Payroll jobs increased 167,000 in December alone, and have increased by more than 600,000 jobs in the past four months.
- The Unemployment Rate Was 4.5 Percent In December. This is well below the 5.1 percent average rate for 2005, and below the average of each of the past four decades.
- Real Wages Rose 1.7 Percent During 2006. This rate of growth is substantially faster than the average rate of the 1990s, meaning an extra $1,030 last year for the typical family of four with two wage earners.
- Real After-Tax Personal Income Per Person Has Increased Over $2,800 Or 9.6 Percent During This Administration.
The President's Agenda Will Help Keep The American Economy Flexible And Dynamic
- Making Tax Relief Permanent: The President reduced taxes for every American who pays income taxes, and calls on Congress to keep our economy growing by making this tax relief permanent.
- Balancing The Budget: President Bush has proposed balancing the budget through pro-growth policies and spending restraint, enacting common-sense reforms to help prevent billions of taxpayer dollars from being spent on unnecessary earmarks, and reforming entitlement programs.
- Extending Trade Promotion Authority: The President believes the best way to expand opportunity for American workers and help impoverished nations is to encourage free and fair trade, and he has asked Congress to extend his trade promotion authority to negotiate trade deals.
- Reforming Our Health Care System: In addition to his ongoing policies, the President's State of the Union Address included new initiatives to help make health care available and affordable for more Americans, including a standard deduction for health insurance and the Affordable Choices Initiative for States.
- Diversifying Our Energy Supply: By increasing the transportation sector's energy diversity and reducing demand for oil, the President's Twenty in Ten energy plan announced in his State of the Union Address can enhance America's energy security and help confront the challenge of climate change.
- Strengthening Public Education: The President's proposals to strengthen and reauthorize the No Child Left Behind Act will help ensure that every public school is a place of learning and a force for upward mobility. In addition, the President's American Competitiveness Initiative will help improve math and science education in middle schools and high schools.
America's Business Leaders Also Have Responsibilities. Shareholders should know what executive compensation packages look like, so the Securities and Exchange Commission has issued new rules to ensure that these packages are transparent. Government should not decide compensation for America's corporate executives, but the salaries and bonuses of CEOs should be based on their success at improving their companies and building value for their shareholders.
Making Tax Relief For All Americans Permanent
Through The End Of 2006, President Bush's Tax Relief Has Helped Spur Economic Growth By Keeping $1.1 Trillion In The Pockets Of American Taxpayers. The President reduced taxes for every American who pays income taxes, doubled the child tax credit, reduced the marriage penalty, created new incentives for small businesses to invest, and put the death tax on the road to extinction. The American people have used the tax relief to provide for their families, create jobs, and help make America's economy the envy of the industrialized world.
- The President Calls On Congress To Keep Our Economy Growing By Making His Tax Relief Permanent. To keep our economy growing, the President wants to make tax rate reductions and other pro-growth tax relief permanent. He also supports making permanent the Child Tax credit and the marriage penalty relief.
- In May 2006, The President Signed The Tax Increase Prevention And Reconciliation Act Of 2005, Extending His 2003 Tax Cuts On Dividends And Capital Gains. In December 2006, the President signed legislation to extend the deductibility of tuition and higher education expenses to help more Americans go to college, and to extend and expand the research and development tax credit to keep our Nation leading the world in technology and innovation.
Balancing The Budget By 2012
Next Week, President Bush Will Propose A Budget That Will Reduce The Deficit Over The Next Five Years And Produce A Balanced Budget By 2012. The Budget will achieve balance while addressing the Nation's most critical needs, including supporting the Global War on Terror and sustaining the strength of our economy through permanent tax relief.
- The President Has Called For Earmark Reform To Help Eliminate Wasteful Spending. The President applauds Congress' progress in requiring the disclosure of the sponsors, costs, recipients, and justification for each earmark. The President calls on Congress to go further by enacting comprehensive earmark reform that brings greater transparency and accountability to the Congressional budget process, including:
- Stopping the practice of concealing earmarks in so-called report language instead of placing them in the actual language of the bill.
- Cutting the number and cost of all earmarks at least in half by the end of this session.
- The President Believes Balancing The Budget Through Pro-Growth Economic Policies And Spending Restraint Better Positions Us To Tackle The Longer-Term Fiscal Challenge Facing Our Country: Reforming Entitlements. Reforming Social Security, Medicare, and Medicaid will enable future generations to benefit from these vital programs without bankrupting our country. The President has led the way in focusing attention on this problem and in promoting real solutions, and passing legislation to enact such reforms will require bipartisan cooperation.
Extending Trade Promotion Authority
The President Is Committed To Opening Markets Around The World And Expanding Opportunities For America's Farmers, Ranchers, Workers, And Businesses. America is home to 5 percent of the world's population, meaning that 95 percent of our potential customers are abroad. President Bush believes America can compete economically with any nation as long as the rules are fair. By encouraging a system of free and fair trade, we can create better-paying jobs for American workers and farmers, provide new opportunities for entrepreneurs, and help lift entire nations out of poverty.
- The President Has Asked Congress To Extend His Trade Promotion Authority To Negotiate Trade Deals, Including The Doha Round. The President believes the best way to help impoverished nations and expand opportunity for American workers is to complete the Doha round and expand wealth and opportunity through opening markets and ensuring our trading partners play by the rules.
Reforming Our Health Care System
The President Seeks To Help More Americans Afford Basic Private Health Insurance By Reforming The Tax Code With A Standard Deduction For Health Insurance And Helping States Make Affordable Private Health Insurance Available To Their Citizens. The President's proposed standard deduction for health insurance will help make basic private health insurance more affordable for families and individuals whether they have insurance through their jobs or purchase insurance on their own. For those who remain unable to afford coverage, the President's Affordable Choices Initiative will help eligible States assist the poor and sick in purchasing private health insurance.
- President Bush Has Called On Congress To Enact Other Policies To Help Make Health Care More Affordable And Accessible. We need to expand Health Savings Accounts, help small businesses through Association Health Plans, reduce costs and medical errors with better information technology, encourage price transparency, and protect good doctors from predatory lawsuits by passing medical liability reform.
Diversifying Our Energy Supply
The President's Twenty In Ten Energy Plan Sets The Goal Of Reducing U.S. Gasoline Usage By 20 Percent In 10 Years. This plan will help confront the challenge of climate change and increase our energy security by:
- Increasing The Transportation Sector's Energy Diversity. Under the President's proposal, the alternative fuel standard will be set at 35 billion gallons of renewable and alternative fuels in 2017, an amount equal to 15 percent of projected annual gasoline consumption. Increasing renewable and alternative fuels used in automobiles from 3 percent in 2006 to 15 percent in 2017 can give drivers a built-in defense against supply disruptions and high gasoline prices.
- Reducing Oil Demand. Reforming and modernizing fuel standards for cars as we did with light trucks will reduce projected gasoline consumption by another 5 percent in 2017. Overall, the President's plan will reduce our projected gasoline consumption by 20 percent in 2017. Reducing oil demand could slow the growth of oil prices and lower price volatility over time, increasing our energy security.
In Addition, The President Has Called For Doubling The Current Capacity Of The Strategic Petroleum Reserve To 1.5 Billion Barrels By 2027. Uninterrupted oil supply is critical to our energy security. Increasing oil reserves strengthens our ability to respond to supply disruptions and reduces our vulnerability to terrorist attacks on energy supplies and infrastructure.
Keeping America Competitive By Strengthening Education
The President's American Competitiveness Initiative (ACI) Will Help Keep America The Most Innovative And Competitive Economy In The World. The ACI will encourage more aggressive investment by businesses in research and development, increase Federal support for vital basic research, and improve math and science education for America's students as well as support the basic research that fuels innovation.
The No Child Left Behind Act Is Getting Results For Our Children And Our Economy And The President Asks Congress To Reauthorize It This Year. Math and science skills are critical for success in college and the workplace. The President's proposals to strengthen and reauthorize NCLB include:
- Strengthening the teaching of math in elementary and middle schools by implementing the Math Now program based on the recommendations of the National Math Panel;
- Increasing academic rigor by training more teachers and making rigorous Advanced Placement classes available to more low-income students;
- Encouraging talented professionals, especially in the fields of math and science, to share their expertise in the classroom through the Adjunct Teacher Corps; and
- Encouraging a greater focus on science by including student achievement results in science in accountability decisions.
In February 2006, The President Signed Legislation Creating Grants To Encourage Students To Complete A Rigorous High School Course Of Study And To Major In Math, Science, Or Critical Foreign Languages. Academic Competitiveness Grants and National SMART Grants will provide $4.5 billion over the next five years to further reward Pell-eligible students who complete a rigorous high school curriculum or who pursue college majors in high demand.
Funding For Pell Grants Has Risen By Nearly 50 Percent Since President Bush Took Office. More students received aid last year than in any other year. From 2001 to 2006, student aid funding increased by 57 percent, and the number of students receiving aid increased by 24 percent.
- Student Loan Interest Rates Are Low By Historical Standards. This school year, as required by 2002 legislation, the variable interest rate was replaced with a fixed 6.8 percent interest rate, which is lower than the student loan interest rate in all but six of the last 42 years.