The nation's economy would improve, Sen. Mitch McConnell, R-Ky., told the Richmond and Berea chambers of commerce Thursday, if President Barack Obama would "just stop doing what he is doing."
The president may have inherited a difficult economic situation, said McConnell, the Senate's Republican leader, but Obama has had ample time to get it restarted. But, his actions have made it worse, the senator said.
For Obama to win re-election, he will have to convince voters that someone else is to blame for continuing high employment.
With Democratic majorities in both houses of Congress during his first two years in office, the president had many opportunities to get the economy turned around, McConnell said. But, his policies have slowed recovery, the senator believes.
Offering advice to the president, McConnell said, "If you're in a hole, quit digging."
For example, the Dodd-Frank financial reform legislation passed by Congress and signed by the president have added about $1,000 to the cost of new mortgages, McConnell said a friend in the industry had told him.
Obama and his party seem to believe that anyone in business to make a profit must be doing something wrong, the senator said.
Democrats appear to think that regulation reduces unemployment because businesses must hire employees to deal with them. But, regulations enacted in the past two or three years have held back job growth, McConnell said.
Some small businesses have reduced their number of employees to 50 so they will be exempted from many regulations, he said.
Also, fear of new regulation and higher taxes has led corporations to keep more than $2 trillion in cash "on the sidelines" instead of investing it, McConnell said.
After Republicans regained control of the House of Representatives in 2010, the Senate minority leader said he hoped divided government would produce the kind of advances made in the recent past when the White House and Congress were controlled by opposing parties.
Sweeping, fundamental changes are possible only when both parties come to agreement, McConnell said, not when one party controls two branches of government. In fact, one-party control of both the White House and Congress tends to produce a negative reaction from voters, as occurred in 2006 and 2010, he said.
Republican President Reagan and Democratic Speaker of the House Tip O'Neill had reached compromises on raising the retirement age for Social Security to 67 and corporate tax reform. President Bill Clinton and a Republican-controlled Congress came to agreement on welfare reform and produced a balanced budget in the late 1990s.
The senator offered Clinton, "a practical man who governed from the center," as a model to guide Obama in the last year of his first term and if re-elected for a second term.
McConnell said he and Vice President Joe Biden, a former Senate colleague, had negotiated a continuation of tax cuts passed during George W. Bush's presidency and increasing the amount exempted from the federal estate tax to $5 million. But, that has been the exception.
However, members of the president's party had created a "laundry list" of measures over the past decade, including health-insurance reform, that they used control of both Congress and the White House to enact, McConnell said.
The policies favored by the president and his party are akin to those that have led the European Union to a debt crisis, the senator said, and America should turn away from that path instead of taking it.
