Businesses are still not hiring due to lingering uncertainties surrounding taxes and healthcare policies, says Carlos Gutierrez, former U.S. Secretary of Commerce. He also told Newsmax.TV that the United States should compete with China by forging free-trade agreements with other Asian nations and not through slapping tariffs on Chinese imports.
China is a competitor with the U.S. in the tight race to create jobs and fuel economic growth, Gutierrez said. The U.S. free-trade agreement with Korea would be a key tool for the United States to win that race.
"One of the most strategic moves we can make in Asia is having a free-trade agreement with Korea,” he says. ”All of a sudden we're not just reliant on China. China sees that we have a very special relationship with a neighbor, other neighbors see the same thing, (and) we can start diversifying our business throughout the region," Gutierrez says.
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"Those are the types of things that we should be doing to compete against China, but it should be that kind of a competition as opposed to the political rhetoric of imposing tariffs," Gutierrez adds.
Should the U.S. use laws to limit imports as opposed to using policy to increase trade, protectionism would ensue. "And the U.S. being the leader, if we sanction protectionism, you can be sure the rest of the world is going to follow."
The United States and South Korea are hammering out terms over their proposed free-trade agreement.
Turning back to the U.S. and a corporate reluctance to hire, he said: "I think there is a lot of reluctance to make commitments before some big questions are answered."
"Today companies are beginning to understand the cost of healthcare, the cost of healthcare reform. Businesses still aren't sure what's going to happen with the tax regime although the deal that was struck was a very good step forward."
More regulations, however, pop up and hamper business, prompting corporate America to sit back, tidy up their finances and wait for better times.
"I believe what they've done is focus on making sure their balance sheets are healthy and hoping that a time does come when they feel more secure about investing in their own country," says Gutierrez.
"I've heard some people talk about if there is political risk of investing in the U.S. It's the first time in my life that I've ever heard that."
Repealing President Barack Obama's healthcare reform has become a priority for some lawmakers, and Gutierrez says taking a step back to at least rethink the reform isn’t a bad idea.
The White House says it's happy with the law and adds it's "willing and eager to work with both Democrats and Republicans to improve the Affordable Care Act."
"But we can't go backward," Obama says, according to UPI.
"Americans deserve the freedom and security of knowing that insurance companies can't deny, cap, or drop their coverage when they need it the most, while taking meaningful steps to curb runaway healthcare costs."
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