Accelerating Growth

To restore security to the middle class and create an economy built to last – that creates the jobs of the future and makes things the rest of the world buys -- we have to out-innovate the competition. But to win that competition, and for American companies to be successful, they must be able to take their ideas to market quickly without the constraints of undue regulation and costs. That’s why President Obama has directed his Administration to reduce barriers to American business success, including reforming our patent system, reviewing federal regulations and promoting trade.

Patent reform

The strength and vitality of the U.S. economy depends on a patent system that protects new ideas and investments in innovation and creativity. On September 16, 2011 President Obama signed into law the most significant reform of the nation’s patent system in more than half a century. The America Invents Act was passed with President Obama’s strong leadership after nearly a decade of effort to reform the nation’s outdated patent laws. The U.S. Patent and Trademark Office is implementing the legislation in a manner that makes it easier for innovators large and small to bring new goods and services to market more quickly. It will help companies and inventors avoid costly delays and unnecessary litigation, and let them focus instead on innovation and job creation.

The U.S. Patent and Trademark Office has implemented a number of reforms. The Track One service ensures a patent application will receive a full review within one year, and offers discounts for small inventors. The backlog of patent applications has been reduced to its lowest point in years, all while taking steps to increase patent quality. And a new satellite office in Detroit, Michigan, is providing employment to experienced engineers as patent examiners, while further helping to reduce the patent application backlog. Two more satellite offices in other parts of the United States will open before the summer of 2014.

Many more advances will be announced or implemented in 2012, including new tiers of fees to provide discounts for micro-entities; streamlined and affordable methods to confirm the validity of patents after they’re issued; and increased harmonization with other countries as the U.S. again takes the lead in ensuring patent protections in a 21^st Century global marketplace.

Promoting trade

On October 21, 2011 President Obama signed three trade agreements with Korea, Colombia, and Panama into law, a key step towards helping create and preserve U.S. jobs. At the same time, he also signed an extenstion of the Trade Adjustment Assistance (TAA) that helps workers whose jobs are affected by global competition. All four of these items are important elements of the President’s balanced trade agenda to open markets for U.S. exporters and keep faith with workers here at home. 

The U.S.-Korea Trade Agreement will have a more positive impact on America’s economic output than the last nine trade agreements combined. It will eliminate within five years tariffs on many U.S. industries selling to Korea, including agricultural equipment and automotive and consumer goods. The tariff cuts in the agreement alone could increase exports of American goods by $10 - $11 billion, supporting tens of thousands of American jobs. The U.S.-Colombia Trade Promotion Agreement opens up the third largest economy in Central and South America to American businesses. It will eliminate tariffs and other barriers to U.S. exports, expanding the exports of American goods by a projected more than $1.1 billion and supporting thousands of additional jobs here at home. The U.S.-Panama Trade Promotion Agreement gives American businesses access to the one of the fastest growing economies in Latin America, with a $20.6 billion services market, and a major shipping route. This Agreement is critical, as the United States faces strong competition in Panama from other countries, with Canada and the European Union having already finalized their trade agreements.

These trade agreements will help meet the goal of the President’s National Export Initiative – doubling exports by 2015 -  by working to remove trade barriers abroad, by helping overcome the hurdles to entering new export markets, by assisting with financing, and in general by pursuing a coordinated, Government-wide approach to export advocacy abroad.

Controlling the costs of health care

With insurance premiums rising 40 percent over the last five years alone, maintaining coverage for employees has become increasingly difficult and in some cases unsustainable.

The Affordable Care Act will make it easier for businesses small and large to offer quality, affordable insurance to their employees. Today, if you are a small business with less than 25 full-time workers, you may be eligible for enhanced tax credits to help pay for your employees’ coverage. If you provide health insurance to retirees ages 55 - 64 (who are not eligible for Medicare), you can now get financial help through the Early Retiree Reinsurance Program. Importantly, the law also curbs the annual rise of in your premiums, forcing insurance companies to apply no less than 80 percent of every premium dollar collected to medical care. 

By 2014, the business case for health reform gets even stronger. For small businesses, the tax credit goes up to 50 percent. State private health insurance exchanges will create a new marketplace where individuals and small businesses can buy affordable health benefit plans. For small businesses, generally those with fewer than 100 employees, it will provide the ability to shop for coverage, pooling together to purchase quality, affordable coverage, the same way large employers do

Health care reform also benefits large employers, 95 percent of whom already offer insurance to their employees. The Affordable Care Act aggressively tackles waste, fraud, and abuse and other drivers of health care costs, which will provide employers significant savings in the cost of employee care. And, by providing affordable coverage to all Americans, the law will significantly reduce the hidden tax that currently adds $1,000 to the cost of every family policy to help pay for the costs of uncompensated care.

Developing a 21st Century regulatory system 

President Obama is committed to removing redundant and inconsistent regulations to make sure that they don’t add to red tape for businesses and American workers, while fighting to preserve common-sense standards that protect consumers and safeguard public health and the environment. 

The Administration works hard to make sure that our regulatory system is as efficient and effective as possible. In fact, regulatory costs decreased on average in the first two years of the Obama administration compared with the last two years of the Bush Administration. In the past decade, the costs of economically significant rules were highest in 2008, based on a review by the White House Office of Information and Regulatory Affairs (OIRA). In its last two years, the administration of George W. Bush imposed far higher regulatory costs than did the Obama Administration in its first two years. 

And most recently, in putting forward the American Jobs Act, the President committed to pursuing efforts to reduce the regulatory burdens on small business capital formation in ways that are consistent with investor protection.

Over the Obama administration’s first two years, the net benefits of regulations exceeded $35 billion — more than 10 times the net benefits from the first two years of the Bush administration. The benefits of regulation include not only money but also lives saved and illnesses prevented. Consumers, for instance, will ultimately save $1.7 trillion in fuel costs thanks to more fuel-efficient cars and trucks. Clean air standards will prevent tens of thousands of premature deaths and hundreds of thousands of asthma attacks each year, along with a number of other public health benefits. New regulations will prevent tens of thousands of illnesses every year from salmonella. And in 2009, highway deaths fell to their lowest level in 60 years, in part because of lifesaving rules that promote seat-belt use and make vehicles safer.

President Obama has made Wall Street reform a top priority since his first day in office, and it will now become a reality. Wall Street Reform created an independent Bureau of Consumer Financial Protection that will set and enforce clear, consistent rules for the financial marketplace. A single consumer bureau will set clear rules of the road and ensure that financial firms are held to high standards. That means consolidating and simplifying with plain language two overlapping and sometimes inconsistent federal mortgage forms, and enforcing the credit card law signed by President Obama that bans rate hikes on existing balances and other unfair practices.

At the same time it works to protect consumers and uphold fair commercial and financial practices, the Administration continues to streamline, modify, and when necessary repeal regulations to make our regulatory system more efficient. In August, 26 agencies released their final regulatory review plans, identifying reforms that will save billions of dollars in the coming years. The plans span 805 pages and include over 500 initiatives that will reduce costs, simplify the regulatory system, and eliminate redundancy and inconsistency. Estimates of the monetized five-year savings from just a small fraction of the plans’ initiatives range up to $10 billion or more. We hope and expect that ultimately the savings from the numerous initiatives will greatly exceed that $10 billion figure.

These steps are not one-time exercises. We’re changing the regulatory culture to prevent a future backlog of out-of-date and ineffective regulations that needlessly burden American businesses and consumers. We’re establishing a balanced, common-sense approach that protects the health and safety of Americans while promoting economic growth, job creation and innovation. 

Effective regulations secure a wide range of benefits: savings for businesses, predictability in the marketplace, clean air and water, workplace safety, safe food, and consumer protections. They are essential for protecting public health and implementing critical laws passed by Congress. And this Administration’s record demonstrates that a smart regulatory approach can minimize burdens on small business without compromising the basic protections that Americans have long relied on government to provide.