Jack Earle knows something about job creation.
The Willingboro native owns seven McDonald’s in the region and has more than 400 employees at the fast-food restaurants.
The businessman, like some other observers last week, said President Barack Obama’s speech Thursday night was delivered well.
The substance, he said, was another story.
“I applaud the president for taking on job creation. We need to get it fixed,” said Earle, a resident of Gladwyne, Montgomery County.
Earle is chairman of the International Franchise Association, a trade group that advocates for franchise businesses.
He experienced the speech firsthand Thursday in Washington, D.C., as a guest of House Speaker John Boehner, the Ohio Republican.
Obama revealed a $450 billion plan to create jobs and put dollars in the hands of recession-fatigued Americans and urged Congress to act quickly on it.
The newest item in the president’s speech would cut the Social Security payroll tax for millions of workers and for employers. For individuals, that tax has been reduced from 6.2 percent to 4.2 percent for this year, but will go back up without action by Congress. Obama said he wanted to deepen the cut to 3.1 percent for workers.
Earle said the speech didn’t address serious issues that concern his members.
“First and foremost, access to credit,” said the business leader who has owned McDonald’s franchises for 28 years. “We have franchisees who can’t access credit to grow their brand.”
The uncertainty about health care reform and tax rates are also issues, he said.
“Costs with the employer-mandate provision in the health care law ... uncertainty regarding the future of tax rates beyond 2012 ... are crippling the ability for franchised small-business owners like myself to create jobs.” Earle said.
Nationally recognized economist Joel Naroff, the president of Naroff Economic Advisors in Northampton, agreed that uncertainty is a big concern for business. The speech also showed the limitations of government, he said.
“The speech was well-stated,” Naroff said Friday. “It seemed to be balanced, but the issue is what can the president really do?”
Naroff said the basic problem is lack of demand on the part of consumers and industry. Proposed fixes such as the Social Security payroll tax cut could only provide short-term relief, he said.
“You have a lot of negative news that affects a willingness to spend,” said Naroff, a past president of the Philadelphia Council of Business Economists.
“So much of the problem has to do with perception,” he said. “When it comes to government, don’t just do something, stand there. There are limitations to the capacity of government.”
Temple University economist William C. Dunkelberg said, “The best thing the president can do is stop creating uncertainty with all the new regulator stuff, and reach an agreement with Congress on a clearly understood path to a better fiscal picture, not the road to Athens.”
Dunkelberg, who also chairs Liberty Bell Bank in Evesham, pointed out that the Michigan consumer sentiment gauge showed confidence was at its lowest level since 1980.
“Once fear is mitigated, consumers will spend more and business will have a reason to hire,” said Dunkelberg, a resident of Wynnewood, Montgomery County.
Philip Harvey, a professor of law and economics at Rutgers School of Law in Camden, praised the president for making a “powerful argument for the need to set aside the partisanship of this summer’s budget debate in addressing the nation’s unemployment crisis.
“If Republican leaders in Congress respond in kind,” he said in an email interview, “it should be possible to reach agreement on measures that would avoid a double-dip recession and begin to push the unemployment rate down.”
Harvey said he wonders if it was a good negotiating strategy when dealing with “policy extremists, to propose at the outset what you’re willing to settle for in the end.
“Substantively, I wish he would make the distinction that FDR did, between the policies we should adopt to promote a rapid recovery from the recession and our responsibility to meet the immediate needs of the unemployed by creating temporary jobs for them in the public sector while they wait for the private sector to recover to the point that it can re-employ them,” Harvey said.
On a more positive note, Mark Zandi of Moody’s Analytics said in his online analysis of the Obama plan, that it would aid economic growth by 2 percentage points, add 1.9 million jobs and reduce unemployment by a full percentage point next year.
Chris Bishop: 609-871-8140; email: cbishop@phillyBurbs.com; Twitter: @chrisleebishop
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