House Leadership Crafts FinTech Agenda

The Innovation Initiative

Fixing Problems, Creating Opportunity, and Building the Future for the American People

The world is changing rapidly. Amazon has surpassed Wal-Mart as the world’s biggest retailer without a single brick and mortar location. The iTunes Store is now the top music vendor without carrying a single CD. And in five years, the ride-sharing service Uber went from an idea to a global company valued at more than established carmakers like Honda, Ford, and GM.

We are experiencing a fourth industrial revolution — a revolution that holds great promise for America, but has also brought great changes. Unfortunately, despite the advances we’ve made, many Americans haven’t felt the benefits of the 21st century. We can’t go back in time, nor should we. But we obviously can’t accept a status quo that leaves so many people out.

Our goal in government should be to adapt to changing times — rethinking what government does and how government operates to give every person the opportunity to succeed.

Unfortunately, the federal government has been unwilling to update. Just think: we still operate under a tax code that was last overhauled before the modern Internet existed. Likewise, most of our agencies and bureaucracies were invented before the age of cell phones and personal computers. And we still create a budget each year using a process formalized when The Stingwon Best Picture at the Academy Awards.

These deficiencies cause real problems for the American people. Workers who would gladly take a job in a new American industry are left jobless because an outdated tax code and regulations keep that industry from growing. In fact, the rate of new businesses entering the economy has fallen to a 30-year low. And while we are accustomed to greater convenience in everyday life from banking to shopping to learning, government remains opaque and slow.

So Chief Deputy Whip Patrick McHenry and I are beginning an Innovation Initiative in Congress to make sure the future works for the American people. To do this, the House will devise legislation to accomplish two goals: remove government-made obstacles to innovation and bring government itself into the 21st century.

Removing Government-Made Obstacles to Innovation

Getting government out of the way is about much more than economics or entrepreneurship, though both will improve with reformed government regulation. The most tangible benefits of 21st century government policy will be new and better paying jobs, improved and cheaper services and consumer goods, and greater flexibility for American workers and businesses.

By stopping or limiting innovation, government policy hurts every small business owner and Main Street entrepreneur looking to grow, every employee who wants a good paying job or a raise, and every person looking for an easier and better life for themselves and their families.

Workers are hit the hardest by these policy failures. Take the ridiculous occupational licensing requirements, where government puts up barriers to work even for people with the lowest skill levels. For example, a “Shampoo Technician” — meaning a person who shampoos hair — in Tennessee must pay $140, pass two exams, and complete “not less than 300 hours in the practice and theory of shampooing at a school of cosmetology.”

Every challenge presents an opportunity, and we have the opportunity to overcome these challenges by enabling positive disruption and even just basic individuality, reducing the standardizing control government tries to exert over our lives. In essence, we want small government that allows innovation not just because big government is inept, unaccountable, and hurts our economy, but also because small government allows for creativity, individuality, flexibility, and success in a way big government does not.

Majority Leader Kevin McCarthy and Chief Deputy Whip Patrick McHenry meet with OpenGov during a trip to Silicon Valley, recently profiled in the Wall Street Journal, to discuss their Innovation Initiative.

Bringing Government Itself into the 21st Century

In the 1930s, people suffered through the summer with electric fans. Today, we have central air conditioning. In the 1930s, we got the news on the radio and in the morning paper. Now, we hear about worldwide events instantly with alerts on our smartphones. In the 1930s, the Department of Veterans Affairs (VA) processed paper disability claims. Today, it still processes paper disability claims.

Fifteen years into the 21st century and the VA hasn’t entered the internet age, and its veterans who suffer for it. Across the board, government is malfunctioning, and today there is an entire generation of voting-age Americans who has never seen government work the way that it should. It’s no wonder people think Washington is broken.

Updating how government works means getting rid of the outdated, left-wing assumption that more money, bigger bureaucracy, and centralized control are the only solutions. After all, tax dollars and a bigger government haven’t improved the VA, health care, education, the job market, or really anything. Congress can improve the way Washington functions by challenging the status quo and bringing innovation and technology from the private sector into government. There is no reason our government shouldn’t be in the Internet age.

But we also must acknowledge that in the 21st century, government generally isn’t the best tool to solve our complicated problems. Government has failed to help people too many times, and our country’s resources would be better spent on what actually works.

Embracing the Future for the Benefit of All

We can’t hide from the future. But we also can’t ignore the fact that rapid changes are unsettling the American people. The new economy is dynamic and filled with opportunity, but it hasn’t helped everyone. Retrenching in the policies of the past — of big government, higher taxes, and more regulations treating everyone and every problem the same — only ensures the same results.

America has unprecedented potential. With the Innovation Initiative, we can remove government obstacles and bring government itself into the modern age, creating a freer, more stable, and more prosperous country for all.

Majority Leader Kevin McCarthy and Chief Deputy Whip Patrick McHenry meet with OpenGov during a trip to Silicon Valley to discuss their Innovation Initiative

Majority Leader Kevin McCarthy and Chief Deputy Whip Patrick McHenry meet with OpenGov during a trip to Silicon Valley to discuss their Innovation Initiative