The U.S. economy expanded by an estimated 3 percent in the second quarter, more than double the rate in the first quarter.
One of the keys to an expanding economy is a tax code that rewards and encourages innovation and growth. That’s why we appreciate the efforts by Representative David Schweikert (R-AZ) and his Ways and Means Committee colleagues who are examining how changes to the tax code would affect America’s economy and workers, families and businesses. Rep. Schweikert is leading the New Economy team, one of 10 established by Committee Chairman Jason Smith (R-MO) and Tax Subcommittee Chairman Mike Kelly (R-PA).
Several key provisions from the 2017 Tax Cuts and Jobs Act are scheduled to expire at the end of 2025. Congress will be looking to raise revenue to pay for extensions of those expiring provisions. But Rep. Schweikert and his colleagues don’t want to harm growth prospects in key sectors, including small businesses and the burgeoning gig economy.
Life insurers have long supported efforts to increase access to financial protection for workers at small businesses. We were strong proponents of the SECURE and SECURE 2.0 retirement legislation that made it easier for small businesses to set up retirement plans and for part-time gig workers to join employer plans.
Life insurers also help businesses – small and large – attract and retain key talented workers. A proven way for business owners to stand out is to partner with life insurers to provide employee benefit packages including retirement plans, life insurance, paid family and medical leave, disability insurance, dental insurance and more.
Another vital factor for America’s economic success is access to capital.
Life insurers provide investment capital through their investments in stocks, bonds and mortgage loans across the United States. Life insurers take premium payments and invest for the long-term so they can keep their promises to their policyholders. These stable investments include U.S. corporate bonds, which companies use to expand operations, facilitate innovation and boost employment. Life insurers own more than 23% of all U.S. corporate bonds.
Life insurers also invest in state and local municipal bonds supporting utilities, transportation and other capital improvements, which are vital for economic development. In Arizona, life insurers have invested $1.4 billion in these bonds. All told, life insurers invest $137 billion in Arizona and $7.5 trillion in the U.S. economy, making life insurance companies one of the largest sources of investment capital in the nation.
For generations, America’s life insurers have been providing essential benefits to families, good jobs for workers and long-term investment capital that fuels economic growth. As Congress considers updating the tax code, we are dedicated to working with policymakers so that any changes support the American economy and maintain access to financial security for American workers and small business owners.
Tracy Jones is a NAIFA member and financial professional in Phoenix, Arizona.
