FROM THE OFFICE OF PUBLIC AFFAIRS

Good morning.  It is a pleasure to address the State Department’s first Hispanic Business Roundtable, and to join Secretaries Powell and Evans, Ambassador Zoellick, SBA Administrator Baretto and Judge Gonzales for this historic event.  It is even more exciting to see so many prominent business leaders in the room -- so many engaged in realizing the economic potential of the United States, and our neighbors in Latin America.

Last month, I made one of my first international trips as Treasury Secretary to three Latin American nations: Brazil, Ecuador and Colombia.  I went to emphasize the importance of the region to American economic interests, and to say that we are making trade, growth and stability in Latin America one of our top priorities.  It is clear to me that Brazilian and Ecuadorian leaders are on the right track, and Colombia, which has struggled with security issues, has leadership committed to making progress on economic development.

In each of these countries, and in other Latin American nations whose leaders I’ve met, it seems there is an understanding that the private sector, especially small business, must serve as the engine of economic growth and job creation, while the government’s role is to promote a stable, investment-oriented policy environment.  That’s a wonderful development, and we are looking to build on that understanding with major free trade pacts that will encourage economic cooperation and international investment.

That is also the understanding we have here in the United States, and it is embodied in the President’s Jobs & Growth plan, which I am pleased to say has significantly cleared both the House and Senate, and is now headed for negotiations between the two houses. 

The plan will help all of the business leaders in this room to invest in this country, create new jobs, and through that growth expand trade with our Spanish speaking neighbors. 

Consider a few of the major components.  The elimination of the double taxation of dividends, passed in the Senate, will reduce the cost of capital in our economy, allowing businesses like yours to invest more easily in expansion and hiring.  Stock values are likely to rise, as a result of the higher tax-effective return on equity, and those stock values will stimulate investment and consumer demand through the wealth effect.

Another part of the plan, the immediate reduction in marginal income tax rates, will put more money in the hands of consumers – every taxpaying American – right away, boosting your sales.  Just as valuable, those reduced marginal rates apply directly to the incomes of the small businesses which we know drive so much of our economic activity.  Lower marginal income tax  rates, passed in both the House and Senate, will free up money for new jobs and equipment in those small businesses. 

Another outstanding element of the President’s plan for small business is the increased expensing of new business equipment.  In the House and Senate plans, that amount has been raised to $100,000 of new equipment annually.  That’s a real incentive to accelerate investment plans and make new jobs for every business, and it will especially help equipment and technology manufacturers.

We are certainly eager to see the final law come out of committee and onto the President’s desk as soon as possible, with all the President’s key initiatives in force.  The sooner he can sign the bill, the sooner America’s families and entrepreneurs can begin to take advantage of the enhanced incentives for growth it provides.

Hispanic-American business leaders, such as those in this room today, represent a strong entrepreneurial culture in the American economy, and you stand to benefit from the President’s plan.  You also represent a strong voice in favor of the President’s plan, and we thank you for that.  Keep up the good work, and let your legislators know how you feel.

While your companies do business with all Americans, of every background, it is interesting to note that America’s Spanish-speaking population represents the fifth-largest such population in the world.  Clearly, that common culture is going to strengthen our relations with our Latin American neighbors, and provides a natural basis for our partnerships.  I encourage all of you to look for opportunities for trade and investment in Latin America, as well as here at home.

Just as this administrations policies are designed to make it easier to do business within the United States, we have a number of initiatives aimed at making it easier for you to invest and trade abroad.  The Free Trade Area of the Americas agreement is a key initiative for strengthening business-to-business ties in our hemisphere.  Negotiations for that agreement are well underway, as I’m sure Ambassador Zoellick will detail.  Within the domain of free trade, Treasury is focused on liberalization of trade in financial services, which is essential for strengthening developing economies, and creating credit for growth.

I also want to applaud two of my favorite Hispanic-American government leaders, Rosario Marin, the Treasurer of the United States, and José Fourquet, Executive Director of the Inter-American Development Bank.  They are two of our most valuable players at Treasury.  Rosario’s a great spokesperson for our department and this administration, and I hope everyone here has a chance to meet her and hear her story.  José will be speaking to you later today, and I can’t think of anyone who has greater insight into the development challenges facing Latin America today, or the way we can work together to make progress.

This administration highly values our economic ties to Latin America, and we value our ties to Latino business and community leaders in the United States.  I am confident that with events like today’s roundtable, we can set our priorities for investment and development together, and create the greatest gains for job creation and prosperity throughout this country, and throughout our hemisphere.

Thank you.