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Small business job creation has continued to be weak throughout 2011, though a slight increase in December has sparked some hope. In congressional testimony, Martin Baily of the Brookings Institute outlines the challenges facing small businesses and the decline in startups. Small business startups are essential to economic revival, as these businesses create jobs faster than more established businesses.

Infrastructure

House Republicans Link Transportation, Energy Legislation

A key House committee has linked a $260 billion measure to provide funding for roads and other transportation infrastructure (WSJ) to controversial energy legislation. The measure, which will face a difficult time in the Senate, would increase offshore oil production, open up the Alaska National Wildlife Refuge to drilling and expand exploration for shale oil in the United States.

Infrastructure. Read more on how upgrading the nation’s aging infrastructure is essential to maintaining U.S. competitiveness.

International Trade and Investment

Blaming China for U.S. Economic Woes

Writing for the National Interest, Professor John F. Copper of Rhodes College says American politicians should not blame China for many of America’s economic problems. He takes issue with claims that the yuan is undervalued and argues that a stronger yuan would do very little to help the U.S. economy.

International trade and investment. Read more from leading analysts on the debate over next steps in U.S. trade policy.

Innovation

Center for Public Policy Innovation Issues Report on Restoring U.S. Competitiveness

In a special report, CPPI emphasizes the importance of small businesses to economic growth and job creation (SacBee). The report underlines the importance of technological innovation in spurring small business growth, as access to modern technology creates more opportunity for virtual global supply chains and boosts competitiveness.

The report’s findings argue for making capital gains tax exemption permanent for qualified small business investors, which would provide a profitable corporate tax credit.

Innovation. Read more on how the U.S. capacity to innovate could play a chief role in economic growth.