Mr. Chairman, I welcome a discussion about how to invest in our future. In a time when many valuable initiatives are limited by budget squeezes or even cut by sequestration, it is important to be creative. I salute Mr. Young, Mr. Larson and their cosponsors for recognizing the need to invest much more in programs that help low and middle income Americans get an education, attain long-term employment and succeed in other important areas.
In some places, social impact bonds are already in use. I certainly support seeking innovation and applaud businesses and donors who seek better ways to encourage stronger and more responsive communities. Since the states are the laboratories of democracy, one question presented by today’s hearing is whether federal intervention is necessary or desirable. This is a welcome departure from much of the rhetoric used in recent years by Congressional Republicans in their efforts to label many important programs, like nursing care for seniors, Pell Grants for college students, and tax relief for working families as welfare and to subject them to deep cuts.
This hearing is examining whether a specific financing structure, known as social impact bonds, are a useful way to support successful programs. I look forward to hearing from our witnesses on this question and I strongly support encouraging businesses to do all they can to better serve our communities. However, I have significant doubts as to whether we should be using taxpayer money to pay a premium to private investors -including investment banks -in pursuit of social service solutions. With our budget as limited as it is, at a time when funding for one highly effective program-home-visiting for at risk mothers and their children-is set to expire next March, I have serious doubts as to whether now is the time to implement a funding structure that will help put taxpayer dollars in the pockets of third-party investors instead directly into our communities.
I look forward to hearing from each of our witnesses on this question. I think we need to be open to new ideas, we just need to be sure that those new ideas are the best way to make good use of what are precious taxpayer dollars.
Thank you.
