The Obama administration's policies put in place to stimulate the economy and create jobs have failed, former GOP Congressman Vito Fossella says.
In a Newsmax.TV interview, the New York City Republican says the Dodd-Frank financial reform law should be repealed and spending needs to be cut.
Otherwise, the United States can use Greece as a weather vane for what could happen when bad policies are left to linger unattended.
Poor fiscal and monetary policies can stifle economic growth, but excessive regulations, such as those imposed on the financial sector like Dodd-Frank, can really keep the economy stuck in the doldrums.
Story continues below video.
Even when lawmakers delay unleashing fresh regulations on business, uncertainty in general can keep business investment on the sidelines and hiring at bay.
Think Dodd-Frank affects only big businesses and Wall Street banks?
Think gain, says Fossella, who served in the House for 12 years, including a stint on the House Energy and Commerce Committee.
The entire financial system is at risk to President Barack Obama's onslaught of government intervention into the nation's business sector.
"Every small business or large business deals with a financial institution in some way shape for form," Fossella tells Newsmax.TV.
"When it comes to regulation, we need regulations that are more sensible and that reflect our economy and our financial institutions to date and our economy as a whole," he said. "But to throw everything at the problem and say it's going to be the cure-all, history has taught us is that's a mistake, and I think we are seeing that as a result of the implementation particularly in the regulations of Dodd-Frank."
While regulations are hampering recovery, so are debt burdens.
The Obama administration and Republicans in Congress will likely agree on a short-term solution to avoid a government default by agreeing on short-term fiscal reforms in exchange for lifting the government's $14.3 trillion debt ceiling by an Aug. 2 deadline, Fossella predicts.
The problem, however, is that sooner or later, both sides will need to address the issue again and with longer-term implications.
And Obama's calls for taxes on the wealthy won't solve the country's woes.
Feel-good legislation never does.
"Ultimately when you punish the entrepreneurial spirit in this country over the long haul, you only serve to reduce jobs, and the last thing the country needs right now is something that will punish job creation," Fossella says.
"You have business folks and consumers who are uncertain whether they should allocate and deploy capital, so this is part of that package. Until and unless we all address that, we are going to continue to see economic growth lag from where it should be, which again gets back to what's the number one issue: having growth oriented policies that create new jobs."
Stimulus measures and added regulations won't create jobs.
"There were predictions made that unemployment would drop below 8 percent if you agreed with the stimulus package, if you agreed with Dodd-Frank."
Unemployment is currently at 9.1 percent.
Greece, meanwhile, is grabbing headlines as the country wrestles with unpopular austerity measures in order to avoid defaulting.
While the United States is no Greece, the Adriatic country and cradle of the democracy deserves a good look of what can happen.
"Greece I think is the canary in the coal mine as to what's happening when countries spend too much and don't focus on the things that matter from an economic point of view."
"We need to accelerate economic growth, and Greece is an example of what can happen if we let a situation linger far too long."
Talk has emerged that the government may nudge the Aug. 2 deadline back a bit to give all said more time to reach a debt compromise.
The Treasury Department quickly quashed such suggestions.
"The Treasury Department continues to project that the United States will exhaust its borrowing authority under the debt limit on Aug. 2, 2011," the Treasury said in a statement.
"Secretary (Timothy) Geithner urges Congress to avoid the catastrophic economic and market consequences of a default crisis by raising the statutory debt limit in a timely manner."
© 2015 Newsmax Finance. All rights reserved.