Obama's coming job-creation proposals already drawing fire

McClatchy NewspapersAugust 31, 2011 

WASHINGTON — Under pressure to move the needle on the nation's stubborn unemployment rate, President Barack Obama is expected to call next week for a package of job-creating proposals that include extending a payroll tax break for the middle class and rebuilding the nation's aging bridges, roads, schools and airports.

But with Democrats and Republicans in Congress at odds all year on how to create jobs, there's little evidence that their impasse will break anytime soon.

Even the timing of the speech was up in the air late Wednesday, with House Speaker John Boehner, R-Ohio, rejecting Obama's call to address a joint session of Congress next Wednesday night, the same time that Republican presidential candidates will be debating in California.

Obama, who previewed some job proposals last month during a Midwest bus tour, called Wednesday for bipartisan support for his pending package, saying that voters want politicians to "put aside politics and start making decisions based on what is best for our country and not what is best for each of our parties."

"It is my intention," the president said in a letter to congressional leaders, "to lay out a series of bipartisan proposals that the Congress can take immediately to continue to rebuild the American economy. It is our responsibility to find bipartisan solutions to help grow our economy, and if we are willing to put country before party, I am confident we can do just that."

Already, Obama has signaled that he'd use Republican opposition as a 2012 re-election campaign theme if the GOP rejects what his administration said would be projects determined by independent analysts to be "pro-growth and pro-job creation."

The president said Tuesday in a radio interview that "if Congress does not act, then I'm going to be going on the road and talking to folks, and this next election very well may end up being a referendum on whose vision of America is better.

"The American people voted for divided government, but they didn't vote for dysfunctional government," he said on the "Tom Joyner Morning Show." "And if they see one side not willing to work with the other to move the country forward, then that's what elections are all about."

The coming speech could be key to Obama's re-election efforts, with the sluggish economy pulling down his popularity ratings to all-time lows. Liberals, unhappy with the president's summer debt-ceiling negotiations with House Republicans, are pressing him to offer a sweeping job-creation plan, not one that's limited to what might pass muster with congressional Republicans.

Obama is hemmed in by budget considerations, but 68 liberal groups wrote to him this week pressing him to go "big" and "bold" and pay for it by increasing taxes on the wealthy.

The Center for American Progress, a liberal policy-research center with close ties to the Obama White House, has suggested that the U.S. put up at least $65 billion for infrastructure projects, as well as efforts to reduce the number of U.S. home-mortgage foreclosures.

"President Obama should not meet halfway those who only offer economic incoherence,' the center said in its own plan. "He should take them head on."

Michael Ettlinger, the center's vice president for economic policy, said he expects Obama to call for an infrastructure bank to pay for repairing aging roads and bridges, as well as to put construction workers back to work retrofitting buildings to make them more energy-efficient. But he said the size of the president's proposal had yet to be determined.

"Someone needs to show the American people that someone is trying to do something about job creation," he said, suggesting that Obama needs to "throw down the gauntlet. "If the president comes out with something tepid, we've got no chance of forcing that kind of discussion."

Republicans have called for more tax breaks and repealing regulations that they say are smothering job creation.

Democrats note that in a sign of the recent partisan division, congressional Republicans are signaling that they'll oppose Obama's bid to extend an employee payroll tax cut for another year, a tax break that had bipartisan support when it passed in December.

The president's expected call next week for a program to use private and public money for highway and rail construction picked up support, if somewhat qualified, from the U.S. Chamber of Commerce, which called it an "interesting concept," depending on how it's structured.

But some of his expected proposals face opposition even among his allies. AFL-CIO President Richard Trumka called Wednesday for "boldness" but said the union would oppose pending trade deals with South Korea and Colombia, which Obama has said would boost U.S. exports.

Other proposals the president is said to be looking at include a business tax credit for new hires. In early August, Obama said he'd ask Congress to give tax breaks to companies that hire returning Iraq and Afghanistan veterans, as well as to double an existing tax credit for hiring long-term unemployed veterans who have service-related disabilities.

While vacationing in Martha's Vineyard, he talked with members of a jobs council he convened about increasing the number of engineers who graduate from U.S. schools. He's also said to be looking at expanding payroll-tax relief for employers, along with programs that would help school districts retain teachers.

Obama asked federal departments and agencies on Wednesday to identify "high impact, job-creating infrastructure projects" that could be sped up and completed within 18 months.

But he may have a tough time getting traction on Capitol Hill. House Majority Leader Eric Cantor, R-Va., laid out a plan earlier this week for job creation legislation that House Minority Whip Steny Hoyer, D-Md., criticized as unrealistic.

The GOP-controlled House of Representative has scheduled a series of votes this fall to repeal what Cantor called "job-destroying regulations."

A second Republican theme will involve tax relief aimed at creating what Cantor calls "middle-class jobs." The GOP would increase tax deductions for small business, for instance. Those efforts may not get far in the Democratic-controlled Senate.

Democrats have been fighting back with a "Make It in America" agenda. It includes a series of bills such as one that would require industry, labor and other leaders to develop a national strategy to increase manufacturing.

(David Lightman contributed to this report.)

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