Obama Proposes $450B Jobs Plan; Receives Mixed Reaction
Tweet
Share
E-mail
President Obama is at it again.
Thursday night, Obama, no doubt after much lobbying and handshaking, took the stand in a joint Chamber of Congress to announce a new jobs plan. Much of the plan, which is about $447 billion in total size, circles around payroll-tax cuts for employees and employers.
Other aspects include $62 billion in spending to extend unemployment insurance benefits through 2012 (it generally costs about $10 billion per month for the U.S. to provide unemployment benefits to those that qualify. CNN notes unemployed Americans have collected "$319 billion in jobless benefits over the past three years," though that's a bit of an older article. Unemployment levels are largely the same). Another $140 billion is to go toward infrastructure spending and state aid.
Whatever you fell about the speech -- whether it's a ploy for Obama to campaign against Congress if not passed, or to look like a hero if it is -- many will agree that jobs need to be created. Last month, nonfarm payrolls added no positions, and the unemployment rate held firm at 9.1 percent. Unemployment has only been under 9 percent for a few months since 2010, meaning many Americans have been suffering since that time.
But its not a "stimulus" plan, as Obama has fastidiously maintained, insomuch as a "jobs plan." Many unemployed Americans -- and employed for that matter -- have grown weary of the constant political bickering over the past 18-months or so, made even worse over the summer stemming from the back-and-forth about the debt ceiling limit.
Obama received applause from Republicans regarding the extension of unemployment benefits, and like the idea of an infrastructure bank, though some speculate as how the money will be spent. On taxes, the payroll tax on businesses' first $5 million in wages will be cut in half, and any business will not have to pay payroll taxes for any increase in payroll up to $50 million.
Other plans include putting $25 billion toward improving 35,000 schools, with an additional $5 billion toward community colleges.
But many Republicans object to the near $450 billion plan, still reeling from prior packages. And this one has others determining how to spend the money, which adds another layer of uncertainty.
One Moody's analyst expects the plan to add 2 percentage points to GDP, while adding 1.9 million payroll jobs, and reducing unemployment by one percentage point.
Detail of the spending expected:
Thursday night, Obama, no doubt after much lobbying and handshaking, took the stand in a joint Chamber of Congress to announce a new jobs plan. Much of the plan, which is about $447 billion in total size, circles around payroll-tax cuts for employees and employers.
Other aspects include $62 billion in spending to extend unemployment insurance benefits through 2012 (it generally costs about $10 billion per month for the U.S. to provide unemployment benefits to those that qualify. CNN notes unemployed Americans have collected "$319 billion in jobless benefits over the past three years," though that's a bit of an older article. Unemployment levels are largely the same). Another $140 billion is to go toward infrastructure spending and state aid.
Whatever you fell about the speech -- whether it's a ploy for Obama to campaign against Congress if not passed, or to look like a hero if it is -- many will agree that jobs need to be created. Last month, nonfarm payrolls added no positions, and the unemployment rate held firm at 9.1 percent. Unemployment has only been under 9 percent for a few months since 2010, meaning many Americans have been suffering since that time.
But its not a "stimulus" plan, as Obama has fastidiously maintained, insomuch as a "jobs plan." Many unemployed Americans -- and employed for that matter -- have grown weary of the constant political bickering over the past 18-months or so, made even worse over the summer stemming from the back-and-forth about the debt ceiling limit.
Obama received applause from Republicans regarding the extension of unemployment benefits, and like the idea of an infrastructure bank, though some speculate as how the money will be spent. On taxes, the payroll tax on businesses' first $5 million in wages will be cut in half, and any business will not have to pay payroll taxes for any increase in payroll up to $50 million.
Other plans include putting $25 billion toward improving 35,000 schools, with an additional $5 billion toward community colleges.
But many Republicans object to the near $450 billion plan, still reeling from prior packages. And this one has others determining how to spend the money, which adds another layer of uncertainty.
One Moody's analyst expects the plan to add 2 percentage points to GDP, while adding 1.9 million payroll jobs, and reducing unemployment by one percentage point.
Detail of the spending expected:
- $175 billion: Payroll tax cut from 6.2% to 3.1% for workers in 2012, up from a 2% reduction this year.
- $70 billion: Payroll tax cut from 6.2% to 3.1% for employers and eliminated for qualifying new hires in 2012, plus 100% expensing for new investments.
- $140 billion: Infrastructure investments, including modernizing schools and rehabbing vacant homes, and funding for states to rehire teachers and first responders.
- $62 billion: Extending unemployment insurance and new programs for jobless.
Create E-mail Alert Related Categories
Economic Data, General NewsRelated Entities
Nonfarm Payrolls, Barack ObamaSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
