In an address to a joint session of Congress, Obama unveiled his $447 billion jobs plan, which also includes new spending for teachers’ pay, school construction and tax reform.
Obama sought to set a tone of urgency early on. “Tonight we meet at an urgent time for our country,” Obama said. “We continue to face an economic crisis that has left millions of our neighbors jobless and a political crisis that has made things worse.”
Throughout the speech, the president avoided the lofty rhetoric that has been a hallmark of his oratory, opting for a more blunt tone.
“The people of this country work hard to meet their responsibilities. The question tonight is whether we’ll meet ours. The question is whether, in the face of an ongoing national crisis, we can stop the political circus and actually do something to help the economy,” Obama said, a line that drew loud applause from Democrats but stony glares from Republicans.
Mixed in with his calls to work together, Obama took a number of not-so-subtle shots at Republicans. His direct attack on the GOP brought Democrats to their feet in thunderous applause and was a clear nod to the demands of his party’s base that Obama fully engage Republicans politically.
Likewise, Obama’s proposals on education and infrastructure clearly pleased Democrats, who at the outset of the speech seemed reluctant before warming to the plan as Obama described it.
Republicans were predictably quiet as Obama appealed to his base with proposals for more spending for teachers and transportation, but many also sat silently even as Obama touched on areas they might support. Virtually no Republicans responded to Obama’s call for an extension of the payroll tax cut, while Obama’s statement that “this isn’t class warfare” drew derisive laughter from the Republican side of the aisle.
However, Republicans, under strict orders from their leaders, did not engage in the kind of theatrics that have marred previous speeches by Obama before Congress. And in some cases, particularly Sen.Scott Brown (Mass.), a few Republicans even broke ranks with their colleagues to applaud some of Obama’s proposals.
According to administration officials, the specifics of the plan will be built on a series of proposals that have been backed by Democrats and Republicans in the past.
This is “a combination of proposals that, if passed by Congress, will indisputably add to economic growth and add to job creation,” one senior administration official said.
The president will urge Congress to quickly pass the measure, which will likely be formally unveiled next week along with proposals to offset its cost.
According to the Congressional Budget Office’s midyear economic analysis released last month, the unemployment rate, which was 9.1 percent in August, will decline to only 8.5 percent by the end of next year and will remain above 8 percent until 2014.
The administration official stressed that helping create jobs can’t be delayed by the kind of political wrangling that marked debate over a deal enacted last month to raise the debt ceiling and over funding the federal government through the end of the fiscal year, which was passed in April, five months after fiscal 2011 ended.
The official referred to the debt ceiling debate as “the circus that the American people witnessed in Washington this summer over the debt crisis,” a term Obama reprised during his speech.
The plan calls for cutting the payroll tax in half for all workers in 2012, building on the 2 percentage point cut passed in December, which trimmed the tax by about one-third. The proposal is expected to cost $175 billion.
Another administration official said that the December cut helped Americans as gas prices rose. “It proved to be an enormously important buffer … for families facing higher gas and oil prices,” the official said.
The official also said the proposal would provide a tax cut of about $1,500 to a typical family earning $50,000 a year.
The plan also includes $70 billion in tax cuts to help small businesses by cutting in half the taxes paid by businesses on their first $5 million in payroll. The White House package also includes language to temporarily eliminate the payroll tax for new workers and increased wages — capped at $50 million in payroll increases. It would also extend through 2012 100 percent expensing that allows businesses to take an immediate tax deduction on investments in new plant and equipment.
The officials stressed that Republicans have in the past supported cutting the payroll tax for employers and employees.
An additional $140 billion would go toward various proposals intended to create jobs, including $50 billion for highway, transit, rail and aviation projects; $35 billion to prevent layoffs of teachers, police officers and firefighters; and $30 billion for school modernization, including $5 billion for community colleges.
An additional $62 billion would be spent to extend unemployment benefits and make changes in the program, including a plan that would allow workers who keep their jobs but work reduced hours to collect some unemployment insurance to make up the difference.
The officials would not speculate how many jobs the plan would create, in part because Republicans pummeled Democrats after they projected that the 2009 stimulus package would keep the unemployment rate from going above about 8.5 percent.
One official said that it is too difficult to accurately make that prediction and preferred to leave it to “independent economists to make their assessments.”
“We are just not going to get caught in that trap again,” the official added.