Obama plans to cover the cost by asking a new congressional supercommittee debt panel to go beyond its target of finding $1.5 trillion in deficit reduction by the end of November, so the extra savings can pay for short-term economic help. That debt panel meets for the first time Thursday.
In one upbeat sign for those looking for a Washington compromise, House Speaker John Boehner and House Majority Leader Eric Cantor have told Obama they see potential areas of agreement on jobs — for example, infrastructure, which Obama has pushed repeatedly. Cantor also signaled to reporters Wednesday that he might support a payroll tax cut.
"It is not games and politics for people out across this country. It's real," Cantor said about the state of the economic debate. "The fact that we have had such sustained joblessness in this country, the fact that people are doing anything they can in many instances just to stay afloat and to pay the bills, it's real."
At the heart of Obama's plan will be extending, by one more year, a payroll tax cut for workers that went into effect this year. The president wants the payroll tax, which raises money for Social Security, to stay at 4.2 percent rather than kick back up to 6.2 percent. That tax applies to earnings up to $106,800.
Obama is expected to seek continued unemployment aid for millions of people receiving extended benefits. That program, too, is set to expire at year's end.
Among the other potential proposals by Obama:
—Tax credits for employers who hire.
— A major school construction initiative.
— Aid to local governments to prevent layoffs of teachers and other workers.
—Other tax help for businesses, such as continuing to allow them to deduct the full value of new equipment.
The White House said little about Obama's speech, including whether Obama would indicate how many jobs his plan would create. Spokesman Jay Carney said Obama's ideas "will lead to greater and faster job creation in the United States, and those are the two things that Americans across the board are demanding."
Since Obama took office in January 2009, nearly 2 million Americans have lost jobs. Almost 14 million people are out of work.
The unemployment rate, which stood at 5 percent at the start of the deep recession and 7.8 percent when Obama began in office, is at 9.1 percent. Most troubling is the trend line. After a period of steady if modest job creation, employers have stopped hiring. There was no net change in jobs in August.
Associated Press writers Ken Thomas, Christopher S. Rugaber, Jim Kuhnhenn and Larry Margasak contributed to this report.
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