Cut taxes, Obama tells Congress in $450B jobs plan

By Ben Feller

Associated Press

Published: Thursday, Sept. 8 2011 7:20 p.m. MDT

Rep. Jeff Landry, R-La., holds a sign during a speech by President Barack Obama to a joint session of Congress at the Capitol in Washington, Thursday, Sept. 8, 2011.

Charles Dharapak, Associated Press

WASHINGTON — Attacking a deepening crisis on jobs, President Barack Obama challenged a reluctant Congress Thursday night to urgently pass a larger-than-expected $450 billion plan to "jolt an economy that has stalled." He urged lawmakers to slash Social Security taxes for tens of millions of Americans and for almost every business to encourage hiring.

"Stop the political circus," an animated Obama told a joint session of Congress in a nationally televised speech. Over and over he implored lawmakers to "pass this jobs bill."

Open to discussion but making no promises, Republican House Speaker John Boehner said Obama's ideas would be considered but the president should give heed to Republicans' as well. "It's my hope that we can work together," he said.

In announcing a plan heavy on the tax cuts that Republicans traditionally love, Obama sought to achieve multiple goals: offer a plan that could actually get through a deeply divided Congress, speed hiring in a nation where 14 million are out of work, shore up public confidence in his leadership and put Republicans on the spot to take action.

Obama never estimated how many jobs would be created by his plan, which also includes new federal spending for construction, hiring and an extension of jobless benefits for the long-term unemployed. Despite his promise that it would all be paid for, he has not yet released the details on how.

His message was unmistakable to the point of repetition, as he told Congress more than 15 times in one way or another to act quickly. That was meant as direct challenge by a Democratic president to the Republicans running the House to get behind his plan, especially on tax cuts, or be tarred as standing in the way.

The urgency of the jobs crisis is as pronounced as it's been since the early days of Obama's term. Employers added zero jobs last month. A whopping number of Americans — about eight in 10 — think the country is headed in the wrong direction.

In the House chamber, Obama received a warm response but then the usual political pattern took hold, Republicans often sitting in silence on the applause lines that had Democrats roaring. Boehner had chummy moments with Vice President Joe Biden at his side during the speech but was somber over Obama's shoulder as the president spoke.

"The people of this country work hard to meet their responsibilities. The question tonight is whether we'll meet ours," Obama said. "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."

The newest and boldest element of Obama's plan would cut the Social Security payroll tax both for tens of millions of workers and for employers, too.

For individuals, that tax has been shaved from 6.2 percent to 4.2 percent for this year but is to go back up again without action by Congress. Obama wants to deepen the cut to 3.1 percent for workers.

Obama would also apply the payroll tax cut to employers, halving their taxes to 3.1 percent on their first $5 million in payroll. Businesses that hire new workers or give raises to those they already employ would get an even bigger benefit: On payroll increases up to $50 million they would pay no Social Security tax.

Obama proposed spending to fix schools and roads, hire local teachers and police and extend unemployment benefits. He proposed a tax credit for businesses that hire people out of work for six months or longer, plus other tax relief aimed as snaring bipartisan support in a time of divided government.

The White House put the price tag of Obama's plan at $447 billion, with about $253 billion in tax cuts and $194 billion in federal spending.

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