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Senate rejects slimmed-down Obama jobs bill

By Andrew Taylor

Associated Press

Published: Thursday, Oct. 20 2011 9:40 p.m. MDT

According to the AP-GfK poll, Obama's party has lost the faith of the public on handling the economy. In the new poll, only 38 percent said they trust Democrats to do a better job than Republicans in handling the economy, the first time Democrats have fallen below 40 percent in the poll. Some 43 percent trust the Republicans more.

Immediately after the vote on Obama's plan, Democrats turned the tables and filibustered Republican-backed legislation that would prevent the government from withholding 3 percent of payments to government contractors. The legislation failed to get the 60 votes needed to end the filibuster on a 57-43 vote, even though 10 Democrats voted to advance it.

Many Democrats and President Barack Obama support the idea but opposed it Thursday because it would be paid for with $30 billion in cuts from domestic agency spending. Advocates of repealing the withholding requirement say it will help create jobs, especially from contractors on large projects with smaller profit margins.

The withholding law was passed in 2006 by a GOP-controlled Congress. Then, the idea then was to make sure contractors couldn't duck their taxes and was imposed after government investigators found that thousands of federal contractors owed taxes.

The GOP-controlled House is likely to pass the measure next week and Reid promised that the Senate would revisit the issue, though there's likely to be a split between the House and Senate over how to pay for the cost of repealing the withholding rule.

White House Press Secretary Jay Carney, speaking the day after Obama returned from bus tour, said the president's jobs plan has the advantage of providing an immediate kick to the economy.

"The Republicans don't have proposals that would help the economy grow or help it create jobs now," Carney said. "That's the comparison."

Republicans also want to roll back government regulations that they say choke job growth. They backed free-trade pacts with South Korea, Colombia and Panama that were ratified this month. They also back extending tax breaks for businesses that buy new equipment and favor offering a $4,800 tax credit to companies that hire veterans.

Democrats and the White House, meanwhile, are confident that other elements of Obama's larger jobs bill, including extending cuts in Social Security payroll taxes, will pass. A 2 percentage point payroll tax cut enacted last year expires at the end of the year. Obama has proposed cutting it by an additional percentage point and extending the cut to the first $5 million of a company's payroll.

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