Re-elect Dan Lipinski Congressman

Obama Asks $450B to Lift Economy, Mostly Tax Cuts

09/08/2011

 
Southtown Star
September 8, 2011
By Ben Feller

WASHINGTON — Confronting an economy in peril, President Barack Obama unveiled a larger-than-expected $450 billion plan Thursday night to boost jobs and put cash in the pockets of dispirited Americans, urging Republican skeptics to embrace an approach heavy on the tax cuts they traditionally love.

With millions of voters watching and skeptical of Washington, Obama repeatedly challenged Congress to act swiftly.

The newest and boldest element of Obama’s plan would slash 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.

“This plan is the right thing to do right now,” Obama said after a divided body rose in warm unison to greet him. “You should pass it. And I intend to take that message to every corner of this country.”

In his televised address to Congress, Obama sought to provide a jolt for the economy, still staggering on his watch, and for his tanding at one of the lowest marks of his presidency. He put forth a jobs plan that he hopes can get bipartisan support and spur hiring in a nation where rughly 14 million people remain out of work and the jobless rate is stuck at 9.1 percent. Public confidence in his stewardship of the economy is eroding.

Obama did not venture an estimate as to how many jobs his plan would create. He promised repeatedly that his plan would be paid for but never said how, pledging to release those details soon.

The president also would apply the Social Security 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 also proposed spending to fix schools and roads, hire local teachers and police and to 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 at winning bipartisan support.

U.S. Rep Dan Lipinski (D-3rd) said Congress should pass the overdue surface transportation bill and the reauthorization for the Federal Aviation Administration, which would “quickly put hundreds of thousands of people to work (and) provide the public with a lasting benefit in the form of better roads, railways, airports, public transit and other transportation infrastructure — all of which reduce delays and boost economic growth. Everyone knows we need the investment here in northeastern Illinois, which suffers from the worst congestion in America.”

Under soaring expectations for results, Obama sought to put himself on the side of voters whom he said could not care less about the political consequences of his speech.

“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,” he said.

His aim Thursday night was to put pressure on Congress to act — and to share the responsibility for fixing the economic mess that is sure to figure in next year’s elections. For every time he told lawmakers to “pass the bill” — and he said it over and over — Democrats cheered while Republicans sat in silence.

U.S. Rep. Adam Kinzinger (R-11th) said there are areas where the two parties can “work together such as implementing the three free-trade agreements and lowering corporate tax rates, but the devil is in the details — namely how are we going to pay for it?”

Tax cuts amounted to the broadest part of Obama’s proposal — in essence, a challenge by him to congressional Republicans to support him on one of their cherished economic principles or risk the wrath of voters for inaction. The tax cuts alone would amount to roughly $250 billion.

The president said deepening the payroll tax cut would save an average family making $50,000 a year about $1,500 compared to what they would pay if Congress did not extend the current tax cut.

“I know some of you have sworn oaths to never raise any taxes on anyone for as long as you live,” Obama said, a reference to the conservative Tea Party influence on many House Republicans. “Now is not the time to carve out an exception and raise middle-class taxes, which is why you should pass this bill right away.”

The American public is weary of talk and wary of promises that help is on the way.

In one striking sign of discontent, nearly 80 percent of people think the country is headed in the wrong direction. That’s about the same level of pessimism as when Obama took office. It reflects both persistently high unemployment and disgust with Washington infighting.

No incumbent president in recent history has won re-election with the unemployment rate anywhere near the current 9.1 percent.

Obama’s jobs plan put a special emphasis on the long-term unemployed — those who have been out of work for six months or more. He repeated his calls for a one-year extension of unemployment insurance to prevent up to 6 million people from losing their benefits, and he proposed a $4,000 tax credit for businesses that hire workers who have been out of work for more than six months.

http://southtownstar.suntimes.com/business/7549362-420/obama-asks-450b-to-lift-economy-mostly-tax-cuts.html



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