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President Barack Obama outlined new
multibillion-dollar stimulus and jobs proposals Tuesday, saying the
nation must continue to "spend our way out of this recession"
until more Americans are back at work.


      Without giving a price tag, Obama proposed a package of new
spending for highway, bridge and other infrastructure projects,
deeper tax breaks for small businesses and tax incentives to
encourage people to make their homes more energy efficient.

      "We avoided the depression many feared," Obama said in a
speech at the Brookings Institution, a Washington think tank. But,
he added, "Our work is far from done."


      For the third time in a week, Obama sought to focus on job
creation, noting that the unemployment rate was still at 10 percent
in November, though down slightly from its 10.2 percent peak. He
said "a staggering" 7 million Americans have lost jobs since the
recession began two years ago.


      While his proposal did not include the kind of direct federal
public works jobs that were created in the 1930s, he said
government could set the stage for more job creation by private
businesses.


      A major part of his package is new incentives for small
businesses, which account for two-thirds of the nation's work
force. He proposed a new tax cut for small businesses that hire in
2010 and an elimination for one year of the capital gains tax on
profits from small-business investments.

      Obama also proposed an elimination of fees on loans to small
businesses, coupled with federal guarantees of those loans through
the end of next year.

      He called for more government spending on infrastructure
projects such as roads, bridges and water projects and for new tax
breaks for consumers who invest in energy-efficient retrofits in
their homes. 


This could be what some administration officials have
called a "Cash for Caulkers" program, modeled on the now-expired
Cash for Clunkers program of tax rebates for people who turned in
old cars for more fuel-efficient models.


      The administration also is eyeing ways to get money still not
spent in the $787 billion stimulus bill passed last winter into
projects more quickly.


      Obama did not characterize his new proposals as another stimulus
program like that mammoth measure, but Republican critics have
called it just that and have said it will increase a federal
deficit that is already at a record level.

      Obama included sharp criticism for Republicans in his speech,
accusing them of opposing economic stimulus efforts and his health
care overhaul while supporting tax cuts and spending that have
ballooned the deficit.

      He said that soon after taking office, he and congressional
Democrats took "a series of difficult steps" to try to stabilize
the financial system and pull the economy out of a deep recession.

      "And we were forced to take those steps largely without the
help of an opposition party which, unfortunately, after having
presided over the decision-making that led to the crisis, decided
to hand it to others to solve."

      Obama did not say how much his proposals would cost, although
congressional Democrats are eyeing a $70 billion package to help
create jobs and to provide aid to hard-pressed state and local
governments. Administration aides suggested that the part of the
package dealing with roads, bridges and other infrastructure could
total about $50 billion.

      While acknowledging increasing concerns in Congress and among
the public over the nation's growing debt, Obama said critics
present a "false choice" between paying down deficits and
investing in job creation and economic growth.

      To pay for the new programs, the administration is citing the
Treasury Department's report on Monday that it expects to get back
$200 billion in taxpayer-approved bank bailout funds faster than
expected.

      Obama suggested this windfall would both help the government
spend money on job creation while also paying down the nation's
debt, which now totals $12 trillion.


      Obama called the bank bailout, under the Troubled Asset Relief
Program (TARP), "galling."


      "There has rarely been a less loved -- or more necessary --
emergency program," Obama said. The program is expected to go out
of business at the end of this year unless extended by Congress.

      Since the program is costing taxpayers at least $200 billion
less than expected, Obama said, "This gives us a chance to pay
down the deficit faster than we thought possible, and to shift funds
that would have gone to help the banks on Wall Street to help
create jobs on Main Street."

      But Republicans continued to insist that the leftover and repaid
TARP money must be used exclusively for deficit reduction and not
for a new jobs program.


      "The president's announcement is further proof that TARP has
morphed from an emergency injection of liquidity to thaw frozen
credit markets into a $700 billion revolving slush fund to promote
the Democrats' political, social and economic agenda," said Rep.
Jeb Hensarling, R-Texas.

      Obama said he is backing the measures he outlined because they
"will generate the greatest number of jobs while generating the
greatest value for our economy."


      "These targeted initiatives are right, and they are needed,"
he said.

Gallery

Obama unveils plan to spur job creation

Business and Economic News

Politics and Government News

President Barack Obama outlined new
multibillion-dollar stimulus and jobs proposals Tuesday, saying the
nation must continue to "spend our way out of this recession"
until more Americans are back at work.


Obama's plan: 'Spend our way out' of downturn

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