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Analysis: Obama: 'Pass this jobs bill'

| Friday, Sept. 9, 2011

WASHINGTON -- Among the jobs President Obama hopes to save with Thursday night's proposals to a Joint Session of Congress is his own.

There are no guarantees that the $447 billion American Jobs Act will be enacted, or that it would significantly reduce unemployment if it were. But the package of payroll tax relief, extended jobless benefits and funding to repair schools, fix roads and keep teachers working at the minimum gives Obama a plan to extol -- and to batter a "do nothing" Congress with if it fails to act.

He exhorted Congress to "pass this jobs bill" or "pass it right away" 16 separate times. And he said the word "jobs" 37 times in 34 minutes.

The high-profile, high-risk address took place as the White House starts a re-election campaign in a political landscape loaded with landmines. The administration's economists last week projected the unemployment rate, now 9.1 percent, would be 8.2 percent in the fall of 2012.

That would be the highest rate on any presidential Election Day since 1940.

"I've now gotten old enough so every new movie strikes me as a sequel, and this is beginning to feel a little like 1979 and 1980 to me," said Bill Galston, a former White House aide to President Clinton and veteran Democratic adviser who is now at the Brookings Institution. At that time, "the American people were coming to the conclusion that they would like to replace Jimmy Carter, if the Republicans presented a reasonable alternative to him, and then that was what the general election was about."

Of Obama, Galston said, "His presidency is in peril."

So the president strode through the House chamber and up the steps to the speaker's platform as members of the House and Senate stood and applauded. In a setting familiar from State of the Union addresses, Obama stood before an oversized American flag with Vice President Biden seated behind him to his right and House Speaker John Boehner to his left.

"Tonight we meet at an urgent time for our country," Obama began. "Those of us here tonight cannot solve all of our nation's woes. Ultimately, our recovery will be driven not by Washington, but by our businesses and our workers. But we can help. We can make a difference. There are steps we can take right now to improve people's lives."

While he decried the partisanship and "political circus" he said had led to gridlock -- and the electoral implications for 2012 as the obsession of reporters -- the politics of the moment were hard to miss.

An hour or two before Obama spoke, his re-election campaign sent an e-mail to millions of supporters with the subject line "Before I head to the Capitol," urging them "to pressure Congress to act -- or hold them accountable if they do not."

In the first lady's box in the House gallery, Michelle Obama was joined by two dozen labor leaders, business CEOs, small-business owners and others. They included three from Ohio and others from Iowa, North Carolina, Colorado and Florida -- swing states all.

In a way, Obama was having a long-distance debate with the Republicans vying for the nomination to oppose him next year.

At a debate on Wednesday night in the Reagan Library, the GOP field described Obama as a president who has failed, endorsing a conservative economic prescription of cuts in taxes, spending and regulations to boost the private sector. "I say the American people have had enough," former Utah Gov. Jon Huntsman declared. Former Massachusetts Gov. Mitt Romney said Obama "doesn't have a clue how to get this country working again."

At a luncheon with reporters yesterday organized by The Christian Science Monitor, House Majority Leader Eric Cantor, R-Va., was generally conciliatory toward Obama, saying there had been "enough rancor" and suggesting they could find common ground on issues such as temporarily cutting the payroll tax.

But the response from Republican members of Congress was dismissive or worse. Rep. Darrell Issa of California derided Obama's proposal as "Son of Stimulus" and Senate Republican Whip Jon Kyl of Arizona said the president had "dusted off a tired agenda of old ideas wrapped in freshly partisan rhetoric."

In the House chamber, Obama was alternately beseeching and demanding, acknowledging today's economic woes but striking an optimistic tone at the end about America's future. He quoted Abraham Lincoln and John Kennedy.

Obama's dilemma: The public's view of him, his leadership and his handling of the economy has soured, making it harder for him to convince Americans that he'll be able to enact his proposals -- or that, if enacted, they would work.

After all, they have heard him talk about the issue before.

"Now is the time to jump-start job creation, restart lending and invest in areas like energy, health care and education that will grow our economy, even as we make hard choices to bring our deficit down," he has said. "It's an agenda that begins with jobs."

That was in his first speech to a Joint Session of Congress, in February 2009, when the unemployment rate was 8.1 percent.

"The speech is important, but the follow-up is even more important," said Dan Glickman, a former Kansas congressman and Agriculture secretary in Clinton's administration. "There's a huge amount of economic anxiety out there, and what's needed as much as anything is confidence building right now."

Obama is scheduled to go to Richmond today. After participating in weekend commemorations of the 10th anniversary of the 9/11 attacks, he will head to Columbus, Ohio, on Tuesday to sell his plan.

The reviews are in

President Obama delivered his much-anticipated speech on jobs on Thursday night. Local economists and business leaders gave it mixed reviews.

Allan Meltzer, economist, Carnegie Mellon University, Tepper School of Business.

Meltzer praised Obama's support for eliminating corporate tax loopholes and using the extra revenue to lower rates across the board.

"That's a good thing. My guess is that will pass" a Republican-controlled House and Democrat-controlled Senate, he said.

Other proposals won't do much for the stalled economy, Meltzer said, including tax credits for businesses to hire workers and give raises. It's difficult to enforce such proposals, he said; companies could hire workers to get the tax credit, then lay them off.

On cutting Social Security taxes for workers, he said, "We've been doing that. It hasn't had much effect."

"The best part of the speech are the things that aimed at the long-term problem," such as increasing U.S. exports with trade deals, Meltzer said.

He questioned whether the proposal to increase spending on things like bridges and roads would have much short-term effect.

"Anybody who's lived in this country for the last couple of years knows that getting those things started is a lot slower than the president seems to think."

-- Stan Hasselbusch, CEO of L.B. Foster, a Green Tree-based manufacturer of infrastructure construction supplies.

The $50 billion spending hike for transportation infrastructure "would really be a shot in the arm," Hasselbusch said.

"We talk about ... how unemployment has been stuck at 9 percent for almost the last two years. Nobody really talks about construction unemployment. It's double that," Hasselbusch said. Every billion dollars spent on transportation infrastructure improvement could "add between 25,000 and 30,000 jobs."

L.B. Foster, which manufactures everything from concrete railroad ties to fabricated bridge parts, depends on major construction projects.

"We need the work to create jobs," Hasselbusch said. "We'd like to see more, but we'll take whatever we can get."

-- Lawrence Lindsey, former member of the Federal Reserve Board of Governors.

Lindsey called the speech "a rerun of policies that have been tried over the last three years to what is, at best, mixed results."

"The infrastructure spending and aid to states (from the stimulus) was shown to be, at best, slowly spent and will not be a near-term job creator," Lindsey said.

Corporate tax reform should have been part of the debt ceiling negotiations this summer, he said. He called Obama's plan to pay for the $450 billion proposal by asking a joint House-Senate committee to find cuts to offset it "an act of such gross arrogance and irresponsibility that I can't recall anything like it in 30 years in Washington."

-- Matthew Marlin, professor of economics and chairman of the Department of Economics at Duquesne University.

"Our nation has not been defined by fairness and security. Since its beginning -- at least through the 1930s -- it has been better defined by a pioneering spirit, by entrepreneurial risk and reward," Marlin said, questioning a premise of Obama's speech.

"I did not catch exactly how 'everything will be paid for,'" Marlin said, quoting Obama. Funding problems for Social Security and Medicare would worsen with Obama's proposed cuts to the taxes that fund them.

"And if Congress does cut ($450 billion to offset Obama's plan), what is it cutting, and will any of those cuts cost people their jobs?"

Additional Information:

Highlights of jobs package:

-- Nearly $250 billion in tax relief for individuals and businesses through tax credits and a variety of tax cuts.

-- $140 billion to upgrade roads, bridges and schools.

-- $35 billion to help keep teachers, police and firefighters on the job.

-- Extending and expanding a payroll tax cut that would save the typical American family $1,500 in taxes in 2012.

-- A payroll tax 'holiday' for employers on any new hires or wages. All companies would be eligible for the break, which would apply to up to $50 million in new payroll spending.

-- Cut the payroll tax in half for businesses with payrolls of less than $5 million.

Obama said he will outline how the government would pay for the plan next week. Administration officials said the package will not affect the debt ceiling and that they will suggest a 'dollar for dollar' budget to pay for it.

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