President Barack Obama held up a copy of legislation to enact his $447 billion job-growth package and called on Congress to act on it with “no games, no politics, no delays.”
“I’m sending this bill to Congress today and they ought to pass it immediately,” Obama said in the White House Rose Garden, where he was joined by Vice President Joe Biden and a group that included teachers, police officers, construction workers and small-business owners. “Let’s put them back to work.”
The package, which the president outlined in a Sept. 8 address to a joint session of Congress, is weighted toward tax cuts, which account for more than half the dollar value of the plan. The rest would provide money for improving infrastructure, modernizing schools and helping states keep teachers and emergency workers on the job.
The centerpiece is a cut in the payroll tax, which covers the first $106,800 in earnings and is evenly split between employers and employees. Obama would reduce the portion paid by workers next year to 3.1 percent from 4.2 percent now. The rate was reduced by two percentage points under the terms of a tax deal reached last year. That cut is set to expire Dec. 31, which would push the tax rate back to 6.2 percent.
“If Congress does not act, just about every family in America will pay more taxes next year,” Obama said. “That would be a self-inflicted wound that our economy just cannot afford right now.”
Job growth stalled last month and the unemployment rate has hovered at or above 9 percent for more than two years. The president’s job-approval ratings are falling to new lows as public doubts about his stewardship of the economy rise. Public opinion of Congress has dropped even lower.
Obama said the legislation won’t add to the federal debt and that he would lay out how to offset the cost in a proposal to the 12-member congressional supercommittee charged with coming up with $1.5 trillion in cuts to the long-term deficit. He said that plan would be sent to the panel by Sept. 19.
The president called on lawmakers to heed his sense of urgency, saying the measure will reduce economic uncertainty and blunt headwinds from Europe’s debt crisis.
“These aren’t games we’re playing here; folks are out of work,” Obama said. “Businesses are having trouble staying open, you’ve got a world economy that is full of uncertainty right now -- in Europe, in the Middle East. Some events may be beyond our control, but this is something we can control.”
Speculation about a possible default by Greece pushed U.S. stocks lower, sending the Standard & Poor’s 500 Index down for a third straight day. The S&P 500 lost 1.1 percent to 1,142.06 at 11:02 a.m. in New York. The benchmark measure slumped 1.7 percent last week, wiping out its rally since Sept. 2 on the final day amid concern Europe’s debt crisis is worsening. The Dow Jones Industrial Average retreated 115.38 points, or 1.1 percent, to 10,876.75.
As Obama spoke, Bank of America Corp., the largest U.S. lender by assets, said it will shed about 30,000 jobs over the “next few years” as part of a cost-cutting program announced by Chief Executive Officer Brian T. Moynihan.
Morgan Stanley, Goldman Sachs Group Inc. and JPMorgan Chase & Co. fell at least 1.7 percent, following losses in European banks, and as Citigroup Inc. slashed its third-quarter profit estimates for the U.S. lenders. Bank of America gained 0.6 percent on the planned cost cuts.
House Speaker John Boehner said the president’s bill should be analyzed immediately by the Congressional Budget Office before the administration and Congress pursue negotiations.
“The record of the economic proposals enacted during the last Congress necessitates careful examination of the president’s latest plan as well as consideration of alternative measures that may more effectively support private-sector job creation,” Boehner said in a statement.
Obama plans to campaign for passage of the measure by appealing to voters to step up pressure on their representatives. He appeared in a part of Richmond, Virginia, Represented by House Majority Leader Eric Cantor on Sept. 9 and he plans an event tomorrow in Ohio, Boehner’s home state. The following day he’ll go to the Raleigh-Durham area of North Carolina.
Economists at Goldman, JPMorgan and Moody’s Analytics Inc. said last week the U.S. economy would get a boost of up to 2 percent under Obama’s plan.
Mark Zandi, chief economist at Moody’s Analytics in West Chester, Pennsylvania, said the proposal would create 1.9 million jobs and lower the unemployment rate by one percentage point compared with current policy. He forecast it would add 2 percent to next year’s GDP.
Goldman Sachs estimated that the plan would add 1.5 percent to the economy, while Macroeconomic Advisers LLC said 1.3 percent and UniCredit Research said up to 2 percent.
“Independent economists and validators have said this could add significant amount to our gross domestic product and could put people back to work all across the country,” Obama said. “The only thing that’s stopping it is politics.”