Sept. 14 (Bloomberg) -- President Barack Obama again pressed Congress to act on his plan for boosting hiring, telling an audience in North Carolina the legislation would help small businesses expand and help young people and veterans find jobs.
The $447 billion package of tax and spending measures targets benefits to small businesses and would help create jobs by keeping teachers employed and putting construction crews on the job rebuilding roads, bridges and school buildings, he said.
“If you’re in favor of America’s jobs creators, this is your bill,” Obama said at North Carolina State University in Raleigh. “The time for gridlock and games is over. The time for action is now.”
Obama, who faces re-election next year, is confronting skepticism from lawmakers and voters about his economic policies. A majority of Americans don’t believe his $447 billion jobs plan will help lower the unemployment rate, a Bloomberg National Poll conducted Sept. 9-12 shows. The poll found 62 percent disapprove of his handling of the economy. The president’s overall job approval rating was at 45 percent, the lowest of his presidency.
Obama spoke after touring WestStar Precision, a small business in Apex, North Carolina, that specializes in quick machine work for commercial and industrial clients. The company has tripled the number of its workers since 2000, according to the White House.
Action From Congress
Ervin Portman, the company’s founder, said his business would benefit from the payroll tax provisions of Obama’s plan.
“Let’s tell Congress loud and clear,” Portman said as he introduced Obama at the university’s Reynolds Coliseum. “It’s time to get serious about jobs.”
The North Carolina stop marks the president’s third trip to an electoral battleground state to promote the jobs package since he unveiled it before a joint session of Congress on Sept. 8. His aides have said he will campaign for it across the country in an effort to put pressure on Congress to adopt the measure as the nation’s unemployment rate is at 9.1 percent.
Obama repeated his pitch tonight at the Congressional Hispanic Caucus Institute’s awards gala at the Washington Convention Center, where he warned that U.S. economic competitors such as China are investing in infrastructure and education. The U.S. risks being left behind, he said.
He asked his audience for support to win passage, saying economic progress in the U.S. is intertwined with that of the Hispanic community.
“Can we finally put a stop to the political circus and do something about the economy,” Obama said. “I believe we can and I believe we must.”
The centerpiece of his plan 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 cut 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.
The package contains spending provisions as well, including a $105 billion infrastructure proposal for school modernization, transportation projects and rehabilitation of vacant properties. The administration also is seeking $35 billion in direct aid to state and local governments to stem layoffs of educators and emergency personnel.
Obama would cover most of the cost of his proposal by raising taxes on top earners, generating about $400 billion over a decade by capping some deductions and exclusions, according to the administration’s estimates. The plan also would raise revenue by taxing carried interest, or profits-based compensation, of private equity managers, real estate investors and venture capitalists as ordinary income, instead of more lightly taxed capital gains, and by ending special tax breaks for oil and gas companies.
In all, the plan would offset the payroll tax cuts, incentives for small businesses and spending on infrastructure, school and aid to states by raising $467 billion.
As he did in appearances in Ohio yesterday and in Virginia on Sept. 9, Obama said in North Carolina that the choices are clear.
“Do we want to keep tax breaks for millionaires and billionaires?” he said. “Or do you want to cut taxes for small business owners and middle class families.”
“We know what’s right,” Obama said.
Senator Richard Durbin of Illinois, the chamber’s No. 2 Democrat, said his caucus isn’t yet united behind all of Obama’s proposals to cover the bill’s $447 billion cost. The resistance from Obama’s fellow Democrats indicates the president’s plan may not survive intact, as leaders of the Republican-controlled House already have said they oppose the proposed tax increase on the wealthy as well as the spending provisions.
Representative Richard Neal, a Massachusetts Democrat who is on the Ways and Means panel, said “there is great skepticism” among party lawmakers about the ways Obama has proposed to pay for the jobs bill. He called the offsets “talking points.”
Resistance in Congress
House Majority Leader Eric Cantor of Virginia said yesterday he expects the tax increases Obama is proposing to pay for his plan will be split off from measures to cut taxes for workers and small businesses. The more contentious parts of the legislation may have to be put off until after the 2012 election, he said.
White House press secretary Jay Carney said yesterday the special 12-member congressional panel charged with trimming $1.5 trillion from the nation’s long-term deficit can modify the administration proposals, as long as the measures aimed at stimulating hiring are paid for. The president wouldn’t veto legislation that only enacted part of his plan, he said.
“He would sign it, and then he would return to press the Congress to get the rest of the job done,” Carney said.
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