Obama to call for urgent steps on US economy4 min read . Updated: 08 Sep 2011, 08:03 PM IST
Obama to call for urgent steps on US economy
Obama to call for urgent steps on US economy
Washington: US President Barack Obama will lay out a jobs package worth more than $300 billon on Thursday, staking his re-election hopes on a call for urgent bipartisan action to revive the faltering American economy.
With his poll numbers at new lows amid voter frustration with 9.1% unemployment, Obama will make tax cuts for middle-class households and businesses the centerpiece of the plan and will press for new spending to repair roads, bridges and other deteriorating infrastructure.
He will use his televised speech before a joint session of the US Congress, at 7 pm EDT (2300 GMT), to urge passage of his “American Jobs Act" by year-end.
If it succeeds, his plan might provide an economic boost quickly enough to help Obama’s re-election prospects. If it fails, his strategy will be to paint congressional Republicans as obstructionist and blame them for the stagnating economy.
Already on Thursday morning, White House Chief of Staff Bill Daley went on the offensive against what he described as a do-nothing climate on Capitol Hill.
“It’s time for Congress, after a five-week vacation, to come back and do something and not just say ‘no´ to everything that gets proposed in this town," Daley said on CBS.
Surprisingly weak jobs data has heightened fears that the United States could be headed for another recession. Net employment growth registered zero in August as a budget standoff in Washington and the European debt crisis spooked businesses and consumers.
Obama is under intense pressure to change perceptions that he has shown weak leadership. His economic stewardship has been criticized by both Republicans and fellow Democrats, casting a cloud over his prospects for re-election in November 2012.
“It’s a major leadership moment for Obama," said Terry Madonna, a political scientist at Franklin and Marshall College in Lancaster, Pennsylvania. “He’s running out of months before voters settle in on whether his presidency has failed."
An NBC/Wall Street Journal poll this week showed Obama was no longer the favorite to win re-election.
Spring 2012 target
A renewal of payroll tax cuts for workers passed last December is one of the biggest elements of Obama’s plan. He will also propose tax cuts to encourage businesses to hire.
The Federal Reserve is also considering ways to further support the US economy, and Fed chairman Ben Bernanke will discuss his outlook for growth on Thursday afternoon. G7 finance ministers meeting on Friday in France are likely to urge countries that can afford it to do more to help growth.
The White House said Obama will discuss in stark terms the difficulties the US economy faces and call on Republicans to work with him. He will argue that Washington must do all it can to help the economy heal, a message he will press in a series of appearances this autumn as the 2012 race heats up.
Obama will send the jobs proposals in legislative form to Congress next week, White House senior adviser Valerie Jarrett told Reuters Insider.
The goal is to pass legislation by the end of this year, with the aim of making a dent in unemployment by early 2012. To bolster his chances for re-election, Obama needs to be able to point to economic improvement by the middle of next year.
If Congress, which controls the nation’s purse strings, does not act, the White House is prepared to paint Republicans as obstructing his efforts to solving the jobless problem.
The bruising battle in July over the country’s debt levels highlighted a wide chasm between Obama’s Democrats and Republicans who control the House of Representatives.
Republicans have derided an $800 billion economic stimulus package that Obama pushed through Congress in 2009 as wasteful spending and want immediate cuts in the deficit.
Democrats say that while long-term deficits must be trimmed, the economy needs a short-term fiscal boost.
The White House has said the jobs package will be paid for with cuts in the future but offered no details. Obama will push the congressional “super committee" that meets for the first time on Thursday to go beyond its goal of finding $1.2 trillion in budget savings, but is not due to lay out his recommendations until next week or later.
Media reports have put the size of Obama’s jobs package at upward of $300 billion. CNN quoted sources saying it could top $400 billion. The White House would not confirm the reports.
In a shift, the two top House Republicans, Speaker John Boehner and Majority Leader Eric Cantor, signaled they were amenable to some infrastructure spending and to a program Obama plans to pitch to help train unemployed workers.
But Mitch McConnell, the top Republican in the Senate, said Obama needed to acknowledge “the failures of an economic agenda that centers on massive government spending and debt" and not blame his political adversaries for slow growth.
Some congressional Republicans were expected to not even attend Obama’s evening address.