Plan B on Obama jobs bill is to take it up piecemeal. What will fly?
Parts that deal with tax cuts and transportation projects stand a better chance of getting enough GOP support to pass. Tax-the-rich elements and extra aid to local governments? Probably not.
After President Obama’s $447 billion jobs bill failed to clear a supermajority hurdle in the Senate on Tuesday, it’s on to Plan B – break up the bill and pass the elements that can attract bipartisan support.Skip to next paragraph
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Despite partisan attacks on this bill, there is common ground, especially around tax cuts and incentives for businesses to hire and invest.
But Republicans promise strong resistance to any new spending that resembles the president’s 2009 stimulus plan, which they say added $787 billion to the national deficit without creating new jobs.
For Democrats, even failed votes on some of these elements are a chance to highlight differences with Republicans, setting themes for the 2012 campaign.
Here’s how some of the leading elements of Mr. Obama's jobs bill are likely to fare standing on their own:
• $240 billion to extend a 2 percent Social Security payroll tax cut through 2012. While supporting the concept of tax cuts, House Republicans are wary of the jolt to workers when this payroll tax reverts to its full level in 2013. They also oppose paying for it with higher taxes for the highest income-earners. Still, cutting taxes is instant common ground between the White House and a new House GOP majority. So far, the public doesn’t view this measure as sapping resources for a popular entitlement program.
• New tax breaks for small businesses, to hire workers. Combining tax cuts and small business has broad appeal across party lines. The kicker is how to pay for it. The White House proposes expanding employer tax credits for hiring disabled veterans (up to $4,800) and unemployed veterans (up to $2,400), which are now set to expire at the end of this year. “We believe there is an opportunity to make meaningful and significant progress in this area,” said House Republicans in a Sept. 16 memo responding to Mr. Obama’s jobs proposal.
• $50 billion for roads and school repairs, and $10 billion for a new “national infrastructure bank.” Anything that smacks of stimulus spending is suspect to Republicans, but infrastructure is one topic on Capitol Hill that often has bipartisan agreement to spend more. House Republicans say some 100 existing federal transportation programs are duplicative and waste money on mandatory set asides. They propose resolving these issues in the current debate over a multiyear transportation authorization bill.
• $30 billion in new aid to local governments to prevent layoffs of teachers, firefighters, and police. This is a hard sell for Republicans, who described a similar $53.6 billion item in Obama’s 2009 stimulus plan as pandering to his party’s base, especially powerful teachers unions. They also criticize the proposal for providing one-time raises or a reprieve, then jolting workers later when the money runs out.
• $15 billion to refurbish foreclosed homes. A nonstarter for Republicans, who say a similar program for $7 billion in Neighborhood Stabilization grants didn’t work.
• $450 billion in tax hikes on incomes over $1 million. Democrats proposed a 5.6 percent surcharge as an alternative to Obama’s suggested hike on incomes over $250,000, including cuts to charitable deductions. The president backed the switch. But tax cuts are toxic to most Republicans, who dubbed the millionaires' tax “class warfare.”