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President Obama's Jobs Plan Expected Next Week | News

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President Obama's Jobs Plan Expected Next Week

WASHINGTON,DC (WUSA) -- President Obama signaled again Tuesday that jobs will be an increasing focus of both his administration and his re-election campaign.

"Next week, I'll be speaking to the nation about a plan to create jobs and reduce our deficit," he told a group of veterans in Minnesota.

"Our economy has to grow faster. We have to create jobs. We have to do it faster," he said.

White House reporters say they have hints of what will be in the President's package. They believe it will include a call to extend a cut in the payroll tax, increased spending on infrastructure, and an extension of unemployment benefits for the unemployed if they seek job training.

"A payroll is a tax that is paid by both the employer and the employee, so when an employer hires an employee and pays the employee a thousand dollars in wages, the employer has to pay a tax equal to seven point six-five percent of the one thousand dollars, and the employee has to pay a tax of seven point six-five percent, so it's a total between the two of them of 15 point three percent.

"So, what President Obama proposed in his first go round was that the employee's taxes be reduced by two percent.

"There was no similar reduction for the employer, and if you look at it economically, what the Obama administration was proposing is to the extent we reduce the taxes for the employee, they will have more money to spend that will create more demand for goods and the economy will improve.

"The flip side of that is the employer is paying seven point six-five percent in tax and if you want to create demand for labor, one of the best way to do that is to reduce the cost of labor and you can do that by reducing the payroll tax on the employer," said Professor David Kautter, Managing Director of the Tax Center at American University's Kogod School of Business.

It also seems likely the administration will call for increased spending on infrastructure as a way to create jobs.

Republicans, who control the House of Representatives, are unlikely to agree.

I think when we hear infrastructure a lot of people think back to the stimulus that the president already enacted which, I think a lot of people on both sides of the aisle would agree didn't do anything to create jobs.

"So, if this is going to be another stimulus, stimulus two-point 0 or three-point 0, I don't think that there is any appetite for that in this country right now," said Republican National Committee Spokeswoman Kirsten Kukowski.


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