Washington (CNN) - President Obama is leaning towards supporting a Congressional Democratic plan to craft a jobs bill by using untapped bailout funds, according to two senior officials familiar with the deliberations.
The officials stressed that no final decision has been made by the president, but they noted he is likely to flesh out more details on the emerging economic package next Tuesday during a speech at the Brookings Institution in Washington. This new package is expected to be much smaller than the original $787 billion stimulus plan because of cost concerns at a time of deep government deficits.
Democrats on Capitol Hill and at the White House are considering a jobs package that would include funding for infrastructure projects, direct lending to small businesses and aid to cash-strapped states.
Using the untapped TARP funds has become an attractive option for Democrats, because it would not increase the budget deficit since those funds are already allocated. Republicans have been attacking the president for already sharply increasing federal spending during his first year in office.
White House spokesman Robert Gibbs on Friday hinted to reporters that Obama is "likely" to discuss the use of untapped bailout funds in Tuesday's speech. "The President thinks we should and must do everything in our power to create an environment for job growth and job creation," he said.
In addition, Democrats are considering a separate emergency spending package that would increase the deficit because the money has not yet been allocated. That package would include extended unemployment benefits, COBRA health benefits for people who have lost jobs, and food stamps.