January 27th, 2010
12:35 PM ET
5 years ago

Washington scrambles to create jobs

New York (CNNMoney.com) - Boosting employment tops the to-do list in Washington right now.

President Obama plans to focus on jobs in his State of the Union speech Wednesday night. The administration's effort will reportedly center on tax credits for small businesses, traditionally the engine of job creation.

At the same time, lawmakers are looking to introduce bills that will spur hiring in the private sector.

Sens. Byron Dorgan, D-N.D., and Dick Durbin, D-Ill., are working on a proposal to be introduced tomorrow. The package will target four areas: Small businesses, infrastructure, clean energy, and assistance to states to keep teachers, firefighters and other public employees on the job, according to a Democratic party aide.


Meanwhile, Sens. Charles Schumer, D-N.Y., and Orrin Hatch, R-Utah, unveiled their plans to boost hiring in a New York Times op-ed piece on Wednesday.

Any company that brings on a worker who has been unemployed for at least two months will not have to pay the 6.2% Social Security payroll tax on that employee for the rest of the year, according to the plan. Employers would receive an additional $1,000 credit on their 2011 taxes for keeping the workers on the payroll continuously for a year.

"Our two-pronged approach would be a far more effective use of taxpayer dollars than other proposals under discussion, all of which could cost many times more with very little guaranteed improvement in unemployment," the senators wrote.

The White House renewed the focus on creating jobs last month, bringing together more than 100 business owners, economists and other experts for a brainstorming session with administration officials.

Soon after, the House passed a $154 billion jobs bill that would funnel more funds to infrastructure and to states. It would also extend the deadline to file for unemployment insurance and the federal Cobra subsidy through June.

They currently are set to expire at the end of next month. The administration had hoped the Senate would quickly pass the House measure, but the landscape changed after the GOP secured its 41st seat in the Senate after winning a special election in Massachusetts last week. Now, it's likely that any jobs package will have to include measures that will appeal to both Democrats and Republicans.

Unemployment, which stands at 10%, has emerged as a key indicator of the success of the Obama administration's efforts to prop up the economy after the worst downturn since the Great Depression.

White House officials say that the $862 billion stimulus package passed last February has created or saved up to 2 million jobs. They credit the effort with helping pull the nation out of the recession.

But Republicans point to the high unemployment rate as proof the administration's measures are not working. Instead, they have proposed their own job creation bill, which includes lowering payroll taxes on employers and halt regulations that impose new burdens on businesses.

"If we're going to get the economy going again, we have to allow American families and small businesses to keep more of what they earn," said Republican Majority Leader John Boehner, R-Ohio, on National Public Radio Wednesday morning. "Until there is more money in their hands, we're not going to see the economy rebound quickly."

soundoff (58 Responses)
  1. C. Farrell, Houston, Tx

    Why aren't the Republicans helping the people of America instead of just helping themselves to get re-elected. Yet Republicans expect people to vote for them, it doesn't make sense, people need help now and not politics.

    January 27, 2010 01:27 pm at 1:27 pm |
  2. Donald

    I beg to differ with the Republicans that the administration's measures are not working. When a person gets a severe infection, the medication does not show sign of working right away depending on the nature of the ailment. Sometimes recovery will take longer because the underlying damage to the tissue was very severe. This is just the case with the economy. This recession did not come by in just one year of wrong ideas/practices. The underlying damage was from more than six years of Republican waste on the Iraq war and neglect on the domestic front while giving unnecessary tax cuts to the wealthly and permitting the Banks/Investment institutions to go off a tangent in the investment schemes they set with very little oversight from the government was the main cause for the current problems. Also the people need to take some responsibility for spending themselves into debt more than they were able to sustain if financial difficulties arise due to a down turn in the economy as it did. No one knew that the damage was so deep and severe. It was not confine to the USA alone. It was a world wide problem. This recession was only surpassed by the Great Depression. First, the administration's stimulus following on the heels of the TARP that was done by the Republicans helped to rescue the economy from total colapse. Can you imagine what it would have been like had president Obama's administration not injected capital into the Banks which have now paid back the money and the government is also now making money for the public purse. Secondly the government introduced initiatives that helped to keep many people in their homes. I may not fully agree with the approach of the current president Obama's administration but the Republicans and some socalled conservative democrats of the congress had no desire to work with the this administration. Their only plan was to spread fear and try to kill anything that will help the American people. I am happy for the system of governance in the USA which can hold the president's administration and congress accountable to each other and is the the envy of the world but they should work for the people not to only furhter their on political careers. The Republicans may win some battles leading up to the war (midterm election) but when it is all said and done the American people will see the effect of what the administration doing to correct the problem, and as such will give the administration credit with their votes. God bless America

    January 27, 2010 01:27 pm at 1:27 pm |
  3. If you want something ruined, put a republican in charge

    Boner you idiot! I got a tax break from Obama on April 1st, 2009, and the republicans fought against it. There has to be one republican somewhere who is not a lying piece of crap, but they are not in congress.

    January 27, 2010 01:27 pm at 1:27 pm |
  4. All the news that's fit to omit

    Are they allowed to "create jobs" for non-union workers or is that a no-no for this administration of paybacks and LIES?

    Most of the stimulus is going to Democratic strongholds to help them get elected as they can appear to be "actually doing something".

    Imagine that, paybacks to unions in Democratic areas using OUR tax dollars to retain power.

    Not an opinion sheep, all FACTS.

    I hate this gutless POS, and I look forward to seeing him and Shelly showing their true colors when the moving van pulls up to the WH in 2013.

    January 27, 2010 01:28 pm at 1:28 pm |
  5. stevegee

    "Quick, let's come up with another bureaucratic scheme to make us look like we actually care about our citizens." - The Democrats

    If they really want to create jobs and get this economy moving again, they should all take a leave of absence (Republicans included). Shut down Washington for a while, put a hiatus on stifling regulations, and stop meddling with free enterprise.

    Pretty soon, the economic engine that's fueled by American ingenuity and hard work would rev back up again. And we'd all be better off.

    January 27, 2010 01:28 pm at 1:28 pm |
  6. littlelate

    Should have been focusing on this about a year ago instead of wasting time and money on the healthcare fiasco.

    January 27, 2010 01:36 pm at 1:36 pm |
  7. John L. - NYC

    How can they just be figuring this out now? Small businesses employ 90% of the country. And, I'm sorry, but conservatives have been saying this from the beginning of this whole stimulus mess last Jan – the administration pointed the hose in the wrong direction, stimulating small biz is the key (why as a biz owner would I hire someone new if my taxes are being raised?). And I'm sure in the days to come you will see the admnistration taking credit for this "wise new direction." Amazing the way these politicians work.

    January 27, 2010 01:38 pm at 1:38 pm |
  8. Mike1952

    Aren't these targeted areas the very same ones that were supposed to be helped by the porkulus spending. Don't look now Wingnut is trying to put one over on us again. Sounds an awful lot like porkulus II. Line up unions and government contractors the pay is good and guaranteed and since there is no schedule you won't have to hire new people, just use the ones you already have.

    January 27, 2010 01:40 pm at 1:40 pm |
  9. cvguy

    I don't know where these people learned Economics or how business works; but one of the first things you learn is a "Job" can not be created.
    True employment expansion only occurs from real growth. Now, the government can create "Work", but government "jobs" do not produce anything, no growth or capital, hence they are only sustainable through taxation of those business that do. So though you MAY be employing someone, ..there will usually be a next loss in another sector as higher taxation (to pay for that created job) and lower revenue dictate costs cutting.

    January 27, 2010 01:41 pm at 1:41 pm |
  10. Peggy - TX

    I am fully supportive of President Obama efforts to focus on creating jobs. The time has come for our President to firmly take the reigns of power and lead this nation with a populous agenda. There is none in Washington that inspires my confidence more the President Obama.

    President Obama tried to work through the established liberal leaders in the Senate and Congress, but they proved to be weak and let him down. The Republicans have shown again and again that they are corrupt to the core and put their own selfish desire for power to get in the way of doing right by America.

    January 27, 2010 01:45 pm at 1:45 pm |
  11. Katherine

    Obama told us in his victory speech and in his inauguration speech that fixing the economy would take time and it wouldn't be easy – that it would take more than a year, perhaps more than one term – and that unemployment would hit 10% before declining. Wasn't anyone listening? Everything he warned has been on target. For goodness sake, give the man a break – his policies will work if the Republicans and those blue dogs Dems would just work WITH him instead of being deliberate road blocks and looking after their own skins instead of actually working for the good of the country!!

    January 27, 2010 01:47 pm at 1:47 pm |
  12. Beverly in NC

    This is a great idea. We need to boost the infrastructure jobs that keeo our society moving forward. We need more teachers for smaller class size. We need more police and fire people to extend their abilities to stop particular problem areas in cities. We need cities to have access to clean energy alternatives like natural gas-powered buses and solar-generated energy. Many cities are in desperate need of crumbling school repair, road widening and repair, unsafe bridge repair, renovation of parks and other public places and more attention to community centers to help poor and at-risk youth an alternative to gangs and violence.

    President Obama believes in all these areas for economic recovery and new job creation. Let's see If the Republicans will also vote NO on this too. It's time to make Republicans choose their values, policies, and whether or not they are with Americans or still against us.

    I'm sick of Republicans lying about how they have been "shut out". They withdrew and refused to work on anything in Congress and then tried to blame their do-nothingness and obstructionism on Democrats. Republicans made a bad strategic decision from the moment President Obama was elected to be against everything he tried to accomplish and to do no work to help our country recover, and to criticize Democrats and the President on all the work being done on behalf of the People,
    Republicans CHOSE to do nothing and not show up for meetings and refuse all attempts to include them. They wasted this entire year saying NO to everything regardless of who it hurt or what their constituents wanted.

    Let's see if they are finally ready to do some work this year or just sit back and criticize, lie, spread hate, fear, and racism. It's time for them to choose if they are going to be a credible Party or one run by wingnuts, tea baggers, FOX, Limbaugh, and other extremist groups.

    January 27, 2010 01:54 pm at 1:54 pm |
  13. Chris - MN

    How many people that demanded this exact thing will now decry him for doing so?

    January 27, 2010 02:00 pm at 2:00 pm |
  14. wait a minute

    Public Option or a government-run health care plan will help create jobs immediately. It will help small businesses free up resources for paying higher premiums and use it for job creation or even start-up. It is a threat not to have a job with coverage and it hinders people from actually start up a small business.

    January 27, 2010 02:01 pm at 2:01 pm |
  15. Brian from NJ

    Wait a minute, I thought the stimulus package cost $787B? You mean they got it wrong and it is really $862B? Shocking!

    In the biz world, you miss budget by 10% and you may as well pack up your things and get on the unemployment line... but not in DC.

    Anyone still thinks they had a deficit neutral healthcare plan and wants to hand over another 16% of our economy to this group?

    January 27, 2010 02:02 pm at 2:02 pm |
  16. southerncousin

    Teachers, firefighter and government employees? This is not what we need, more tax funded jobs for union members.

    January 27, 2010 02:18 pm at 2:18 pm |
  17. Tim

    What's the old saying, better a year late than never?

    January 27, 2010 02:19 pm at 2:19 pm |
  18. Jack

    One of our big problems in our country is that many people do not understand the financial and business world. Althoujgh it was the previous administation that voted for the bailout funds and the stimulus package, now people are honed in on blaming the problems on the present administration. Irregrdless of the party, I don't feel that most people understand the enormity of the financial mess our country has experienced. Also there is not great understanding on what would have happened if we had another great depression, as there are few people who can recall the events of the depression of 1929. It would certainly be educational to see a documentay on the first depression.

    January 27, 2010 02:23 pm at 2:23 pm |
  19. Steve (the real one)

    One way to create jobs and it is not a bill. It is to create an suitable environment for JOB CREATORs! The tax burden is too heavy on JOB CREATORs, especially small businesses! The money lost due to tax breaks can be made up by the payroll taxes of newly minted employees! They have to shop for food and clothing! Since we are in a global economy, we need to offer greater incentives than the global community to attract large businesses! States can do this at their level, why can't the feds?

    January 27, 2010 02:25 pm at 2:25 pm |
  20. Dar

    Tax credits for small business, kind of sounds like a republicans way of doing things. Maybe because it acually works Odumbo. But if Oumbo then taxes the people that make over a cetain amount of money (usally small business owners) then that would make the tax credit a moot point thus killing the hiring of new employees. Then Odumbo can say; see it didnt work.
    Odumbo is going to tax us, he has to. That is now the only way to pay for his spending spree.

    As far as saving or creating 2 millon jobs, smoke and mirrors, thats all it is.

    2010/2012 REAL Change is coming

    January 27, 2010 02:26 pm at 2:26 pm |
  21. Ferret out the BS

    The "Free Market" economists and believers should be happy now, as well as the Republicans. No more whining and complaining!!!!!

    January 27, 2010 02:27 pm at 2:27 pm |
  22. notfooledbydistractions

    Too bad the republicans aren't taking any responsibility for their failed ideology and lending a hand to clean up the mess.

    I guess it's just easier to stand on the sidelines and complain like Mitch McConnell.

    Hey republicans, what have YOU done for us lately? And by "lately" I mean the last 20 years.

    January 27, 2010 02:32 pm at 2:32 pm |
  23. seebofubar

    The right ideas but a little late dont ya think. This is really going to drive the lefties nuts. Giving tax credits to buisnesses? Don't you know that buisness is bad and welfare is good? Hoe dare you Obama.

    January 27, 2010 02:32 pm at 2:32 pm |
  24. notfooledbydistractions

    Thanks Mr. Boehner what an original idea – tax cuts.

    BTW, tax cuts were the LEAST stimulative of the stimulus bill.

    January 27, 2010 02:33 pm at 2:33 pm |
  25. W l Jones

    What some people take our businessmen for some out of touch unform idiot. These people is not going to heat up this economy to fast by hiring people at a rate the economy cannot handle. If do so you think you have problem now our country will be a disastrous to say the least

    January 27, 2010 02:35 pm at 2:35 pm |
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