Updated at 2:58 p.m. ET on 7/30
(CNN) – A new plan from President Barack Obama that would alter the corporate tax code while investing in job creation is a deal that any "serious" lawmaker could sign onto, the president argued in Tennessee Tuesday.
What Obama called a "grand bargain" is being proposed in a bid to break partisan gridlock currently plaguing attempts to pass major legislation in Washington, though congressional Republicans signaled on Tuesday they were unlikely to back the plan, which the president announced at an Amazon.com distribution center in Chattanooga.
"Here's the bottom line: If folks in Washington really want a 'grand bargain,' how about a grand bargain for middle-class jobs?" Obama said in his fourth speech in a week centered on the economy. "I don't want to go through the same old arguments, where I propose an idea and Republicans say no just because it's my idea. So I'm going to try offering something that serious people in both parties should be able to support."
Obama suggested Congress cut corporate tax rates - long a goal of Republicans - while simultaneously making investments in job creation programs, which Democrats and the president have been championing.
In the past, both Obama and Republicans have insisted that corporate tax reform be passed alongside reform for individual earners. Republicans argue that some small business owners file taxes as individuals, and would only benefit from an overhaul of the entire tax code.
The president's plan would propose slashing the corporate tax rate to 28% from 35% while making the filing process simpler and ramping up incentives for small businesses to hire workers.
The plan would also put the tax rate on manufacturers at 25% and remove current tax incentives to send jobs overseas.
On Tuesday, Obama explained that he's open to changing only the corporate tax code as long as it's combined with major investments in programs that create high-paying middle class jobs.
"If we're going to give businesses a better deal, we're also going to have to give workers a better deal, too," he said, suggesting money saved by closing tax loopholes should be put toward infrastructure initiatives that would create construction jobs.
Obama also called for bolstering the country's manufacturing sector and network of community colleges, and proposed creating 45 "innovation institutes" that pair companies with universities and community colleges with the goal of fostering research and development.
Early reaction from Republicans to the outlines of the president's plan was not receptive.
"While I understand he is looking for headlines here, reports indicate that the policy he intends to announce doesn't exactly qualify as news," Senate Minority Leader Mitch McConnell said on the Senate floor Tuesday. "It is just a further left version of a widely panned plan he already proposed two years ago, this time with extra goodies for tax-and-spend liberals."
McConnell said he first learned of the plan Monday night. Brendan Buck, a spokesman for House Speaker John Boehner, wrote on Twitter his office learned of the proposed "grand bargain" through media reports, though White House officials said they reached out to a bipartisan group of lawmakers on Monday to discuss the proposal.
Michael Steel, another spokesman for Boehner, cast the proposal as old news.
"The President has always supported corporate tax reform," Steel wrote in a statement. "Republicans want to help families and small businesses, too. This proposal allows President Obama to support President Obama's position on taxes and President Obama's position on spending, while leaving small businesses and American families behind."
Another House Republican leadership aide said the White House was taking their own plan and making it less amenable to Republicans than previous offers, while "trying to extract a ransom of infrastructure spending" at the same time.
The aide argued the new White House plan was an attempt to "get a headline that says they're offering a grand bargain."
Obama's address in Chattanooga is the latest in a series of speeches the president will deliver on the economy and jobs, part of an attempt to turn back to the issue that rates as most important among Americans. The tour began last week in Illinois, Missouri and Florida.
Tuesday's announcement of a "grand bargain" was the first specific proposal the president made in his new push to focus on the economy, though White House officials say there will be more as the initiative continues.
During his remarks, Obama said he'd "keep throwing things out there to see if something takes" on jobs.
"If (Republicans) have better ideas to help create jobs rebuilding our infrastructure, or help workers earn the high-tech skills our businesses demand, let's hear 'em," the president said.
Amazon.com, whose facility Obama spoke at Tuesday, announced this week plans to hire 7,000 workers for its U.S. operation, with most jobs offering pay and benefits far above typical retail wages, the company said.
Amazon did not give specific pay scales for the positions, but said the 5,000 warehouse jobs will pay 30% more than jobs in traditional retail stores.
The jobs are full-time permanent positions and also include stock grants that, over the last five years, have averaged 9% of pay for Amazon's full-time workers. And the company said many workers would also be eligible for 95% tuition reimbursement for those attending college, whether or not their field of study is related to their job.
In addition, Amazon is looking for 2,000 workers for its customer service department, with those jobs being a mix of full-time, part-time and seasonal positions.
CNN's Brianna Keilar, Chris Isidore and Adam Aigner-Treworgy contributed to this report.
People I must say you make fun of Republicans by calling them "rethugs" but Democracts arent much better. Look at it the President speaks of jobs creation the Market goes down? Doesn't that some what make you ask why?
Ok, here we go again, the old bait and switch routine. Let's start with a great offer and then pull that offer and demand I want my thing first and then we can discuss your thing. Same thing happened with immigration reform people. Let's secure the border, no wait, let's first give amnesty and then secure the border. We were promised a secure border back in the 1980s with the last immigration reform and to date the gubbment still has not secured the border. So if we are still waiting on a secure border, what makes you think the offer of tax reform of any form, corporate or personal is ever going to happen.
Obama is an economic nitwit.
For all the people who want to tax corporations, guess who pays for it? YOU DO! Politicians love corporate taxes because it's going after the big guy and it's a hidden tax that the consumer doesn't see. It's a win win for politicians and a lose lose for taxpayers.
The corporate response: Thank you very much for the tax cut. We will immediately start creating jobs (in China, India and anywhere else we can find cheap labor), and we will import that cheap labor here to do the jobs we can't export.
If the middle class falls, so does the rest of society. The poor can't pay any more and the upper class refuses to. I think Obama has good intentions but the GOP will make it very hard for him. However, until the GOP totally re-invents itself they don't stand a snow ball chance in hades of getting back in office. So, my guess is that Obama has started paving the way for the next Democratic president, smart move, I give him that. Only a young moderate Republican with fresh ideas and a compassion for the poor and middle class can save them now. NO... not Ryan and/or Romney again, that'll never work. First the GOP needs to drop their romance with the religious right, then build from there.
the repucks will fight this, and to all those saying cut tax rate less money coming in they can not see passed there nose. it will help create jobs that pay taxes, along with the investing in real jobs more jobs that pay taxes. oh sorry for thinking back to the just say no tea party knuckle heads.
Cutting taxes + investing (a.k.a. spending)
How exactly are we supposed to pay for this when we're 17 TRILLION in debt already?
When Obama stop to naive. Like a child he jump from one step to another. Very low quality.
Weakest I have heard from him so far. What "investments in middle class jobs"? The man has not figured out how to create ANY jobs let alone how to focus on one particular segment.
King Obama...talk about an exploding gas plant. We're already $125 trillion in the hole for unfunded liabilities. But hey, how about some more "investment" (deficits)?
Umm, what? That's not at ALL what happened with immigration reform.
The proposed immigration reform bill requires the department of homeland security to verify that the border is secure BEFORE any illegal immigrants can apply for citizenship.
If anyone is doing the bait and switch, it's Republicans. You literally got it backwards.
In fact, I suspect that the House will do exactly what you're describing. Demand that the corporate tax code before reformed before they will even discuss any legislation that will improve the economy or create jobs. After all, they ran on a platform of creating jobs, then spend the majority of their legislative session trying to repeal Obamacare – legislation that they know before even starting has absolutely NO chance of passing the Senate, or even coming to a vote.
I am fed up with all the lies. Obama is talking about more jobs yet there are almost 700,000 fedearl employees alone that are being furloughed by the governement. Does no good to talk about creating jobs and then cut salaries by 20%. That is not helping the middle class.
A good move by Obama by listening to Romney's campaign before. Cutting taxes will attract more businesses here in America. It happened in Canada when their government decided to reduce the corporate taxes, thier economic growth was phenomenal.
Worst President in history.
What happened to LASER FOCUS on jobs?
and you will notice he wants congress to come up with a plan – he is clueless.
Increasing employment will raise revenue despite cuts. Think of the cuts as reducing how much you sell a product for. Then think about the jobs investment as producing more product in a market that already has huge demand for said product. The net result is that you're spending more to produce and selling for less, but you're going to be getting a lot more sales.
That doesn't gaurantee more income, but it provides the opportunity to do so.
Of course, it makes more sense to just produce more product (IE. get more jobs in the economy), but Republicans seem morally opposed to such a thing unless it helps out their special interest groups in some way.
One day Obama will realize that just because he says "investment" doesn't mean it will happen or affect job growth. Corporate taxes going down will mean more profits, but in the face of ACA and other heavy-handed regulations businesses, small or large, are more likely to hoard cash, or create non-US vs. American jobs. Democrats have overplayed their regulatory hand, and businesses will not respond positively until that hand no longer exists to punish them.
"President Barack Obama will offer a new proposal Tuesday... " Beware of anything that comes out of this snake-oil salesman's mouth.
raise min wage to $10.25 hr who can live on $7.25 hr ??????????
If this is good for the country then the republicans will say "no". They are simply not interested in solving our problems, only catering to their tea party base. Sorry, but I will not vote for one republican until they work for the best solution instead of just saying "NO, NO, NO"
Obama had absolutely nothing to do with the furloughs. Those government cuts were supported by Republicans and Democrats in Congerss. And despite numerous deals proposed by the Democrats to stop the cuts, the Republicans counter offers only ever included more cuts from non-defense spending (including a proposal for no tax increases, no defense cuts, and $1 trillion in cuts from non-defense spending). That's not a compromise, that's "give us everything we want or we'll drag this country down with us."
I am tired of all the lies. Obama and Congress talks about helping the middle class. Yet their actions speak differently. How can you help the middle class by furloughing (cutting salaries by 20%) almots 700,000 mostly middle class federal employees. Talk is cheap but losing 20% of your pay is not helping middle class people.
Everyone hates spending until the next bridge collapse or the next flood breaks through levies. It's all pork as long as you don't need it right?
Sorry Mr. Obama. You have zero credibility regarding truthfulness, job creation, or the economy.
Bull. The EPA and other regulartory bodies have been cut, reduced in size, and have had regulations repealed on many industries over the past 12 years. Including major exceptions to regulation for energy industries since 2005 (including exceptions from the clean water and clean air acts).
All the while, our economy has faced one of the worst hits since the great depression, and one of the slowest recoveries in our nations history. Many of the bubbles resulting in the loss of jobs and slow recovery being caused directly by the lack of oversight and regulation that you claim is the problem.