So, how about that jobs speech?
I thought the president introduced a great jobs plan Thursday night -- a plan that accomplished a number of important goals:
- The package is of a magnitude that could help a lot of folks get back to work. I agree with Paul Krugman: "if it actually became law, it would probably make a significant dent in unemployment."
- It's a plan that in normal times would be broadly supported by partisans on both sides of the aisle; about 60% of the $450 billion in the American Jobs Act is tax cuts, the rest is largely infrastructure and unemployment insurance, and we've never in our history failed to extend UI benefits with unemployment this high.
- The president pressed the urgency of the moment, the need to rise above partisanship, to stop with the self-inflicting wounds, the political circus, and get down to the people's work, and he did it with some real fight in 'em.
I also really liked the spirit he brought to this and I like the policy agenda, especially:
- Adding another percent to the payroll tax holiday on the employee's side, taking it up from 2% to 3%, which means the tax break for most working people would increase by half. So if you earned $50K, your tax break would increase from $1K to $1.5K. For weeks on these pages I've talked about how renewing the payroll cut would just keep the macroeconomic foot on the accelerator, not push it down further. Well, this renewal/increase presses the pedal down further.
- Hiring tax incentives targeted at small business and at the unemployed.
- FAST! -- well, something like it: $30 billion for school renovation and repair.
- Summer jobs for low-income youth and a subsidized employment program for low-income families.
But then there is, of course, the politics.
Interestingly, Republicans made more favorable sounds than you might have expected. I was on the NewsHour Thursday night with conservative economist Doug Holtz-Eakin and note how at the end of the segment, he offered his opinion that the payroll tax cuts, the unemployment insurance extension, and perhaps some infrastructure could pass. Rep. Eric Cantor made some similar sounds after the speech.
The Republicans are probably chastened by recent visits to their districts where one expect they got earfuls from constituents to stop screwing around and get to work on the damn economy. And no, that won't last and they won't give the president nearly what he's asking for. I also expect some funky horse trading to start soon -- watch for Republicans to insist on corp tax breaks in exchange for some of the jobs measures.
But Thursday night we saw a spirited President present a solid, smart jobs plan to a nation in need of just that. Obviously, a lot more to come on this, but in this town, in these days, I'd call that a very good thing.
This post originally appeared at Jared Bernstein's On The Economy blog.