Obama’s American Jobs Act: Promising, Conservative Alternative: Poor Excuse
Some are trying to hide the fact there is a jobs crisis here in Texas. Currently the Lone Star State has the 27th highest unemployment rate in the country -- tied with Colorado. Most importantly, with massive public sector job losses recently, Texas now has the highest unemployment rate, 8.5%, that it has had in 25 years. Ironically, the last time our unemployment was this high, Rick Perry was just starting his political career.
There is a possible solution on the horizon. President Barack Obama’s recent proposal of the American Jobs Act, comprised of 53% tax cuts and 47% spending (what a balanced approach to a balanced budget looks like), is wildly popular according to recent polls but the Conservative Speaker, Republican John Boehner and Republican Senate Leader Mitch McConnel both say it is dead in the water. The bill is a necessary $447 billion plan comprised of tax cuts and spending aimed at creating jobs by investing in transportation, infrastructure, and education. The things we need to prevent a further economic decline that some describe as a double dip.
A major provision of the bill will focus on helping small businesses by cutting the Social Security payroll tax in half to 3.1% on the first $5 million in wages paid by employers. This will benefit the lower 98% of US firms and benefit 390,000 firms in Texas. The bill will also cut workers’ payroll taxes in half, which would provide $1,460 in income to a typical house in Texas with a median income of $47,000.
- $2.6 billion: investment in highways, transit, and rail, supporting a minimum of 33,800 jobs
- $2.6 billion: investment in education and first responders supporting 39,500 jobs
- $2.3 billion: improvements in school infrastructure supporting 30,000 jobs
- $114 million: revitalizing and refurbishing local communities
- $458 million: investments in community colleges
In addition, the American Jobs Act proposes reforms to unemployment insurance aimed at putting 329,000 long-term unemployed Texans back to work as well as extending benefits to 123,900 Texans in the first six weeks.
Another important provision of the bill is the “Pathways Back to Work Fund”, which would give 29,200 youths and 8,700 adults in Texas training and employment in growth industries.
The bill’s investment in public education provides substantial benefits for some of the state’s largest school districts, including Arlington ($39.1 million), Fort Worth ($84.9 million), Dallas ($191.6 million) and 16 others.
This bill literally helps everyone and asks billionaires and millionaires to pay their fair share in a time of record corporate profits spurred by billions in taxpayer funded bailouts. So unless you are a multi-billionaire who prefers an income tax rate at the lowest level in modern history, there is nothing to dislike about this bill, right?
Unfortunately, when sent to the House conservatives took out their chainsaws and started cutting away, hacking away 98% of the original bill with their $11 billion plan. Their plan basically scraps the American Jobs Act, supporting only three initiatives of the Obama plan, which are summed up well by David Dayen:
- Extending the 100% bonus depreciation for business, basically a tax break on capital purchases. ($5 billion)
- Expanding incentives for hiring veterans, in the form of a tax credit to business. The GOP wants to actually build on this and add education and job training assistance to it. (n.a.)
- Georgia Works-style programs for job training for the unemployed. I’ve noted on a couple occasions the concern with this approach. “While the President links these reforms to a blanket extension of extended (up to 99 weeks) UI benefits and new federal spending, there is no reason we cannot move forward on these areas of agreement,” the memo says. In other words, ditch the extension of UI and just institute Georgia Works. ($5 billion)
This is what an unbalanced approach to an unbalanced budget looks like and is the same sort of meddling and gridlock that made Standards and Poor downgrade our global credit rating.
The American Jobs Act is a comprehensive and promising plan with many provisions to help the average American by reviving education, public services, infrastructure, and employment from the blows they’ve suffered from the recession. The conservative plan does nothing for education, infrastructure, or unemployment and is a poor excuse for addressing the nation’s economic woes. To say that their plan does nothing for the American people is an understatement while Texas and the United States’ economies continue to struggle with a double-dip recession looming. Most importantly, this job directly helps Texans in a time the Lone Star state needs it most.