President Obama discussed the specifics of his plan to increase jobs and boost the economy Thursday night. Don't let the expressions on Vice-President Biden and Speaker of the House Boehner fool you. Obama presented a package valued at $447 billion that economists are giving high marks. Most had a favorable reaction to the president's focus on infrastructure because it accomplishes a great deal more that jobs creation. Deteriorating roadways, crowded, outdated airports and insufficient mass transportation impede the effective movement of people and products.
The president's plan would eliminate payroll taxes for companies that add workers or increase wages of current workers, with a cap at the first $50 million in payroll increases. It also includes a $4,000 tax credit for employers who hire long-term unemployed workers, plus a "returning heroes" hiring tax credit of $5,600 to $9,600 for each unemployed vet hired. In addition, by extending and expanding the existing payroll tax holiday for another year. Americans will pay just 3.2 percent on the first $106,800 of income, instead of the previous 4.2 percent, which is the current rate under the payroll tax holiday, and far less than the previous 6.2 percent. He also included money to support mortgage refinancing.
President Obama combined the legislation with specific offsets and reforms. For example, he proposed closing corporate tax loopholes and levying higher taxes on the wealthy, much like Warren Buffett demanded in his op-ed piece in the NY Times a few weeks ago. The plan he presented does not affect the deficit, and, later, he'll present proposals for significant, long-term fiscal reforms to the Congressional deficit super- committee.
Ham on Wry suggests that Congress pass this bill as quickly as possible. A majority of Americans support Buffett'suggestions of raising taxes on the wealthiest Americans. Middle and lower class citizens have stretched dollars as far as possible, while goods and services regularly rise. Congress must put partisan politics aside and concentrate on what's best for the country in this time of economic hardship.
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