Obama Proposes New Round of Stimulus Efforts
Monday, September 06, 2010
President Obama will be presenting a new $50 billion proposal for infrastructure investments at a speech in Wisconsin.
According to reports by the Associated Press, Obama will propose government spending for roads, railways and runways, which he intends to put before Congress. This is part of a total infrastructure package that would come over six years, with the initial $50 billion front-loaded to create jobs in the short term. The spending is one building block in a broader economic package that includes a $100 billion proposal to increase and make permanent research and development tax credits for business. President Obama is scheduled to pitch the proposal at a speech in Cleveland on Wednesday.
The boost in infrastructure is part of Obama's pre-election effort to prove he is trying to stimulate the economy. But it is highly uncertain if the proposals will find approval among members of Congress, who must sign off on the spending. Legislators are worried about adding to the federal deficit just ahead of the midterm elections - before they have time to create jobs.
Among the goals of the infrastructure plan would be the improvement of 150,000 miles of roads; the construction and maintenance of 4,000 miles of railways, enough to go coast-to-coast; and the rehabilitation or reconstruction of 150 miles of airport runways. It also includes plans to revamp the air navigation system, in order to reduce travel times and delays.
As the AP reports, Obama will also call for the creation of a permanent infrastructure bank that would focus on funding national and regional infrastructure projects. According to a report by The New York Times, this idea is one that White House chief of staff Rahm Emanuel has been promoting within the West Wing for some time. It was not included in the 2009 stimulus program, because changes in the way public projects are financed would have met with resistance in Congress, thus slowing the passing of the package as a whole.
When questioned about how the White House wants to pay for the new spending, officials said it would consider closing a number of special tax breaks for oil and gas companies.
Obama made infrastructure investments a central part of the $814 billion stimulus Congress passed last year, but with that spending winding down, the economy's growth has slowed. Officials said this infrastructure package differs from the stimulus because it's aimed at long-term growth, while still focusing on creating jobs in the short-term.
However, wary of the public's concern over rising deficits, the administration insists a second stimulus plan, similar to last year's $814 billion bill, is not in the works.