In a rather depressing consensus, political observers on the left and right agree that President Obama's $300 billion jobs package isn't going to make a significant dent in the country's 9.1 percent unemployment rate. The president won't introduce the plan until tomorrow night but White House sources have leaked the details to the Associated Press, Bloomberg and Reuters. The broad outline goes like this: The $300 billion gets divided between infrastructure spending, tax cuts and transfer payments to state and local governments. In terms of proportions, more than half of the total package goes into extending the payroll tax cut and cancelling the expiration of unemployment benefits. Here's what observers are saying:
Don't be fooled by the sticker price: It's not enough, writes Jed Lewison at the left-leaning Daily Kos, noting that about two-thirds of that package goes into continuing current fiscal policies. "That leaves just $100 billion in actual new stimulus and it would be split between more tax cuts, infrastructure spending, and aid to states... Especially in light of the inadequacy of the original stimulus, $100 billion in new spending and tax cuts won't be enough to get the job done, even if it were to pass... The $300 billion price tag may sound like a lot, but this is a fairly modest proposal."
$300 billion. That's all? asks Mark Gongloff at The Wall Street Journal: "Something tells me this will be a common theme. $300 billion in stimulus feels like fairly weak tea, particularly if that’s your starting point in a negotiation. And when your own job is on the line."
It does seem a tad weak, writes David Ader, a government-bond strategist at CRT Capital.
[I]t seems, dare we say, rather timid under the circumstances of the current economy and electioneering. $300 billion? [It] leaves $150 bn in the form of infrastructure and aid to state and local governments, with the latter part designed to forestall layoffs of teachers and first responder type of jobs.
This paltry amount would all be paid for by raising tax revenues in later years, which strikes us as something the GOP will be drooling over to reject. Call us cynical but this is hardly a dramatic effort on the Administration’s part – not creative genius at work…. Not that we’re against stimulus, but put some ummph into it – repatriate overseas profits via a corporate tax cut and earmark those for job creation.
It didn't work before, it won't work this time, writes Dan Spencer, at the right-leaning Redstate: "Obama’s new jobs plan looks remarkably like his $830 billion 2009 economic stimulus package... The latest Obama job plan stimulus includes tax cuts, infrastructure spending, unemployment benefits extension and direct aid to state and local governments... As the good folks at the RNC put it: 'Same words, same speeches, same failed policies.'"