Congress Hears Out President Obama’s Jobs Plan

Yesterday at an expanded session of Congress, US President Barack Obama expressed his disappointment with the national economy, a problem which is threatening his political career. He ordered Congress to pass a $447 billion plan to create jobs, tilted heavily toward the republican’s plan to lower taxes. Speaking before both houses of Congress, Obama demanded six times that lawmakers act “immediately” according to the plan which will increase spending on infrastructure, reduce the number of teachers who are approaching retirement age, and cut income tax paid by employees and small business owners twofold.

“The question is whether, in the face of an ongoing national crisis, we can stop the political circus and actually do something to help the economy,” Obama said to lawmakers yesterday. Employment growth ground to a halt while the unemployment rate has hovered at and above 9% for the past two years. The president’s approval ratings fell to a new low after US society’s doubts about his capability to fix the economy grew. DT Trading experts noted that American society’s opinion of Congress fell even lower. Tax cuts make up more than half of the dollar amount of the president’s latest plan to restore the economy while representatives of the Obama administration are promising to make the greatest appeal to the Republican part of Congress. The president dared his challengers to oppose wider and deeper income tax cuts that are due to expire on December 31.

“I know some of you have sworn oaths to never raise any taxes on anyone for as long as you live,” Obama said. “Now is not the time to carve out an exception and raise middle-class taxes, which is why you should pass this bill right away,” the president concluded.

Literally only a few hours before Obama’s televised speech to congress, Federal Reserve Chairman Ben Bernanke said that at the next meeting this month, politicians will discuss a package of instruments they could use to “promote a stronger economic recovery in the context of price stability.” Speaking before the Economics

Club of Minneapolis, Bernanke refrained from saying what he would consider the best option to help the economy.

Bond prices dropped at the same time that futures on the Standard & Poor’s 500 Index went up after Obama reported on his plan. Yields on 10-year treasury bonds increased three basis points to 2.01% as of 11:04AM in Tokyo. Futures on the S&P 500 went up 0.5% after a 0.6% fall.

Obama emphasized that he intends to pay for the entire jobs package with compensation from spending cuts and increased tax revenues over the next decade. He said that the exact measures would be announced before September 19.

Obama didn’t speak about the overall cost in his televised address. He also didn’t use the word “stimulus,” although Republican lawmakers were quick to draw parallels with a 2009 program to cut $825 billion in spending and taxes that was unpopular among voters.

California Representative Kevin McCarthy, the third-ranking Republican in the House, called the new plan “Stimulus 2.0.” According to DT Trading analyts, the package includes spending proposed by Democrats. It will include $105 billion in spending for infrastructure projects to modernize schools, transportation projects, and rehabilitation of vacant government assets. The economic effect of expenditures on the majority of infrastructure projects will materialize only next year, although some of it will come in 2013, according to administration representatives who spoke to journalists on condition of anonymity.