Obama's jobs plan: Could it make a difference?

“There is no magic way to swiftly create jobs,” said The Washington Post in an editorial. But the $447 billion jobs plan President Obama unveiled last week is a “worthy proposal” that might actually stimulate hiring and give a significant boost to the stagnant economy. The centerpiece of the plan is an even deeper payroll-tax cut for workers than Obama provided this year, with the usual 6.2 percent Social Security deduction being halved to 3.1 percent. Employer payroll-tax contributions would also be cut in half, and a tax credit would be given to employers who hired the long-term unemployed. The rest of it, said David Brooks in The New York Times, consists of new spending on rebuilding roads, bridges, and other infrastructure, plus billions in subsidies to the states to protect the jobs of teachers, policemen, and firefighters. Obama shied away from calling his proposal what it is—a second round of “stimulus” spending. But with the recovery “now grinding to a halt,” putting some extra cash in the pockets of consumers and employers may be our last best hope of heading off a double-dip recession—a prospect that is “truly horrifying.”

When is Obama going to realize that “Washington can’t create jobs”? said John Tamny in Forbes.com. Short-term payroll-tax cuts don’t lead to hiring, because for employers hiring a worker is a long-term proposition. Obama says the government should pay for most of his $447 billion plan by raising taxes on “affluent citizens and corporations,” but taxing job creators is the precise opposite of how growth, and real hiring, has historically been stimulated. Clearly, Obama “remains oblivious” to how the economy actually works. Liberals keep assuring us that this president is “pragmatic,” not an ideologue, said Michael Barone in NationalReview.com. But Obama’s last, $825 billion stimulus package was supposed to lower the unemployment rate to below 8 percent. It’s now 9.1 percent. “A pragmatist doesn’t keep pressing the same garage-door button when the garage door doesn’t open.”

Truth is, the economy would be far worse without that first stimulus, said Eugene Robinson in The Washington Post. The nonpartisan Congressional Budget Office calculates that the first Obama stimulus saved or created up to 3.6 million jobs, and may have shaved two percentage points off the unemployment rate. His latest plan will also make a difference, said Jonathan Cohn in TheNewRepublic.com. Mainstream economists say it would add about 1.3 million payroll jobs by the end of 2012, while boosting economic growth by 2 percent. And finally, Obama is taking the fight to Republicans, insisting as he campaigns across the country that the GOP “pass this bill—now,” or answer to the voters. If Republicans make good on their threats to kill this badly needed plan to boost hiring, said the Chicago Sun-Times, “American voters will know exactly whom to blame.”

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With the economy in crisis, neither side should be “scoring political points,” said Robert J. Samuelson in The Washington Post. One major reason the first stimulus plan didn’t achieve more, I’m convinced, is that “the partisan rancor” in Washington is scaring the hell out of both consumers and companies. Every time Republicans and Democrats contemptuously dismiss each other’s ideas to help the economy, public confidence sinks even lower—keeping spending and hiring depressed. What Washington should be doing is “building confidence,” and giving job creation precedence over all other goals, including political ones. “This is a tall order. As the 2012 election approaches, it may be too tall.”