Obama calls for the end of ‘political circus’ on economy, seeks stimulus plan for jobs

A politically imperiled President Obama called on lawmakers Thursday night to approve another stimulus plan to create jobs, many for his union base, while adding about $450 billion to next year’s budget.

“I am sending this Congress a plan that you should pass right away,” a defiant Mr. Obama told a joint session of the House and Senate. He urged lawmakers to “stop the political circus and actually do something to help the economy.”

The president, whose job-approval ratings are his lowest ever, announced a package of proposals that is likely to be his last major effort to create jobs before the 2012 presidential campaign swings into high gear.

Among the proposals he outlined are extending unemployment benefits, worth about $50 billion; boosting spending on construction projects by about $100 billion; giving $35 billion to states to keep teachers on the job; and providing another round of payroll-tax cuts for workers and employers. The payroll-tax cuts could cost about $200 billion and would provide the average household with about $1,500.

The president referred to an economic “crisis” and used the phrase “pass this jobs bill” at least a dozen times. He rejected the argument that his plan is politically motivated.

“The next election is 14 months away,” Mr. Obama said. “And the people who sent us here — the people who hired us to work for them — they don’t have the luxury of waiting 14 months.”

The administration’s $825 billion stimulus measure in 2009 failed to deliver the promised results on jobs. Early estimates this week put the cost of the new plan at more than $300 billion, but by the time of his speech, that figure had risen to nearly $450 billion. Addressing GOP criticism that the nation cannot afford to add to its $14 trillion debt, Mr. Obama insisted, “Everything in this bill will be paid for. Everything.”

But the president won’t explain how to pay for it, exactly, for at least another week. Said Mr. Obama, “A week from Monday, I’ll be releasing a more ambitious deficit plan — a plan that will not only cover the cost of this jobs bill, but stabilize our debt in the long run.”

Presidential adviser Valerie Jarrett said the administration wants to cover part of the cost by closing certain corporate tax loopholes, a strategy that failed to produce an agreement with congressional Republicans during the debt-limit negotiations this summer. White House Chief of Staff Bill Daley said some of the cost should be borne by a tax increase on the wealthiest wage earners. The plan would add to the deficit-reduction work of a congressional supercommittee, which is already tasked with finding $1.5 trillion worth of deficit trims by the end of November.

Mr. Obama reiterated his theme of “shared sacrifice” that dominated debt-reduction talks with the GOP this summer.

“Should we keep tax breaks for millionaires and billionaires?” Mr. Obama asked rhetorically. “While most people in this country struggle to make ends meet, a few of the most affluent citizens and corporations enjoy tax breaks and loopholes that nobody else gets. This isn’t political grandstanding. This isn’t class warfare. This is simple math. These are real choices that we have to make. And I’m pretty sure I know what most Americans would choose. It’s not even close.”

The two parties abandoned the bipartisan seating arrangements they had for Mr. Obama’s State of the Union address, with only a few Democrats, such as Sens. Mark Udall of Colorado and Thomas R. Carper of Delaware, embedded in the sea of GOP lawmakers. The president’s protestation that he wasn’t engaging in class warfare drew laughter from the GOP side. And Rep. Jeffrey M. Landry, Louisiana Republican, held a sign that said, “Drilling = Jobs.”

Senate Minority Leader Mitch McConnell, Kentucky Republican, called it “a re-election plan,” rather than a jobs plan.

Among Mr. Obama’s first public actions after the speech will be trips to push his proposal in the faces of the House GOP leadership. On Friday, the president will travel to Richmond, home district of House Majority Leader Eric Cantor, Virginia Republican, to promote his agenda. On Tuesday, he will lobby for the plan in Columbus, Ohio, about an hour’s drive from the district of House Speaker John A. Boehner, Ohio Republican.

Mr. Boehner said the president’s proposals “merit consideration,” but he should also listen to the GOP’s plans.

“It’s my hope that we can work together to end the uncertainty facing families and small businesses and create a better environment for long-term economic growth and private-sector job creation,” Mr. Boehner said in a statement.

Mr. Obama said he thinks Republicans are sincere in their desire to improve the economy by cutting spending and regulations. But in the next breath, the president implicitly accused the GOP of using the economic crisis as a subterfuge to eliminate social safety nets.

“What we can’t do — what I won’t do — is let this economic crisis be used as an excuse to wipe out the basic protections that Americans have counted on for decades,” Mr. Obama said. “I reject the idea that we need to ask people to choose between their jobs and their safety. I reject the argument that says for the economy to grow, we have to roll back protections that ban hidden fees by credit card companies, or rules that keep our kids from being exposed to mercury, or laws that prevent the health insurance industry from shortchanging patients.

“I reject the idea that we have to strip away collective-bargaining rights to compete in a global economy. We shouldn’t be in a race to the bottom, where we try to offer the cheapest labor and the worst pollution standards. America should be in a race to the top. And I believe that’s a race we can win,” he said.

For the most part, Republicans are choosing not to engage with the president on rhetoric this time. After returning to Washington from a month of town-hall meetings with constituents, they are pledging — outwardly at least — to find common ground with Mr. Obama where possible. They are also mindful that Congress’ job-approval ratings are even lower than that of the president.

Rep. Darrell E. Issa, chairman of the House Committee on Oversight and Government Reform, described Mr. Obama’s plan as “stimulus three,” but said Republicans should build on portions they can agree with. He praised the president for seeking greater deficit reduction, but questioned Mr. Obama’s need for tax increases while he’s also cutting payroll taxes.

“A tax increase never actually created a job,” Mr. Issa said.

Sen. Bernard Sanders, Vermont independent, had measured praise for Mr. Obama’s speech, but said his former colleague in the Senate didn’t go far enough on infrastructure spending. He also worried about diverting money from the Social Security trust fund to help pay for Mr. Obama’s proposed additional payroll-tax cut for employers.

Mr. Obama again called for “modest adjustments” to Medicare, saying, “If we don’t gradually reform the system while protecting current beneficiaries, it won’t be there when future retirees need it.”

Many Republican lawmakers said Mr. Obama is offering more of the same policies that have failed to produce jobs. A handful of GOP lawmakers even skipped the speech.

“His hopeless economic policies are costing too much,” said Sen. John Thune, South Dakota Republican.

Mr. Cantor told reporters before the speech that the president’s proposal to extend payroll-tax cuts, worth $1,500 per household, is “certainly part of the mix as we talk about how to go forward.”

The president said his plan would repair at least 35,000 schools. “This is America,” he said. “Every child deserves a great school.”

And he said thousands of teachers would be hired with the money.

“While they’re adding teachers in places like South Korea, we’re laying them off in droves,” the president said. “It’s unfair to our kids. It undermines their future and ours. And it has to stop. Pass this jobs bill, and put our teachers back in the classroom where they belong.”