Government

Parsing Obama's Jobs Bill

Here's the president's speech; here's a White House fact sheet.

The WSJ's WashWire has a nice explainer on the president's plan for a payroll tax cut (incuding an explanation of what the payroll tax is), which accounts for the biggest chunk of money in the proposal.

At the Atlantic, Megan McArdle does the math:

Tax cuts: $250 billion

  • Payroll tax rebate on first $5 million in payroll, which the president says will reach 98% of American companies, plus complete rebate for new hires or raises
  • Extending payroll tax cut
  • Extending 100% expensing of business investment
  • (A bunch of regulatory streamlining that is likely to have little effect and is bizarrely classed as a tax cut)
  • Tax credits for hiring unemployed veterans, particularly those with service-connected disabilities
  • $4,000 per worker for hiring workers who have been unemployed for more than six months


Infrastructure: about $100 billion

  • $50 billion for new infrastructure projects
  • $10 billion for an infrastructure bank
  • $15 billion to rehab vacant and foreclosed homes/businesses
  • Some undisclosed sum for getting high speed wireless to "98% of American"
  • $25 million to rehab schools


Direct assistance: About $100 billion (?)

  • Continuing the extension of unemployment benefits
  • Various retraining/wage support ideas that are supposed to help the structurally displaced to transition into new careers.
  • $35 billion for preserving/hiring teachers, cops and firefighters
  • Federal assistance in refinancing to current mortgage rates

Macroeconomic Advisers, a nonpartisan economic forecasting shop, says the president's plan would give "a significant boost to GDP and employment over the neart-term":

  • The various tax cuts aimed at raising workers' after-tax income and encouraging hiring and investing, combined with the spending increases aimed at maintaining state & local employment and funding infrastructure modernization, would:
    • Boost the level of GDP by 1.3% by the end of 2012, and by 0.2% by the end of 2013.
    • Raise nonfarm establishment employment by 1.3 million by the end of 2012 and 0.8 million by the end of 2013, relative to the baseline.

What that means: "nonfarm establishment employment" basically just means "jobs"; there are currently 131 million jobs in the U.S., down from 137 million before the recession.

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