WASHINGTON -- President Obama urged Congress Thursday night to pass a surprisingly big, $447 billion jobs package that's intended to spur business hiring and consumer spending in an economy that has sputtered almost to a halt.
The package, more than half the size of Obama's $825 billion economic stimulus plan passed in February 2009, would slash payroll taxes by 50% next year for employees and small businesses, extend unemployment benefits, and create or save jobs for teachers, police and firefighters, and construction workers.
"You should pass this jobs plan right away," Obama defiantly told joint session of Congress filled with enthusiastic Democrats and skeptical Republicans. "There should be nothing controversial about this piece of legislation. Everything in here is the kind of proposal that's been supported by both Democrats and Republicans, including many who sit here tonight. And everything in this bill will be paid for."
The president didn't say how he would pay for his proposals but promised to do so a week from Monday, when he submits a deficit-reduction plan to a congressional committee charged with cutting red ink by at least $1.2 trillion over 10 years. Obama will add at least $447 billion more to the task.
The jobs plan includes these main elements:
• Cutting the 6.2% payroll tax paid by both employees and employers to 3.1% next year. This year, only employees got a 2-percentage-point cut. That would cost $240 billion, more than half of the total package.
• Spending $140 billion to save the jobs of state and local teachers and first responders, repair deteriorating schools and rebuild roads, railways and airports.
• Extending jobless benefits to the unemployed, with special emphasis on those out of work at least six months and those in low-income neighborhoods.
While most of the initiatives have been tried before with limited success, weaving them together into such a large package marked a bold move for a White House that has been on the defensive for more than two years of heavy government spending with only paltry economic growth to show for it.
And delivering the 33-minute speech before a joint session — a format used only three times in the past two decades except for State of the Union addresses — represented another risky venture for a president known for his speech-making ability.
Republicans blasted the plan even before it was released, just as they have attacked the original stimulus plan for failing to create robust growth and tame the nation's 9.1% unemployment rate. Most independent economists say the first plan helped, but only to prevent a full-fledged depression.
"This isn't a jobs plan. It's a re-election plan," said Senate Republican leader Mitch McConnell of Kentucky. "It's time the president start thinking less about how to describe his policies differently and more time thinking about devising new policies."
That said, it remains unclear how a divided Congress will deal with Obama's proposal. Republicans don't like the concept of government stimulus, and nearly all of them voted against the initial version. But they also favor tax cuts and infrastructure improvements, which represent the twin centerpieces of the plan.
"I think there are opportunities" for compromise, said Douglas Holtz-Eakin, a top Republican economist who served as 2008 GOP presidential candidate John McCain's top domestic policy adviser. Obama "can prove a lot of the skeptics wrong, but he has to change his playbook."
That would mean finding a way to pay for his package without raising taxes, which most Republicans would oppose. But without that option, Obama would have to get savings from entitlement programs such as Medicare and Medicaid — proposals certain to be opposed by many of his liberal allies. On Thursday, he vowed to do both — raise taxes on the wealthy and corporations, and propose cuts to Medicare.
Obama alluded to the difficult political path ahead: "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," he said, drawing his first round of applause.
"The next election is 14 months away. 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. Some of them are living week to week; paycheck to paycheck; even day to day. They need help, and they need it now."
Much of his heated rhetoric didn't sit well with Republicans. While GOP leaders have spent much of the past 2 ½ years trying to block Obama's initiatives, they came into this week sounding more conciliatory. In the Republican-run House, they plan to spend the fall focusing on regulatory relief — something the White House argues won't create jobs.
"Good speeches and more deficit spending won't get Americans back to work," said Sen. Rob Portman, R-Ohio, former White House budget director under President George W. Bush. "But unfortunately, that's what we heard tonight — President Obama doubling down on his failed stimulus that pushed the country further into debt while not creating the jobs promised."
That stimulus plan did save or create several million jobs, according to the non-partisan Congressional Budget Office. But with the unemployment rate rising, Obama's problem is proving a negative — that things would have been worse without it — as well as distancing himself from his own administration's much rosier predictions.
The president sought to woo Republicans in his speech, noting that 50 House Republicans have proposed the same payroll tax cut for small businesses, and citing a bridge in need of repair between Kentucky and Ohio — home to McConnell and House Speaker John Boehner, who sat impassively behind him.
And he sought to rally Americans to his side — in an e-mail to supporters, a video address to them by White House counselor David Plouffe, and directly even as he addressed lawmakers.
"Regardless of the arguments we've had in the past, regardless of the arguments we'll have in the future, this plan is the right thing to do right now," Obama said. "You should pass it. And I intend to take that message to every corner of this country."