This article first appeared in the St. Louis Beacon, Sept. 18, 2011 - WASHINGTON - Now that President Barack Obama is banking his political capital on the appeal of his new jobs plan -- and making his case for it across the country, including a planned St. Louis stop -- states and cities are trying to assess its impact.
Despite its array of tax breaks, infrastructure spending, jobless aid and school funding, the American Jobs Act has gotten a mixed reception so far, not only among Republicans but also from some skeptical Democrats. The contrast was evident in Missouri and Illinois, both of which have Democratic governors.
Illinois Gov. Pat Quinn gave the Jobs Act high marks, applauding Obama's "vision for American innovation, infrastructure, fiscal responsibility and bipartisanship." But Missouri Gov. Jay Nixon offered only a tepid assessment that seemed intended to put him at arm's length from the partisan wrangling on Capitol Hill.
"Here in Missouri, folks on both sides of the aisle are working together to create jobs," Nixon said in a statement Friday, responding to a Beacon request. "We're all hopeful they will do the same in Washington."
A New York Times/CBS News survey after the president's jobs speech found that Obama's approval rating had fallen to 43 percent, most people said they had heard about the American Jobs Act and nearly half thought it would create jobs and help the economy.
The Times reported that "a substantial majority" of those surveyed supported the main proposals aimed at creating jobs, including tax cuts for small businesses, infrastructure work and payroll tax cuts. Even so, about two-thirds doubted whether Congress would reach an agreement on a job-creation package. And the survey found an extremely low approval rating of Congress, with just 19 percent approving of Republicans, compared with 28 percent that approve of Democrats.
The $447 billion American Jobs Act includes a one-year extension of Social Security payroll tax cuts for workers, expanded to include businesses; other tax breaks; an extension of unemployment benefits; funding for highway and bridge construction; and aid to states to hire more teachers and first responders.
On Sunday, U.S. Sen. Dick Durbin, D-Ill., told CNN that Obama's jobs package -- which he calls "a good plan, a fair plan [that is] fully paid for" -- is likely to be taken up by the Senate in early October. While Obama has proposed a strong plan to create jobs, Durbin said, Republicans "continue to criticize any effort to step forward and do something positive to move this economy."
But House Speaker John Boehner, R-Ohio, said last week that Obama's approach was "a poor substitute for the pro-growth policies that are needed to remove barriers to job creation in America."
Among the early supporters of Obama's plan was St. Louis Mayor Francis Slay, who said in a statement distributed by the White House that he was pleased that the president emphasized education, innovation and infrastructure in his plan. "I will be on my telephone with some of our biggest and smallest companies telling them that I think the tools President Obama has promised will let them start hiring again, that government will not be in their way," Slay said.
Sen. Claire McCaskill, D-Mo., said "many of the ideas in this proposal make sense, have received bipartisan support, and could help boost Missouri jobs and businesses. But I believe the package must be paid for responsibly and that's the next challenge before us."
While he supported a few parts of the proposal -- such as sending free-trade pacts to Congress for approval -- Sen. Roy Blunt, R-Mo., said Obama "unveiled yet another stimulus bill that he's desperately trying to re-brand as a jobs plan."
The plan's basic elements have been outlined over the past week. What follows is a summary, based on White House estimates, of the bill's potential impact in Missouri and Illinois.
Impact of 'American Jobs Act' on Missouri, Illinois
Here is a summary of a White House analysis of how Obama's proposed American Jobs Act would likely affect employment, education and infrastructure work in Missouri and Illinois.
[Note: The differences in federal spending in Missouri and Illinois relate mainly to the disparity in population. Illinois is the fifth most populous state, with about 12.7 million residents, while Missouri is the 18th most populous, with 5.99 million residents.]
Here is the impact, according to a White House analysis, by category:
1) Tax cuts for employees and small businesses:
Tax cuts that aim to benefit small businesses: The plan would cut the payroll tax in half to 3.1 percent for employers on the first $5 million in wages, providing broad tax relief to all businesses but targeting it to the 98 percent of firms with wages below this level.
- Missouri: about 120,000 firms would get a payroll tax cut.
- Illinois: about 260,000 firms.
Tax relief for employees: By expanding the payroll tax cut passed last December, the plan would cut workers payroll taxes in half next year.
- Missouri: a typical household (average statewide income of $49,000), would get a tax cut of around $1,520.
- Illinois: a typical household (average $53,000) would get a tax cut of about $1,640.
2) Initiatives to bolster employment include:
* Extending the federal transportation legislation to provide $50 billion for highways, transit, rail and aviation, with the goal of modernizing infrastructure and creating more construction jobs. Of the funds for highway and transit modernization projects, the plan's short-term outlays (mainly from the trust fund) would be at least:
- Missouri impact: $716.9 million, supporting at least 9,300 local jobs.
- Illinois impact: $1.6 billion, supporting at least 14,500 local jobs.
* $35 billion to prevent layoffs of up to 280,000 teachers, while supporting the hiring of tens of thousands more and keeping cops and firefighters on the job. These funds would aim to help states and localities avoid and reverse layoffs.
- Missouri impact: $565.2 million to support as many as 9,100 jobs for educators and first responders.
- Illinois: $1.24 billion to support as many as 14,500 jobs for educators and first responders.
* $25 billion for school infrastructure, aiming to modernize at least 35,000 public schools, creating jobs while upgrading schools.
- Missouri: $422 million to support as many as 5,500 jobs.
- Illinois: $1.1 billion to support as many as 14,400 jobs
* $15 billion in a national effort to put construction workers on the job rehabilitating and refurbishing hundreds of thousands of vacant and foreclosed homes and businesses.
- Missouri: $71.9 million to revitalize and refurbish local communities, in addition to funds available through a competitive application.
- Illinois: $351 million, in addition to competitive funds.
* $5 billion of investments for facilities modernization needs at community colleges.
- Missouri: $69.1 million in the next fiscal year
- Illinois: $212.7 million
3) Unemployment insurance initiatives
The bill proposes reforms to unemployment insurance to help people without jobs enter the workforce. Intended state impacts:
- Missouri: Help put 109,000 long-term unemployed people back to work
- Illinois: Help an estimated 330,000 long-term jobless back to work
The president wants to extend unemployment insurance, which in theory would -- in the first six weeks after enactment -- help prevent the following numbers of people who are looking for work from losing their benefits:
- Missouri: 40,400 people
- Illinois: 104,900 people
The planned new Pathways Back to Work Fund would provide low-income youth and adults with opportunities to work and to get training in growth industries. The program would seek to place the following in jobs:
- Missouri: 2,400 adults and 9,500 youths
- Illinois: 5,900 adults and 18,900 youths