Obama’s Jobs Bill May Cost $100 Billion

By Kriesgberichter

Obama’s Jobs Bill May Cost $100 Billion

Feb. 1 (Bloomberg) — Legislation aimed at making it easier for companies to hire more workers is likely to cost about $100 billion, White House spokesman Robert Gibbs said.

The measure should include a tax credit for small businesses to offset payroll taxes, as President Barack Obama proposed in a Jan. 29 speech, Gibbs said on CNN’s “State of the Union” program yesterday. The administration would also like to add infrastructure spending, Gibbs said.

“We’re not creating the jobs that we would like,” Gibbs said. “I think some additional recovery and stimulus spending is important in order to create an environment where small businesses and large alike can hire more workers.”

The president also wants to use $30 billion repaid by banks under the Troubled Asset Relief Program to enable community banks to make loans to small businesses, Gibbs said. U.S. gross domestic product grew 5.7 percent in the fourth quarter, the fastest pace in six years, the Commerce Department said Jan. 29.

Obama would help businesses gain the confidence they need to start hiring again by shelving health-care reform and assuring business owners that taxes won’t increase, Senate Minority Leader Mitch McConnell, a Kentucky Republican, told CNN’s “State of the Union.”

“If you’re in business now and you’re trying to figure out what the future is, you’re looking at health care taxes, you’re looking at capital gains taxes going up, dividend taxes going up,” McConnell said. “Is that a great environment in which to expand employment? I think the answer is no.”

Obama’s call to freeze discretionary spending in the federal budget over three years, not including defense or national security, is “an important step” toward bridging the disconnect between Washington’s actions and budget decisions made by local governments and families, Michigan Governor Jennifer Granholm told CNN’s “State of the Union.”

“Cutting spending is even more important,” said Granholm, a Democrat. “Triage everything to provide the basics to people so you’re protecting them. But all this other stuff, forget it. Put money where you have to. Cut everything else.”

Obama’s spending freeze would be more effective if it began right away and not in 2011, Representative Paul Ryan, a Wisconsin Republican, said on “Fox News Sunday.”

“What matters in Congress is the first year’s spending levels,” Ryan said. “Get your handle on the deficit and debt and lower tax rates for employers, for workers, that’s the best way to grow the economy.”