Obama's Going to Make Stimulus Work

Obama's traveling to Denver Feb. 17 and Phoenix Feb. 18 to talk about the stimulus and outline his plan to prevent home foreclosures. By then, republican moaning and groaning and spectacular theatrics will have subsided (maybe) and the bill will have passed.
So why the trip?
Obama may not have the left or the right but he has the majority of the American people with him, the people in the middle, so he's going to rally them and make the stimulus work. That's what I'm thinking.

Republican Governor Crist Likes Stimulus

Gov. Charlie Crist says the people of Florida need the stimulus.

Visit msnbc.com for Breaking News, World News, and News about the Economy

Obama's Meeting With House Republicans Constructive -Video

Obama says he doesn't expect 100% agreement, but he's hoping politics can be set aside.

Republican response:

CQ Politics: House Republicans said that Obama defended the existing stimulus package but assured them there were would be room to incorporate some changes during negotiations between the House and Senate over a final version.

Several members said they still plan to vote against the House bill Wednesday but would take another look when a final version comes back to the House.

“Sometimes you have to vote no the first time around,” Rep. Jack Kingston , R-Ga., said. “The real test will be what happens a week from now.”

“The most encouraging statement the president made was that he had no pride of authorship” over the House bill, said Minority Whip Eric Cantor , R-Va. “I took that to mean that tomorrow’s vote is a first step.”

Rep. Henry E. Brown Jr. , R-S.C., described the meeting as having “a relaxed atmosphere. Everybody was jovial.” He added that from Obama’s remarks “it was pretty evident that he had a good handle on the content of the bill.”

Rep. Peter T. King , R-N.Y., said Obama drew laughter and cheers from the lawmakers when he agreed to extend the question and answer period from 25 minutes to 30 minutes, even though it would make him late to meet GOP senators.

King said Obama told them “The Senate can wait. You see I can pander with the best of you.”

House GOP Conference Chairman Mike Pence of Indiana said prior to the meeting that Democrats had drafted a purely partisan bill. He said Republican leaders would undertake a public campaign against it. “The American people need to know that President Obama’s call for compromise has been completely ignored.”

Obama open to more tax breaks for small businesses:

While Obama didn’t promise major changes to the package, GOP members said he showed flexibility on some issues.

“The president did say he has some concerns over the spending proposals he sees in this bill,” Boehner said.

Participants said Obama took about 10 questions. Peter J. Roskam, R-Ill., had one of the more charged exchanges with Obama, after complaining that House Democratic leaders had shut out GOP amendments and seemed to be taking a much less compromising approach than the negotiated bipartisan approach suggested by Obama.

“He said he would be open to hear about tax breaks for small business. I might get back to him,” Roskam said. Read more at CQ

What else did Obama say?

US NEWS: "Obama is speaking now. He is talking about how bad the economy is and that it is deteriorating rapidly."

- "Mentioned Caterpillar and Microsoft having to layoff workers."

- "The president said that the stimulus is 'just one leg in multi leg stool to get economy going.'

- "He wants to deal with the housing market more aggressively."

- "This is just the first step."

- "Obama said the he would 'like not to have to spend the stimulus money.'"

- "He also said that he has 'no interest in increasing government just to increase the size of government.'"

- On taxes, "Obama says tax relief for some working families must come from payroll so even families who don't pay income taxes get relief and they will spend it."

- On GOP complaints, "he said that 'there will be time to beat him up and a time for politics. He said I understand that and I will watch you on Fox News and feel bad about myself.'"

- "Obama said if we can do more small business tax relief, 'we should do it, but I am just as concerned about the long term impact of tax cuts as I am about spending.'"

- "He also issued concern about the debt. 'I will be judged by the legacy I have left behind. I don't want to leave our children with a legacy of debt. I am inheriting an annual yearly debt of over $1 trillion.'"

Apparently, what Obama did today was rare:

PI: Obama's trip to Capitol Hill was rare for a sitting president, especially given his decision to meet only with the opposition. He met with Democratic lawmakers earlier this month.
In his comments, Obama said he is "absolutely confident" that the country can find ways to solve the country's economic woes. But he said "the key right now is to make sure that we keep politics to a minimum."

Jobs, Jobs, Jobs, Jobs,

You've probably figured out by now that Obama's economic recovery and reinvestment plan (economic stimulus) is all about creating jobs. Here is the Obama team's job impact report.
In this video, Obama's team talks about..... jobs!

If you want to know more about the plan for 4 million new jobs, here's another video for you.
Obama's transition site has a new Citizen's Briefing Book site where you can share ideas and read others. You can also vote ideas up or down.

Obama Asks For Better Ideas Krugman Bites

Inaugural rehearsal
Obama told all the people complaining about the economic stimulus package to present better ideas if they didn't like what he was offering (and if you ask me, any opposition isn't serious, only political theater), so Paul Krugman did.
Krugman, a recent Nobel Prize winner for his economics and NYT columnist, says the economic recovery package needs a bigger number:

First, Mr. Obama should scrap his proposal for $150 billion in business tax cuts, which would do little to help the economy. Ideally he’d scrap the proposed $150 billion payroll tax cut as well, though I’m aware that it was a campaign promise.

Money not squandered on ineffective tax cuts could be used to provide further relief to Americans in distress — enhanced unemployment benefits, expanded Medicaid and more. And why not get an early start on the insurance subsidies — probably running at $100 billion or more per year — that will be essential if we’re going to achieve universal health care?

Mainly, though, Mr. Obama needs to make his plan bigger. To see why, consider a new report from his own economic team. NYT

Obama has asked for the remaining TARP money and President Bush agreed to release it:

President-elect Barack Obama made his case to Congress for the release of $350 billion in remaining federal bailout funds.

A top Obama economic aide laid out new priorities for the use of the remaining balance under the Treasury Department's $700 billion Troubled Asset Relief Program, or TARP. In a letter addressed to the leadership of the Senate and House of Representatives, the Obama team strikes a note of urgency about winning the release of the funds.

"President-elect Obama believes it is not too late to change course, but it will be if we don't take dramatic action as soon as possible," says the letter, written by Larry Summers, director-designate of the National Economic Council. CNN

CNN Money has a pretty good summary of Obama's stimulus plan:

The plan proposes four main categories of measures: Investment in infrastructure, funds to cash-strapped states, expansion of safety net programs to protect the vulnerable, and tax cuts.

Infrastructure: The job creation machine
A key aspect to the the stimulus plan is investment in the nation's infrastructure, which Obama expects to help create between 3 million and 4 million jobs.

Construction projects: Fund the rebuilding of crumbling roads and bridges. Obama wants to rebuild schools and modernize classrooms, labs and libraries.

Renewable energy: Double production of alternative energy in the next three years by modernizing 75% of federal buildings, investing in solar panels and wind turbines and by making cars more fuel-efficient. Obama also wants to modernize the nation's electrical grid with a new, cost-efficient "smart" grid that can deliver electricity from clean, alternative energy sources.

Broadband: Expand broadband Internet lines across rural and urban areas of America.

Health care records: Modernize the health care system by computerizing all of the nations' medical records in the next five years.

Science, research and technology: Invest in scientific innovation to create new industries, new jobs and medical breakthroughs.

State relief: Funding for budget shortfalls
As states face budget shortfalls, Obama's plan seeks to help states pay for Medicaid and unemployment benefits.

State fiscal relief will be allocated to prevent increases in state and local taxes, provided they use the money to maintain essential services like police, fire, education, and health care.

Safety net: Helping the most vulnerable
Obama proposes temporary programs to protect those most vulnerable to the effects of the recession.

Federal aid will go to temporary increases in food stamp spending, extensions and expansions of unemployment insurance, as well as health care coverage for unemployed.

Tax cuts: Breaks for businesses and the middle-class
The president-elect will propose roughly $300 billion in tax cuts for individuals and businesses, adding up to about 40% of the total stimulus plan.

Middle-class tax cut: An estimated 95% of low-income and middle-class families will receive a refundable tax cut equal to $500 a year for individuals and $1,000 for couples. The credit would essentially be a payroll tax credit, with companies able to reduce the tax they withhold from employees' paychecks.

Small business write-offs: Obama would increase the amount of expenses small businesses can write off to $250,000 in 2009 and 2010 from the current $125,000 level.

Tax cuts for companies suffering losses: He would extend the so-called net-operating loss carryback to five years from two years. For businesses that book losses in 2008 and 2009, the provision allows companies to apply their losses to past and future tax bills so that they can get money back on taxes they've already paid or would otherwise have to pay. CNN

Obama's Big Tax Cuts for Middle Class and Business

Big tax cuts, big speech this week.

Politico: Aiming to foster bipartisan support for his record-setting economic stimulus, President-elect Obama plans to propose huge tax cuts for businesses and middle-class workers that will total about 40 percent of the package, or up to $310 billion, congressional officials said.

The revelation is part of an intricately orchestrated roll-out of the plan that includes an appearance by Obama on Capitol Hill on Monday and a major speech about the economy later in the week.

Obama plans to ask Congress for a stimulus package of $675 billion to $775 billion, so the planned tax cuts will total about $270 billion to $310 billion, the officials said.

Obama strategists say he wants to get 80 or more votes in the 100-member Senate, and the emphasis on tax cuts is a way to defuse conservative criticism and enlist Republican support. read the rest.

What form will the tax cuts take?

For families, the tax cuts include the $500 “Making Work Pay” payroll tax credit Obama proposed during the campaign.

For businesses, the tax cuts would include breaks for small employers and a “new jobs credit.”

Dems are planning on getting the package to Obama in mid-February. More from MSNBC:

Congressional aides briefed on the measure say it probably would blend tax cuts of $500 to $1,000 for middle-class individuals and couples with about $200 billion to help revenue-starved states with their Medicaid programs and other operating costs. A large portion of the measure will go toward public works projects and include new programs such as research and development on energy efficiency and an expensive rebuilding of the information technology system for health care.

WSJ says the breaks could pack a punch:

The Obama tax-cut proposals, if enacted, could pack more punch in two years than either of President George W. Bush's tax cuts did in their first two years. Mr. Bush's 10-year, $1.35 trillion tax cut of 2001, considered the largest in history, contained $174 billion of cuts during its first two full years, according to Congress's Joint Committee on Taxation. The second-largest tax cut -- the 10-year, $350 billion package engineered by Mr. Bush's in 2003 -- contained $231 billion in 2004 and 2005.

Obama's Weekly Address Jan. 3

Our problems aren't democratic problems or republican problems. They are America's problems. Obama talks about his economic recovery and reinvestment plan in this week's address. Politico says the plan could be ready for a vote real soon:

No draft or outline is circulating yet, but the biggest special spending bill in history should be ready for a vote the week of Jan. 12, a week from Monday, House officials tell Playbook. 'We are hoping for a House vote on Week 2 (week of Jan. 12),' a House official said. 'It could slip if we decide to hold regular approps hearings. But I think a vote is likely the week of Jan. 12.'