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No Clear Path for Obama’s Jobs Package

Scott J. Ferrell/CQ Roll Call File Photo
Sen. Jim Webb criticized the millionaire tax because it doesn’t address the 15 percent capital gains tax rate.

More than one month after President Barack Obama spoke to a joint session of Congress to extol his American Jobs Act, Congressional Democrats have no clear path forward on the package in the face of a GOP filibuster in the Senate and the House Republican leaderships lack of interest in taking up the measure.

The White House and Democratic leaders indicated they plan to push pieces of it, but that might not happen before the next Senate recess in two weeks, according to that chambers Democratic aides.

Democrats, of course, have plenty of disagreements within their own ranks over what to do next to the delight of the GOP.

Some are talking about just moving the tax cuts in an effort to corner the GOP; others want spending on infrastructure or other pieces. And they are still arguing among themselves over how to pay for any type of package.

Senate Majority Leader Harry Reid (D-Nev.) had hoped to unite his caucus with a 5.6-percent surtax on income of more than $1 million, but he still ran into dissenters.

Sen. Jim Webb (D-Va.), for example, ripped the new millionaire tax Tuesday not because it strikes millionaires, but because it doesnt touch the 15 percent capital gains tax rate, which allows many millionaires such as Warren Buffett to pay a lower overall tax rate than middle-class workers.

If youre willing to discuss capital gains, I know youre serious, he said. If youre not ready to discuss capital gains, I think we have seen this movie before.

Webb also complained about the timing of moving to the jobs bill, as the Joint Committee on Deficit Reduction is still meeting to hash out a broader budget deal.

Sen. Joe Lieberman (I-Conn.), meanwhile, said that while he would vote with Democrats to bring the jobs bill to the floor, he would vote against passage unless it shrinks dramatically.

I will seek to amend the American Jobs Act down to a very few of its constituent parts that I think are worth their cost, he said.

Lieberman said the bill spends half [of] a trillion [dollars] we dont have and that while he supported Obamas stimulus package in 2009, it didnt provide the jolt the president hoped it would. Lieberman called the latest package a mini-stimulus and said the best thing Congress could do for jobs is to reduce the debt. He said he didnt object to a millionaire tax but that it should go toward deficit reduction, not more stimulus.

Democratic aides shrugged off the Democratic dissents and said breaking the bill into smaller pieces could make it harder for the GOP to oppose. Republicans will either have to give in on something or they will get the blame for a dysfunctional Congress, the aides said.

Will Senate Republicans keep saying no again and again to proposals which have bipartisan pedigree, all the while having no plan of their own? a Democratic leadership aide asked.

Senate Majority Whip Dick Durbin (D-Ill.) quoted Senate Minority Leader Mitch McConnells (R-Ky.) own comments on Fox News in January 2009 calling for a payroll tax cut to stimulate the economy.

They are summarily rejecting payroll taxes for families that they have supported in the past, Durbin said, adding that McConnell and other Republicans voted for a stimulus tax cut when President George W. Bush was in office but now wont do the same when Obamas name is attached to it.

Durbin said the GOP has no alternative to create jobs right now.

The Republican approach to this is to do nothing, he said. Absolutely nothing.

But McConnell said Democrats designed the bill to fail so that they have an issue to run on in the next election, and he blasted the bill as nothing more than another stimulus package.

Everyone who votes for this second stimulus will have to answer a simple but important question: Why on earth would you support an approach that we already know will not work?

Senate Republican aides speculated that the Democratic game plan and Obamas hopes for re-election lie in failing to get anything done so that he can run against the GOP.

Id be surprised if they didnt design everything to draw Republican opposition, one senior aide said, no matter how small.

House Majority Leader Eric Cantor (R-Va.) welcomed talk of a more incremental approach on jobs but said Democrats and the White House should try to work with the GOP, and he called tax increases a nonstarter.

I think that hopefully this says this is the end of the political games, and hopefully it will also mean that the White House and the president will stop going out there demanding an all-or-nothing approach, pass my bill or else, because that is pure politics, Cantor said.

But there is precious little that the two parties actually agree on suggesting that any substantial jobs package is likely to come out of a compromise in the deficit committee or not at all.

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