Obama Proposes $50 Billion Local Aid Package

Posted June 13, 2010 at 8:39am

Updated: June 13, 2:10 p.m.

President Barack Obama urged Congressional leaders Saturday night to pass a nearly $50 billion emergency aid package to help spur state and local hiring and stem sweeping layoffs, saying it is “a critical juncture in our nation’s recovery.”

The letter — addressed to Senate Majority Leader Harry Reid (D-Nev.), Speaker Nancy Pelosi (D-Calif.), Senate Minority Leader Mitch McConnell (R-Ky.) and House Minority Leader John Boehner (R-Ohio) — comes as Members are increasingly wary of growing deficits.

“While our efforts over the past 18 months have helped break the free fall and restore growth, it is essential that we continue to explore additional measures to spur job creation and build momentum toward recovery, even as we establish a path to long-term fiscal discipline,” Obama wrote.

The package would include $23 billion for teachers and $25 billion for state Medicaid assistance, according to a White House aide. The president said targeted investments by Congress would help get the country back on track, making a pitch for other legislation to help shore up small businesses, as well as calling for additional infrastructure spending and clean-energy job creation.

But he also said that the “lingering damage” from the financial meltdown has left a “mounting unemployment crisis” at the state and local level that could stymie the overall economic turnaround.

“Because the urgency is high — many school districts, cities and states are already being forced to make these layoffs — these provisions must be passed as quickly as possible,” Obama told House and Senate leaders.