Obama's Jobs Plan: A Good Start But America Needs Much More

Washington, DC-Just after President Obama's speech to a joint session of the US Congress on his new plan to stimulate job growth entitled "The American Jobs Act," the national policy center Demos published a point-by-point analysis of the plan. Based on the deep economic troubles facing this nation, including widespread joblessness and stagnant or declining wages, the Demos analysis concludes that the President's plan is a good start, and tells the right story about how to get the economy moving again. But ultimately it is not bold enough to meet our national needs. 

Demos' analysis, entitled "HELP WANTED: AMERICA NEEDS A BETTER JOBS PLAN," highlights the following:

--While containing many positive elements, the President's plan is too modest given the magnitude of the jobs crisis. Total proposed outlays of nearly $450 billion in the form of $253 billion in tax cuts and $194 billion in spending is too low to make up for today's shortage of demand in a $15-trillion economy.

--Extending unemployment benefits, which are now scheduled to expire under the terms of the debt ceiling deal, is essential. We also applaud the President's commitment to funding work-share programs at the state level, which allow employers to keep workers at reduced salaries and avoid layoffs. Work-share programs deliver more bang for the stimulus buck.

--The President's proposed investments in infrastructure are a good start, but even more spending is needed to put 1.5 million unemployed construction workers back on the job. Last year, a bipartisan group of transportation experts estimated that the United States needs to spend an extra "$134 billion to $262 billion per year for roughly the next quarter century" to meet its transportation infrastructure needs and ensure future prosperity.

--The President is right to advocate extending the payroll tax cut for another year and expanding it to cut the tax in half for all workers. But Congress should consider going even further, suspending the entire 6.2 percent payroll tax on workers.

--We applaud the President's commitment to helping struggling state and local government avoid layoffs of more teachers and first responders. Over 600,000 public sector workers have already lost their jobs due to budget cuts. However, the proposed new spending in aid by the White House to state and local governments is not large enough to help states cope with massive budget shortfalls in 2012, which will mean more layoffs.

--In addition to taking the more dramatic steps in the areas outlined above, Demos' analysis calls for: raising labor standards to improve job quality; expanding protections for workers that want to join unions; providing more help to small businesses; and investing in direct job creation to provide employment opportunities now.

Download "HELP WANTED: AMERICA NEEDS A BETTER JOBS PLAN"

Read a newly released statement from Demos President Miles Rapoport at http://bit.ly/n4yOk9

For more information and insight into the jobs crisis, explore the daily writings, info-graphics and illustrations from Demos' "America Can Work Better" series at http://bit.ly/pfFdc3

Demos President Miles Rapoport, Vice President of Policy and Programs Tamara Draut and Senior Fellow David Callahan are available for comment. To reach them please see the above contact information.