On Thursday, President Obama tried to sell the country on his jobs plan by saying it would be fully funded, would not add to the deficit, would create jobs as soon as it was passed, and was filled with bipartisan ideas.
Not so fast, say the fact-checkers at the Associated Press.
Calvin Woodward and Tom Raum took the President’s plan apart, saying it “employs sleight-of-hand accounting.”
They started with Obama’s claim that everything in the bill is paid for.
THE FACTS: Obama did not spell out exactly how he would pay for the measures contained in his nearly $450 billion American Jobs Act, but said he would send his proposed specifics in a week to the new congressional supercommittee charged with finding budget savings. White House aides suggested that new deficit spending in the near-term to try to promote job creation would be paid for in the future – the “out years,” in legislative jargon – but they did not specify what would be cut or what revenues they would use.
Essentially, the jobs plan is an IOU from a president and lawmakers who may not even be in office down the road when the bills come due. Today’s Congress cannot bind a later one for future spending. A future Congress could simply reverse it.
Explaining that roughly all federal revenues are currently used to pay benefit programs and the national debt, nearly “everything else is done on credit with borrowed money.”
They conclude that “there is no guarantee that programs that clearly will increase annual deficits in the near term will be paid for in the long term.”
As for Obama’s claim of bipartisan ideas, the fact checkers said basically, ‘not so much.’
THE FACTS: Obama’s proposed cut in the Social Security payroll tax does seem likely to garner significant GOP support. But Obama proposes paying for the plan in part with tax increases that have already generated stiff Republican opposition.
For instance, Obama makes a pitch anew to end Bush-era tax cuts for the wealthiest Americans, which he has defined as couples earning over $250,000 a year or individuals over $200,000 a year. Republicans have adamantly blocked what they view as new taxes. As recently as last month, House Republicans refused to go along with any deal to raise the government’s borrowing authority that included new revenues, or taxes.
Third, they took on Obama’s statement that his plan would not add to the deficit:
THE FACTS: It’s hard to see how the program would not raise the deficit over the next year or two because most of the envisioned spending cuts and tax increases are designed to come later rather than now, when they could jeopardize the fragile recovery. Deficits are calculated for individual years. The accumulation of years of deficit spending has produced a national debt headed toward $15 trillion. Perhaps Obama meant to say that, in the long run, his hoped-for programs would not further increase the national debt, not annual deficits.
Finally, they addressed the President’s statement that the Act would create jobs immediately.
THE FACTS: Not all of the president’s major proposals are likely to yield quick job growth if adopted. One is to set up a national infrastructure bank to raise private capital for roads, rail, bridges, airports and waterways. Even supporters of such a bank doubt it could have much impact on jobs in the next two years because it takes time to set up. The idea is likely to run into opposition from some Republicans who say such a bank would give the federal government too much power. They’d rather divide money among existing state infrastructure banks.
In short, the bill outlined by the President is not paid for, not bipartisan, will add to the deficit and will not solve the problem of unemployment.
Ed Morrissey of Hot Air wrote that nothing Obama proposed Thursday night was new:
Obama didn’t offer one single new idea last night. He didn’t even offer an idea on how to pay for the bill, whose price tag Obama never mentioned once in his speech but has now bloated from an initial estimate of $300 billion to $450 billion. Instead, he told Congress to figure out how to carve the cost out of future spending while it battles over meeting its $1.5 trillion commitment from last month’s debt-ceiling increase.
Responding to the President’s speech, Rep. Cathy McMorris Rodgers (R-WA) said she would have preferred to see the President display a greater commitment to using free-market solutions to revive the economy and create middle-class jobs.
“As we saw on November 2nd of last year – and in polls throughout this year – the American people are not happy with the status quo. They are tired of the failed ‘spend, borrow, and bailout’ policies that got us into this crisis and continue to make it worse. They know we need to create a climate where small business owners have the confidence to grow and create jobs again,” she said.
Noting that the Republican-controlled House has passed fourteen jobs bills this year, she emphasized the need to reduce the size and scope of federal government:
“When I met with job creators in Eastern Washington during the last five weeks, I asked them how we can create that climate. Their message was clear: If we want to grow jobs in the private sector, we need to shrink the size of the public sector. We need less government spending. We need less government borrowing. And we definitely need less government regulation.”
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