With no money to spend, lawmakers talking about job creation aren’t likely to accomplish anything unless a plan is swept into the deficit talks dominating Capitol Hill.
Last month’s uptick in the unemployment rate had Senate Democrats looking to restart their efforts to launch a new jobs agenda while redoubling their attempts to blame Republicans as obstructionists who don’t care about the unemployed.
“I guess their goal is, ‘Let’s make things as bad as we can, and hopefully the American people won’t see through it, and maybe we’ll get somebody elected to replace President [Barack] Obama,'” Senate Majority Leader Harry Reid said Monday on the Senate floor. The Nevada Democrat complained Senate Republicans were blocking modest small-business and economic development reauthorization bills, while accusing House Republicans of letting pension reform and the Federal Aviation Administration reauthorization languish.
But none of those bills would dramatically affect the unemployment rate in the short term, and with the debt limit deadline looming, big new spending plans aren’t likely to go anywhere in either chamber.
That leaves tax cuts as the most likely suspect for addressing job growth. The White House has floated the idea of expanding and extending this year’s 2 percent stimulus payroll tax deduction, but even that proposal has gotten a tepid response so far.
White House Communications Director Dan Pfeiffer told a group of liberal activists Friday at the Netroots Nation convention in Minneapolis, it is “very challenging … [to] get the economy moving on a large scale” when there is a GOP majority in the House.
“This president has put forward a number of initiatives … that have not been acted on yet … that are being blocked by Republicans,” Pfeiffer said. Among those: an infrastructure bill, a national wireless program, clean energy measures and small-business tax breaks. Obama will keep putting forth proposals that could be presented in one large jobs bill, he said.
Sen. Charles Schumer (N.Y.), the No. 3 Democrat, on Sunday sought to tie long-term deficit reduction talks to a new jobs agenda that he said Democrats are putting together.
“We should have as a goal, as a guidepost: For every trillion we cut in the deficit, we should seek to create a million jobs in the short term,” he said on CBS’ “Face the Nation.” “And we can do both.”
Schumer mentioned infrastructure and tax cuts among the items Democrats are considering. They will discuss the agenda at their lunch today, but the caucus has not yet coalesced behind any one idea.
Democrats contend they are trying to find items to lower the unemployment rate that appeal to Republicans and Democrats alike because those proposals have a better chance of reaching the president’s desk.
“They want to get something done,” one senior aide said.
However, Republicans have charged Democrats with “doubling down” on the same stimulus agenda that the GOP says has already failed.
Republicans have stuck to their mantra that cutting regulations and spending, while also adopting free-trade pacts, will enable the private sector to grow.
Sen. Rob Portman, the Ohio Republican charged with developing the Senate GOP’s jobs agenda, said he remains optimistic something can get enacted. Portman said his plan — focused on eliminating regulatory red tape and other business-backed proposals — has attracted the interest of four or five Democrats.
But Portman said next year’s elections are having a chilling effect and attributed the gridlock to the lack of presidential leadership and Democratic angst over 2012.
“To a certain extent, Democrats in the Senate have been looking to the White House to provide leadership, and I think they’d tell you they haven’t seen it,” the freshman Senator said in a telephone interview. “The president is not interested in moving forward with these common-sense ideas because he’s in somewhat of a campaign mode.”
In fact, the Senate GOP’s message is focused on blaming Obama. Its working slogan is: “He’s making it worse,” and the example that it is expected to continue highlighting is the National Labor Relations Board case that has delayed the Boeing Co. from opening a new, $1 billion plant in South Carolina. The NLRB is accusing Boeing of expanding in the Palmetto State, rather than Washington state, to avoid having to hire union workers.
With Republicans only four seats away from taking back the Senate majority, party operatives on Capitol Hill said political insecurity has made it impossible for Democrats to agree on a jobs agenda.
Even as the country’s financial woes have dampened the prospects for a robust jobs agenda from either party, the prospects for getting a comprehensive deficit and debt limit deal before the upcoming deadline seemed to dim over the weekend. Senate Minority Leader Mitch McConnell (R-Ky.) said on “Face the Nation” that a short-term extension of the debt ceiling might be needed to give negotiators more time to work out a longer-term deal. Republicans have insisted on budget cuts in exchange for their votes to raise the debt ceiling by Aug. 2, when Treasury Secretary Timothy Geithner has said the U.S. will begin to default on its obligations.
Senate Minority Whip Jon Kyl (R-Ariz.) said significant progress must be made this week or they would have to reassess the situation. Kyl, who is representing Senate Republicans in talks led by Vice President Joseph Biden, said it might take a month to get a bill through Congress even if they reach a deal.
Kyl said that he’s looking forward to seeing what the Senate Democrats’ jobs agenda ultimately looks like but that their push for new revenue in the talks isn’t the right way to go.
“One sure way not to create more jobs is to kill the economy with tax increases,” he said. “What are the Democrats asking us to do? Raise taxes.”
Christina Bellantoni contributed to this report.