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Republican jobs plan pushes tax cuts and deregulation

By Reuters
Friday, May 27, 2011 8:49 EDT
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WASHINGTON (Reuters) – Congressional Republicans unveiled a jobs agenda on Thursday, hitting President Barack Obama where it hurts — the stubbornly high 9 percent unemployment rate.

Two days after suffering a stunning election defeat, largely because of their unpopular proposal to privatize Medicare, Republicans sought to focus attention on the still weak economic recovery.

Their jobs-creation proposals, largely a repackaging of policies they have long advocated, include lowering taxes, reducing federal regulations, increasing domestic energy production, boosting trade and discouraging frivolous lawsuits.

“Just because we proposed it in the past doesn’t mean it’s not a good idea,” House of Representatives Speaker John Boehner told a Capitol Hill news conference.

“We’re trying to package this in a way where the American people understand what it’s going to take in terms of changing policies here that will create jobs in America,” said Boehner, flanked by fellow House Republican leaders.

House Democratic leader Nancy Pelosi brushed off the Republican plan as a “warmed-over stew” of failed ideas that contributed to the weak economy under former President George W. Bush.

The economy promises to again be a core issue for voters in the 2012 presidential and congressional elections. Jobs and gasoline prices tend to drive voters’ impressions of the overall health of the economy, and Obama does not look strong on either front.

America’s unemployment rate was 7.8 percent when Obama took office in January 2009. It rose to nearly 10 percent during last November’s election and has since dipped to 9.0 percent.

Gasoline prices averaged $1.79 per gallon at the start of Obama’s presidency. Last week, they averaged $3.85 a gallon.

More broadly, the economic recovery remains fragile, data shows.

A report on Thursday showed the economy grew at a scant 1.8 percent annual rate in the first three months of the year and jobless claims remain above 400,000 a week, implying an economic soft patch could likely last through the second quarter and possibly longer.

Republicans won the House from Obama’s Democrats in last year’s election by keying on a top voter concern, the weak economy, while dismissing Obama’s stimulus plan as a failure and repeatedly asking: “Where are the jobs?”

On Tuesday, Republicans lost a House seat in a special election in New York, which many analysts attribute to voter anger over their proposed cuts to the Medicare healthcare program for the elderly.

Democrats accused Republicans of being more interested in cutting government spending than in creating jobs.

Pelosi said the Democratic stimulus package of 2009 created or saved 3.5 million jobs, and that further job-creation bills had been blocked by Senate Republicans.

Obama enjoyed a boost in his approval rating — to more than 50 percent — after U.S. forces killed Osama bin Laden, but polls show most Americans still do not approve of his handling of the economy.

The House Republicans’ “Plan for America’s Job Creators” aims to boost employment and economic growth largely by easing federal regulations and taxes, two conservative cornerstones.

For example, it would cut the top business and individual tax rates to no more than 25 percent, from 35 percent. It would also reform the tax code so U.S.-based companies would only be taxed on income earned in the United States, not in foreign countries.

(Additional reporting by Glenn Somerville and Kim Dixon; Editing by Vicki Allen and Eric Beech)

Source: Reuters US Online Report Politics News

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