September 20, 2020

Obama faces tight restraints in crafting jobs plan

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WASHINGTON (AP) — Hamstrung by budget cuts and a tight debt ceiling, President Barack Obama is preparing a September jobs package with limited tools at his disposal to prime the economy and crank up employment.

At a minimum, the president’s plan will call on Congress to extend current payroll tax cuts and jobless benefits, spend money for new construction projects and offer incentives to businesses to hire more workers. But economists say that while that would eliminate some drag on the economy and maintain the status quo, it won’t be enough to propel it to new heights.

The president’s plan, which he will announce in a major speech next week, will be far less ambitious than the$825 billion stimulus of 2009, passed when the economy was still shrinking and when unemployment stood at 8.2 percent. Now the economy is growing sluggishly but unemployment is nearly a full percentage point higher — 9.1 percent for July.

Economists who advocate for government intervention in the economy estimate that it would take a package of at least $300 billion to avoid backsliding and even more to give the economy a lift.

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