Major highlights of Obama's speech: reveals $447 billion package

Business

oi-Monika Nihalani

By Monika Nihalani

Published: Friday, September 9, 2011, 10:59 [IST]

With fourteen million people still unemployed in United States, President Barack Obama is in politically endangered situation amid fears US economy could be headed for another recession. Just couple of weeks ago, the most thrilling word on Capitol Hill was 'debt' and this time it was 'jobs'.

Obama called an urgent joint congress session on Thursday and unveiled a $447 billion job package plan of tax cuts and infrastructure spending revive a kiosk job market.

Obama's speech has taken on new importunity after the latest labor department report showed a stagnant employment growth in August adding to his bitter battle with Republicans which could impact over its presidency at a time of re-election which is going to happen in November 2012.

The major highlights of the speech were:

• Obama's new plan would cut taxes for workers and businesses and put more construction workers and teachers on the job through infrastructure projects.
  
• He proposed extending unemployment insurance at a cost of $49 billion
  
• Modernizing schools for $30 billion which includes renewing 35,000 schools
  
• Investing in transportation infrastructure projects for $50 billion by building roads, bridges and other major infrastructure projects that would put thousands into work
  
• $70 billion in tax breaks for small businesses
  
• Tax credits for companies taking on military veterans
  
• To provide training for the long-term jobless people
  
• To provide aid to states so that they do not have to lay off 280,000 teachers, as well as other workers
  
• The major component of the project was made up of $175 billion in tax relief by cutting payroll taxes for employees in half next year and cutting employer payroll taxes as well so as to put more money into the pockets of workers and their families through a 50% cut in payroll tax.
  
• The proposal would also slash the payroll tax for businesses with payrolls of up to $5 million, and declare a complete payroll tax "holiday" for employers who hire new workers or give wage increases to current employees. All companies would be eligible, but the benefit would be limited to the first $50 million in new payroll spending.

But the package does not include any measures to provide direct relief to hard-pressed homeowners and the troubled housing market, a problem many experts believe is central to the sluggish recovery but measures might be taken soon as mentioned by Obama.

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