Senate passes job-creation bill
3/18/2010WASHINGTON - President Obama is expected to sign into law today the first significant job-creation measure passed by Congress since Democrats earlier this year vowed to attack the nation's high unemployment rate.
The bill, which the Senate passed yesterday by a 68-29 vote, is a $17.6 billion package intended to spur hiring nationwide by, among other things, granting employers a payroll tax "holiday" for the rest of the year for hiring new workers.
Mr. Obama will sign the bill in a morning Rose Garden ceremony. "It is the first of what I hope will be a series of jobs packages that help to continue to put people back to work all across America," he said yesterday after the bill passed.
The measure would grant employers an exemption for their 6.2 percent Social Security payroll contribution for every new employee hired through the rest of the year, as long as that employee had been out of work for at least 60 days. There would also be an additional $1,000 corporate income-tax credit for every new employee kept on for 52 weeks.
Experts are split as to whether the payroll provision will boost hiring. Optimistic estimates predict the tax break could generate perhaps 250,000 jobs through the end of the year, but that would be just a tiny fraction of the 8.4 million jobs lost since the start of the recession.
The bill is financed in part over the coming decade by cracking down on offshore tax havens, though it would add $13 billion to the debt in the coming three years.
The measure would also make it easier for businesses to write off equipment purchases and would authorize the transfer of $20 billion into federal highway and mass-transit funding programs, which Democrats hope will jump-start construction projects.
The bill had previously passed the Senate last month but was modified by the House, which required a second Senate vote. Eleven Republicans crossed the aisle to vote with Democrats, including Ohio's George Voinovich.
"The funding in this bill sends the message to struggling states like Ohio that they can move forward with shovel-ready transportation projects - projects that will put people back to work quickly and contribute to economic growth," Mr. Voinovich said.
Nebraska's Ben Nelson was the only Democrat to vote against the bill.
The House is considering a $140 billion package passed by the Senate last week that contains a series of industry-friendly tax breaks such as a credit for research and development as well as extensions of unemployment benefits and COBRA insurance subsidies through the rest of the year.
The Senate is expected to turn its attention to legislation that would provide struggling small businesses with increased access to credit.