On Monday, President Obama released his proposed Federal budget for FY2013, a $3.8 trillion spending blueprint that takes a balanced approach to deficit reduction while protecting key public investments and devoting almost $350 billion to job creation policies over the next 18 months.
Along with significant investments in infrastructure, the budget proposes a range of large-scale investments targeted towards stimulating economic growth and job creation, the major pieces of which include:
• $95 billion in payroll tax cuts for workers, a piece which passed both the House and the Senate today. This piece cuts the percentage workers pay out of their income in Social Security taxes from 6.1% to 4.1%, a tax cut which economists predict will put close to $1000 in workers’ pockets over the next 10 months.
• $80 billion in other business tax cuts, including additional write-offs for firms purchasing new equipment and a $25 billion credit for employers that hire new workers—especially those who number among the long term unemployed.
• $45 billion in emergency unemployment benefit extension, ensuring that workers in high unemployment states will continue to receive up to 73 weeks of unemployment benefits—an extension that will especially benefit workers in North Carolina, a state with an unemployment rate higher than the national average. By putting money in the hands of dislocated workers, the UI extension ensures that these laid off workers can continue to put food on their tables, pay rent, and purchase goods from private sector establishments like grocery stores, restaurants, and hospitals—a public sector investment with immediate private sector payoffs. In more good news, this piece also passed Congress today.
• $20 billion in school facility repair and modernization + $30 billion in retaining or rehiring teachers and first responders. Taken from the American Jobs Act, these policies are expected to generate significant job creation in both public and private sectors while ensuring that our workforce is trained for the industries of the future.
• $25 billion in transportation infrastructure investments ($50 billion over ten years).
Taken together, these policies are projected by nonpartisan economists to create 1.5 million jobs in fiscal year 2012 and 1.3 million jobs in fiscal year 2013 (through Sept. 2013).