The American Jobs Act: Promise or Problem?

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Last night, before Congress and the nation, President Obama laid out a plan for creating jobs and restoring vitality to the American economy. The plan includes a $447 billion package of tax cuts and spending initiatives that the Administration believes will provide the impetus for job creation and overall economic growth.

Let take a look at what has been proposed:

Expansion and extension of the one-year payroll tax cut   $240
Unemployment insurance and jobs programs 62
Infrastructure projects 60
Aid to states and local governments($80 billion)
To keep teachers, firefighters and police officers in their jobs     35
To modernize schools and community colleges 30
 To rehabilitate and refurbish vacant and foreclosed homes     15
To help low-income youths and adult workers 5
Total $447

How does break down between individuals and business?

Employee payroll tax holiday $175
Unemployment insurance and jobs program        62
To keep teachers, firefighters and police officers in their jobs   35
To help low-income youths and adult workers        5
Total for individuals       $277
Payroll tax holiday for small businesses    $60
Accelerated depreciation of business assets 5
Aid to states and local governments 45
Infrastructure projects 50
National Infrastructure Bank    10
Total for business $170

How you feel about this deal will probably be determined by your political swaying’s, but the majority of the economists interviewed inthis article seem to believe that the benefits of this pending legislation will be anywhere from minimal to meaningful.

With the unemployment rate for the construction industry still hovering around 13.5%, it is obvious that job creation in the industry is badly needed. But with a highly partisan atmosphere in Congress, what is the realistic chance that this proposed legislation will be passed?  What is your take on the American Jobs Act?

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