Obama addresses a joint session of Congress tonight

Here is a summary of the American Jobs Act that the White House is putting out. I don’t have a ton of time to analyze it right now, but much of it will be familiar, albeit with a few new wrinkles. There’s $35 billion for state fiscal aid, which is somewhat robust and good bang for the buck in terms of saving jobs. All in all there’s $105 billion in infrastructure/public works (that includes a replenishing of the Neighborhood Stabilization Fund, which helps address the foreclosure crisis). And there’s an attempt to restart the TANF Emegency Fund with $5 billion or so. That’s on top of the $170 billion for the payroll tax cut and extending unemployment insurance. So all in all, back of the envelope says about $315 billion.

UPDATE: There are apparently a couple things missing from this, which could add to the cost by as much as another $100 billion. There’s an employer-side payroll tax cut component for small business, up to 3% with a limit on the first $5 million. There would also be a tax break for hiring new employees, a tax break for hiring long-term unemployed or veterans, and 100% expensing of business equipment and costs. So most of the additional spending is on the tax side. I haven’t seen a breakdown of that total cost, though it sounds extensive.

I’ll put the summary here, and on the flip some excerpts from the speech.

American Jobs Act – President will lay out the details tonight and will submit the actual legislation next week. He’ll call on Congress to pass it immediately.

There are five major categories:

1) Tax Cuts for Small Business
a. Payroll Tax Cut

2) Putting Workers Back On the Job
a. Fund to prevent teacher layoffs and first responder layoffs – $35 billion. $30 billion would be used to prevent teacher layoffs and would be distributed using Title I formula and not given to Governors with great discretion as was done before. $5 billion for first responders to be distributed through COPS and Safer Communities.

3) Rebuilding America

a. $30 billion investment in School Construction – to be distributed to the 100 neediest school districts
b. $50 billion in infrastructure – $5 billion for TIGER IV and TIFIA
c. $10 billion for an infrastructure bank – open to projects from both the public and private sectors
d. $15 billion for Project Rebuild – formerly Neighborhood Stabilization – addressing foreclosures and vacant commercial properties

4) Pathways Back to Work – $5 billion
a. Extend UI
b. 1/3 summer jobs; 1/3 TANFF Emergency and 1/3 Innovation Fund for Training

5) Plan is fully paid for.
a. President will look to the Super Committee to identify $1.5 Trillion plus additional savings which will pay for the plan.

Here are some excerpts from the speech:

The people of this country work hard to meet their responsibilities. The question tonight is whether we’ll meet ours. The question is whether, in the face of an ongoing national crisis, we can stop the political circus and actually do something to help the economy; whether we can restore some of the fairness and security that has defined this nation since our beginning.

Those of us here tonight cannot solve all of our nation’s woes. Ultimately, our recovery will be driven not by Washington, but by our businesses and our workers. But we can help. We can make a difference. There are steps we can take right now to improve people’s lives.

I am sending this Congress a plan that you should pass right away. It’s called the American Jobs Act. There should be nothing controversial about this piece of legislation. Everything in here is the kind of proposal that’s been supported by both Democrats and Republicans – including many who sit here tonight. And everything in this bill will be paid for. Everything.

The purpose of the American Jobs Act is simple: to put more people back to work and more money in the pockets of those who are working. It will create more jobs for construction workers, more jobs for teachers, more jobs for veterans, and more jobs for the long-term unemployed. It will provide a tax break for companies who hire new workers, and it will cut payroll taxes in half for every working American and every small business. It will provide a jolt to an economy that has stalled, and give companies confidence that if they invest and hire, there will be customers for their products and services. You should pass this jobs plan right away.

David Dayen

David Dayen