The Nitty Gritty of the Jobs Plan

For indispensable reporting on the coronavirus crisis, the election, and more, subscribe to the Mother Jones Daily newsletter.

So what about the nitty gritty of Obama’s American Jobs Act? Is it any good? At a policy level, it rings in at about $450 billion, much bigger than most people were expecting. Here’s how it breaks down:

  • $250 billion in tax breaks. Most of this is a payroll tax cut, but the plan also includes 100% expensing of business investment, tax credits for hiring unemployed workers, and a few other things.
  • $100 billion in infrastructure spending. About half of this is for new projects, and the other half goes to an infrastructure bank, a program to fix up vacant and foreclosed homes and businesses, and a program to fix schools.
  • $100 billion in other stuff, including extension of unemployment benefits, direct state assistance to hire cops and firefighters, a mortgage refinancing program, and a few other smaller items.

The White House fact sheet is here. So would it work? Macroeconomic Advisors, a private forecasting firm, estimates that it would boost GDP by 1.3% in 2012 and raise employment by 1.3 million. This is roughly equivalent to the CBO’s low-end estimates of the original stimulus package in 2010, and the CBO has estimated that 1.3 million new workers translates to a decrease in unemployment of 0.7%.

Moody’s is a little more optimistic: “The plan would add 2 percentage points to GDP growth next year, add 1.9 million jobs, and cut the unemployment rate by a percentage point.”

So that’s probably the rough consensus. The plan is bigger than expected, the president’s appeal was stronger than expected, the details of the plan have been generally well received, and if passed, it will raise GDP by 1-2 points and reduce unemployment by about one point or so.

So why did it take me so long to write a post about the actual policy impact of the AJA? Partly because I was waiting for the private forecasters to weigh in on its effect. But to put my cards fully on the table, there’s also this: much more than usual — which is already a high bar — chattering about the policy impact of Obama’s plan simply feels like a charade. I can’t remember the last time that the actual merits of a policy proposal mattered so little. The details of Obama’s plan will simply have no impact at all on whether it’s passed. Among Republicans, reaction to Obama’s proposal will be 100% guided by political considerations.

I don’t think anyone really disputes this. And maybe I’ll buck up and get all wonkish about this stuff after I recover this weekend. I usually do. But the truth remains that the policy impact of Obama’s plan is purely a sideshow. Arguments on that level are all sound and fury, signifying nothing. Republicans just flatly don’t care.

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

SIX TRUTHS

Reclaiming power from those who abuse it often starts with telling the truth. And in "This Is How Authoritarians Get Defeated," MoJo's Monika Bauerlein unpacks six truths to remember during the homestretch of an election where democracy, truth, and decency are on the line.

Truth #1: The chaos is the point.

Truth #2: Team Reality is bigger than it seems.

Truth #3: Facebook owns this.

Truth #4: When we go to work, we're in the fight.

Truth #5: It's about minority rule.

Truth #6: The only thing that can save us is…us.

Please take a moment to see how all these truths add up, because what happens in the weeks and months ahead will reverberate for at least a generation and we better be prepared.

And if you think journalism like Mother Jones'—that calls it like it is, that will never acquiesce to power, that looks where others don't—can help guide us through this historic, high-stakes moment, and you're able to right now, please help us reach our $350,000 goal by October 31 with a donation today. It's all hands on deck for democracy.

payment methods

We Recommend

Latest

Sign up for our free newsletter

Subscribe to the Mother Jones Daily to have our top stories delivered directly to your inbox.

Get our award-winning magazine

Save big on a full year of investigations, ideas, and insights.

Subscribe

Support our journalism

Help Mother Jones' reporters dig deep with a tax-deductible donation.

Donate