Tuesday
Dec082009
Obama Proposes New Economic Recovery Measures
Tuesday, December 8, 2009 at 1:45PM
By Ravi Bhatia – Talk Radio News Service
President Barack Obama discussed his administration’s plans to continue accelerating economic recovery Tuesday at the Brookings Institute in Washington, D.C. Obama suggested that growth will occur through tax cuts and incentives for small businesses, continued investment in American infrastructure, and job creations through clean energy investments.
The measures, at least in part, would be funded by money saved from the Troubled Asset Relief Program, a program which allowed the U.S. government to purchase assets and equity from troubled financial institutions in order to trigger economic growth after the financial collapse. Administration officials say TARP cost about $200 billion less than expected.
“We are going to wind down [TARP],” Obama said. “There has never been a less loved or more necessary program. It was flawed… but today has served its original purpose and at a much lower cost.”
["This] gives us a chance to pay down the deficit faster than we thought possible and to shift funds that would have gone to help the banks on Wall Street to help create jobs on Main Street,” Obama added.
However, senior administration officials noted that the administration has not determined the minimum costs of the proposed programs, and at a press conference this morning, House Minority Leader John Boehner (R-Ohio) said Obama’s announcement indicates a “Stimulus 2,” being paid for with TARP money that Boehner says, “was to go to the deficit.” Boehner said the idea of spending money that was intended to be in excess, is “repulsive.”
Obama said that the programs would eliminate a tax on capital gains from new investments in small business stock for one year and expand on the 75 percent exclusion in the Recovery Act. The small business measures would also create a tax cut for small businesses to encourage new hiring next year, and would continue giving companies enhanced expensing provisions through 2010, allowing them to instantly expense up to $250,000 of qualified investments.
Besides investments in bridges, roads and infrastructure, the new economic programs could provide new incentives for consumers who invest in energy efficient retrofits for their homes.
Following the President's speech, top Economic Adviser Christina Romer and Labor Secretary Hilda Solis told reporters during a conference call briefing that the measures align with the administration's continuing plans to end the recession.
“This really is an evolution,” Romer said. “We had done important actions early in the administration to heal the economy...the Financial Stability Plan, the Recovery Act (ARRA), our housing program.”
Romer added that as indicated in Obama’s speech, today’s announcement of tapping into TARP funds isn’t “a sum total of everything that we are considering.” The economic advisor said congressionally extending ARRA provisions is also being considered.
As far as unemployment benefits that are expected to end this month, Solis promised that there will be a discussion on the Hill about extending unemployment insurance and extending certain ARRA provisions that would be applicable.
President Barack Obama discussed his administration’s plans to continue accelerating economic recovery Tuesday at the Brookings Institute in Washington, D.C. Obama suggested that growth will occur through tax cuts and incentives for small businesses, continued investment in American infrastructure, and job creations through clean energy investments.
The measures, at least in part, would be funded by money saved from the Troubled Asset Relief Program, a program which allowed the U.S. government to purchase assets and equity from troubled financial institutions in order to trigger economic growth after the financial collapse. Administration officials say TARP cost about $200 billion less than expected.
“We are going to wind down [TARP],” Obama said. “There has never been a less loved or more necessary program. It was flawed… but today has served its original purpose and at a much lower cost.”
["This] gives us a chance to pay down the deficit faster than we thought possible and to shift funds that would have gone to help the banks on Wall Street to help create jobs on Main Street,” Obama added.
However, senior administration officials noted that the administration has not determined the minimum costs of the proposed programs, and at a press conference this morning, House Minority Leader John Boehner (R-Ohio) said Obama’s announcement indicates a “Stimulus 2,” being paid for with TARP money that Boehner says, “was to go to the deficit.” Boehner said the idea of spending money that was intended to be in excess, is “repulsive.”
Obama said that the programs would eliminate a tax on capital gains from new investments in small business stock for one year and expand on the 75 percent exclusion in the Recovery Act. The small business measures would also create a tax cut for small businesses to encourage new hiring next year, and would continue giving companies enhanced expensing provisions through 2010, allowing them to instantly expense up to $250,000 of qualified investments.
Besides investments in bridges, roads and infrastructure, the new economic programs could provide new incentives for consumers who invest in energy efficient retrofits for their homes.
Following the President's speech, top Economic Adviser Christina Romer and Labor Secretary Hilda Solis told reporters during a conference call briefing that the measures align with the administration's continuing plans to end the recession.
“This really is an evolution,” Romer said. “We had done important actions early in the administration to heal the economy...the Financial Stability Plan, the Recovery Act (ARRA), our housing program.”
Romer added that as indicated in Obama’s speech, today’s announcement of tapping into TARP funds isn’t “a sum total of everything that we are considering.” The economic advisor said congressionally extending ARRA provisions is also being considered.
As far as unemployment benefits that are expected to end this month, Solis promised that there will be a discussion on the Hill about extending unemployment insurance and extending certain ARRA provisions that would be applicable.
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