Healthcare finished, House Democrats switch to jobs agenda

House Democrats are pivoting to a jobs agenda hours after sending President Barack Obama landmark healthcare legislation.

Democrats are planning votes as soon as Tuesday on an $18 billion bill that funds infrastructure projects and provides small-business tax breaks, as well as a disaster-relief measure that includes $600 million for a summer youth jobs program.

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“Now we can have a sustained and focused effort on jobs,” said Rep. Barbara Lee (D-Calif.), chairwoman of the Congressional Black Caucus (CBC).

The jobless rate for February was 9.7 percent, down slightly from a peak of 10.2 percent last fall. A majority of Americans said unemployment or the economy in general was the top problem the country faces, according to a Gallup poll taken this month. In the same poll, healthcare was cited as the country’s top problem by a fifth of respondents.

Many of the proposals to be considered this week were pushed in January by Obama during his State of the Union address, at which time he also said the economy would be his top priority in this midterm election year.

The $18 billion jobs bill includes $2 billion to exempt small businesses from the capital gains tax through 2011, a move Obama had called for in the address.

The bill also features spending provisions pushed for by liberal Democrats. It includes $2.5 billion for Temporary Assistance for Needy Families that Lee and the CBC pushed for. It also includes $7.5 billion to increase federal subsidies for Build America Bonds to provide state and local governments with low-cost financing for infrastructure projects, $2.4 billion for more low-income housing tax credits and $2.4 billion for public works bonds for areas hit hard by job losses.

Part of the bill’s costs would be offset by closing a loophole that allows foreign companies that do business in the U.S. to avoid paying certain taxes by moving their operations to a third nation. 

All Republicans on the House Ways and Means Committee voted against the bill during a markup last week. Republicans said the measure increases taxes, spends too much on government programs instead of the private sector and is too narrow and ineffective to create jobs.

“We believe slapping together a dozen unrelated tax provisions and calling it a jobs bill is not an effective strategy for putting Americans back to work,” Rep. Patrick Tiberi (Ohio), a Ways and Means Republican, said Monday.

The $600 million in grants for states and local governments to provide summer jobs for young people is attached to a separate $5.8 billion measure that extends a contingency fund for the Federal Emergency Management Agency (FEMA). The summer-jobs funding will be paid for through spending reductions in other areas, but the cost of FEMA funding won’t be offset because it’s considered an “emergency spending,” said House Appropriations Committee Chairman David Obey (D-Wis.).

To ease passage of the jobs measures, Senate Democrats have said they plan to pass a “jobs agenda” made up of several bills instead of resorting to one big bill, such as the $862 billion stimulus passed last year.

The Senate has been a roadblock for jobs measures House members want, Lee said. She noted that Democratic leaders failed this month to attach the summer jobs funding to a nearly $150 billion unemployment aid and corporate tax break bill when centrist Democrats and Republicans objected because the jobs program wasn’t paid for.

The House is now following the Senate’s lead in looking to bite-sized bills, said Anne Kim, a former House Democratic aide. While small-business tax breaks won’t be enough to turn the economy around by themselves, a string of legislative victories should at least let Democrats recapture some momentum after the healthcare debate.

“We’ve got big-bill fatigue, so it’s about racking up [as many] victories as possible and daring the other side to say no,” said Kim, now the economic program director at the center-left think tank Third Way.