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Obama Team Presses Recovery Plan

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The Associated Press

Published: November 24, 2008

WASHINGTON - After more than two weeks of virtual silence on the economy, President-elect Barack Obama's transition team burst onto the scene with new ambition and urgency Sunday, demanding swift passage by Congress of a massive two-year spending and tax-cutting recovery program.

Obama aides called on lawmakers to pass, by the Jan. 20 inauguration, legislation that meets Obama's two-year goal of saving or creating 2.5 million jobs. Democratic congressional leaders said they would get to work when Congress convenes Jan. 6.

Though Obama aides declined to discuss a total cost, it probably would far exceed the $175 billion he proposed during the campaign, but would not immediately seek to raise taxes on the rich. Some economists and lawmakers have argued for a two-year plan as large as $700 billion, equal to the Wall Street bailout Congress approved last month.

With the wounded economy worsening, the Obama team's new assertiveness was a recognition that he needs to soothe financial markets with signs of leadership. It also foreshadowed a more hands-on role by Obama to influence congressional action during the final weeks of the transition.

"We don't have time to waste here, " Obama senior adviser David Axelrod said. "We want to hit the ground running on January 20th."

The emphasis on the economy began Saturday when Obama outlined the framework of a plan to save or create 2.5 million jobs by the end of 2010. The scope of the package is far more ambitious than what Obama had spelled out during his presidential campaign, when he proposed $175 billion of spending and tax-cutting stimulus. The new one will be significantly larger and would incorporate his campaign ideas for new jobs in environmentally friendly technologies - the "green economy." It also would include his proposals for tax relief for middle- and lower-income workers.

But there were no plans to balance the tax cuts with an immediate tax increase on the wealthy. During the campaign, Obama said he would pay for increased tax relief by raising taxes on people making more than $250,000.

Obama could delay any tax increase until 2011, when Bush administration tax cuts expire.

While Obama in the weekend Democratic radio address said his plan "will mean 2.5 million more jobs by January of 2011," aides said the figure was a net sum of jobs created and jobs saved that would otherwise disappear without government help.

Obama's plan is both an economic and a political blueprint. By not including tax increases, he silences one potential Republican objection to his plan. If successful, the scope of his plan would set the stage for his other legislative goals, including expanded health care, permanent changes in tax rates and an overhaul of energy policy.

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