WASHINGTON, (Reuters) – The U.S. Senate defeated President Barack Obama’s job-creation package yesterday in a sign that Washington is likely too paralyzed to take major steps to spur hiring before the 2012 elections.
The $447 billion package of tax cuts and new spending failed by a vote of 50 to 48, short of the 60 votes it needed to advance in the 100-member Senate. Voting was expected to continue for several hours but would not affect the outcome.
Obama, campaigning in Florida, said the vote was not the end of the fight for the measure. In a statement after the vote, Obama accused Republicans of obstruction and said he would work with Senate Majority Leader Harry Reid to make sure that individual proposals in the bill would get a vote as soon as possible.
“Ultimately, the American people won’t take ‘no’ for an answer. It’s time for Congress to meet their responsibility, put their party politics aside and take action on jobs right now.”
Obama had barnstormed around the country to pressure his Republican opponents to back his top legislative priority, but he did not pick up a single Republican vote in the Democratic-controlled Senate.
Two Democrats, facing re-election in conservative states, also voted against the measure. Obama said earlier yesterday he would try to pass components of the bill individually.
Though Obama’s top legislative priority is now dead in Congress, it is certain to have a long afterlife on the campaign trail.
Obama’s 2012 re-election chances depend on his ability to spur the sluggish economic recovery and revive the nearly stagnant job market.
The U.S. unemployment rate has been above 9 percent since May and almost 45 percent of the 14 million jobless Americans have been out of work for six months or more.
Even Wall Street is feeling the pinch, with a report from the New York State Comptroller showing that banker bonuses are likely to drop for the second year in a row.
Among the elements of the bill which might be salvaged are a payroll tax cut which Obama wants to extend to avoid imposing an effective tax increase at a time when wages have not been rising much. Obama’s bill would also extend unemployment benefits for the long-term unemployed, another area that could yield bipartisan support.
Other elements, such as increased highway spending and aid for cash-strapped states, aren’t likely to pick up Republican support.
Democrats say that Republicans are more interested in defeating Obama than helping the country recover from the deepest recession since the 1930s.
“Republicans think if the economy improves it might help President Obama.
So they root for the economy to fail, and oppose every effort to improve it,” Senate Democratic Leader Harry Reid said before the vote.
Republicans, who have lined up behind a job-creation agenda centered around relaxing business regulations, say Obama’s jobs bill is essentially a warmed-over version of his 2009 stimulus.
That effort helped to ease the impact of the worst recession since the 1930s, but Republicans point out that it did not keep unemployment below 8 percent as the White House had promised.
“Everyone who votes for this second stimulus will have to answer a simple but important question: why on Earth would you support an approach that we already know won’t work?” said Senate Republican Leader Mitch McConnell.
Obama’s so-called Jobs Council, under the chairmanship of GE Chief Executive Officer Jeffrey Immelt, earlier delivered a report in which they proposed steps to foster U.S. innovation and make the country more attractive to foreign investment.