WASHINGTON — Despite doubts among many lawmakers that it'll create many jobs, the House on Thursday passed legislation giving companies that hire the jobless a temporary payroll tax break.
The measure passed 217-201 on a mostly party-line vote. The bill also extends federal highway programs through the end of the year.
Some Democrats feel the approximately $35 billion jobs bill is too puny, while others say the tax cut for new hires won't generate many new jobs. However, the pressure is on to address jobs and deliver a badly needed win for President Barack Obama and a Democratic Party struggling in opinion polls and facing major losses in the upcoming midterm elections.
Further jobs measures are promised.
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The legislative action in Washington comes amid soaring unemployment in the Northern San Joaquin Valley. The jobless rate has been on the rise since the collapse of the housing market in late 2005, reaching levels not recorded in the region for more than a decade.
As housing values declined and payments for popular subprime loans ballooned, foreclosures mounted. The ensuing economic meltdown forced valley businesses to cut jobs to reduce expenses and try to stay afloat.
Despite the job cuts, many businesses of all types and sizes went under, from large chains to mom-and-pop stores. With the January jobless figures due out today, the region could see unemployment climb from about 17 percent to nearly 20 percent.
The impending closure of the New United Motor Manufacturing Inc., or NUMMI, plant in Fremont is expected to add to those numbers as the GM-Toyota operation ceases at the end of the month.
4,500 NUMMI-related layoffs
That will leave about 4,500 autoworkers without jobs, including 300 in Stanislaus County and 900 in San Joa- quin County. The closure already has caused job losses around the region at the plant's suppliers, including Trim Masters Inc. in Modesto.
Business and government leaders in the valley have said assistance from Washington has been too slow to do much good. They also doubt the money will generate much lasting job growth.
A recent Associated Press analysis showed the president's strategy hadn't affected unemployment rates as of December 2009. The findings also raised questions about whether additional federal money for jobs would be any more effective in curbing joblessness.
"If that's the only thing that I can vote on ... I'll vote for it, obviously," Rep. Bill Pascrell, D-N.J, said of Thursday's legislation. "We've got to get something moving. We've got to get something done."
"It's really not a jobs bill," said Rep. Barbara Lee, D-Oakland. "It's one small piece."
Lee said she instead wants money in the legislation for job training and youth summer jobs.
The House had passed a much larger measure in December that contained almost $50 billion in infrastructure funding, $50 billion in help for cash-starved state governments and a six-month extension of jobless aid.
The Senate responded last week with the far smaller measure that the House is reluctantly accepting.
The House amended the measure Thursday to conform with so-called pay-as-you-go budget rules that have become an article of faith among moderate Democrats. The rules require future spending increases or tax cuts to be paid for with either cuts to other programs or equivalent tax increases.
The minor tweak means that the notoriously balky Senate would have to act again before Obama could sign the bill into law.
The $35 billion bill — blending $15 billion in tax cuts and subsidies for infrastructure bonds issued by local governments with the $20 billion in transportation money — is far smaller than the massive economic stimulus bill enacted a year ago.
Across the Capitol, the Senate is debating a far more costly measure to clean up a lot of unfinished business from last year.
The $100 billion-plus bill would extend unemployment assistance, revive a bevy of expired tax breaks, help states with soaring Medicaid costs and prevent doctors from having to absorb big cuts in Medicare payments. The popular initiatives are traditionally extended on a bipartisan basis for brief periods of time, which hides their long-term costs.
The Senate plans to act on the jobs bill after wrapping up the unfinished-business bill, which means it probably won't be sent to Obama until next week.