Obama Expands Job Growth Goals as Part of Broad Stimulus Proposal

LORI MONTGOMERY: Well, there's three basic pots of money, as I understand it.

Number one, they are going to cut some taxes. And it's unclear how much of that is going to be tax-cutting. Obama's advisers say it will be a substantial part of the package. One thing that they have said they absolutely want to do is implement his making-work-pay tax credit, which would be a credit of $500 for singles, $1,000 for families.

JUDY WOODRUFF: That's for lower-income...

LORI MONTGOMERY: It's -- the parameters are unclear.

JUDY WOODRUFF: OK.

LORI MONTGOMERY: It would phase out towards the upper incomes. But it would be available only to people who are working. That's the idea.

So, they could go tax cuts. There could be some other business breaks in there.  There could be some tuition credits. Unclear exactly how the tax portion is going to shape up.

The second pot would be money for states. That can be delivered very rapidly. States are having a hard -- something like 41 states are facing budget deficits right now. So, that money would go to helping them cover the cost of Medicaid, which, as unemployment rises, demand rises. That's, of course, the health care program for the poor.

And there could also be some block granting of education money. But the big -- the big pot is likely to be investments in things like roads, bridges, education, health I.T., alternative energy. And that is where a lot of the fighting is happening.

LORI MONTGOMERY: Well, there are -- there are competing purposes here.

A stimulus package, by definition, needs to pump money into the economy very rapidly. Now, earlier in this crisis, like January, for example, people were saying, well, it has to get into the economy, you know, within 60 to 90 days.

In September, when the House passed a stimulus bill, their deadline for spending investment money was 90 days. Now, because the crisis is expected to be so prolonged -- we're not really expected to recover until the middle of next year -- Obama's people are saying, well, it can spend out over as long as two years.

So, that's one criteria. And there is a -- there is a bit of a dispute, I think, about whether it should be rapid, or whether it should go over that entire period of time.

JUDY WOODRUFF: But they're still talking about getting money out there for infrastructure jobs, as you just said, roads, bridges. Is that money -- we -- we hear about these shovel-ready projects that the states have. Is this money that they believe can get into the system quickly?

LORI MONTGOMERY: Yes.

I mean, I think that, when you are talking about roads and bridges, I think that you -- you can get that money in very rapidly, from -- from what I understand, particularly if it's maintenance, if it's fixing things, rather than building things, because you think about how that money would flow.

I mean, there's already state departments of transportation with lists. And you just -- the federal government needs only to shove that money out the door and send it down to the states. And they can immediately hire all these unemployed contractors to start repaving roads.

JUDY WOODRUFF: Assuming there are enough people to do these jobs, right?

LORI MONTGOMERY: Well...

JUDY WOODRUFF: And they do assume there are?

LORI MONTGOMERY: Well, the -- the -- the construction trades have the highest rate of unemployment of any sector. It's over 10 percent. So, they assume the capacity is there.

I mean, that's one of the reasons to do construction and maintenance, is because those people need jobs.

LORI MONTGOMERY: Right.

The early versions of stimulus that Democrats discussed, the House Democrats in particular, in September were talking about spending money specifically on roads and that kind of, you know, traditional infrastructure, which everyone agrees, you know, at least some of those projects can be spun out very rapidly.

Now there's a goal of also creating green stimulus that is -- or, in a larger sense, putting a down payment on some of Obama's campaign promises. So, that would include green stimulus, which would begin to cut emissions of, you know, the contributing to green -- to greenhouse gases, but also making a down payment on health I.T.

And there's some concern, I think, about -- among lawmakers -- about how quickly that kind of spending could really be done, because it's not like you can send it to a state department of transportation.

JUDY WOODRUFF: But you're suggesting -- you're saying there still is discussion, debate inside the Obama team on this, even though they have begun to share a lot of this with members of Congress?

LORI MONTGOMERY: Well, they have got a plan, and they have presented it to Congress. And -- and we aren't privy to all the details of that plan.

JUDY WOODRUFF: And what sort of resistance or agreement are they meeting with? I mean, what are the prospects right now in Congress?

LORI MONTGOMERY: Well, I think the prospects are -- are fairly good.

I mean, it depends on, A, how they shape this package and get to the number. Their number is about $770 billion, $775 billion. And I think the conservative Democrats -- there are fiscally conservative Democrats they have to worry about -- they might be willing to accept that -- that size if, in fact, this is truly economic medicine, and not just a grab bag of good ideas from every Democratic constituency.

JUDY WOODRUFF: But they have still got a few weeks to figure out how to best make their case...

LORI MONTGOMERY: They do.

JUDY WOODRUFF: ... make their argument.

LORI MONTGOMERY: They do.

JUDY WOODRUFF: Lori Montgomery, The Washington Post, thank you very much.

LORI MONTGOMERY: Thanks for having me.