Washington DC: The United States House of Representatives on Friday followed the Senate in passing a jobs bill of $15 billion and setting the ball rolling for President Obama's top priority for 2010 — tackling unemployment.
With a 217-201 vote largely along partisan lines, the Hiring Incentive to Restore Employment Act (the “HIRE Act”) offers a payroll tax holiday for businesses that hire unemployed workers and an income tax credit of $1,000 for businesses that retain them. The bill passed in the Senate a few weeks ago by a vote of 70-28 and remains to be signed into law by Mr. Obama.
While the bill is significantly smaller than the $787 billion American Reinvestment and Recovery Act — more commonly known as the stimulus package — that was passed approximately a year ago, it offers a range of supports designed to boost new hiring.
Apart from the tax holiday and credits, the bill also provides for the extension of the Highway Trust Fund, “allowing for tens of billions of dollars in infrastructure investment”, according to a statement by the Speaker of the House, Nancy Pelosi.
Further the bill contains provisions based on the Build America Bonds programme, she said, and aims to simplify the process for states to borrow for infrastructure projects, including school construction and energy projects.
Speaking on the floor of the House after the vote, Ms. Pelosi said, “We must be unrelenting in our efforts to create more jobs”. However, the House Republicans charged their Democrat colleagues with fiscal profligacy.
Mike Pence, Chairman of the House Republican Conference, said, “A one-time government handout is not going to create jobs — only immediate and permanent tax relief for working families, small businesses and family farms will help get businesses hiring again”.
Stressing the need for across the board tax relief, not “Carter era wage subsidies” he also raised objections to the bill for transferring $19.5 billion from the government's general fund to the highway trust fund.
Mr. Spence pointed out that the general fund was running a $1.6 trillion deficit making it inappropriate to “prop up an insolvent highway trust fund with an insolvent general fund”.