The Herald Bulletin

Evening Update

Nation & World

July 30, 2013

Obama proposes 'grand bargain' for jobs

WASHINGTON —  President Barack Obama is extending a new proposal to Republicans that he hopes will break the political gridlock on budget negotiations, offering to cut corporate tax rates in exchange for job investments.

White House officials say just because they're at an impasse with congressional Republicans over a grand bargain on reducing the deficit doesn't mean they shouldn't look for other areas of agreement. So Obama plans to use a trip to an Amazon.com distribution center in Chattanooga, Tenn., on Tuesday to propose a "grand bargain for middle-class jobs."

Obama long has called for a cut in corporate tax rates, but previously insisted such business tax reform be coupled with an individual tax overhaul. He's dropping that demand and says instead that he's open to the corporate tax cut that that businesses crave. But he wants it to be coupled with a significant investment on some sort of job creation program, such as manufacturing, infrastructure or community colleges.

House Speaker John Boehner's office said Obama's proposals were hardly a compromise.

"This proposal allows President Obama to support President Obama's position on taxes and President Obama's position on spending, while leaving small businesses and American families behind," Boehner spokesman Michael Steel said.

Congressional Republicans have long insisted on tying corporate and individual tax reform so that small business owners who use the individual tax code would be offered cuts along with large corporations.

Senior administration officials described the corporate tax proposal as the first new economic idea Obama plans to offer in the coming months, with budget deadlines looming in the fall. Administration officials wouldn't put a price tag on the proposal or say how much would be a "significant" investment in jobs since the dollar figures would be part of negotiations with Congress. But in an example from this year's State of the Union address, Obama proposed $50 billion to put Americans to work repairing roads and bridges and other construction jobs.

The officials said money to pay for the jobs creation would come from a one-time revenue boost from measures such as changing depreciation rules or having a one-time fee on earnings held overseas.

"As part of his efforts to focus Washington on the middle class, today in Tennessee the president will call on Washington to work on a grand bargain focused on middle-class jobs by pairing reform of the business tax code with a significant investment in middle-class jobs," Obama senior adviser Dan Pfeiffer said.

Obama planned to make his remarks from an Amazon fulfillment center in Chattanooga, one of more than a dozen warehouses operated by the world's largest online retailer, which announced Monday that it would increase hiring. The company said it would add 7,000 new jobs, including 5,000 more at U.S. distribution centers that currently employ about 20,000 workers who pack and ship customer orders. Amazon.com Inc. has been spending heavily on order fulfillment to help its business grow.

Obama planned to tour the packing floor of the Chattanooga warehouse, which opened in September 2011. It is one of the company's largest and newest facilities, with more than 1 million square feet — the size of more than 28 football fields full of merchandise.

The plant was the source of tax controversy when it opened; Amazon originally was granted an indefinite waiver on collecting sales tax in a deal to bring two distribution centers to Tennessee. The state's retailers were outraged that they were put at a competitive disadvantage, and Amazon has agreed to start collecting Tennessee sales tax next year.

The White House said Obama wasn't visiting Amazon because of the company's position on taxes, but because it's an example of a successful American business growing and creating more jobs.

Obama proposed last year to overhaul corporate taxes by lowering rates from the current 35 percent to 28 percent, with an even lower effective tax rate of 25 percent for manufacturers. The U.S. has one of the highest corporate tax rates in the world, but many businesses avoid the full cost by taking advantage of deductions, credits and exemptions that Obama wants to eliminate.

Obama wants to do away with corporate tax benefits like oil and natural gas industry subsidies, special breaks for the purchase of private jets and certain corporate tax shelters. He also wants to impose a minimum tax on foreign earnings, a move opposed by multinational corporations and perhaps the most contentious provision in the president's plan.

And the president has made little progress toward getting Republicans to sign on to a "grand bargain" of tax increases and spending cuts to reduce the deficit.

When Obama unveiled the corporate tax plan last year, congressional Republicans called for even deeper cuts for the business world. His campaign rival, Mitt Romney, wanted a 25 percent corporate tax rate.

___

 

1
Text Only
Nation & World
  • Social Security spent $300 million on 'IT boondoggle'

    Six years ago the Social Security Administration embarked on an aggressive plan to replace outdated computer systems overwhelmed by a growing flood of disability claims. Nearly $300 million later, the new system is nowhere near ready and agency officials are struggling to salvage a project racked by delays and mismanagement, according to an internal report commissioned by the agency.

    July 24, 2014

  • Plane crashes in Taiwan, 47 trapped, feared dead

    A plane landing in stormy weather crashed outside an airport on a small Taiwanese island late Wednesday, and a transport minister said 47 people were trapped and feared dead.

    July 23, 2014

  • US pushes for truce as Gaza battle rages

     Israeli troops battled Hamas militants on Wednesday near a southern Gaza Strip town as the U.S. secretary of state reported progress in efforts to broker a truce in the conflict that has so far killed at least 657 Palestinians and 31 Israelis.

    July 23, 2014

  • Bodies of Malaysia jet victims leave Ukraine

    Two military aircraft carrying the first bodies of victims of the Malaysia Airlines crash left the embattled plains of eastern Ukraine Wednesday, and pro-Russian rebels shot down two Ukrainian fighter jets as fighting flared in the region.

    July 23, 2014

  • Perdue defeats Kingston in Georgia Senate runoff

    Businessman David Perdue has defeated longtime Rep. Jack Kingston in the Republican runoff for Georgia's U.S. Senate nomination, setting up a nationally significant general election matchup against Democrat Michelle Nunn.

    July 22, 2014

  • New arrest linked to gun used after Boston attacks

    A friend of Boston Marathon bombing suspect Dzhokhar Tsarnaev is believed to have provided the handgun used to kill a Massachusetts Institute of Technology police officer during the manhunt, people with knowledge of the investigation said Tuesday.

    July 22, 2014

  • California firm issues nationwide fruit recall

    A Central California company is recalling specific lots of its fresh peaches, plums, nectarines and pluots sold nationwide over concerns of possible listeria contamination.

    July 22, 2014

  • Obama nominee McDonald pledges to 'transform' VA

    President Barack Obama's choice to lead the Department of Veterans Affairs pledged Tuesday to transform the beleaguered agency, saying that "systematic failures" must be addressed.

    July 22, 2014

  • Obamacare hit by ruling, but subsidies to continue

    President Barack Obama's health care law is enmeshed in another big legal battle after two federal appeals courts issued contradictory rulings on a key financing issue within hours of each other Tuesday.

    July 22, 2014

  • US airlines scrap Israel flights over missile fear

    Two U.S. airlines cancelled all flights to Israel until further notice, after a rocket landed near Tel Aviv's Ben Gurion Airport.

    July 22, 2014

More Resources from The Herald Bulletin
AP Video
'Modern Family' Star on Gay Athletes Coming Out MN Twins Debut Beer Vending Machine DA: Pa. Doctor Fired Back at Hospital Gunman Raw: Iowa Police Dash Cam Shows Wild Chase Obama Seeks Limits on US Company Mergers Abroad Large Family to Share NJ Lottery Winnings U.S. Flights to Israel Resume After Ban Lifted Official: Air Algerie Flight 'probably Crashed' TSA Administrator on Politics and Flight Bans Raw: National Guard Helps Battle WA Wildfires Raw: Ukraine's Donetsk Residents Flee Senators Push to End Hamas Threat in Cease-Fire A Young Victim's Premonition, Hug Before MH17 Raw: Deadly Storm Hits Virginia Campground Death Penalty Expert: 'This is a Turning Point' Raw: MH17 Victim's Bodies Arrive in Netherlands Raw: Families Travel to Taiwan Plane Crash Site Arizona Execution Takes Almost Two Hours Crash Kills Teen Pilot Seeking World Record
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.
Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Helium debate
Helium