AUGUSTA, Maine — Legislative leaders called on Congress Tuesday to pass another stimulus package featuring tax breaks for small businesses that add employees, investment in infrastructure improvements and additional financial relief for states.
Gov. John Baldacci, meanwhile, held a jobs summit with business leaders from around the state on Tuesday to solicit ideas on steps government can take to help companies and the state grow their way out of the recession.
“That’s why every one of you gets up every day and it’s certainly before me every single day,” Baldacci told representatives from 80 businesses across the state.
At a midday press conference, Democratic leaders from the House and Senate urged Congress to move forward with a jobs stimulus bill reinvesting money from the federal bailout of financial institutions, known as the Troubled Asset Relief Program, or TARP.
Specifically, funding for a jobs bill could come from leftover bailout money or from the TARP loans already repaid by banks.
“Wall Street has already had a bailout,” said Senate President Elizabeth “Libby” Mitchell, a Vassalboro Democrat and gubernatorial candidate. “We want money for Main Street and for jobs here in Maine.”
In late December, the U.S. House of Representatives passed a $154 billion jobs bill on a 217 to 212 vote. That bill contains many of the provisions discussed at Tuesday’s rally, including tax incentives for small businesses that hire new employees and additional spending on road repair or construction and other infrastructure projects. The measure also would provide money to states to help avoid teacher layoffs.
Democrats in the U.S. Senate are developing their own jobs stimulus proposal. But the loss of a filibusterproof majority in the Senate will likely further complicate Democrats’ effort as concern mounts among Republicans and some Democrats about the federal deficit.
Underscoring that challenge, House leaders lost 38 Democrats on the jobs bill vote in December and failed to pick up a single Republican. Maine’s two representatives — Mike Michaud and Chellie Pingree, both Democrats — voted in support of the House jobs bill.
Rep. Pingree’s daughter, House Speaker Hannah Pingree, said during Tuesday’s press conference that an additional stimulus package is needed to spur job creation and help avoid job losses resulting from an estimated $438 million hole in the current 2-year budget.
A recent study by the Maine Center for Economic Policy estimates that $257 million in proposed state cuts to education and health and human services programs could result in an additional 7,000 to 10,000 job losses.
Pingree, D-North Haven, said any additional stimulus money should be spent in areas where the state can see the most benefit, such as schools, transit improvements and encouraging small business job growth.
“Even better, these investments are fully paid for by redirecting TARP funds from Wall Street to Main Street,” Pingree said.
It is unclear when the U.S. Senate will take up a jobs bill or how different it will be from the House version.
Senate Democrats would need to pick up at least one Republican vote to avoid a filibuster, meaning Maine’s two moderate GOP senators, Olympia Snowe and Susan Collins, could once again be in the spotlight.
But winning the support of either Collins or Snowe is far from guaranteed.
Snowe, who is a member of the Senate Finance Committee, has opposed using leftover or repaid TARP money for stimulus programs. Last week, Snowe called the Obama administration’s proposed use of $169 million in TARP funds for another stimulus bill a “budget gimmick.”
But Snowe is supportive of redirecting unexpended funds from the separate $800 billion stimulus package for other job creation efforts. Earlier this month, Snowe introduced legislation that would require the federal Office of Management and Budget to provide Congress with recommendations for redirecting stimulus money to programs that would be more effective at creating jobs or assisting the unemployed.
“The level of unemployment in the nation is severe and we must maximize the punch in this economy now,” Snowe said after a Finance Committee meeting last week with OMB officials. “The definition of economic stimulus is that it should be timely, targeted and temporary. When we are clearly not meeting two out of three under this criteria, why not redirect the funding, rather than adding to the deficit?”
Collins, meanwhile, said she would be open to exploring a bipartisan jobs bill that focuses on creating private-sector jobs without adding to the federal deficit.
In a statement on Tuesday, Collins said Congress should focus on policies that help the small businesses responsible for most job growth. She also supports extending unemployment benefits to Americans who lost jobs through no fault of their own and have been unable to find work due to the recession.
“A jobs bill should not be financed using TARP funds to cover additional spending since, by law, unexpended TARP funds are to be directed toward reducing our national debt,” Collins said. “It is also important that the bill not be larded with funding for special interests.”