December 2, 2008

Governors urge Obama to spend on infrastructure

POLITICS - The governors of the United States took to President Obama today a plan for a $136 billion infrastructure spending program that they hope will funnel immediate government money toward bridges, roads and rail lines in the hopes of creating jobs and spurring the economy out of recession.

It's not a handout or a bailout, insisted the host of the economic forum, Democratic Gov. Ed Rendell of Pennsylvania, the chairman of the National Governors Association. Rather, it's the "best remedy for getting America back to work," Rendell said.

"We think that we can create literally millions of new jobs and at the same time lots of orders for concrete and steel companies and asphalt companies and lumber companies and the like," Rendell said. "None of the bailouts have created one new job. Infrastructure can create, the economists say, 40,000 jobs for every $1 billion of infrastructure spending. Well, that's a huge lift."

At least 41 states are expected to face budget shortfalls this year, in part because the slowing economy has decreased tax revenue states depend on for their annual spending plans.

Those shrinking state coffers come even as hard times and layoffs force more people to apply for unemployment and other state-administered benefits, including Medicaid. And declining property tax revenue in states with high foreclosure rates has hurt local governments, which depend on that money to provide local services.

Obama on Tuesday pledged to move as quickly as possible on a stimulus package that could hasten an economic turnaround, beginning at the state level.

"I recognize that every single one of you is struggling to come up with a budget at a time when you're facing great and growing needs," said Obama, who asked the governors for the meeting. "More and more people are turning to you for help for health care, for affordable housing, to prevent foreclosures even as the credit markets are tightening and tax revenues are making it more difficult to provide that help."

The country's economic woes require a bipartisan approach, Obama said, and he told the Republican governors at the meeting that he was offering "the same hand of friendship and cooperation that I offer our Democratic governors. We have a strong and vibrant democracy. We compete vigorously during an election. But with the end of that season comes the time to govern together — and that time is now."

Most governors were on board with the infrastructure spending proposal, including high-profile Republicans such as Arnold Schwarzenegger of California.

The overriding sentiment among the nation's top executives was to begin building and start as quickly as possible.

Rendell cautioned that all U.S governors are prepared to make sacrifices and cut spending in other areas — and in many cases have already done so in the face of slowing tax collections. Pennsylvania has slashed $311 million from its budgets and will trim up to $500 million total in the coming days, he said.

The Liberal/NDP Coalition in Canada is also pushing for an infrastructure program that creates jobs.

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