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Obama, in campaign mode, defends policies and offers new proposal for transportation spending

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With Democrats facing dismal prospects in the November elections, the party is weighing President Barack Obama's role in the midterms.

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By Peter Slevin
Monday, September 6, 2010; 10:21 PM

MILWAUKEE - Faced with the twin challenges of boosting the economy and saving Democratic congressional seats in November, President Obama tried to do a little of both on Monday at a Labor Day rally that heralded a prominent role for him in a fiery fall campaign.

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Obama defended his record and criticized Republicans and his Washington foes as opponents of the middle class "who talk about me like a dog." He told several thousand cheering labor union members that the Republican Party is peddling failed economic policies, and he vowed to "make this case across the country between now and November."

"Their slogan," he said of Republicans, "is 'No, we can't. No, no, no. No.' "

The crowd answered by chanting Obama's signature 2008 slogan, "Yes, we can."

Under pressure to show that he is doing all he can to deliver jobs, Obama announced a proposal to spend $50 billion in the next year on roads, railroads and airport runways. The modernization plan, a more formal version of a long-standing pledge to improve the nation's crumbling infrastructure, is one of several economic proposals he is to make this week.

"So many Americans have been idled for months, even years, at a time when there is so much of America that needs rebuilding," Obama said. "We used to have the best infrastructure in the world. We can have it again."

White House officials said the $50 billion in new government spending would be the first installment of a six-year transportation strategy that would include investments in high-speed rail and air traffic control. To pay for it, the administration would raise taxes on oil and gas companies.

In addition to his infrastructure plan, Obama will lay out on Wednesday two new tax breaks for business: a permanent extension of the research tax credit worth $100 billion over 10 years, and a plan to let companies write off 100 percent of their new investment in plant and equipment this year and next.

The latter proposal would cost the Treasury about $30 billion over the next decade, but it would provide a much bigger boost to business in the short term, an administration official said Monday night, by encouraging companies to invest now, tax-free. White House economists say the plan would cut business taxes by nearly $200 billion over the next two years, though much of the money would be recouped thereafter.

If approved by Congress, the infrastructure money would be used to build or repair 150,000 miles of road, 4,000 miles of railroad track and 150 miles of runways, the officials said. The proposal includes creating an "infrastructure bank" to prioritize projects and attract private funds.

The officials declined to estimate how many jobs would be created at a time when the economic recovery is proving more sluggish than the administration hoped or predicted.

"Just more of the same," the Republican National Committee said in an e-mail to reporters, shortly before Obama spoke to the Milwaukee Area Labor Council's annual Laborfest.


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