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Republicans map out their agenda of less

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President Barack Obama says he's pleased with healthier job growth, but concedes the economy isn't producing enough jobs to accommodate people in need of work.

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By Lori Montgomery
Washington Post Staff Writer
Saturday, November 6, 2010; 12:33 AM

Republicans are mapping an agenda for the new Congress that calls for a radical reduction in government spending, a hard-line stance against new taxes and a "sustained" battle against federal regulators - all aimed at easing the concerns of voters desperate for jobs and anxious about the soaring national debt.

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The path charted in the party's "Pledge to America" and in a new blueprint released this week by Rep. Eric Cantor (R-Va.), the No. 2 Republican in the House, is certain to provoke clashes with the White House. It is already stirring dissension among Republicans who say it doesn't go far enough. Less certain is its ability to make progress on the nation's top economic priorities, particularly job creation.

On Friday, the Labor Department reported that the unemployment rate was stuck at 9.6 percent for the third month in a row, although job growth accelerated in October. Employers added a total of 151,000 jobs - more than double analysts' expectations. Gains were concentrated in the private sector, where 159,000 new jobs offset the loss of 8,000 government positions.

It was the strongest job growth since May, and a welcome sign that the recovery may finally be strengthening. Still, many economists see the need for further government spending to bring down unemployment. This week, the Federal Reserve announced plans to pump $600 billion into the economy through massive purchases of Treasury bonds to fuel the recovery.

Republicans reject the notion that government spending can spur prosperity. Instead, they favor keeping tax rates steady by extending Bush-administration tax breaks that are set to expire this year and repealing President Obama's health overhaul. Republicans also want to restrain government regulators and are looking to require congressional approval for any new regulation that imposes costs on the private sector in excess of $100 million a year.

On Friday, Cantor even rejected President Obama's call for additional tax breaks to spur hiring, such as a proposal to let businesses deduct their expenses more quickly.

Republicans offer "a disciplined approach to removing uncertainty and to allowing the private sector to regain its footing and begin to grow again," Cantor said in an interview. "Trying to prod business to do what Washington wants is not what is needed. We need to rein in this desire of Washington to tell business how to grow."

That hands-off strategy - combined with GOP plans for an immediate and dramatic reduction in government spending - would do more harm than good, said Bill Gale, a senior fellow in economics studies at the Brookings Institution.

"I don't get what they think they're doing to stimulate the economy right now," Gale said. "I can understand that people are angry or upset about the economy. But I can't understand how that anger and anxiety has turned into this set of legislative proposals."

To make good on their campaign pledge to reduce the size of government, Republicans say they are planning a series of quick moves to slash spending soon after they take control of the House in January. Among the likely options: a massive rescissions package that aides said would slice 20 percent from most domestic agency budgets and enact $160 billion in additional cuts endorsed by visitors to Cantor's "YouCut" Web site.

Such a package would trim more than $260 billion from this year's $1.1 trillion budget for most government operations - the biggest one-year reduction at least since the military drawdown after World War II, budget experts said.

Because Republicans propose to exempt the Pentagon, veterans programs and homeland security from these cuts, liberal analysts said the reductions would decimate education funding, the National Park Service and other worthy programs.


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