WASHINGTON — The White House is exploring new proposals to boost the struggling economy, including tax cuts to spur hiring and programs that could provide a lift to the housing market, according to people familiar with the efforts.
President Barack Obama, who is planning a three-day bus tour of the Midwest this month to discuss the economy, has been searching for ways to generate economic growth that could attract broad public support.
White House officials are weighing a proposal to offer tax cuts to employers in return for hiring new workers. The administration considered this idea last year, but it gave way to a broader payroll tax deduction for workers in a bipartisan deal in December.
In addition, administration officials are considering proposing new investments in domestic clean energy as well as renewing tax breaks for companies using renewable energy — particularly wind power — that are to expire this year.
Also on the table is an initiative designed to help the ailing housing market without the need for more public spending. Under that proposal, the government-controlled mortgage giants Fannie Mae and Freddie Mac would rent out foreclosed properties that they own rather than try to sell them at depressed prices. That approach could relieve pressure on the housing market, one of the main drags on the economy.
Former administration officials are pushing other initiatives, such as a program to rebuild and rehabilitate schools as a way to improve education and stimulate the economy. A fan of this approach, Jared Bernstein, a former chief economist for Vice President Joe Biden, calls the program “Fix America’s Schools Today.”
“I’d think the FAST! idea would appeal to my former colleagues, as it has great jobs potential and should be highly visible in communities,” he said.
The search for new ideas comes as the economic recovery is running out of steam, dashing hopes that the unemployment rate will come down significantly in the near term. But as they discuss new ideas, White House officials are lowering expectations that any new policy could make a major difference in the economy.
“The president will continue to promote and put forward ideas for things we can do to create jobs and grow the economy,” White House press secretary Jay Carney said. “The fact (is) that there is no magic bullet that lowers our unemployment rate to where it would be ideally.”
