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The Honolulu Advertiser
Posted on: Sunday, December 21, 2008

Obama raises stimulus goals, aims for 3M jobs

By Lori Montgomery
Washington Post

WASHINGTON — President-elect Barack Obama has expanded his goals for a massive federal stimulus package to keep pace with the increasingly grim economic outlook, aiming to create or preserve at least 3 million jobs over the next two years.

The more aggressive target, up from 2.5 million jobs set a month ago, comes after a four-hour meeting last week where Obama's top economic advisers told him the economy is now expected to lose as many as 3.5 million jobs over the next year. Obama was told that could drive unemployment above 9 percent.

With liberal and conservative economists calling on the government to spend $800 billion to $1.3 trillion to stanch the bleeding, the greater danger to the nation, Obama was told, lies in doing too little rather than too much.

Given that gloomy forecast, Obama last week presented congressional Democrats with a proposal to dedicate $675 billion to $775 billion over the next two years to middle-class tax cuts, aid to strapped state governments and investments in domestic priorities such as infrastructure, healthcare technology and education — a package designed to jolt the economy while deterring further layoffs and putting people back to work.

Congressional aides said they talked with Obama's team about tacking on initiatives that could drive the price tag as high as $850 billion, a figure more in line with economists' recommendations. But with resistance expected from Senate Republicans and some fiscally conservative Democrats, an Obama adviser said the team settled on $775 billion as the highest figure likely to win congressional approval and be ready for Obama's signature after he takes office Jan. 20.

Lawrence Summers, who has been tapped to serve as Obama's top economic adviser in the White House, said that the numbers are likely to shift as the package takes shape before Congress commences Jan. 6.