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What Obama's speech means for policymakers

The president pitches a long list of initiatives in the State of the Union. The economy and job creation top his priorities.

January 30, 2010|By Peter Nicholas

Reporting from Washington — In his State of the Union speech, President Obama spooled out a long list of proposals to lift the economy, create jobs and carry out his broader policy agenda. Some of the ideas are new; others had been announced. The following is a summary of the initiatives cited in the speech and where they stand:

The economy and jobs

* To ease unemployment, Obama urged Congress to pass a jobs bill. The House narrowly passed a $174-billion measure in December, but the Senate has yet to act. The bill is one of Obama's main vehicles for jump-starting employment, which is the centerpiece of his 2010 agenda.

* Obama proposed routing $30 billion to community banks so they can lend to small businesses. The money would come from repaid bailout funds from the financial sector, and congressional approval would be required. Even after the bailout of the banking industry, small businesses contended that credit dried up, making it difficult to operate. The speech was the first time Obama attached a specific dollar amount to the planned redirection of bailout funds. The White House said it would release more details in the coming weeks.

* Obama announced a National Export Initiative meant to help farmers and small businesses tap overseas markets, with increased funding for export marketing programs. Overall, Obama wants to double U.S. exports over the next five years, an ambitious goal last achieved in the 1970s. He suggested that his administration would work on forging trade pacts to open more markets, especially in fast-growing Asia. But key members of his party have balked at passing free-trade deals with South Korea, Colombia and Panama -- three nations that he referred to by name in his speech.

* Obama mentioned a 10-year fee on large banks to recoup taxpayer money that was spent to bail out the financial sector. He formally introduced the fee Jan. 14, and he intends to incorporate it in the 2011 federal budget, which he'll release Monday. With the public deeply unhappy about Wall Street bonuses, Obama is using the fee in part to try to assuage concerns that he is too cozy with the banking establishment.

Middle-class aid

* Obama rolled out a package of measures aimed at easing the financial burdens of middle-class families feeling pressed by the economy. Before the State of the Union address, aides previewed these steps, which include curbing borrowing costs for student loans; increasing the child-care tax credit; setting up automatic IRAs for workers; and ramping up refinancing programs to make home ownership less costly. The White House would not disclose the cost, saying that number will be included in the 2011 budget released next week.

Also on the to-do list

* Obama renewed a pitch for a "comprehensive energy and climate bill" -- code words for a bill that carries a carbon cap -- as a mechanism to spur clean-energy job creation. He also called for new nuclear plants, clean coal development and offshore oil and gas drilling -- sweeteners that Senate Republicans are demanding before they'll consider a climate change bill.

* Obama, for the first time, put a timetable of this year for overturning "don't ask, don't tell," the 1993 law prohibiting gays from serving openly in the military. Reversing the policy was an Obama campaign promise and priority for liberal Democrats.

At a congressional hearing Tuesday, Defense Secretary Robert M. Gates will outline steps the Pentagon is taking to prepare for a change in the law. Gates will not present a legislative proposal but will explain how the Pentagon intends to advise Congress on changing the law and how the department will try to anticipate unintended consequences of a policy change. Although some in the military remain skeptical of allowing gays to serve openly, defense officials insist the top brass want to make sure the commander in chief's will is carried out.

peter.nicholas@latimes.com

Jim Tankersley and Julian E. Barnes in the Washington bureau contributed to this report.

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