Dems weigh job creation, cutting deficit

House Democratic leaders on Wednesday urged Congress to ramp up spending on research and infrastructure projects for the sake of job creation, while also vowing “a laser-like focus” on deficit reduction.

The message echoes that delivered by President Obama in last month’s State of the Union address, but sets Democrats on a collision course with Republican leaders, who say increases in federal spending will drown out investment and job creation in the private sector.

{mosads}In a meeting of the Democratic Steering and Policy Committee, party leaders argued that growing the economy with what they call targeted “investments” — not cutting spending across the board, as Republicans have proposed — is the better recipe for tackling the lingering jobs crisis.

“Democrats will measure every effort that comes before us by three standards: does it create jobs, reduce the deficit, and strengthen the middle class,” said Minority Leader Nancy Pelosi (D-Calif.).

“We have to talk about balancing budgets with growth,” not just reducing spending, she added.

Rep. Rosa DeLauro (D-Conn.), co-chairwoman of the Steering panel, agreed, arguing that targeted federal spending has been at the root of U.S. economic success for centuries.

“The foundation of our prosperity,” DeLauro said, “has always been our investment in infrastructure.”

Wednesday’s hearing, which was called during a recess week when most House members are in their districts, underscores the ideological divide between the parties as Congress takes steps to reduce the nation’s 9.4 percent unemployment rate.

Democrats have focused efforts on temporary tax cuts and increased federal spending, both of which have exacerbated the sky-high deficits the Obama administration inherited in 2009. The Congressional Budget Office estimated recently that the fiscal 2011 deficit will be a record $1.5 trillion, up from $1.2 trillion just before Obama assumed the presidency.

Republican leaders, meanwhile, have insisted that the federal government has little role to play in the economic recovery aside from getting out of the way of private enterprise. They’re urging Congress to cut taxes, slash federal spending – including emergency aid to states and the unemployed – and scale back regulations they say are preventing private-sector businesses from hiring new workers. 

“By spending money we don’t have, running up the huge budget deficits, we create more uncertainty in the private sector,” House Speaker John Boehner (R-Ohio) told Fox News Sunday. “This is where cutting spending will create jobs because it is going to bring greater fiscal responsibility here in Washington, D.C., end some of the uncertainty, and allow jobs to be created in America.”

Behind Boehner, House Republicans last month passed a resolution to cut federal spending to 2008 levels – a plan criticized by the Democrats as a threat to the recovery.

Appearing before the committee, several state and local officials urged lawmakers not to abandon efforts to help states weather the jobs crisis. Maryland Governor Martin O’Malley (D) told the Democrats that states have “a tremendous backlog” of infrastructure projects wanting for funds.

“There are many clever things we can do to improve government,” O’Malley said, “but there’s no clever way to build a $60 million bridge for $10 million.”

Philadelphia Mayor Michael Nutter (D) echoed that message, arguing before the panel that the issue of infrastructure spending is not partisan, except in Washington.

“There is no Democratic or Republican way of filling a pothole,” Nutter said. “Send the money to local governments. … At least in Philadelphia, all the bridges go somewhere.”