Congressional Republicans were swift to condemn President Barack Obama's call Tuesday for more federal spending to promote job creation.
Obama called for using a portion of the savings of roughly $200 billion from the $700 billion financial bailout as a way to finance a series of infrastructure investments, tax credits and incentive programs as a way to encourage businesses to begin hiring now that the nation is returning to economic growth.
Although Obama pledged to use some of the savings and funds paid back by banks that were the recipients of the bailout, Senate Minority Leader Mitch McConnell, R-Ky., said it would merely continue policies that failed to prevent the unemployment rate from breaking through 10 percent.
"This is not only irresponsible, since the purpose of these emergency funds was to prop up the credit system in the midst of a crisis," McConnell said. "It also violates both current law and the pledge we made that every dollar we got back would be returned to the taxpayer to reduce the national debt."
He added, "This proposal is completely wrongheaded, but it's perfectly illustrative of the way Democrats in Congress have been dealing with taxpayer money all year — by throwing it at one problem after another without much regard for the consequences."
"Americans are running out of patience with politicians who promise jobs, but who deliver nothing but more debt, higher taxes, and longer unemployment lines," McConnell said.
Sen. Judd Gregg, R-N.H., the ranking Republican on the Senate Budget Committee and one of the lead GOP negotiators for the original financial rescue legislation, known as the Troubled Assets Relief Program or TARP, accused the administration of seeking to set up a slush fund to pay for pet projects with funds designed to stabilize the financial system.
"Using TARP funds to grow other government programs would only increase deficits and debt and would undermine the purpose of the program as stated in law," Gregg said. "It also clearly breaks the Administration's earlier promises about how it would carry out the TARP, and runs counter to what the President himself said last year when he voted for TARP when he was a Senator."
He added, "Taxpayers will lose out if we create more deficit spending, but at least the President's proposal will result in one new job - he'll need to hire a magician to make this new deficit spending appear fiscally responsible."
House Republican Leader John Boehner, R-Ohio, speaking to reporters before Obama actually outlined his proposals, said the call for additional federal spending clearly signaled that the earlier $787 billion economic stimulus and recovery bill hadn't worked.
"Right now all the policies coming out of this administration and this Democrat-controlled Congress are doing much harm to our economy," Boehner said, referring to health reform and climate change bills that he contends will raise taxes.
Her added, "If we're serious about answering the question that the American people are asking, 'where are the jobs,' what we ought to be doing is allowing American families and small businesses to keep more of what they earn because at the end of the day, only they can get the economy going again."
Rep. Mike Pence, R-Ind., said the proposal was illustrative of Democrats' broader vision of fiscal discipline.
"It seems that the policy of this Administration on job creation is, 'If you got it, spend it,'" Pence said. "Well House Republicans believe that the real prescription for economic growth is fiscal discipline in Washington, D.C. and fast-acting tax relief for working families, small businesses, and family farms."
He added, "We're going to continue to fight to achieve deficit reduction, to get spending under control, and to give the American people more of their hard-earned dollars to spend. That's the way to grow jobs in this country."
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.