Obama sets goal for jobs

His target is 2.5 million, and he wants a bill passed quickly

WASHINGTON -- President-elect Barack Obama signaled Saturday that he would pursue a far more ambitious plan of spending and tax cuts than anything he outlined on the campaign trail, setting the tone for a recovery effort that could absorb and define much of his term.

In the Democrats' weekly radio address, Obama said he would direct his economic team to design a two-year stimulus plan with the goal of saving or creating 2.5 million jobs. He called it "a plan big enough to meet the challenges we face."

Obama said he hoped to have the plan completed, approved by Congress and ready for his signature shortly after he takes office in January. He is coordinating with the Democratic leaders of Congress, who have said they will begin work in December.

With the worsening economic turmoil certain to mark Obama's first year, his advisers say they are intent on trying to use the crisis as an opportunity to act on many of the issues he emphasized in his campaign, including cutting taxes for lower- and middle-class workers, addressing neglected public infrastructure projects such as roads and schools, and creating new "green jobs" through federal business incentives for energy alternatives and environmentally friendly technologies.

"The news this week has only reinforced the fact that we are facing an economic crisis of historic proportions," Obama said in his address. "We now risk falling into a deflationary spiral that could increase our massive debt even further."

Seeking calm

Obama's address was part of an effort to calm tumultuous financial markets roiled by the failure of an outgoing president and a lame-duck Congress to come up with a plan to boost the economy and restore investor confidence.

On Monday, Obama plans to introduce his economic team, starting with his Treasury secretary, Timothy F. Geithner. News that Geithner, president of the Federal Reserve Bank of New York., would get the job sent the Dow Jones up nearly 500 points Friday after days of sharp losses.

The team is expected to include former Treasury Secretary Lawrence H. Summers and Peter R. Orszag, head of the Congressional Budget Office.

Summers, who was already serving as a campaign adviser to Obama, has advocated for a forceful government stimulus plan, saying the federal government should be doing more, not less, in areas such as health care, energy, education and tax relief. Obama seemed to echo those thoughts in his radio address.

"We'll be working out the details in the weeks ahead, but it will be a two-year, nationwide effort to jump-start job creation in America and lay the foundation for a strong and growing economy," Obama said. "We'll put people back to work rebuilding our crumbling roads and bridges; modernizing schools that are failing our children; and building wind farms and solar panels, fuel-efficient cars and the alternative energy technologies that can free us from our dependence on foreign oil and keep our economy competitive in the years ahead."

Obama's announcement came after market declines and the prospect of automakers and other storied companies near collapse last week had sparked growing criticism that he was sitting on the sidelines.

Though advisers say they have not begun to fill in the details, Obama's proposal would go beyond the $175 billion stimulus plan that he proposed in October. That included a $3,000 tax credit to employers for each new hire above their current work force and billions in aid to strapped states and cities.

Separately, Democratic leaders in Congress have been calling for a robust economic recovery initiative of up to $300 billion, including large spending on infrastructure to create jobs. President George W. Bush has refused to consider a package so large, yet even some conservative economists have said $300 billion is the minimum needed to spur the economy.

"There are no quick or easy fixes to this crisis, which has been many years in the making," Obama said. "And it's likely to get worse before it gets better. But January 20th is our chance to begin anew, with a new direction, new ideas and new reforms that will create jobs and fuel long-term economic growth."

Much work ahead

Some economists welcomed Obama's plan, though they said it was difficult to assess without full details. The focus on creating and saving jobs made sense, they said, given the deterioration of the job market.

"The unemployment rate is soaring," possibly into the double digits, said Kenneth S. Rogoff, a professor of economics at Harvard.

Sen. Harry Reid, the majority leader, said, "We will soon finally have a leader and partner in the White House who recognizes the urgency with which we must turn around our economy, and I look forward to working with him and the new Congress to do so."

Republicans in the next Congress could still block a big stimulus package in the Senate, as Obama seemed to recognize. "I know that passing this plan won't be easy," Obama said. "I will need and seek support from Republicans and Democrats, and I'll be welcome to ideas and suggestions from both sides of the aisle.

"But what is not negotiable," Obama said, "is the need for immediate action."