Senate Dems work with GOP on jobs bill

WASHINGTON — In a rare move toward bipartisanship, Senate Democrats worked with Republicans as they prepared Tuesday to unveil an $85 billion jobs bill that would include payroll tax breaks for employers who create new jobs, aid to small businesses and other GOP-backed ideas to attack unemployment.

Outlines of the bill emerged as President Obama spent more than two hours meeting with congressional leaders. The president said both parties must be prepared to compromise, regaining a sense of purpose that transcends petty politics as they tackle unemployment and other major issues.

Democrats embraced some GOP-backed ideas, including new help for small businesses, which in the past have led the way back toward recovering lost jobs.

According to a draft outline of the bill circulated by Senate Democrats, the cornerstone of the bill would be a proposal to give businesses that hire unemployed workers this year an exemption from the 6.2 percent Social Security payroll tax. If they keep those new employees more than a year, employers would get an additional $1,000 tax credit.

Other provisions are, for the most part, expansions or extensions of existing policies. The tax break for new equipment purchases by small businesses would be increased. The bill expands the Build America Bonds program, which subsidizes interest costs for state and local bonds issue to finance infrastructure projects. It extends until May 31 unemployment payments and health-care subsidies for the jobless, which otherwise would expire for many people at the end of February.

Few Republicans had seen the proposals Tuesday and bristled when Senate Majority Leader Harry Reid, D-Nev., said he hoped the Senate would pass it by the end of the week. That was unlikely, in any event, because of the weather.

Senate Minority Leader Mitch McConnell, R-Ky., did not endorse the emerging bill, but neither did he shoot it down.

"The sooner we could get the parameters of the final package the better," McConnell told Reid.

There have been some signs of greater room for agreement on a jobs bill, if only because unemployment has emerged as top concern of voters that politicians of both parties believe they ignore at their peril.

Senate Finance Committee Chairman Max Baucus, D-Mont., has been working with Republicans privately on jobs proposals involving tax policy. GOP Sen. Orrin Hatch, R-Utah, has teamed up with Sen. Chuck Schumer, D-N.Y., to draft the proposed payroll tax break.