New Urgency in the Battle for Stimulus

For Mr. Obama, who last month promised a pivot to job creation, the Labor Department’s report raises the stakes as he prepares for a prime-time national address on Thursday before a joint session of Congress. In the speech, he will outline a new round of economic stimulus measures.

In Congress, the reactions from some Republicans suggested small cracks in their party’s wall of opposition to such measures, whether tax cuts or spending. That change underscored the potential of the moment to alter the dynamic in Washington as Congress returns from its recess, though the prospects of a major compromise on short-term stimulus and long-term deficit reduction remain remote.

Within the White House, the report gave ammunition to Obama advisers who have pressed internally for bolder action on tax cuts and spending measures as Mr. Obama makes the final changes to a speech that could be as important to his re-election prospects as any to date. No president since Franklin Roosevelt has been re-elected with unemployment so high.

While the scale of stimulus measures Mr. Obama will seek remains unclear, early indications suggest it will far exceed the limited agenda that the White House was talking about as recently as July, which mostly called for extending for another year a payroll tax cut for workers and unemployment compensation for those out of jobs for six months or more.

Now Mr. Obama has said he will seek those extensions and more, including proposals to put people to work repairing and retrofitting roads, bridges, schools, airports, rails and other public projects, and giving tax incentives to employers to hire additional workers.

The rapidity with which the summer’s signs of a weakening economy have raised calls for fiscal stimulus — from economists, financial forecasters, business leaders and the chairman of the Federal Reserve, Ben S. Bernanke — recalls the final months of 2008, as the near collapse of the financial system intensified the recession that year just as Mr. Obama was preparing to take office. Then, the incoming administration put together a package of tax cuts and spending measures that seemed to grow by the month, and finally passed Congress in February 2009 at nearly $800 billion for two years.

Nonpartisan analysts and the Congressional Budget Office have credited the first stimulus package with helping to end the recession and keep unemployment from growing even higher than it did. They say the winding down of the federal government’s help this year has contributed to the economy’s stall.

But Republicans, who solidly opposed the original stimulus program, say it was a failure that only dug the country deeper into debt — a stand that hardly suggests they will be receptive to such ideas now. That argument against big government helped Republicans win control of the House last November, and they have since forced Mr. Obama and Congressional Democrats into repeated rounds of spending cuts.

While that was widely welcomed at first, given the nation’s mounting long-term debt, economists began to fret that the austerity measures in both the United States and Europe threatened to push the world into another recession. In an analysis this week, for example, the chief economist of OppenheimerFunds, Jerry A. Webman, cited “the counterproductive approach Congress and the administration are taking to fiscal policy.”

Mr. Obama hopes to change the balance with his speech to Congress. He will call for short-term job creation measures now — to prevent a recession that would widen annual deficits through lost revenue and safety-net spending — and for deficit reduction proposals, including spending cuts and tax increases for people with higher incomes, that would take effect after the economy regained full health.

The conventional wisdom has been that Mr. Obama’s job creation plan “is likely to be dead on arrival,” as one financial analysis group, Bank of America Merrill Lynch Global Research, wrote to clients on Friday.

Yet Congressional Republicans’ response to the disappointing jobs numbers suggested slightly more openness than before to Mr. Obama’s pitch. The question is whether the shift is rhetorical or real.

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