WASHINGTON (Reuters) - President Barack Obama laid out a $447 billion jobs package of tax cuts and government spending on Thursday that will be critical to his re-election chances but he faces an uphill fight with Republicans.
With his poll numbers at new lows amid voter frustration with 9.1 percent unemployment, Obama said in a high-stakes address to Congress that the United States is in a "national crisis" and called for urgent action on sweeping proposals to revive the stalled economy and avert another recession.
"Those of us here tonight can't solve all of our nation's woes," Obama said in a nationally televised prime-time speech. "But we can help. We can make a difference. There are steps we can take right now to improve people's lives."
Taking aim at Republicans who have consistently opposed his initiatives, Obama said it was time to "stop the political circus and actually do something to help the economy."
Obama, who pushed through an $800 billion economic stimulus package in 2009, said his jobs plan would cut taxes for workers and businesses and put more construction workers and teachers on the job through infrastructure projects.
"It will provide a tax break for companies who hire new workers and it will cut payroll taxes in half for every working American and every small business," he said.
Obama is seeking to seize the initiative in his bitter ideological battle with Republicans, ease mounting doubts about his economic leadership and turn around his presidency just 14 months before voters decide whether to give him a second term.
Obama wants Congress to pass his "American Jobs Act" -- which administration officials said would cost $447 billion -- by the end of this year and offset the cost with deficit cuts.
But a deal may be hard to achieve with politicians already focusing on the presidential and congressional elections in November 2012.
If Obama can push through his plan, it might provide an economic boost quickly enough for him to reap political benefits. If it stalls in a divided Congress, his strategy will be to blame Republicans for obstructing the economic recovery.
Obama said his proposed plan would "provide a jolt to an economy that has stalled and give companies confidence that if they invest and hire there will be customers for their products and services."
"You should pass this jobs plan right away," he said in a speech interrupted by applause from his fellow Democrats while Republicans sat mostly in silence.
Obama proposed extending unemployment insurance at a cost of $49 billion, modernizing schools for $30 billion and investing in transportation infrastructure projects for $50 billion.
But the bulk of his proposal was made up of $240 billion in tax relief by cutting payroll taxes for employees in half next year and trimming employer payroll taxes as well.
Obama also said he was seeking to broaden U.S. homeowners' access to mortgage refinancing in a plan to help the ailing housing market and put money back in the pockets of borrowers needing help locking into record low interest rates.
How much of the jobs package is viable remains in question. Almost all of it ultimately depends on winning support from Republicans who control the House of Representatives.
Bipartisan cooperation could be hard to come by in Washington's climate of political dysfunction where a bruising debt feud this summer brought the country to the brink of default and led to an unprecedented U.S. credit downgrade.
But Obama insisted that "everything in here is the kind of proposal that's been supported by both Democrats and Republicans -- including many who sit here tonight -- and everything in this bill will be paid for. Everything."
Republicans will still be resistant, not wanting to give Obama a helping hand before the election. But they will be under pressure to cede some ground to help boost the economy or risk a voter backlash in 2012.
Obama's choice of a rare joint session of the House and Senate, a setting better known for the president's annual State of the Union address, was intended to lend ceremonial pomp to a critical speech and push Republicans to cooperate.
But it also carried the risk of raising public expectations that will be hard to meet.
Obama's speech has taken on new urgency after the latest Labor Department report showed zero employment growth in August, stoking fears of a slide back into recession.
The pressure on Obama to act is driven not just by a spate of dismal economic data but by his own increasingly grim approval ratings now languishing around 40 percent, the lowest since he took office in January 2009.
An NBC/Wall Street Journal poll showed Obama was no longer the favorite to win next year's election.