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Obama says he'll work on relief for states

Seeks advice from nation's governors

President-elect Barack Obama shared a laugh with Governor Jim Douglas of Vermont at the National Governors Association annual meeting in Philadelphia yesterday. ''We intend to put tax cuts into the pockets of hard-pressed, middle-class families in your states,'' Obama said. President-elect Barack Obama shared a laugh with Governor Jim Douglas of Vermont at the National Governors Association annual meeting in Philadelphia yesterday. ''We intend to put tax cuts into the pockets of hard-pressed, middle-class families in your states,'' Obama said. (Jim Watson/AFP/Getty Images)
By Liz Sidoti
Associated Press / December 3, 2008
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PHILADELPHIA - President-elect Barack Obama yesterday pledged quick work on an economic recovery plan that will include tax cuts and increased federal spending, and told the nation's governors he wants their advice in designing a package to help their hard-hit states.

"We intend to put tax cuts into the pockets of hard-pressed, middle-class families in your states. And we intend . . . to start making a down payment on the critical investments that are going to be necessary to sustain long-term economic growth as well as pull us out of the current slump," Obama said as he sat down with governors, nearly all of whom are struggling with budget deficits at home as a result of the recession.

"Forty-one states are likely to face budget shortfalls this year or next, forcing you to choose between reining in spending and raising taxes," Obama said. "Programs for the needy are at risk. Libraries, parks and historic sites are being closed."

Vice President-elect Joe Biden told the governors he hoped they will not criticize the incoming administration for raising the federal deficit as it tries to help them. "I know none of you would do that," he said jokingly. Many states have constitutions that prohibit deficit spending.

The recession and the accompanying increase in joblessness translate into higher healthcare costs for the poor, greater use of food stamps, and added strain on welfare programs, and the governors are seeking help in coping.

They have asked for at least $40 billion to help pay for healthcare for the poor and disabled and perhaps $136 billion more in infrastructure projects in the legislation, which Democrats hope to have ready for Obama's signature as soon as he takes office on Jan. 20.

Governor Ed Rendell of Pennsylvania, a Democrat who chairs the National Governors Association, told reporters that road and bridge repair projects can get started especially quickly. "We are not here asking for money for governors. If we're asking for any money at all, it's for the citizens of our states," he said.

Obama has said he will make an economic stimulus his top priority, and his aides and congressional leaders have been discussing the outlines of a measure that could exceed $500 billion over two years. The president-elect has said his goal is to save or create 2.5 million jobs in his first two years.

In his brief remarks before the closed session, Obama pledged a partnership with the governors and made a point of promising Republican governors "the same hand of friendship and cooperation that I offer Democratic governors."

Obama spoke to a bipartisan group of state chief executives at historic Congress Hall that included former and possibly future political rivals. Among those attending were Republican Governors Bobby Jindal of Louisiana and Sarah Palin of Alaska, the GOP vice presidential nominee.

Republican and Democratic governors sat at desks in the hall, with no separation by party, and gave Obama and Biden a standing ovation.

Biden singled out Palin and said his former rival's presence there is a sign that both parties are now confronting problems together. He joked that since the election, he has been virtually ignored, unlike Palin, a media star. "Maybe walk outside with me later and say hello to me," he said to laughter from the crowd.

Palin told reporters after the meeting that she was "optimistic" about Obama's bipartisan outreach, and praised him for inviting governors into his Cabinet. "On the campaign trail I tried to convince a majority of voters that governors knew best. Obviously that didn't work, and I'm here and VP-elect Biden is there," she said.

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