Lisa Montgomery and Anne Kornblut bury the lede in this story about the President’s plan for a permanent extension of the R&D tax credit:

This is not the first time Obama has called for making the credit permanent. But with the economic recovery moving more slowly than the administration had hoped – and Democratic candidates nationwide panicking as the issue threatens their majorities in the House and Senate on Nov. 2 – he is increasingly eager to show he understands the depth of the problem and is trying to act [...]

The White House has decided to forgo a broad-based payroll-tax holiday at this point, officials have said. That proposal, which had been part of earlier discussions with key congressional officials, would have been an expensive measure, potentially costing hundreds of billions of dollars. It also could have deprived Social Security of needed cash even as Democrats are accusing the GOP of plotting the program’s demise on the campaign trail.

Making the R&D tax credit permanent is a nice policy that you do if unemployment is at 6.5% and dropping and you’re concerned about long-term growth. We should absolutely incentivize research and development (although tying the tax credit to manufacturing in America would be nice). I have nothing against that policy. But it’s current policy right now. It won’t change any short-term planning and will not stimulate the economy at all.

A payroll tax cut, as clumsy as it is, would have been stimulative. It’s true that it wasn’t a great stimulus, but it was better than anything thought to be on the table, especially if it was designed properly, along the lines of Robert Reich’s “People’s Tax Cut.” It would get money into the hands of people who could spend it. I acknowledge the Social Security Trust Fund concerns – and I’m glad the White House did as well – but there are ways to structure that tax cut to defuse that issue (like as a ‘Making Work Pay’ tax credit equal to the payroll tax amount, coming out of general revenues).

It seems the real issue was the expense. The White House plans to pay for the R&D tax credit by taking away some other business breaks, and couldn’t find a few hundred billion more for the payroll tax cut. But the whole point of stimulus is to raise aggregate demand, so swapping tax breaks for better tax breaks makes very little sense. It’s nice to structure the economy toward investment and technology and away from plain old giveaways to industry – and that’s a decent long-term strategy – but it’s kind of like building road 10 miles from your house when your house is on fire.

But speaking of that road… I went to bed very annoyed at the dropping of more ambitious measures, and woke up to this:

President Barack Obama today will propose a six-year plan to rehabilitate the nation’s transportation infrastructure with an initial $50 billion to help spur an economy that’s lost jobs for three straight months.

Obama will announce the program to fix the nation’s roads, railways and runways to union families at a Labor Day rally in Milwaukee scheduled for 3:10 p.m. New York time, the White House said in a statement.

Two months before congressional midterm elections, Obama will call for the formation of an “infrastructure bank” and request money to rebuild 150,000 miles (241,400 kilometers) of roads, construct and maintain 4,000 miles of rail, and overhaul 150 miles of runways, the statement said.

“This plan would build on the investments we have already made under the Recovery Act, create jobs for American workers to strengthen our economy now, and increase our nation’s growth and productivity,” according to the statement.

The administration will work with Congress to ensure the plan is fully funded, and a “significant portion of the new investments would be front-loaded in the first year,” according to the statement.

OK, it’s not much. But by front-loading the investment, you actually get a stimulus out of it in the first year. It’s $50 billion more into the economy (and those shovel-ready projects exist), with equal footing for rail transit with roads. What’s more, it’s something you can run on, if and when Republicans resist this. “We want to rebuild America, they want to stop us.” Back in 2009, infrastructure spending was seen as a popular, 80/20 issue by the likes of Frank Luntz. I’ll bet it still has potency today. And I find a national infrastructure bank to be a compelling idea, one Obama has supported without much energy in the past but which he’s getting behind fully now.

This is something that Democrats can at least put out there as an example of their agenda for the future. It’s not big enough, but it’s in the right direction and frankly more than I expected.

UPDATE: There will be a tendency to say “this is not going to do anything.” And it won’t, before the election. But $50 billion into infrastructure right away is a good idea short-term, with the infrastructure bank a good idea long-term. Because Republicans are highly unlikely to go for it, they probably should have picked a number commensurate to the problem, but I guess my expectations were so low that I’m easily pleased.

UPDATE II: Sheryl Gay Stollberg reports that this could be paid for through ending fossil fuel subsidies. Bernie Sanders tried a standalone vote on that earlier this year and got a whopping 35 votes.

I have a fact sheet from the White House about their infrastructure plan, and I’m throwing it on the flip.

FACT SHEET: Renewing and Expanding America’s Roads, Railways, and Runways

The President today laid out a bold vision for renewing and expanding our transportation infrastructure – in a plan that combines a long-term vision for the future with new investments. A significant portion of the new investments would be front-loaded in the first year.

This plan would build on the investments we have already made under the Recovery Act, create jobs for American workers to strengthen our economy now, and increase our nation’s growth and productivity in the future. At the same time, the plan would reform the way America currently invests in transportation, changing our focus to enhancing competition, innovation, performance, and real analysis that gets taxpayers the best bang for the buck, while moving away from the earmarks and formula debates of the past. In prior years, transportation infrastructure was an issue that both parties worked on together, and the Administration hopes the same can be true now.

Some of the tangible accomplishments of the President’s plan over the next six years include:

· ROADS: Rebuild 150,000 miles of roads – renewing our commitment to the backbone of our transportation system;

· RAILWAYS: Construct and maintain 4,000 miles of rail – enough to go coast-to-coast;

· RUNWAYS: Rehabilitate or reconstruct 150 miles of runway – while putting in place a NextGen system that will reduce travel time and delays.

The President’s plan would accomplish this through:

· An up-front investment. The President will work with Congress to enact a new up-front investment in our nation’s infrastructure – an investment that would help jump-start additional job creation, while also laying the foundation for future growth. This initial investment would fund improvements in the nation’s surface transportation, as well as our airports and air traffic control system.

· A vision for the future. The President proposes to pair this with a long-term framework to reform and expand our nation’s investment in transportation infrastructure. Since the end of last year, when the last long-term surface transportation legislation expired, these investments have been continued on a temporary basis, even as the trust fund to finance them has fallen into insolvency. If we are to enjoy the benefits that come from a world-class transportation system, Congress must enact a long-term reauthorization that expands and reforms our infrastructure investments and returns the transportation trust fund to solvency. To jumpstart job creation, this long-run policy front-loads – through a $50 billion up-front investment – a significant share of the new infrastructure resources. As with other long-run policies, the Administration is committed to working with Congress to fully pay for the plan.

The long-term framework includes meaningful reforms:

Ø The establishment of an Infrastructure Bank to leverage federal dollars and focus on investments of national and regional significance that often fall through the cracks in the current siloed transportation programs;

Ø The integration of high-speed rail on an equal footing into the surface transportation program to ensure a sustained and effective commitment to a national high speed rail system over the next generation;

Ø Streamlining, modernizing, and prioritizing surface transportation investments, consolidating more than 100 different programs and focusing on using performance measurement and “race-to-the-top” style competitive pressures to drive investment toward better policy outcomes.

Ø Expanding investments in areas like safety, environmental sustainability, economic competitiveness, and livability – helping to build communities where people have choices about how to travel, including options that reduce oil consumption, lower greenhouse gas emissions, and expand access to job opportunities and housing that’s affordable.

Specifically, the President proposes to make the initial up-front investment in the following areas:

· Roads. The nation’s highways serve as the backbone of our transportation system. Many roads and bridges are in need of repair and expansion and many of the Americans who want to do this work face high unemployment right now. Our investments would be focused on modernizing the highway system’s critical assets while providing much-needed jobs.

· Rail. Many parts of transit systems have been allowed to fall into a state of ill-repair. The President’s plan would help address this by making a major new investment in the nation’s bus and rail transit system. The Administration is also committed to expanding public transit systems and would dedicate significant new funding to the “New Starts” program – which supports locally planned, implemented, and operated major transit projects. In addition, the Administration is committed to building on its investments so far in high-speed rail – constructing a system that will increase convenience and productivity, while also reducing our nation’s dependence on oil and cutting down on pollution. The President’s plan would also invest in a long-overdue overhaul of Amtrak’s fleet.

· Runways & NextGen. The Administration proposes to invest in our nation’s airports by improving their runways and other equipment and facilities. We also propose a robust investment in our effort to modernize the nation’s air traffic control system (NextGen). This investment will help both the FAA and airlines to install new technologies and, among other improvements, move from a national ground-based radar surveillance system to a more accurate satellite-based surveillance system – the backbone of a broader effort to reduce delays for passengers, increase fuel efficiency for carriers, and cut airport noise for those who live and work near airports.

· Infrastructure Bank. The President proposes to fund a permanent infrastructure bank. This bank would leverage private and state and local capital to invest in projects that are most critical to our economic progress. This marks an important departure from the federal government’s traditional way of spending on infrastructure through earmarks and formula-based grants that are allocated more by geography and politics than demonstrated value. Instead, the Bank will base its investment decisions on clear analytical measures of performance, competing projects against each other to determine which will produce the greatest return for American taxpayers.