Republican governors split over Obama stimulus

By Alan Elsner

WASHINGTON (Reuters) - Republican governors were split on Sunday over whether to accept all of the money their states stand to receive from a $787 billion economic stimulus plan which President Barack Obama signed last week.

Three governors of southern states have come out against taking part of the money designated to extend unemployment benefits and perhaps for other programs. A handful of others are considering follow suit.

With the global economy in crisis and unemployment at record levels, Obama made a top priority for his first month in office the package of tax cuts and spending for infrastructure projects and social services including unemployment aid. Only three Republicans in Congress backed its passage, charging Obama and his Democratic party had loaded it up with unnecessary spending and failed to cut taxes enough.

"There is some (stimulus money) we will not take in Mississippi. If we were to take the unemployment insurance reform package that they have, it would cause us to raise taxes on employment when the money runs out, and the money will run out in a couple of years," said Mississippi Governor Haley Barbour on CNN's "State of the Union."

"Then we'll have to raise the unemployment insurance tax, which is literally a tax on employment. I mean, we want more jobs. You don't get more jobs by putting an extra tax on creating jobs," Barbour said.

South Carolina Governor Mark Sanford and Louisiana's Bobby Jindal, who has often been mentioned as a potential Republican presidential candidate in 2012, have also said they would reject the unemployment funds, which make up a small proportion of the overall package.

Sanford, on "Fox News Sunday" said some of the stimulus money came with strings attached.

"What we would be required to do would be, for the first time, increase the level of benefit for part-time workers. Right now, it's full-time workers -- increase it to part-time workers," he said.