Plans for a massive economic stimulus package pushed by Congress and President-elect Barack Obama began to take shape Thursday, as House Democrats released details of a $825 billion proposal that includes spending projects and tax cuts.
But House Democrats’ senior money handler said the two-year package may not be enough and that Congress may have to spend more money to help pull the country out of its economic free-fall.
“I believe this product may in fact undershoot because the economy is spiraling downward at a much faster rate than anyone thought possible,” House Appropriations Committee Chairman David R. Obey of Wisconsin told a gathering of reporters in his office. “It could get much worse very, very, very, very fast, and I would not be surprised to see us having to go even further for some of these programs.”
The package, which Democrats want to send to Mr. Obama’s desk by mid-February, would include $550 billion in investment and job creation measures and $275 billion in tax cuts.
House Republican leaders were quick to dismiss the package, calling it a typical bloated Democratic spending measure that could do more harm than good.
The plan “appears to be grounded in the flawed notion that we can simply borrow and spend our way back to prosperity,” said House Minority Leader John A. Boehner, Ohio Republican. “It calls for more than half a trillion dollars in questionable new government spending on programs and projects, while providing less tax relief for middle-class families and small businesses than President-elect Obama has proposed.”
House Speaker Nancy Pelosi said the numbers in the Democrats’ plan were fluid and could change during committee “markups” next week.
“This is the first step along the way,” the California Democrat said.
The speaker promised to bring the final version to the House floor for a vote in two weeks. The Senate, meanwhile, is working on its own recovery package, which is expected to be ready after Tuesday’s presidential inauguration.
The $825 billion House package, if passed, would be one of the most expensive pieces of legislation in history. But Democrats say the cost of doing nothing would be worse and speed up the country’s economic hemorrhaging.
“Once our economy stabilizes, we must renew our pledge of fiscal responsibility and make the tough choices necessary to rein in deficits and restore balanced budgets,” said House Majority Leader Steny H. Hoyer, Maryland Democrat.
House Democrats, who worked with the Obama transition team in drafting the proposal, said the plan would create or save 3 million to 4 million domestic jobs, with an estimated 90 percent of the jobs created in the private sector.
The Democrats’ proposal calls for $500 tax credits for employed Americans and $1,000 per couple for those earning less than $200,000.
The plan also would provide tax credits to businesses and first-time homebuyers, $87 billion for Medicaid, $32 billion for upgrades to the nation’s energy transmission, distribution, production and storage systems, and $30 billion for highway construction.
Not included is an Obama proposal for a $3,000 business tax credit to hire or retain workers.View Entire Story
Sean Lengell covers Congress and national politics and can be reached at firstname.lastname@example.org.
Kara Rowland, White House reporter for The Washington Times, is a D.C.-area native. She graduated from the University of Virginia, where she studied American government and spent nearly all her waking hours working as managing editor of the Cavalier Daily, UVa.’s student newspaper.
Her interest in political reporting was piqued by an internship at Roll Call the summer before her ...
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