White House, Congress clash over stimulus

The White House has begun a summerlong effort to rehabilitate the damaged image of the $862 billion Recovery Act, arguing that Americans are finally beginning to see the effects - even as the administration is struggling to get Congress to agree to another round of stimulus spending.

Voting late Thursday, the Senate rejected a second effort to pass a tax and spending package President Obama called for, even though Democratic leaders had pared it down by $35 billion after an earlier failed vote.

Republicans filibustered and were joined by one Democrat and one independent, forcing Democratic leaders back to the drawing board yet again as they seek to balance job creation with fears of the expanding deficit.

“There is going to be havoc in America starting tomorrow,” said Senate Majority Leader Harry Reid, Nevada Democrat, warning that Medicare payments to doctors will be slashed and unemployment benefits will not be extended for those who have been jobless the longest because the bill didn’t pass.

The stimulus, Mr. Obama’s first major accomplishment in office, has become one of the major battlegrounds heading into November’s elections as Republicans question whether it was worth it and even some Democrats argue that Congress needs to worry more about the deficit than job spending.

But with polls showing a majority of Americans don’t think the stimulus has had much effect, the White House finds itself playing defense.

The effects of the first stimulus are expected to peak this summer before winding down, and Mr. Obama will travel to Columbus, Ohio, on Friday for groundbreaking on the 10,000th stimulus-funded road project.

Still, with the unemployment rate higher now than it was a year ago, the administration is pushing Congress to keep spending.

“This is not a time to take, to use the metaphor, take our foot off the accelerator here. We still need to continue to create jobs and spur job growth now,” Vice President Joseph R. Biden Jr. told reporters at the White House as he checked off the thousands of stimulus-funded projects Americans will see over the summer.

To date, the stimulus has remained intact. Key Democrats, including House Majority Leader Steny H. Hoyer of Maryland, say they are now open to revisiting the stimulus and redirecting some of the unspent money toward new job-creating priorities, such as stopping states and local governments from laying off teachers.

“At the time we considered it in February of last year, nobody was saying there were going to be 300,000 teachers, because of continuing lack of revenue at the state level, that might be laid off,” Mr. Hoyer said. “That, it seems to me, has been concluded by the administration, and I think most members I talk to, is a priority item.”

Mr. Reid is not willing to take that step. He rejected a Republican offer Thursday to shift stimulus money to pay for the bill.

At the White House, press secretary Robert Gibbs said they are not ready to open up the stimulus and start redirecting money.

“We’ve got a plan you heard the vice president talk about that, we believe, is helping what was a very fragile economy become more stable,” Mr. Gibbs said. “We need to continue to implement the plan that we have, and not take money away from very important projects like education right now,” Mr. Gibbs said.

Mr. Biden said 2.5 million people are working today because of the Recovery Act and that it is on track to meet the original metric “of creating or saving 3.5 million jobs by the end of this year.” At $862 billion, that works out to nearly $250,000 per job.

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