By Brian Faler
Jan. 29 (Bloomberg) -- The U.S. House passed President Barack Obama’s $819 billion stimulus package without any Republican votes as lawmakers remained divided over whether the plan would do enough to pull the economy out of recession.
The 244 to 188 vote yesterday sends the measure to the Senate, where Republicans will have more power to demand changes. They are calling for more tax cuts, less spending and a bigger focus on housing in the measure.
Senate Minority Leader Mitch McConnell, a Kentucky Republican, said today the House plan “doesn’t meet the standard for bipartisan cooperation set by President Obama.” He said it “doesn’t fix the main problem, which is housing,” and that his colleagues want to make changes “which will actually stimulate the economy.”
Among the changes Republicans are seeking: a plan to have the federal government back fixed-rate 4 percent mortgages.
Obama yesterday urged lawmakers to work out their differences in the next few weeks, saying delay in passing a final bill would cost more people their jobs. “The plan now moves to the Senate and I hope we can continue to strengthen this plan before it gets to my desk,” he said in a statement after the House vote.
The Senate is likely to begin work on the stimulus plan on Feb. 2. The measure is separate from the administration’s plan to shore up the banking system, which may cost in excess of $1 trillion.
Visit to Capitol
Obama traveled to Capitol Hill earlier this week to personally lobby for Republican support for the stimulus bill, an effort that included a private session with the party’s House members. He failed to win any converts. In yesterday’s vote, all of the 244 “yes” votes came from Democrats. Voting “no” were 177 Republicans and 11 Democrats.
Obama hosted a cocktail party for Democratic and Republican congressional leaders at the Blue Room in the White House last night after the vote. House Minority Leader John Boehner, an Ohio Republican, told Obama that he shouldn’t take the House vote as a rebuke to his outreach effort, according to a Democratic aide with knowledge of the conversation. The aide spoke on condition of anonymity.
The stimulus package, equivalent to one-quarter of the entire federal budget, is aimed at resuscitating an economy that lost 2.6 million jobs last year. The House plan would provide a $500 payroll tax cut for individuals along with $604 billion for infrastructure projects, jobless benefits, education programs, aid to struggling state governments and scores of other initiatives.
Another $3 Billion
The plan grew slightly from $816 billion during House debate on it yesterday when lawmakers approved an amendment budgeting an additional $3 billion for transit projects.
The Senate version of the stimulus bill already differs from the House plan. The Senate Finance Committee voted this week to add a $70 billion alternative-minimum tax cut to the package. Lawmakers in the two chambers also differ over how much to spend on highway projects, renewable-energy tax breaks and expanding access to broadband.
Senate Finance Committee Chairman Max Baucus of Montana has signaled willingness to work with Republicans such as Kentucky Senator Jim Bunning to consider additional tax relief measures, including an increase in deductions for investment losses.
Republican Complaints
In the House, Republicans complained they were given little chance to offer revisions to the plan’s provisions. They also said they doubted the stimulus plan would work.
“Do not, for one minute, believe that this bill reflects the input of House Republicans,” said Representative Jerry Lewis of California, the top Republican on the House Appropriations Committee. The measure is “less about creating jobs and stimulating the economy and more about spending the public’s money.”
House Speaker Nancy Pelosi, a California Democrat, dismissed such complaints, saying Republicans were given plenty of opportunities to offer amendments. “Some of the initiatives they have put forth are really the same policies that got us into this terrible economic crisis,” she said. “We will not -- we will not -- be stuck in the past.”
House Democrats made some concessions to Republicans, dropping provisions easing access to contraceptives for Medicaid recipients and deleting money to refurbish the national Mall in Washington that critics said had little to do with revitalizing the economy.
Arts Funding
Democrats held firm on a provision criticized by Republicans that would give the National Endowment for the Arts additional funding.
“People in the arts field are losing their jobs just like anybody else; you have local arts agencies, you have local orchestras, local symphonies, local arts groups of all kinds that are shutting down,” said House Appropriations Committee Chairman David Obey, a Wisconsin Democrat.
The nonpartisan Congressional Budget Office estimated this week that by the end of 2010, the House bill would pump into the economy about $526 billion, slightly less than two-thirds of the package.
The agency said the plan would provide a “substantial” boost to the economy, estimating it will increase the U.S. gross domestic product by 1.2 percent to 3.5 percent by the fourth quarter of 2010 and create between 1.2 million and 3.6 million jobs.
Tax Credits
The bill would expand tax credits for the working poor, make more families eligible for a child tax credit and expand college tuition subsidies. It would let businesses convert losses into tax refunds and provide faster write-offs for purchasing equipment.
The plan would expand unemployment benefits on several fronts. It would increase average weekly payments by $25 while offering states incentives to provide coverage to part-time workers. It would also expand a program that allows the jobless to continue buying health-care coverage through their former employers by subsidizing their insurance and letting older workers receive benefits longer.
“It is completely predictable that, in this recession, millions of low-income American workers and their families will lose their jobs and join the ranks of the uninsured -- we can’t just sit by and let that happen,” Energy and Commerce Committee Chairman Henry Waxman, a California Democrat, said yesterday.
The bill is H.R. 1.
To contact the reporter on this story: Brian Faler in Washington at bfaler@bloomberg.net
Last Updated: January 29, 2009 11:22 EST
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