Jan. 7 (Bloomberg) -- Democrats on the Senate Finance Committee will make some “tweaks” to President-elect Barack Obama’s fiscal stimulus plan to add items sought by lawmakers such as a “stronger energy component,” said the tax-writing panel’s chairman.

There is “strong support” among Senate Democrats for additional tax breaks to spur energy production, said Senator Max Baucus of Montana, who held a closed-door meeting today in Washington with Democrats on his committee. He said lawmakers may make a “slight shift” in the portion dedicated to tax cuts.

Baucus’s comments open the window for lawmakers from both parties to seek inclusion of favored issues, said New York Senator Charles Schumer, who attended the meeting. “There was a lot of interesting discussion on how to change certain parts and make it better,” Schumer said.

The House and Senate Budget Committee chairmen said they want the plan to address the housing crisis. One of a group of so-called Blue Dog Democrats who focus on deficit reduction said they want assurances the government will later work on “pay-go” rules requiring Congress to find funds for new spending.

Congress is working on an economic stimulus plan of about $775 billion over two years to pull the U.S. out of a recession. Obama, who aides said will give a “major” speech on the economy tomorrow, is seeking tax cuts worth about $300 billion to boost consumer spending by giving $500 to individuals and $1,000 to couples, according to congressional aides involved in the talks.

The aides say tax cuts would make up about 40 percent of the $775 billion package.

‘Urgent Action’

Obama’s speech “will make the case for urgent action,” the transition office said in an e-mailed release. The president- elect hasn’t released details of his proposals. Congressional leaders say they expect to have legislation to enact his policies by mid-February.

Democratic Senator Tom Carper of Delaware said Obama’s chief strategist, David Axelrod, told lawmakers the president-elect’s office conducted a poll on the stimulus that found half the respondents supported a large recovery plan even in the face of a trillion-dollar deficit. People also wanted strong oversight to make sure money isn’t wasted, Carper said Axelrod told the lawmakers.

Also today, former Labor Secretary Robert Reich and Mark Zandi, chief economist at Moody’s Economy.com, told lawmakers a stimulus package is needed quickly.

‘Bang for the Buck’

Speaking at a forum in Washington on the economy, Zandi said the government needs to spend at least $750 billion and the emphasis should be more on spending than tax cuts to spur the economy and get more “bang for the buck.”

Reich said a package closer to $900 billion is needed to keep unemployment from climbing to 10 percent.

“If we don’t have a stimulus package that is that high or nearly that high, next year unemployment is going to be at least 3 million additional jobs,” Reich said. After the hearing, he said, “It has got to happen as fast as possible because we are hemorrhaging jobs.”

“Nothing could be clearer than the fact that we need action,” House Speaker Nancy Pelosi said at the forum. “A failure to act quickly can only lead to more job losses.”

Senator Kent Conrad of North Dakota and Representative John Spratt of South Carolina, chairmen of their chambers’ budget committees, said they want to address the housing crisis. Conrad, who called housing a “dead weight on this economy,” proposed additional steps to reduce mortgage interest rates along with a temporary $7,500 tax credit for homebuyers.

Blue Dog Democrats

Indiana Representative Baron Hill, a member of the “Blue Dog” Democrats, said in a Bloomberg Television interview those lawmakers worry about a stimulus plan’s effect on the deficit. Even so, he said “we understand that this economy needs to be revved up” and the group would support major stimulus spending as long as “we know pay-go is coming.”

Baucus signaled a willingness to accept Republican ideas to reach a bipartisan consensus. “My goal is to get people together,” he said. Baucus’s full committee will meet privately tomorrow and may draft a bill as early as next week.

Senate Minority Leader Mitch McConnell, a Kentucky Republican, has said his party would support an immediate middle- class tax cut as part of any stimulus package.

Obama also has proposed tax cuts for businesses, including the ability to convert current losses into cash by getting a refund of taxes paid in the past, accelerated depreciation for companies that purchase equipment, and a tax credit for hiring workers.

House Republican Leader John Boehner told reporters today that talks between Republicans and Obama about the specifics of a stimulus measure are off to a “good start.” Still, he said members of his party remain wary about the overall size of proposals that Democrats are discussing.

Asked whether Republicans have an overall cap in mind, Boehner said that won’t be determined until Obama has made a specific proposal and there has been time to review it.

To contact the reporters on this story: Ryan J. Donmoyer in Washington at rdonmoyer@bloomberg.net; Brian Faler in Washington at bfaler@bloomberg.net.

Last Updated: January 7, 2009 18:04 EST