Congress weighs another stimulus
But this plan is likely to be aimed at people and areas hit hard by the slump.
(Page 2 of 2)
But the Republican leadership has different ideas for the stimulus.Skip to next paragraph
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"Action to strengthen our economy is needed, and it should come in the form of pro-growth policies that create new jobs, lower energy costs, and protect taxpayers – not hundreds of billions in new government spending masquerading as 'economic stimulus,' " said a statement from House minority leader John Boehner on Monday.
While Spratt interpreted the White House statements as an indication it was willing to compromise, a spokesman for Mr. Boehner said in an e-mail that the White House message has been the same for weeks – that it is open to additional solutions "but the Dems' ideas aren't going anywhere."
The timing of any legislation is likely to have a political dimension, says William Beach, director of data analysis at the Heritage Foundation, a conservative think tank in Washington. "The House and Senate are framing it up but are unlikely to pass it this year because they will worry about a veto," says Mr. Beach. "This is likely to be done next year to give the incoming president – [John] McCain or [Barack] Obama – an early victory. February is the target month."
Spratt agrees a package is likely to take place after the election, which is less than two weeks away. But he says it could be passed during the lame duck session or held over to January to mesh with the next administration. He says Senator Obama has endorsed the concept of another fiscal program without being specific. Senator McCain's press office did not get back to the Monitor by deadline.
However, in a speech Monday, McCain lashed out at what he termed the explosion of government spending that he said "put us deeper in debt to foreign countries that don't have our best interests at heart." And, he said, "I'm going to make government live on a budget, just like you do."
The federal budget deficit this year could be close to $1 trillion, some budget analysts say, up from last year's $450 billion in red ink.
Total package could cost $300 billion
The ultimate size of any program is also unclear.
Fed Chairman Bernanke suggested any program be "significant." In testimony before Spratt's committee on Monday, Martin Bailey of the Brookings Institution in Washington called for a $200 billion to $300 billion spending program. During questioning, he suggested Congress start with $200 billion and then add another $100 billion if the economy needed it. He also warned against adding "ornaments" to the legislation, such as spending programs that would benefit an individual congressman's district but not the nation as a whole.
"I said it in a kind of light way but did not get a laugh from the members who were there," says Mr. Bailey.
• Material from the Associated Press was used in this report.