Even before the Senate approves an economic recovery package, House and Senate leaders are thrashing out a joint version of a stimulus bill of unprecedented size and scope.

One issue is all but resolved: The legislation will come in close to the $820 billion that President Obama says is needed.

What’s left is how to spend it, and the House and Senate versions of the bill diverge markedly in some areas, especially aid to the states, healthcare, education, energy, and tax policy.

In his weekly radio address, Mr. Obama emphasized the need for speed. He’s expected to hit that point again Monday during a visit to Elkhart, Ind., where unemployment now tops 15 percent, and in a prime-time televised press conference.

“We can’t afford to make [the] perfect the enemy of the absolutely necessary. The scale and scope of this plan is right. And the time for action is now,” he said Saturday.

In the Senate, Friday’s deal between Democrats and three GOP moderates brings a bill that had ballooned to $920 billion back in the president’s target range. The House bill, approved Jan. 28, came in at $819 billion. A Senate vote is expected Tuesday.

The plan, negotiated by Sens. Ben Nelson (D) of Nebraska and Susan Collins (R) of Maine, cut $110 billion from the base Senate version of the bill.

The $827 billion bill won the support of three GOP senators – Senator Collins, Sen. Olympia Snowe of Maine, and Sen. Arlen Specter of Pennsylvania – whose votes give Democrats the 60 they need to avoid a filibuster. (With one recount pending, Democrats have 58 senators in their caucus, including two independents.)

That close margin could give Senate Democrats extra leverage in negotiations with the House over the legislation’s final shape. The House bill passed 244 to 188, without a single Republican vote.

Collins has already made clear the tenuousness of her support.

“I, for one, have made no commitments for supporting a conference report, because I don’t know what’s going to come out of conference,” she said at a Friday briefing. “If a lot of the House expenditures that I viewed as wasteful are put back in by the conference committee, then I will feel compelled to vote against the conference report.”

Spending for states in dispute

To produce a final bill, House and Senate negotiators must resolve differences on both the spending and tax sides. One big disparity is over new funding to the states.

The House bill sets up a $79 billion fiscal stabilization fund to help states avoid sizable layoffs and cuts in services, especially in public education. In the Senate, the deal with GOP moderates calls for cutting $40 billion out of that funding stream, reducing it to $39 billion.

That funding specifically affects schoolteachers and their unions – a core constituency for Democrats. It’s a top priority for Rep. George Miller (D) of California, chairman of the House Education and Labor Committee and a key ally of House Speaker Nancy Pelosi. Without an infusion of new federal dollars, Representative Miller warns, big budget shortfalls will force school districts to make dramatic layoffs that risk “the collapse of our elementary and secondary education system.”

Under both bills, funding would increase for Pell Grants for low-income college students. But the Senate bill would max out new funding at $13.9 billion; the House wants an additional $15.6 billion.

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