Senators want to alter stimulus
Republicans are poised to cut spending, increase tax cuts, and refocus on homeowners.
Washington — As the Senate takes up an $888 billion economic recovery plan this week, lawmakers – piling on from both sides of the aisle – want to lop items they say will create more debt than stimulus.
In the cross hairs: $50 million for the arts, $15 billion for college scholarships, $198 million in once-promised benefits to Filipino World War II veterans, $1 billion to fix the next census, $150 million for honey-bee insurance, $600 million for more fuel-efficient government cars, and so on.
A $200 million item to resod the National Mall was the first to bite the dust. President Obama urged dropping it before bringing the stimulus bill to the House, where it passed last week without a single Republican vote.
But the president needs more GOP support in the Senate, where Democrats are two votes shy of the 60 needed to break a filibuster. To get those votes – and even hold on to skeptics on their own side of the aisle – Democrats need to make changes in the bill.
In all, Senate Republicans want to excise some $200 billion in projects on the social spending side, while beefing up tax cuts and spending on infrastructure.
“We’re not trying to prevent a package from passing, we’re trying to reform it,” said Senate Republican leader Mitch McConnell at a briefing on Monday. That means: “Housing first, tax relief for middle-and lower-income tax payers to put money back in their pockets immediately.”
Mr. McConnell also criticized Democrats for adding protectionist elements to the stimulus plan, referring to mandates to buy American in the House-passed version of the bill. That, he said, would set off international trade wars.
Senate Republicans also want to target the plan on the foreclosure crisis, which they see as ground zero for the nation’s economic woes. GOP amendments expected to be offered this week include a proposal to offer 4.5 percent mortgages to qualified homeowners to help avoid foreclosures.
Senators on both sides of the aisle are also lobbying colleagues to back an amendment to increase homebuyers’ tax credit.
“Housing is the root cause of how we got here and has got to be a major part of any stimulus bill. And credit is the 90 percent issue as a result of what happened in housing,” says Sen. Bob Corker (R) of Tennessee. “If you try to lay a potpourri of massive spending on top of a foundation that’s not solid, it’s going to be totally wasted.”
Just look at the mass of proposed projects, he says. The state of Tennessee has a budget gap of $900 million, but is on track to get some $3.8 billion if the Senate bill becomes law.
“I want our state to be treated like the other states, but my point is there is no thought in this massive spending package,” the senator says.
Democrats also have concerns
At the same time, many Senate Democrats are signaling concerns with the bill as it emerged from the Senate Appropriations and Finance panels.
“We all owe it to give our very best and write a package that meets the tests of temporary, timely, and targeted,” he said.
While some Democrats describe new health and education spending in the bill as a “down payment,” others insist that this spending is not intended to be permanent.
“Increases for programs as varied as food stamps, loan guarantees, and education, for example, are being made available with the clear understanding that the level of resources provided in this measure are to respond to this crisis and will not be sustained in the future,” said Sen. Daniel Inouye (D) of Hawaii, chair of the Senate Appropriations Committee, at a hearing on the bill on Jan. 27.
Other Democrats want to see the balance in the stimulus plan shifted toward more spending on infrastructure.
“If you look at our problem as an urgent need to provide jobs and a long-term need not to sink the country fiscally, the thing that meets both those needs best are ... infrastructure projects,” says Sen. Sheldon Whitehouse (D) of Rhode Island.
“When you lay out the money, in addition to getting the jobs, you get also the hard asset you’re left with – the new highway, or the new bridge, or the repaired sewage treatment facility,” he adds.
A bid for broad support
In a bid to encourage a bipartisan vote, Senate Democrats have promised an open amendment process this week – a sharp break from the way both Democrat and Republicans used majority powers in the last few Congresses.
“I am confident that by the time we actually have the final package on the floor that we are going to see substantial support,” said Mr. Obama in an interview with NBC News on Sunday.
He added that he would urge Congress to cut elements of the bill that don’t contribute to “putting people back to work right now.”
Citing the president’s comments, Republicans this week say they’re hoping that Democratic leaders will get in line with the president’s priorities.
With the current balance of seats in the Senate, Republicans can’t expect that they’re going to win all or even many of their amendments, said McConnell in the briefing on Monday, adding, “But there is considerable Democratic senatorial unrest on this package.”
“We have a bill that was worked out with the House and Senate and the White House,” said Jim Manley, a spokesman for Senate majority leader Harry Reid. He adds that if people have suggestions on how to change it, Senator Reid has said he was open to them.