Obama, Dems Plan a Main Street StimulusOctober 12, 2008 - by Donny Shaw
While the Bush Administration tries to decide how to use their new Wall Street bailout powers, Democrats in Congress are working out the details of a $150 billion plan to provide jobs and help out people struggling on Main Street. Consulting with Sen. Barack Obama (D-IL), the Democratic leadership has come up with the framework for a Main Street stimulus plan that will probably include an extension of unemployment insurance, more money for food stamps and additional funds for transportation infrastructure projects to create new jobs.
A formal announcement of what will be in the new stimulus package could come Monday afternoon, when House Speaker Nancy Pelosi (D-CA) and other Democrats will be holding an economic forum to discuss the stimulus package with a panel of economists.
The tentative plan is to bring Congress back after the election on November 4th in a lame-duck session to get the stimulus passed. If the politics don’t work out then, the stimulus package will have to wait until the next session of Congress convenes in January, and even then it may still take a month or two to get the bill completed. For now, Republicans in Congress are tentatively on board for some kind of stimulus package:
>Rep. Roy Blunt, the Missouri Republican who serves as House minority leader, said he would support a stimulus plan if it did not include massive public works spending and budget bailouts for states that overspent on health care and other social programs.
>"A stimulus plan that makes sense is something that I’ll be helpful with," Blunt said, also on ABC television.
Both the public works spending and the money for state budget shortfalls have come straight from Barack Obama’s economic stimulus proposal. His website states that he would include a “$25 billion State Growth Fund to prevent state and local cuts in health, education, housing, and heating assistance or counterproductive increases in property taxes, tolls or fees” and “$25 billion in a Jobs and Growth Fund to prevent cutbacks in road and bridge maintenance and fund school repair – all to save more than 1 million jobs in danger of being cut.”
Unlike what is being talked about by congressional Democrats, Obama’s stimulus proposal includes a provision to help it pay for itself. He calls for enacting a “windfall profits tax on excessive oil company profits” in order to make back some of the money that will be spent stimulating the economy. So far, Democrats have not proposed a plan to pay for the $150 billion in new spending they are calling for in their stimulus package. When the bill comes up for consideration in November, this will probably be a major sticking point with both Republicans and the fiscally conservative Blue Dog Democrats.
Obama’s plan also calls for another round of tax rebates, which some reports suggest will be included in the Democrats’ stimulus bill while others do not. We’ll be updating as more details are released.
UPDATE: From The Hill:
>House Democratic leaders on Monday announced a broad economic recovery package aimed at the middle class that they say needs to be enacted in the wake of the Wall Street rescue bill.
>House Speaker Nancy Pelosi (D-Calif.) led a meeting of almost a dozen top House Democrats and about as many economists on Monday morning. She said the group coalesced around a general economic recovery package aimed at aiding states, extending unemployment insurance benefits, investing in transportation and infrastructure, and perhaps providing a new round of tax rebate checks.
>Pelosi said the package would be hammered out after various committees hold hearings in the coming weeks, adding that it may well exceed the $61 billion economic stimulus package that the House recently passed. That measure stalled in the Senate.
>“We plan to go forward expeditiously but not hastily,” Pelosi said.
>The Speaker did not answer directly whether or not she will convene a lame-duck session of Congress following the Nov. 4 elections but indicated that it is a possibility.
>“We will have the hearings and we’ll see what they yield,” she said. “We stand ready to take action when we are ready to do so.”
And here’s Pelosi today on the current lack of bipartisan agreement regarding the stimulus package:
>“The last time we did something in a bipartisan way, it seemed to be a largely Republican package with largely Democratic votes,” Pelosi said to reporters.
>“If it is going to happen that way, we might as well write the bill ourselves and do the right thing for the American people.”
>Pelosi said she is ready to work with her GOP colleagues on the package, but so far “what we have gotten from Republicans is rejection.”