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Dems See Stimulus Replay In Senate Jobs Bill

February 11, 2010 - by Eric Naing

Senate Majority Leader Harry Reid [D, NV] is meeting with fellow Democratic senators today to hammer out an agreement over an $85 billion jobs bill.

The Hill is reporting that Reid and Sen. Max Baucus [D, MT] are loading the bill up with tax cuts to attract Republican support including:

  • a Social Security tax cut to encourage companies to hire new employees
  • an expansion of the tax-credit bond program encouraging infrastructure projects like school construction and clean-energy development
  • an extension of tax breaks for business targeting research, the film industry and other activities

While the tax cuts may attract the support of Republicans like Sen. George Voinovich [R, OH], they may also drive away liberals who have seen this exact scenario play out during the stimulus debate.

Sen. Tom Harkin [D, IA] is one such liberal saying, “We think that tax incentives can solve any problem, and it doesn’t work like that.”

Democrats went out of their way to include tax cuts in the stimulus bill (H.R.1) at the expense of infrastructure spending and other investments of federal dollars, but in the end only three Senate Republicans and zero House Republicans supported the bill.

Some Democrats are also concerned that the $85 billion price tag of a bill that some consider a second stimulus package is not enough. The accompanying House jobs bill (H.R.2487) passed last December, in contrast, totals $154 billion.

In another parallel to the stimulus debate, liberal economists, including Obama Economic advisor Christina Romer, also warned that the $787 billion stimulus package was not enough.

We’ve discussed what is expected to be in the bill before but some of the other highlights include:

  • an extension of COBRA health insurance subsidies and unemployment insurance
  • a delay in cuts to Medicare reimbursements for doctors
  • a one-year extension on the PATRIOT Act
  • billions for infrastructure from the federal Highway Trust Fund

Democrats had hoped to vote on the bill this week, but the snow-induced shutdown of government this week changed all that. Though Sen. Reid has threatened to make the Senate work this weekend, many expect action on the bill to be pushed off until after the upcoming President’s Day recess.

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