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Economic bill necessary to save jobs

President Barack Obama hammered at the urgent need to pass a bill aimed at combatting the worst recession in decades and put people back to work.

business Updated: Feb 07, 2009 20:30 IST

With the Senate moving toward a tenuous compromise on the White House's economic stimulus plan, President Barack Obama hammered at the urgent need to pass a bill aimed at combatting the worst recession in decades and put people back to work.

"Americans across this country are struggling, and they are watching to see if we're equal to the task before us. Let's show them that we are. And let's do whatever it takes to keep the promise of America alive in our time," Obama said Saturday in his weekly radio and Internet address.

Obama made an aggressive push for House and Senate lawmakers to work quickly to resolve their differences in an economic bill whose pricetag has swung from $720 billion upward toward a trillion dollars.

The new president had hoped to sign economic legislation on his first day in office, but instead has spent his first three weeks in office wrangling with a reluctant Congress _ including fellow Democrats _ to heed his leadership.

Obama inched closer to a completed economic bill, as lawmakers sought to put their own stamp on the legislation. The House _ without a single Republican vote _ passed an $819 billion bill that gave many moderates pause for its size and scope.

Senate leaders went to work paring down that bill, working late into Friday to produce a $780 billion version. A vote on the measure could come as soon as Monday.

Democratic leaders expressed confidence the concessions they had made to a handful of moderate Republicans and Democrats to trim the measure had cleared the way for its passage. The moderates forced more than $100 billion in cuts in programs they felt would not create many jobs right away.

While ensuring passage of Obama's plan in the Senate within a few days, the deal sets up difficult negotiations with the House to reconcile both versions of the stimulus package and more changes could still come.

Officials put the overall cost of the Senate bill at $827 billion, including Obama's signature tax cut of up to $1,000 for working couples. Also included is a tax credit of up to $15,000 for homebuyers and smaller breaks for people buying new cars. At its core, the legislation is designed to ease the worst economic recession in generations, and combines hundreds
of billions of dollars in spending to boost consumption by the public sector, along with tax cuts designed to increase
consumer spending. States would get large sums aimed at forestalling cuts in services or tax increases.

Much of the money would go for victims of the recession in the form of food stamps, unemployment compensation and health care. There are funds, as well, for construction of highways and bridges, and it also includes a "Buy American" protectionist measure for iron and steel that has drawn strong criticism from major U.S. trading partners including Japan, Australia and Canada. The end-stage negotiations played out against a backdrop of yet another dismal jobs report _ 598,000 jobs lost in January and the national unemployment rate rising to 7.6 percent. It's hoped that the combined effort would work its way into the economy and save or create 3 million jobs or so to begin to ease the nation out of the recession by the end of this year. The agreement announced Friday night capped a tense day of backroom negotiations in which Senate Majority Leader Harry Reid, joined by White House chief of staff Rahm Emanuel, sought to attract the support of enough Republicans to pass the measure. Democrats hold a 58-41 majority in the Senate, including two independents, but it takes 60 votes to pass the bill because it would raise the federal deficit.

In the end, only two Republicans publicly signed onto the proposal.

"The American people want us to work together. They don't want to see us dividing along partisan lines on the most serious crisis confronting our country," said Sen. Susan Collins of Maine, one of the Republican moderates who broke ranks and pledged their votes for the bill.

Most Republicans looked at the measure skeptically. Sen. John McCain, Obama's Republican opponent in last November's election, mocked the bill and said lawmakers could call it many things, "but 'bipartisan' is not one of them."

Since his Jan. 20 inauguration, the president repeatedly has reached across the aisle to resistant Republicans as the stimulus plan has wound its way through the Democratic-controlled Congress. But Obama and his advisers have grown more assertive in recent days, reminding Democrats that voters gave them the White House, the House and the Senate to bring change, not partisan gamesmanship. "In the midst of our greatest economic crisis since the Great Depression, the American people were hoping that Congress would begin to confront the great challenges we face," Obama said in the address, released before he made his first trip to Camp David, the presidential retreat in the Maryland mountains.

"That was, after all, what last November's election was all about."

Republicans characterized Obama's rhetoric as arrogant. "Democrats have controlled both branches of government for less than a month. And you have to wonder if all that power has gone to their heads," the new Republican National Committee Chairman Michael Steele said in his party's weekly address. "For the last two weeks, they've been trying to force a massive spending bill through Congress under the guise of economic relief." The economic bill is the first legislative test of Obama's presidency, one his top aides have worked to turn into a victory. But Obama has found it increasingly difficult to manage the liberal wing of his party, which wanted more money directed to infrastructure, governors who wanted more money allocated to help patch their thin budgets and moderate members of his own party. He also sought to bring Republicans into the mix, pledging to listen to them, praising the late-Friday negotiations. Obama said that "by the evening, Democrats and Republicans came together in the Senate and responded appropriately to the urgency this moment demands."

Republican leaders, however, said the rhetoric didn't match what was written. They have pushed for the bill to include more tax cuts and less spending.

The Senate's top Republican took the floor of the Senate Friday to oppose the measure.

"Now, if most Republicans were convinced that this would work, there might be a greater willingness to support it," Sen. Mitch McConnell of Kentucky said. "But all the historical evidence suggests that it's highly unlikely to work. And so, you have to balance the likelihood of success versus the crushing debt that we're levying on the backs of our children, our grandchildren, and, yes, their children."

Obama acknowledged the bill was far from perfect but said it would be too dangerous to leave it lifeless on the table.

"Legislation of such magnitude deserves the scrutiny that it's received over the last month, and it will receive more in the days to come," Obama said. "But we can't afford to make perfect the enemy of the absolutely necessary. The scale and scope of this plan is right. And the time for action is now."

Obama planned to take his message outside of the capital next week, participating in town hall-style meetings in two cities that are struggling. White House spokesman Robert Gibbs said Obama plans to visit Elkhart, Indiana, and Fort Myers, Florida, on Monday and Tuesday to tell residents what his stimulus plan would mean for them.

While senators hashed out a deal on the economic stimulus plan, the president and his wife, Michelle, took daughters Malia and Sasha to see the Alvin Ailey American Dance Theater performance at the Kennedy Center on Friday night.