Democrats Craft Economic Plan

Some key lawmakers argue that Democrats should go beyond a quick tax cut to boost consumer activity and swiftly implement all of Obama's proposals to ease the tax burden on the middle class. That would include a variety of targeted tax credits for working families, the elderly and college students, as well as legislation to extend the Bush tax cuts past their 2010 expiration date for families earning less than $250,000 a year.

"Substantial parts, if not all, of his tax-relief proposals will be passed as part of an economic recovery plan soon after the new Congress convenes in January," said Rep. Chris Van Hollen (D-Md.), an influential member of the House leadership who led party efforts to expand the Democratic majority.

"This was a major part of the campaign. It got a lot of attention," Van Hollen said. "Acting now is the best decision from both a policy perspective and a political perspective."

That approach may run into trouble, however, among fiscal conservatives in the Democratic Party, who want Congress to cover the cost of any permanent programs -- whether spending on health care or tax cuts for the middle class -- by raising taxes elsewhere or cutting spending. And the Obama tax agenda is not cheap. The nonpartisan Tax Policy Center estimates that it would add nearly $3 trillion to the deficit over the next decade.

Though extending the Bush tax cuts would normally attract Republican votes, Democrats want to rescind the cuts for families earning more than $250,000 a year, a move the GOP opposes and one that economists say would be unwise during a recession. Van Hollen said the tax increase for wealthy families could be delayed a year or so. But some tax analysts said they would be surprised if Obama encouraged lawmakers to dive immediately into that part of his agenda.

Democrats said they did not plan to include tax reductions in the stimulus package that could be taken up this month, though business groups have submitted a lengthy wish list.

In yesterday's meetings with Pelosi, Reid and other lawmakers, the car company executives were joined by Ron Gettelfinger, president of the United Auto Workers. His presence was meant to be a stark reminder that hard times for the automakers could threaten the livelihoods of thousands of union workers who were instrumental in helping Democrats take back the White House on Tuesday. General Motors issued a statement saying that the automakers had a "very frank and constructive discussion" with Pelosi.

But neither Reid nor Pelosi made any promises, and Reid issued a statement calling on the Bush administration "to exercise its existing authority to provide additional help to these firms."

Staff writer Anne E. Kornblut contributed to this report.