By Shailagh Murray
Washington Post Staff Writer
Monday, January 5, 2009
Lowering expectations for quick passage of an economic stimulus bill, Senate Majority Leader Harry M. Reid rejected setting "some false deadline" for delivering legislation to President-elect Barack Obama in favor of a more deliberate approach that allows Congress to get the package right "the first time."
Congressional leaders had hoped to hand Obama an economic assistance package immediately after he is sworn in Jan. 20, but that looks increasingly doubtful as the legislation grows in complexity and size. In separate interviews this morning, Reid (Nev.) and House Majority Leader Steny H. Hoyer (D-Md.) said the process could take six more weeks.
Obama officials are advocating that Congress direct about $300 billion of the stimulus package, or about 40 percent, toward tax breaks. Under these provisions, most workers would get a $500 payroll tax credit, as Obama advocated on the campaign trail, and many businesses would receive incentives to create jobs and make equipment purchases more affordable.
Along with their potential for short-term impact, the business measures are intended to entice Republicans to vote for the package; most of the provisions received strong GOP support when instituted as temporary measures in 2002.
Hoyer predicted House passage of the bill by the end of January, with Senate action to follow. If all goes smoothly, a final package could land on Obama's desk before the Presidents' Day recess in mid-February. "We have two criteria: Do it as quickly as possible, but do it right," Hoyer said on "Fox News Sunday."
In a radio address Saturday, Obama warned Congress that delay could bring perilous consequences: "If we don't act swiftly and boldly, we could see a much deeper economic downturn that could lead to double-digit unemployment," he said.
The package Congress is compiling is expected to include fresh investments in infrastructure and in targeted industries, along with the broader corporate and individual tax breaks and aid for states and unemployed people, all with the aim of jolting the ailing economy.
Ten percent of the package would assist jobless workers through additional unemployment benefits and health coverage, under scenarios that Democrats are considering. Much of the balance would pay for "shovel ready" projects that add highway lanes, fix bridges, and place a down payment on broader Obama goals related to alternative-energy and health-care technologies.
With an $800 billion price tag, negotiators can afford to consider provisions to satisfy various congressional constituencies. But despite broad agreement on Capitol Hill that government intervention is urgently needed, bipartisan consensus has yet to form around specifics. Those waters will be tested starting today, when the courting of Republicans begins in earnest.
The longer timetable will require Obama to take an active role in devising the package, and the sales pitch will begin today, in a bipartisan meeting in the Capitol featuring Reid, House Speaker Nancy Pelosi (D-Calif.) and top Republicans, including Senate Minority Leader Mitch McConnell (Ky.) and House Minority Leader John A. Boehner (Ohio). Obama also is expected to make a major speech this week laying out his stimulus priorities.
McConnell warned that hasty action could cost Democrats the bipartisan support that Obama, Reid and other party leaders have said they are seeking. "This is an enormous bill. It could be close to a $1 trillion spending bill. Do we want to do it with essentially no hearings, no input, for example, in the Senate from Republican senators who represent half of the American population? I don't think that's a good idea," he said on ABC's "This Week."
Senate Majority Whip Richard J. Durbin said bipartisanship is a given. "We've got to put aside a lot of the squabbling that was in the past and come together under this new administration and new leadership to get the American economy back on line," the Illinois Democrat said on the same program.
Democrats also provided assurances that the bill would not be saddled with earmarks -- always a danger for a fast-moving piece of must-pass legislation. Hoyer promised a clean House bill, free of "specific items," with the money distributed instead "largely on (a) formula basis." He added, "This is not a bill that we want to see loaded up with earmarks. And that's not our intent."
McConnell applauded the $500 tax credit that Obama has proposed as "the sort of thing we could have bipartisan agreement on," adding: "Republicans, by and large, think tax relief is a great way to get money to people immediately."
In today's meeting, McConnell is expected to propose further tax cuts, including lowering the 25 percent individual tax rate to 15 percent. And he will identify items that Republicans are likely to resist, including the 600,000 new government jobs that are part of a 3 million workforce expansion goal. "That's about the size of the post office workforce," McConnell said on ABC. "Is that a good idea?"
He also challenged a proposal to provide grants to hard-hit states to help them launch school reforms and meet rising Medicaid costs. Such aid should be provided in the form of loans, McConnell said, as "it will make them spend it more wisely."
Nor do Republicans favor a move to extend unemployment benefits to part-time workers while providing health-care coverage for unemployed people -- costly efforts that have met stiff resistance in past debates, because opponents think they would prove impossible to end.
"Those are very big, systemic changes," McConnell said. "Do we in the name of stimulus want to make long-term, systemic changes that will affect spending every single year? I think that's at least worth considering, having hearings about, having bipartisan discussions."
But he also predicted that the bill could pass overwhelmingly if the conciliatory mood holds, giving Obama a crucial first win. "If they pursue a fair process . . . and give both sides an opportunity to have input . . . he's likely to get significant support," McConnell said.