By Paul Kane
Washington Post Staff Writer
Thursday, January 29, 2009
The House approved an $819 billion stimulus package on a near party-line vote yesterday, a plan breathtaking in size and scope that President Obama hopes to make the cornerstone of his efforts to resuscitate the staggering economy.
Obama engaged in an all-out lobbying push for the bill, which is among the most expensive pieces of legislation ever to move through Congress, and marked a big victory for his presidency a little more than a week into his term. He will now turn his attention to the Senate, where Democrats are scheduled to begin debate on the measure on Monday and the price tag is likely to reach $900 billion.
Larger than the combined total cost of the wars in Iraq and Afghanistan so far, the two-year stimulus plan would provide up to $1,000 per year in tax relief for most families, dramatically increase funding for alternative energy production, and direct more than $300 billion in aid to states to help rebuild schools, provide health care to the poor and reconstruct highways and bridges.
But Obama's personal salesmanship effort failed to secure a single Republican supporter for the spending plan, which passed on a 244 to 188 vote. Just a day after the president spent more than an hour behind closed doors at the Capitol seeking their support, all 177 House Republicans opposed the measure, arguing that it would spend hundreds of billions of dollars on initiatives that would do little to stimulate the economy. Eleven Democrats opposed the bill.
In a statement issued after the early evening vote, Obama said he was "grateful" for the House action.
"There are many numbers in this plan," he said in the statement. "But out of all these numbers, there is one that matters most to me: This recovery plan will save or create more than 3 million new jobs over the next few years."
While Obama made no mention of the unanimous Republican opposition, a top adviser immediately warned of the political fallout GOP lawmakers could face from constituents struggling in tough economic times.
"There will be people in districts all over the country that will wonder why, when there's a good bill to get the economy moving again, while we still seem to be playing political gotcha," White House press secretary Robert Gibbs said in an interview.
Some moderate Republicans who opposed the bill left open the chance of supporting the final version if the White House and Senate address their concerns about spending. And Democrats remain hopeful of securing a more bipartisan result in the Senate, where committee action has driven up the cost as the amount of tax relief has increased, something Republicans have demanded before they will consider offering their support.
In addition to other tweaks to the tax portion of the package, the Senate Finance Committee added a $70 billion fix to the alternative-minimum tax to the chamber's version of the bill, a provision aimed at preventing the tax from being applied to middle-class households, pushing the total cost to at least $890 billion.
The Finance Committee also added a provision that would reduce taxes on businesses that buy back their own debt at a discount. Senators in both parties were readying amendments to make further changes, including a proposal that would dramatically reduce taxes, from 35 percent to 5.25 percent, on corporate profits earned abroad and brought back to the United States.
Advocates say that the measure, sponsored by Sens. Barbara Boxer (D-Calif.) and John Ensign (R-Nev.), would prompt companies to "repatriate" hundreds of billions of dollars, money that could be used to expand domestic operations and save jobs. Supporters estimate it could increase federal tax revenue by as much as $40 billion.
Housing advocates complained that the package would not provide $10 billion for a trust fund to build affordable housing that was created last summer but never funded. Labor unions complained that the plan would put too little money toward construction projects to create jobs. And the U.S. Chamber of Commerce complained that the measure would do too little to relieve the tax burden on businesses struggling to avoid layoffs.
But such additions might increase the already staggering cost of the legislation, which could risk solidifying Republican opposition and losing more votes among the fiscally moderate coalition of Blue Dog Democrats.
By early afternoon, House Republicans knew they would be united in their opposition to the plan, aides said. As he walked to the chamber floor for the 6 p.m. vote, Minority Leader John A. Boehner (Ohio) touched his finger and thumb together, flashing a zero to indicate the number of GOP votes the bill would receive.
Democrats noted that they allowed Republican amendments, both at the committee level and on the House floor, a more open process than most legislative fights conducted over the past two years. After meeting with Republicans, Obama coaxed his fellow Democrats into dropping some controversial spending provisions that even they acknowledged would do little to create jobs, including funding for a family-planning program and $200 million to refurbish the Mall.
But Republicans continued to press to have more of their proposals included. Rep. Eric Cantor (Va.), the House minority whip tasked with rounding up the opposition, said the vote delivered a message to Obama: "Tell Speaker Pelosi to begin to work with us."
Some Democrats questioned the need for Obama to continue pursuing a bipartisan victory on the final product if Republicans were entrenched in their opposition.
"I think the president went the distance, and I applaud him," said Rep. Rosa DeLauro (Conn.). "Everything was done to be inclusive in this process."
Undeterred, Obama greeted Boehner and other congressional leaders, along with their spouses, at the White House last night for a bipartisan cocktail party -- the fourth time GOP leaders have had a private audience with Obama in the past three weeks.
The stimulus debate comes on the heels of congressional action in mid-January that released $350 billion to Obama's new Treasury secretary, Timothy F. Geithner, for use in the effort to free up the credit markets, part of the massive financial rescue package approved last fall. Held days before Obama was sworn in as president, that vote also fell largely on party lines, as just six Senate Republicans joined 46 Democrats in supporting the release of the money.
Hours before yesterday's House vote, Obama told a group of about 100 business leaders that Congress must not delay efforts to restart the economy and put people back to work.
At a White House gathering this morning, he said: "The businesses that are shedding jobs to stay afloat, they cannot afford inaction or delay. The workers who are returning home to tell their husbands and wives and children that they no longer have a job, and all those who live in fear that theirs will be the next job cut -- they need help now."
House Speaker Nancy Pelosi (D-Calif.) heralded the legislation -- $275 billion in tax cuts and almost $545 billion in domestic spending -- as the first down payment on Obama's pledge, made in his inaugural address, to provide "bold and swift" action to revive an economy that is losing more than 500,000 jobs a month, including 65,000 layoffs announced just this week.
"He said he wanted action, bold and swift, and that is exactly what we are doing," Pelosi told reporters before the vote.
A $475 billion Republican alternative, which focused heavily on reducing individual and business taxes, failed.
After Democrats initially estimated their plan would cost $825 billion, the Congressional Budget Office announced this week that the total cost was $816 billion, with about 65 percent of that amount expected to be spent by September 2010. During debate, lawmakers added $3 billion for mass-transit programs.
Staff writers Michael D. Shear and Lori Montgomery contributed to this report.