Stimulus 2008: a need for speed

The House passed the bipartisan growth bill (aka the “stimulus bill”) yesterday on an overwhelming 385-35 vote. 93% of Democrats and 85% of Republicans voted aye. That vote is a direct result of the cooperation among Speaker Pelosi, Republican Leader Boehner, and Treasury Secretary Hank Paulson on behalf of the President.

The bill now heads to the Senate. Today the President called for quick Senate action:

The temptation is going to be for the Senate to load it up. — We need to get this bill out of the Senate and on my desk so the checks can get in the hands of our consumers and our businesses can be assured of the incentives necessary to make investments.

The Senate Finance Committee is marking up an alternate version of this bill today. There are some in the Senate who have ideas about how they would like to modify the House-passed bill. Various Senators want to:

  • add infrastructure spending
  • add funds to subsidize housing
  • add funds for low-income heating assistance
  • extend unemployment insurance
  • provide tax rebates to seniors
  • eliminate the income cap in the House bill
  • change the business provisions to provide relief to firms that do not invest in 2008

There are many lobbying the Senate this week to add additional provisions to this bill. There are two risks: (1) that the bipartisan agreement in the House is derailed by changes made in the Senate; and (2) that the bill becomes a “Christmas tree”, on which everyone wants to hang an ornament, delaying Senate completion.

At the same time, there is a growing chorus calling for the Senate to quickly take up and pass the House-passed bill without amendment.

Treasury Secretary Hank Paulson: “The key here is keeping the deal simple, keeping this simple.” Complexity is our enemy right here. Once you start adding things, it’s a slippery slope, and the process could quickly bog down and screech to a stop here.  I don’t think the Senate is going to want to derail this program. And I don’t think the Amreican people are going to be anything but impatient if we don’t enact this bipartisan agreement quickly.”

“Former [Clinton] Treasury Secretary Lawrence Summers testified that the plan — due to pass the House today — was appropriately targeted to achieve its short-term goal. While he said an expansion of unemployment insurance would help spur the economy, ‘there are no possible improvements to the package that would warrant delay.’”

“Former [Clinton] White House Budget Director Alice Rivlin concurred: ‘Quick passage, I believe, is more important than improvements.’ Rivlin urged Congress to resist the temptation to add construction projects to the package. She said that spending would proceed too slowly to give the economy a timely boost and would end up accelerating the deficit.”

“It’s important that this bill not get overloaded. I have a full agenda of things I would like to have in the package, but we have to contain the price,” Pelosi said. “We made a decision, because that’s where we could find our common ground.”

Q: “Senator McConnell is asking to do just that, put your bill on the floor, without any amendments. Should Reid just agree to that, to schedule this without slowing it down with a markup tomorrow?”

Speaker Pelosi: “All I would say is, I would hope that the Senate would take up our bill and pass it, so that this can be as timely as it needs to be.”

Senator McConnell: “In the Democrats’ response to the State of the Union, Gov. Sebelius called on Congress to ‘work together’ quickly on a short-term fix to speed relief to families. Speaker Pelosi and Majority Leader Reid previously called for a plan to be ‘implemented into law without delay.’ The best way to do this is for the Senate to take up and pass the bipartisan compromise crafted by the House and send it directly to the President’s desk — this week. Adding extraneous provisions to this cooperative package will only delay, and possibly derail, relief to America’s famliies and job creators.”

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