The Wall Street Journal-20080122-Joint Economic Push Is Both Parties- Goal
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Joint Economic Push Is Both Parties' Goal
WASHINGTON -- As they push for a stimulus package to help the sagging U.S. economy, Democrats and Republicans in Congress face a crucial test: How do they harness their shared desire for action in order to overcome partisan differences on the details?
Top House and Senate leaders from both parties are scheduled to meet today with President Bush. Lawmakers had hoped to emerge from the meeting with a framework for a deal that could move through Congress by mid-February. Now, however, aides said the chance of a detailed breakthrough today is slim, and the timetable for passing a measure has slipped by at least a couple of weeks.
Several big differences remain between Democrats and Republicans, including who should receive tax rebates, and how much cash should be devoted to additional spending items favored by Democrats. One remaining wild card is the Senate, which hasn't been in full session during the recent negotiations, which were led by the House.
Yet for all the remaining questions, there remains a striking desire to work across party lines, a contrast to the bickering and bluster that prevailed on Capitol Hill for much of last year. Near panic in European and Asian financial markets yesterday, which will likely spill into U.S. markets when they reopen today after the holiday, will only increase pressure on lawmakers to act quickly.
"We have a good way forward," said Senate Minority Leader Mitch McConnell. The Kentucky Republican, who last year led efforts to stymie the Democratic majority's legislative agenda, praised the "tone and attitude" established by House Speaker Nancy Pelosi and others in the leadership. He suggested that the groundwork has been laid for bipartisan action, "rather than getting into one of these point- scoring routines."
"That's a good way to start," he said.
A top Democrat, Sen. Charles Schumer of New York, agreed. "Early on, there was a desire to get out front early," Mr. Schumer said. "Now there's a real desire to put together a joint package rather than play one-upmanship."
Neither senator provided details on where they may compromise.
The mood of the Senate will be tested today, when the tax committee holds a hearing to discuss stimulus proposals, and tomorrow, when senators are scheduled to meet in separate party lunches. Treasury Secretary Henry Paulson is expected to join Republicans.
Mr. Paulson, who is heading the administration's stimulus effort, canceled his long-planned trip to the World Economic Forum in Davos, Switzerland, in order to work on the plan. Mr. Paulson had been scheduled to join the president of the European Central Bank for a panel on risks to the global financial system.
Today's meeting with President Bush is expected to focus only in part on the economy; the Mideast also is on the agenda. But congressional leaders hope to begin firming up the broad contours of the stimulus plan, several congressional aides said.
So far, there appears to be bipartisan support for a roughly $150 billion plan that includes cash rebates for millions of people and incentives for business investment.
A sticking point is who would receive rebates. Republicans prefer to limit them to people who pay income taxes. Democrats insist others with lower incomes should be eligible, and that especially people who pay payroll taxes to Social Security and Medicare should be included. Sen. Schumer said there is "broad consensus, though not unanimity, among Democrats" that "the payroll tax is a better tax to use than the income tax" as a basis to decide who gets rebates.
Aid to states, an element in past stimulus bills, appears to have less traction at the moment. Funding for infrastructure also appears to face hurdles, in part because economists worry those funds are rarely spent quickly enough to kick-start the economy.
Other spending items have greater momentum, including an expansion of food stamps and heating assistance for those with low incomes. Enhanced unemployment insurance is likely. Democrats have also proposed a 26-week extension of unemployment insurance and a $50-a- week boost in benefits.
Sen. McConnell said he wants the stimulus package to focus on boosting the economy immediately, and doesn't want the measure to become a vehicle for expanded government spending.
In private discussions, Democrats have suggested pairing spending initiatives -- such as the jobless benefits or more Medicaid funds for states -- with one-time tax relief, a top Republican priority. Sen. McConnell declined to discuss the merits of any trade-off. "I'm not going to rule anything in or out, right now," he said.
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Michael M. Phillips contributed to this article.
