Obama open to compromise on $825B stimulus bill
WASHINGTON — On the eve of a key vote, President Barack Obama privately promised Republicans he stands ready to accept changes in the $825 billion economic stimulus legislation, invoked Ronald Reagan to rebut conservative critics and urged lawmakers to "put politics aside" in the interest of creating jobs.
"The American people expect action," Obama said Tuesday as he shuttled between closed-door meetings with House and Senate Republicans on a trip to the Capitol that blended substance with political symbolism.
Republicans who attended the sessions said the president did not agree to any specific changes but did pledge to have his aides consider some that GOP lawmakers raised dealing with additional tax relief for businesses.
Prodded to budge on another point, Obama said that despite opposition, he will insist on giving relief to wage-earners who pay Social Security taxes but do not earn enough to owe income tax. His spokesman said the president reminded his critics that former President Reagan _ conservative hero to many contemporary Republicans _ supported the same concept while in the White House.
In a measure of the complex political dynamic in Congress, House Republican leaders urged their rank and file to oppose the stimulus measure hours before Obama arrived.
One Republican later quoted the president as saying any changes would have to come after the House gives what is expected to be largely party-line approval Wednesday to the Democratic-backed bill. Debate began late in the day on the measure, which includes about $550 billion in spending and roughly $275 billion in tax cuts. Democrats made one small change, voting to delete $20 million intended for renovating the National Mall. Republicans had criticized the expenditure as wasteful.
In the Senate, traditionally more bipartisan than the House, a companion bill grew to roughly $900 billion. That included a new tax break for upper middle-income taxpayers, at a one-year cost of $70 billion. It was advanced by Sen. Chuck Grassley of Iowa, senior Republican on the Finance Committee.
Democratic leaders in both houses have promised to have legislation ready for Obama's signature by mid-February, and Tuesday's developments coincided with fresh evidence of deterioration in a national economy seemingly growing weaker by the day.
Housing prices tumbled by the sharpest annual rate on record in November, according to a closely watched private report released during the day, and a measure of consumer confidence dropped to a historic low.
Separately, the Treasury Department announced distribution of $386 million to 23 troubled banks, the first awards from the federal bailout fund since Obama took office a week ago.
Obama traveled to and from the Capitol in a snowy motorcade on Tuesday, far different from the inaugural parade seven days earlier. This was a business trip, marking his second reach across party lines in as many days in keeping with a pledge to seek bipartisan solutions to major problems.
On Monday, he leaned on House Democrats to jettison an item that would make it easier for states to provide family planning funds for the poor under Medicaid, a provision in the legislation that had become a target of ridicule for Republicans. Press Secretary Robert Gibbs said Obama supports the concept but wants it included in a different bill.
Ironically, Democrats said deleting the provision would wind up increasing federal spending, since it probably would mean more money spent on higher pregnancy and postnatal care.
House Republican leaders welcomed the president a few hours after urging their rank-and-file to oppose the stimulus bill, and it was far from clear that Obama had managed to pick up any GOP support during the day.
Gibbs said the White House expects some GOP lawmakers will vote for the measure on Wednesday in the House, and indicated he hopes there will be more in the Senate and even more later when a final compromise is reached.
One Republican senator, speaking on condition of anonymity, said the president pledged to Sen. John Ensign, R-Nev., to have aides review two specific proposals. One would affect businesses that pay down their debt. The other would provide a temporary tax holiday for companies that have money overseas and bring it back to the United States to invest.
Obama ventured into an uncertain political environment when he stepped into the Capitol, a president with high approval ratings pitching a plan that also has been favorably received in the polls.
Republicans, on the other hand, are trying to regroup after last fall's elections, in which they lost the White House as well as seats in both houses of Congress. While some conservatives seem eager to mount a frontal attack on Obama and his plans, others are pursuing a strategy of criticizing congressional Democrats rather than the president.
Hours earlier, according to officials who were present at a GOP meeting, none of the Republicans in attendance spoke up in disagreement when urged to oppose the legislation by their leaders. Rep. John Boehner of Ohio, the party's leader, and Eric Cantor of Virginia, the second in command, said they wanted "100 percent" opposition to the measure, which they argue includes billions in wasteful spending, these officials said.
Across the Capitol, Senate Republican leader Mitch McConnell suggested that Democrats in Congress were the problem, not the president.
"We think the country needs a stimulus," McConnell said on NBC's "Today" show. But he also said that he believes most people do not believe recovery can be accomplished through projects like "fixing up the Mall," a reference to funding to repair the National Mall in Washington.
He said Republicans want a bill that devotes 40 percent of its total to tax cuts.
Some conservatives were far more blunt.
"While the president was genial, his proposal remains rooted in a liberal, big-government ideology that ignores history," said Rep. Tom Price of Georgia, head of the conservative Republican Study Committee in the House.
Complicating the Republican position was evidence of support among the nation's governors for the legislation taking shape.
The measure includes more than $120 billion in aid to schools, some of it to protect them from the effects of state budget cuts in a time of recession. It also provides more than $80 billion additional funding for Medicaid, the state-federal program that provides health care for low-income people, and $40 billion more to help people who have recently lost their jobs hold onto employer-provided health care. Another $32 billion is ticketed for transportation projects, and $30 billion more for water projects and rail and mass transit.
Obama's centerpiece tax cut would provide $500 per worker and $1,000 per couple for low and middle-income wage earners, including those who do not earn enough to owe income taxes.
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Associated Press writers Liz Sidoti, Martin Crutsinger, Stephen Ohlemacher, Andrew Taylor, Jim Kuhnhenn and Jennifer Loven contributed to this story.
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DAVID ESPO | January 27, 2009 11:47 PM EST |
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