Federal

Negotiations Intensify on Final Stimulus Plan

By The Associated Press — February 11, 2009 3 min read

Negotiators hoped to seal agreement on President Barack Obama’s economic stimulus package Wednesday after making good progress in the first rounds of closed-door talks.

Obama’s negotiating team insisted on restoring some lost funding for school construction projects as talks began Tuesday in hopes of striking a quick agreement, but by late in the day it appeared resigned to losing up to $40 billion in aid to state governments.

Earlier Tuesday, the Senate sailed to approval of its $838 billion economic stimulus bill, but with only three moderate Republicans signing on and then demanding the bill’s cost go down when the final version emerges from negotiations.

Negotiators were working with a target of about $800 billion for the final bill, lawmakers said.

“That’s in the ballpark,” Senate Finance Committee Chairman Max Baucus, D-Mont., said of the $800 billion figure late Tuesday.

Baucus had said earlier that $35.5 billion to provide a $15,000 homebuyer tax credit, approved in the Senate last week, would be cut back. There was also pressure to reduce a Senate-passed tax break for new car buyers, according to Democratic officials.

Within hours of the 61-37 Senate vote, White House Chief of Staff Rahm Emanuel and other top Obama aides met in the Capitol with Democratic leaders as well as moderate senators from both parties whose support looms as crucial for any eventual agreement.

House Democratic leaders promised to fight to restore some of $16 billion for school construction cut by the Senate. Those funds could create more than 100,000 jobs, according to Will Straw, an economist at the liberal Center for American Progress.

House Majority Leader Steny Hoyer, D-Md., acknowledged Wednesday that finding an agreement on differences over tax cuts and aid to states and localities will be difficult.

“We’re going to have to resolve those differences. Simply talking about what we need to do is not going to be very effective if we don’t do it,” he said in an interview on the Fox News Channel.

The moderate senators — Olympia Snowe and Susan Collins of Maine and Arlen Specter of Pennsylvania — are demanding that the final House-Senate compromise resemble the Senate measure, which devotes about 42 percent of its $838 billion in debt-financed costs to tax cuts, including Obama’s signature $500 tax credit for 95 percent of workers, with $1,000 going to couples.

The $820 billion House measure is about one-third tax cuts.

Collins said last week she won’t vote for any final bill exceeding $800 billion in spending and tax cuts. Specter warned that the Senate bill must stay “virtually intact.”

The GOP moderates also want the final bill to retain a $70 billion Senate plan to patch the alternative minimum tax, or AMT, for one year. The provision would make sure 24 million families won’t get socked with unexpected tax bills during the 2010 filing season.

The AMT was designed 40 years ago to make sure wealthy people pay at least some tax, but it is updated for inflation each year to avoid tax increases averaging $2,300 a year. Fixing the annual problems now allows lawmakers to avoid difficult battles down the road, but economists say the move won’t do much to lift the economy.

House leaders are tempering expectations that they’ll restore many of the cuts.

“You cannot allow the perfect to be the enemy of the effective and of the necessary, and we will not,” said House Speaker Nancy Pelosi, D-Calif.

While they’re fighting to preserve cuts to Obama priorities, Specter is fighting to preserve an enormous $10 billion increase for the National Institutes of Health, while Collins obtained $870 million for community health centers in talks last week.

Copyright 2008 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Events

This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Student Well-Being Webinar
Equity, Care and Connection: New SEL Tools and Practices to Support Students and Adults
As school districts plan to welcome students back into buildings for the upcoming school year, this is the perfect time to take a hard look at both our practices and our systems to build a
Content provided by Panorama Education
This content is provided by our sponsor. It is not written by and does not necessarily reflect the views of Education Week's editorial staff.
Sponsor
Classroom Technology Webinar
Here to Stay – Pandemic Lessons for EdTech in Future Development
What technology is needed in a post pandemic district? Learn how changes in education will impact development of new technologies.
Content provided by AWS
School & District Management Live Online Discussion A Seat at the Table: Strategies & Tips for Complex Decision-Making
Schools are working through the most disruptive period in the history of modern education, facing a pandemic, economic problems, social justice issues, and rapid technological change all at once. But even after the pandemic ends,

EdWeek Top School Jobs

Teacher Jobs
Search over ten thousand teaching jobs nationwide — elementary, middle, high school and more.
View Jobs
Principal Jobs
Find hundreds of jobs for principals, assistant principals, and other school leadership roles.
View Jobs
Administrator Jobs
Over a thousand district-level jobs: superintendents, directors, more.
View Jobs
Support Staff Jobs
Search thousands of jobs, from paraprofessionals to counselors and more.
View Jobs

Read Next

Federal Lawmakers Press CDC About Teachers' Union Influence on School Reopening Guidance
Republican senators asked CDC Director Rochelle Walensky about reports a teachers' union had input on guidance for schools on COVID-19.
3 min read
Dr. Rochelle Walensky speaks during an event in Wilmington, Del., to announce President-elect Joe Biden's health care team on Dec. 8, 2020.
Dr. Rochelle Walensky, CDC director, speaks during an event in Wilmington, Del., to announce then-President-elect Joe Biden's health care team on Dec. 8, 2020.
Susan Walsh/AP
Federal Biden Taps Ex-Obama Aide Roberto Rodriguez for Key Education Department Job
Rodriguez served as a top education staffer to President Barack Obama and currently leads a teacher-advocacy organization.
3 min read
BRIC ARCHIVE
Getty
Federal Biden Pitches Plan to Expand Universal Pre-K, Free School Meal Programs, Teacher Training
The president's $1.8 trillion American Families Plan faces strong headwinds as Congress considers other costly administration proposals.
8 min read
President Joe Biden addresses Congress from the House chamber. Behind him are Vice President Kamala Harris and Speaker of the House Nancy Pelosi.
President Joe Biden addresses a joint session of Congress Wednesday night, as Vice President Kamala Harris, left, and House Speaker Nancy Pelosi of Calif., applaud.<br/>
Chip Somodevilla/AP
Federal Education Department Kicks Off Summer Learning Collaborative
The Summer Learning and Enrichment Collaborative will boost programs for students acutely affected by COVID-19 in 46 states.
2 min read
Education Secretary Miguel Cardona, left, talks with Fort LeBoeuf Middle School teacher Laura Friedman during a discussion on safely returning to schools during the COVID-19 pandemic on March 3, 2021.
Education Secretary Miguel Cardona, left, talks with Fort LeBoeuf Middle School teacher Laura Friedman during a discussion on safely returning to schools during the COVID-19 pandemic in March.
Greg Wohlford/Erie Times-News via TNS