Democrats Float $50 Billion Total For Second Stimulus Plan

Fri. Jul 18, 2008


Democrats, who have been calling for a second stimulus plan for weeks, are now floating a sum of $50 billion as a figure. Presumptive presidential nominee Sen. Barack Obama, D-Ill., underscored his support for such a plan, as well as an expansion of low-interest loans to struggling U.S. automakers, in a letter to the United Auto Workers released today. His letter follows comments on CNN by House Speaker Pelosi late Thursday that called for $50 billion, one third of the cost of the $150 billion stimulus package enacted in February. "I would hope we could have about a $50 billion [package]," Pelosi said. "You have to look at what helps stimulate the economy without spending more money than you should because you weight the economy down by going deeper into debt."

Ideas that have been floated include funding for infrastructure; more tax rebates for the middle class; increased food stamp benefits; low-income assistance for the purchase of home heating oil; another extension of unemployment benefits and increased aid to states for Medicaid. Pelosi did not provide any details about the timing of House consideration. She has said she needs the cooperation of President Bush and House Republicans, but the White House has remained opposed. Federal Reserve Chairman Bernanke said Wednesday he thought such an effort was premature, since the benefits of the first package have yet to take full effect. A spokesman for Minority Leader Boehner declined today to address the specific dollar amount, arguing that Democrats should be focusing on high gas prices. But in an interview on Bloomberg TV airing this weekend, Boehner said he believes the package is politically motivated. A senior House GOP aide said today that election-year politics and the need of Democratic leaders to keep their conference in check are key factors driving the effort. He argued that if GOP lawmakers do not back the package because it is loaded with Democratic priorities, which is likely, it gives Democrats a prime election year talking point against them. If Democratic leaders fail to put together a legislative vehicle for promises made to rank-and-file members throughout the year on transportation and other matters, they face a problem with their Caucus, the aide added. "They have to keep that alive or they will start losing [Democratic] votes on the stuff they want to get done," the aide said.

By contrast, Senate Majority Leader Reid has indicated the Senate has more urgent concerns than the second stimulus bill. "We do plan to take up a second stimulus bill, but no final decisions have been reached about what it will look like," a Reid spokeswoman said today. "The House may act more quickly, [but] I don't expect that any final decisions will be made until September." Senate Minority Leader McConnell said on CNBC today he would consider sending out rebate checks as part of a second stimulus package but seemed to agree with Reid that the Senate has more pressing matters. Meanwhile, Senate Appropriations Chairman Robert Byrd has scheduled a committee vote on his version of a supplemental package Tuesday.

by Humberto Sanchez, with Christian Bourge and Ben Schneider contributing

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