Legislators reduce stimulus package
Republicans oppose the $789 billion it will cost.
Published Feb. 12, 2009
Congress is likely to vote Friday on the latest version of an economic stimulus package. The newest version, with a $789 billion price tag, has seen a $2.24 billion cut in funding for higher education since the original version of the bill went into the U.S. House.
Although students are still eligible for a $2,500 tax cut to cover tuition costs through the latest package, the funds available for modernization of facilities and infrastructure were diminished in an attempt to curtail excessive spending.
After hours of rapid-fire discussion behind closed doors, Democrats and Republicans reached a "grand compromise," as House Speaker Nancy Pelosi, D-Calif., called it on Thursday night.
Opinions differ greatly between parties regarding how effective the compromise over the stimulus will turn out to be.
"The only 'grand' thing about this compromise is the price tag," Sen. Kit Bond, D-Mo, said in a news release.
Bond's sentiment is shared by his Republican colleagues in the Senate, who were united in their opposition to the package, with the exception of three senators.
"This compromise was not presented to Republicans or the public," said Paul Sloca, spokesman for Rep. Blaine Luetkemeyer, R-Mo. "Democrats had secret negotiations behind closed doors and are willing to spend their $800 billion of taxpayer money without allowing the public to see any kind of roadmap as to how it will be spent."
Republican members of Congress are fearful that package has become a line-item wish list.
"Many elements of this package are not directly stimulating to the economy and the debt level we are undertaking is phenomenal," said Steve Taylor, a spokesman for Rep. Todd Akin, R-Mo. "We are risking wrecking the ship of state."
Although the Republicans did manage to get 40 percent of the total cost of the bill to pursue tax relief as a means to simulate the economy, conservative legislators have continually asserted that reinvesting in consumer spending and small business by way of tax breaks will help break the national pattern of economic recession.
Democrats, on the other hand, have praised the speed with which the bill has been hammered out and also look optimistically at the chances of the bill making real improvement possible.
"Missouri is facing its highest unemployment rate in 25 years with 7.3 percent without jobs," Rep. Russ Carnahan, D-Mo, said in a news release. "Our nation cannot afford to lose jobs at this current rate without taking bold and immediate action."
Outside observers are less sure one approach or another will be completely successful.
"The right mix of provisions to stimulate the economy is controversial among economists," MU economics professor David Mandy said. "Some believe provisions that will stimulate demand are more useful. Others believe supply-side stimuli are better. The package arguably includes some provisions that stimulate each side of the economy. Whether it is the right mix and of the right size is a matter of opinion."
Republicans have vowed to vote against the package in its final form, which could be put before the House as early as Friday, and the measure is expected to pass and could see the president's desk as early as Monday.