$850 Billion?

The first challenge of President-elect Obama's first term and of the 111th Congress looks likely to be the passage of a major stimulus package. Obama has been clear that it is his first priority and while he's generally been reluctant to assign a dollar figure to it, he's usually cited a range of between $500b-$1tr. Over the past few weeks, it's become clear that the final number would likely be at the high end of that range and sure enough, now we're starting to get a more specific number:

President-elect Barack Obama is laying the groundwork for a giant economic stimulus package, possibly $850 billion over two years, in his first test of legislative give and take with Congress.

Obama's economic advisers are assembling a recovery plan and reaching out to members of Congress and their staffs.

Obama aides cautioned that they have not settled on a specific grand total. But they noted that economists from across the political spectrum have recommended spending similar or even larger amounts to jolt the worsening economy.

To aid in the passage of Obama's package is a campaign to be launched by progressive groups in order to pressure wavering members.

Despite the uncertainty, Obama got help Thursday from 20 progressive groups investing more than $4 million in advertising and other events to push moderate Democratic and Republican lawmakers to help pass the package. Whatever the details, the package should be on the new president's desk, ready for him to sign, the day he takes office on Jan. 20, members of the group said in a conference call.

A wise acknowledgment that there is likely to be resistance by many folks all over the country to such a large injection of money we don't actually have into the economy. But if what I saw last night is any indication, it's not just moderate and Republican districts where people will need convincing.

I attended an economic forum held by Congressman-elect Jim Himes here in my parents' district (CT-04) and while not widespread, the idea of another stimulus package was met with some real resistance. Of particular concern was the idea that new members would be asked to vote for it mere hours after being sworn in on January 6th (how else would it be on Obama's desk on Jan. 20th?) Will there be time for these Freshmen to actually take the package back to their constituents between their swearing in and their voting for it? How many of them are holding similar forums to gauge the concerns of people in their districts before they're even in Congress? Jim Himes deserves a lot of credit for going on this listening tour of his district before he's even entered Congress and if it is indeed their intention, I hope the House leadership is aware of the sensitivity of having new members vote for something this sweeping mere moments after having been sworn in. As I saw first hand last night, it does not play well and could put some of these new members in an awkward spot with some of their constituents before they've even barely had a chance to break in their new offices.

Tags: 850 billion, Barack Obama, Jim Himes, stimulus (all tags)

Comments

12 Comments

Re: $850 Billion?

mmmmm, now where have we heard the number $850 billion? Oh yea...there would be quite some symmetry if Obama's first stimulus package was equal to the projected give away to the rich of bush's first tax cuts.  

by gak 2008-12-18 05:02PM | 0 recs
Re: $850 Billion?

There seem to be a lot of people who assume that the $850 billion is nothing but the infrastructure projects they've been hearing about (some of which, to be honest, sound like total boondoggles).  In reality, most of the money is for stuff like extension of unemployment benefits, aid to states to ensure their Medicare programs don't have shortfalls during these tough times, etc...

by Steve M 2008-12-18 05:08PM | 0 recs
Re: $850 Billion?

Can't wait too long, however.  Maybe passing something the first week of the new Congress may be rushed, but this economy can't wait.

Here in California, work has been stopped on infrastrucure projects due to the ongoing budget crisis.  One huge part of any stimulus package must be to relieve the states of at least part of their budget deficits.  Another legacy of the Bush years has been the increasingly bad state of state and local government finances.

Infrastructure spending can and must play a role (as long as there's no pork), and we're going to need support of the business community to get it through.

I would also like to see some spending cuts.  Pull out Irag, eliminate Bush's faith-based programs, skip the auto bailout.  And perhaps divert the remaining TARP money (if there's any left) back to homeowners.   And passing a health-care plan must be part of the stimulus package.

There's still a lot of doubt and suspicion about
government.  That's where the ad campaign comes in.

by esconded 2008-12-18 05:29PM | 0 recs
I agree

I regret that new members will be put in a tight spot, but the longer we wait before extending unemployment benefits, etc., the worse the recession will get. I keep hearing about local businesses closing and construction projects being postponed, which will put more people out of work.

by desmoinesdem 2008-12-18 06:37PM | 0 recs
Re: $850 Billion?

Well then, you'd better get crakcing and stop fretting over who's giving the prayers at Obama's inaugural, or whether his cabinet choices are 1,000 percent to your liking.

by spirowasright 2008-12-18 05:38PM | 0 recs
Re: $850 Billion?

CT-04 is Fairfield County, Connecticut? That may explain the ambivalence right there.

by Charles Lemos 2008-12-18 05:44PM | 0 recs
Bingo

CT-04 may be the wealthiest Congressional district in America. Is it surprising that voters there would be leery of major government spending, only to be repaid by tax increases in the future?  Remember, these were the folks that launched the Reagan Revolution in the first place. Not the crackers or the Jesus freaks. It was the rich suburbs that gave rise to the tax revolt and the push for small government.

It's likely that many of those voters, who abandoned the GOP because of incompetence and the religious right's takeover of the party, still harbor skepticism about massive government spending programs.

by elrod 2008-12-18 09:01PM | 0 recs
Re: $850 Billion?

Look, it isn't the amount that's put into play, it's where it's put into play.  We've seen, over the last 8 years how much of a failure it is to put money back into the hands of the 'lower' classes while simultaneously putting the bulk back into the hands of the 'upper' classes.  It's time to change that dynamic.  If you were to put $10,000 into the hands of those making under $200,000 per year, and give NOTHING to those making over that amout, you'd see some positive progress.  What I don't understand is why politicians don't see this--actually, I think they fundamentally know this.  The real test will be whether Obama has the balls to say it.

by slynch 2008-12-18 06:56PM | 0 recs
Re: $850 Billion?

Brilliant comment. You're right placement matters more than or at least as much as the amount.

by Charles Lemos 2008-12-18 07:23PM | 0 recs
Re: $850 Billion?

But it will probably take a little longer for the people to get ready for this to happen.

by spirowasright 2008-12-19 07:54AM | 0 recs
Re: $850 Billion?

What I don't understand is why politicians don't see this

Answer lies in a question:

*which "class" do almost all politicians hail from?*

On a separate note: who says politicians don't see this?

by gak 2008-12-20 03:02AM | 0 recs
Re: $850 Billion?
Sorry but we need spending on all the problems that our country suffers.  We have never spent enough money, including the 60's, and we should start doing it now.
That said, it is true that it should not be done right away, but in a couple of months into the new administration.  
by demjim 2008-12-19 06:36AM | 0 recs

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