Second Stimulus Package: Dead on Arrival

On Friday Reuters reported what many had expected, the second economic stimulus package had failed the Senate.

The 52-42 vote fell short of the 60 votes needed in the 100-member Senate for Democrats to clear a Republican procedural hurdle and move toward passage of the bill, which backers said would give the ailing U.S. economy a needed boost.

Although according to the Associated Press, we probably should have seen this coming:

With most Republicans opposed, however, the Reid-Byrd stimulus plan measure is likely to stall. Democrats are then likely to hold the vote against Republicans in the campaign for control of Congress.

And rightfully so, because blocking the measures that would be taken in this stimulus package is deplorable:

The Senate stimulus measure provides $6 billion to extend unemployment benefits by seven weeks in all states and by 13 weeks in states with high jobless rates. It also contains almost $20 billion to increase federal payments to states for the Medicaid health care program for the poor and disabled. ...the House stimulus measure will be more focused on producing jobs, including $25 billion for infrastructure projects like building new roads and repairing bridges.

Republicans did what they do best, blocked meaningful legislation that would have done wonders for the people on "main street" who they are supposedly working hard for. Instead of thousands of new jobs and the prevention of cuts to critical services, we have nothing. Excellent job Congressional Republicans, you have my vote.

So why did Republicans vote against the bill?

Republicans said they did not have time to review the spending measures properly

Well I can see how that would be difficult amidst an economic crisis that they and President Bush helped to create.

Now lets take a look at the "people of Main Street" that Congressional Republicans decided to leave behind.

In California, according to Capitol Weekly:

An estimated 10,000 state workers who lost their jobs during the fight over the 2008-09 budget are likely to be without state work until next June, although the heads of state agencies have been told privately they will have leeway over rehiring some workers.

The laid-off temporary workers, who include retired annuitants and seasonal workers, lost their jobs following Republican Gov. Arnold Schwarzenegger's July 31 executive order.

In Maryland, according to the Washington Post:

Maryland Gov. Martin O'Malley announced yesterday that he has asked state agencies to identify hundreds of millions of dollars in spending cuts, as much as 5 percent of state government expenditures, to balance the budget as major revenue sources decline in the sour economy.

O'Malley (D) predicted an "extraordinarily difficult budget next year" if his administration does not start to pare spending during the current fiscal year. "While these cuts will not be easy, it is clear that the economic crisis our nation is experiencing will have a dramatic impact on next year's budget," he said in a statement.

In Colorado, according to the Denver Post:

Days after discounting an economic forecast that predicted a $100 million shortfall in the current year's state budget, Gov. Bill Ritter on Thursday announced a partial hiring freeze for state employees and other steps to cut spending.

"These are uncertain times, to say the least," Ritter told reporters at a news conference in which he announced the moves, which also include delaying construction projects on college campuses and for full-day kindergarten.

"We must take steps now to ensure we have options should state revenues begin to dramatically decline," he said.

And finally in Utah, according to the Salk Lake City Tribune:

The Utah Department of Health proposed achieving its 3 percent reduction mainly through a $10 million cut in Medicaid, triggering a $23 million loss in matching federal funds.

Some optional programs such as vision care, physical therapy, and speech and hearing would disappear, and an average 2 percent increase in provider inflation, which took effect in July, would be rolled back.

Qualifying for help also could become tougher. Pregnant women, except for those who are high risk, would see the amount of assets they can have drop to $3,000 from $5,000.

The attempts by Congressional Republicans to make a second economic stimulus package work were mediocre at best, and frankly embarrassing and insulting to those who would have benefited from a second stimulus package done the right way.

So what did we learn about Republicans from this mess? Bailing out Wall Street is always critical, providing aid to the states rarely is. Debating the proper levels of compensation packages for CEOs always takes precedence over debating Medicaid funding and extending unemployment benefits. And most importantly, Republicans talk a tough game about the economy and helping the average American, but rarely put their money where their mouth is.



Display:


Re: Second Stimulus Package: Dead on Arrival (none / 0)

The longer this goes on, the more folks are going to look at McCain parchuting in as a political ploy, and Obama as the guy that can get things working again.

NO ONE likes this deal a whole lot, but if Wall Street doesn't see something soon, the bottom will fall out of the market, and soon enough, we will start seeing bank runs.

This is NOT the kind of chaos that will help McCain.


Support the separation of Church and State: Vote YES on WA R-71!
by WashStateBlue on Mon Sep 29, 2008 at 11:26:39 AM EST

Re: Second Stimulus Package: Dead on Arrival (none / 0)

The market is too high, it needs to fall to a less bubble-high level. Spending $700 Billion to resist the inevitable, if that is one of the public-oriented purposes of the bailout, is very very wasteful of tax dollars.


We can no longer afford to worship the god of hate or bow before the altar of retaliation. Martin Luther King Jr.
by fairleft on Mon Sep 29, 2008 at 12:09:44 PM EST
[ Parent ]

Re: Second Stimulus Package: Dead on Arrival (none / 0)

As much as I hate to see the market fall (I am closer to retirement then most, so my 401K is a horror show these days) I really could give a rip about it.

But I am in the business world, in maybe one of the view good areas for US High Tech manufacturing?

My company, becuase of what we make carries a very expensive inventory?  

We NEED credit. If the banks tighten up, we are screwed.

There are THOUSANDS of small business like us.

None of us are fat cats, but if we get creamed, there goes tax revenues up the ying-yang!

I think a lot of people here who are screaming at this deal are ONLY thinking of the consequences to the fat cats, etc.

If short term credit goes away in this country YOU ARE looking at the Great Depression part duex!


Support the separation of Church and State: Vote YES on WA R-71!
by WashStateBlue on Mon Sep 29, 2008 at 12:29:54 PM EST
[ Parent ]

Re: Second Stimulus Package: Dead on Arrival (none / 0)

Credit will be tight but that won't change with the bailout, lenders are simply being more cautious as the recession emerges. But there will be credit and you'll get yours; the idea of a complete credit freeze is a scare story the bankers are using to get their billions. I wrote a diary on this today largely consisting of Dean Baker quotes:

The basic argument for the bailout is that the banks are filled with so much bad debt that the banks can't trust each other to repay loans. This creates a situation in which the system of payments breaks down. . . .

That is a very frightening scenario, but this is not where things end. The Federal Reserve Board would surely step in and take over the major money center banks so that the system of payments would begin functioning again. The Fed was prepared to take over the major banks back in the 80s when bad debt to developing countries threatened to make them insolvent. It is inconceivable that it has not made similar preparations in the current crisis. . . .

There has been a mountain of scare stories and misinformation circulated to push the bailout. Yes, banks have tightened credit. Yes, we are in a recession. But the problem is not a freeze up of the banking system. The problem is the collapse of an $8 trillion housing bubble. . . .

http://www.mydd.com/story/2008/9/29/1152 17/821


We can no longer afford to worship the god of hate or bow before the altar of retaliation. Martin Luther King Jr.
by fairleft on Mon Sep 29, 2008 at 12:37:21 PM EST
[ Parent ]

Re: Second Stimulus Package: Dead on Arrival (none / 0)

Well, I sure hope you are right.

If my company gets screwed, it really is punishing in the innocent.

We sell about 50% of our products overseas, we are actually HELPING the trade deficit.

I read the Dean Baker quote, as well as some posts on Kos.

I'm praying you folks are right, but I am scared anyway.

Not for my mortgage, but for the industrial ramifications of bank issues.


Support the separation of Church and State: Vote YES on WA R-71!
by WashStateBlue on Mon Sep 29, 2008 at 12:44:44 PM EST
[ Parent ]

Re: Second Stimulus Package: Dead on Arrival (none / 0)

The banks are in bad shape -- their bad, vastly over-leveraged assets are enormous, far beyond $700 billion in value -- and the Fed will nationalize them if necessary to make credit available. I think that's Baker's point.


We can no longer afford to worship the god of hate or bow before the altar of retaliation. Martin Luther King Jr.
by fairleft on Mon Sep 29, 2008 at 12:59:01 PM EST
[ Parent ]

This bill is an insult to Americans.. (none / 0)

Most people don't realize how this happened..

Listen to the radio show in my .sig.

This was brewing for years.. Nobody should be surprised. They knew what they were doing. We should not bail them out. Lets help legitimate businesses some other way. We CAN do it.

This is a bad bill, and it wont do what they say it will. Its a scam.


public option=not affordable for middle. It cant cover all affordably, google adverse selection for why
by architek on Mon Sep 29, 2008 at 04:17:43 PM EST
[ Parent ]

I was talking about the Bailout.. (none / 0)

Thats the bad bill.. sorry to be muddled..

200-1 is a pretty big ratio, lets hope they listen.


public option=not affordable for middle. It cant cover all affordably, google adverse selection for why
by architek on Mon Sep 29, 2008 at 04:19:59 PM EST
[ Parent ]

Hang on now (2.00 / 1)

It's not a "Republican procedural hurdle," it's a "Senate Majority Leader Reid procedural hurdle."  Reid assumes that Republicans are going to filibuster every Democrat-sponsored vote they possibly can and simply causes the bill to fail if they don't reach that mark.  

I'm very sorry if Republican filibusting is inconvenient to you, Harry, but making the Republicans actually filibuster and make a display of obstructionism so that the voters can see is the entire point.  

The ironic thing is that this is Reid's own bill; if he really thought it was important to get stimulus money out there, he'd say "no" to free filibusters.


You can't stop the signal.

President "That One"

by Dracomicron on Mon Sep 29, 2008 at 11:35:14 AM EST

I think there are a couple issues here... (none / 0)

...one is the assumed filibuster.

However, the second one is that if the leadership wants to get it passed, there should be a majority of the Republican caucus should be casting "yea" votes.  By even bringing it up for consideration the Democratic leadership is owning it.  So the thought of Reid and the leadership is that the Republicans need to own it as well because of the 200-1 negative to positive call ratio.  If this is not bipartisan, there will be a political crisis to go along with the economic crisis.  If you can't show a large vote margin, the public isn't going to buy it.  


I wonder why everyone in the blogosphere feels the need to measure his or her Sebelius.
by AZphilosopher on Mon Sep 29, 2008 at 12:15:33 PM EST
[ Parent ]

Sure (none / 0)

Thing is, this is basically the Republicans blocking a tax rebate; if ever there was something to force an actual filibuster on, it's this.  Let Coburn stand up on C-SPAN and explain for hours why average Americans shouldn't get their money to spend the way they see fit.  See how well that works.  

If Reid really wanted this, he'd have pulled the plug on auto-filibusters.


You can't stop the signal.

President "That One"

by Dracomicron on Mon Sep 29, 2008 at 12:22:33 PM EST
[ Parent ]

However... (none / 0)

...the Wall Street component is so noxious that it needs majority Republican support partially because people need to see both parties.

Republicans get a twofer here.  They get to oppose "wasteful spending" (the point you rightly point out one would want a filibuster over).  However they also get to play the populist card (the part that has 200-1 opposition among constiuents).  While we may like the first part, the second part is going to require Republican support for both political and good government reasons.  So about all one can do is to point out Republicans are blocking and try to shame some into switching over.  


I wonder why everyone in the blogosphere feels the need to measure his or her Sebelius.
by AZphilosopher on Mon Sep 29, 2008 at 12:36:51 PM EST
[ Parent ]

Re: However... (none / 0)

I think you two are talking about different bills. Does the stimulus package have a wall street component?


We can no longer afford to worship the god of hate or bow before the altar of retaliation. Martin Luther King Jr.
by fairleft on Mon Sep 29, 2008 at 12:38:36 PM EST
[ Parent ]

Yeah (2.00 / 1)

I think AZ is talking about the bailout, which is the OTHER thing going on.


You can't stop the signal.

President "That One"

by Dracomicron on Mon Sep 29, 2008 at 12:51:46 PM EST
[ Parent ]

Oops (none / 0)

I just assumed they were folded into one huge omnibus bill since that is usually standard operating procedure for Congress.

Apologies.  I do agree with the approach on the stimulus as long as it's a different piece of legislation.


I wonder why everyone in the blogosphere feels the need to measure his or her Sebelius.
by AZphilosopher on Mon Sep 29, 2008 at 01:59:35 PM EST
[ Parent ]

They're being pretty careful (none / 0)

They don't want to contribute to Congress's negative numbers by tacking on all sorts of unrelated riders to the bailout.  It's just too big.


You can't stop the signal.

President "That One"

by Dracomicron on Mon Sep 29, 2008 at 02:31:07 PM EST
[ Parent ]

I think... (none / 0)

...they may have to fold in the stimulus as the "sweetner" to the public.  Apparently it is not too popular.


I wonder why everyone in the blogosphere feels the need to measure his or her Sebelius.
by AZphilosopher on Mon Sep 29, 2008 at 02:37:58 PM EST
[ Parent ]

Republics are such frickin hypocrites... (none / 0)

NOW that Bush is below the Mendoza line in the polls and is the lamiest of lame ducks, all of a sudden the house Republics found their Cajones (must have used a magnifying glass.)

Where were this fiscal conservative bunch while Bush ran up more deficits then all the previous Presidents combined!


Support the separation of Church and State: Vote YES on WA R-71!
by WashStateBlue on Mon Sep 29, 2008 at 12:03:10 PM EST


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