HOUSE STEPS UP WITH STIMULUS PLAN…. Democrats on the Hill began circulating the House version of a proposed stimulus plan this morning. It’s an $825 billion package, with $550 billion in new spending and $275 billion in tax cuts.
The package, developed by Congressional Democrats in partnership with President-elect Barack Obama, includes huge increases in federal spending on education, aid to states for Medicaid costs, temporary increases in unemployment benefits and a vast array of public works projects to create jobs. […]
Some of the largest components include $87 billion for a temporary increase in aid to states for Medicaid costs; $79 billion in aid to local school districts and public colleges to prevent cutbacks; $90 billion in infrastructure spending, and $54 billion to encourage the production of energy from renewable sources. […]
Under the plan, individuals would receive up to $500 and families up to $1,000 through a cut in payroll taxes on the first $8,100 in income. The money would be delivered through paychecks as a reduction in Social Security withholdings, and is intended to boost consumer spending by giving a small lift to household pocketbooks.
The draft bill is making the rounds and has been posted online, but note that the plan includes $90 billion in infrastructure spending, $79 billion to prevent education cuts at the state and local levels, and $54 billion on energy. Moreover, House Democrats would invest $43 billion in extended jobless benefits and retraining; $39 billion to help the unemployed keep their health coverage; and $20 billion for a temporary increase in food stamps — which, not incidentally, offers an amazing bang-for-the-buck in terms of stimulus. (The funding for freight rail seems to have been overlooked.)
Speaker Pelosi conceded that the plan from House Democrats is “the first step in the process.” Quite right. The package will be referred to committee, while the Senate develops its own plan. The NYT noted that “intense haggling and fierce lobbying are expected over the next few weeks, not just between Democrats and Republicans but between the new administration and Congress, as lawmakers push to pass the stimulus bill by mid-February.”