Baucus Proposes His Own Stimulus Plan

By Beacon Staff

WASHINGTON (AP) – A top Senate Democrat unveiled a $156 billion economic stimulus package Monday that awards rebates to senior citizens living off Social Security and extends unemployment benefits, setting up a clash with the White House and House leaders pushing a narrower package.

As the House planned a vote Tuesday on a plan that would speed rebates of up to $600 to most income earners — more for couples and families with children — Senate Finance Committee Chairman Max Baucus scheduled a Wednesday vote on a bill with the add-ons, which would send rebates even to the wealthiest taxpayers.

“My proposal will give America’s seniors the same rebate as any wage earner,” said Baucus, D-Mont. “The White House says we mustn’t slow the economic stimulus agreement down, or blow it up. I agree. We’re going to improve it and get it passed right away.”

The move was in defiance of admonitions from the Bush administration not to risk derailing the deal with changes, and it threatened to slow what was shaping up as an extraordinarily rapid trip through Congress for the stimulus measure. The Senate hopes to pass its version by week’s end.

“I strongly support Chairman Baucus’ efforts to garner bipartisan support to improve the House agreement, and I intend to take legislation to the floor as quickly as possible to strengthen the economy,” said Majority Leader Harry Reid, D-Nev.

President Bush, in his State of the Union address Monday night, warned lawmakers not to give in to the temptation to “load up the bill.”

“That would delay it or derail it, and neither option is acceptable,” the president said. “This is a good agreement that will keep our economy growing and our people working.”

The president and House leaders agreed last week on a proposal to provide rebates to 117 million families and to give businesses $50 billion in incentives to invest in new plants and equipment. The goal is to help head off a recession and boost consumer confidence.

Senate Republicans and Democrats — kept on the sidelines as House Speaker Nancy Pelosi, D-Calif., and Minority Leader John A. Boehner, R-Ohio, cut the deal with Treasury Secretary Henry M. Paulson last week — were eager to put their stamp on the high-profile package.

Sen. Mitch McConnell, R-Ky., the minority leader, urged senators to refrain from trying to swell the size of the package.

“A number of senators have expressed a desire to add tens of billions of dollars in spending on contentious programs to this package, but we don’t have the time for ideological debates. In order for this plan to work, Congress needs to act, and act at once,” McConnell said.

Republicans, though, were among those calling for additions to the plan.

“Many of these additions have bipartisan support, and I hope that the president will recognize that the White House needs to negotiate with the Senate as well as the House,” said Sen. Susan M. Collins, R-Maine, who backs both the rebates for seniors and the unemployment extension.

Sen. Olympia J. Snowe, R-Maine, a Finance Committee member, called the unemployment extension “critical” and said she supported ensuring that the rebates reached the elderly.

Adding rebates for senior citizens living solely off Social Security checks — who are ineligible under the plan hatched by House leaders and the White House — caused Baucus to reduce the size of the rebate to $500 for individuals and $1,000 for couples, instead of the $600-$1,200 rebate plan agreed to by Bush and House leaders. People would still receive an extra $300 per child.

In another key difference, Baucus’ plan would send rebates to all Americans with earned income of $3,000 or more, while the House plan gives only partial rebates to individuals with adjusted gross incomes of more than $75,000 and couples with incomes in excess of $150,000, and no rebate at all to the wealthiest taxpayers.

Bush was pushing for Congress to move quickly on the agreement without additions.

“The president is concerned about efforts that would delay or derail the bipartisan package that was negotiated with House leaders,” White House spokesman Tony Fratto said. “The Senate is threatening to create partisan conflict by trying to put in additional programs.”

Still, pressure from the elderly and labor unions — both politically potent forces — spurred senators from both parties to call for the extras.

The House plan leaves out some 20 million seniors, according to the AARP.

The Senate measure includes a 13-week extension of unemployment payments for those whose benefits have run out, and a 26-week extension in states where the jobless rate exceeds 6 percent.

Including seniors who don’t pay taxes “is a good step,” said David Certner, AARP’s legislative director. He said senators were responding to a flood of elderly people who have contacted lawmakers about the stimulus plan and asked, “‘Why aren’t seniors part of this rebate package? We’re hurting. We spend money.'”

The Senate measure also restores a business tax break dropped from the House bill that would permit corporations suffering losses now to reclaim taxes previously paid.

“This is a package in sync with the House bill but stronger and broader,” said Sen. Charles E. Schumer, D-N.Y. “We hope and expect it will get bipartisan support.”

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