Contrary to the impression you might have after watching Sunday's TV interview shows, an economic stimulus package will be approved with bipartisan support around the middle of February.
Sen. John McCain, the 2008 Republican presidential nominee, and Rep. John Boehner, the Republican House Leader, both declared Sunday that they could not vote for the $825 billion package as now constituted. President Obama will go to the Hill early this week to meet with Republican legislators and solicit their support. But all of this, be assured, is so much bargaining before a grand bargain is made.
The GOP leaders have a point. House Democrats are clearing a bill that contains spending not contained in the original Obama stimulus proposal — and some if it is not directly related to stimulus. Money for family planning and education aid, for example, may be meritorious, but it has nothing to do with jump starting the economy and creating jobs. Republicans also differ with Democrats about the form of low- and middle-income tax relief in the plan, although agreeing that such relief is necessary.
Republicans will have more leverage in the Senate, where 60 votes will be necessary to end debate and bring a plan to a full Senate vote. The Senate Finance Committee, Democrats and Republicans alike, also is likely to view skeptically some of the spending contained in the House version of the plan. But Sen. Mitch McConnell, the Senate Republican leader, said unequivocally Sunday that a bipartisan plan will pass.
The new Obama administration is likely to have tougher going in structuring and gaining congressional acceptance of the second phase of its financial-bailout plan, still being defined, especially among congressional Democrats who thought the first phase gave too much money unconditionally to financial institutions seeking it. Over the weekend Obama announced that he would make proposals shortly for greater oversight of financial markets, banks, and related institutions.
Hang in there. The economic and financial proposals now evolving involve huge amounts of capital and, in some cases, represent fundamental shifts in the way our system has worked. There will be some harsh partisan rhetoric along the way. But, in the weeks ahead, there will be more bad news on unemployment and corporate earnings and, likely, new bank and business failures. Both the administration and congressional leaders of both parties will be under the gun to reach agreement on plans not necessarily pleasing to either liberals or conservatives. That is what will happen. Then we shall see if the plans work.
