Obama stimulus faces battle
12 Feb 2009
Although a version of US President Barack Obama's economic stimulus plan, has now been passed by both houses in Congress, the package still faces a battle before it can be signed into law by the president.
The version of the bill passed by the Senate differs substantially from that passed by the Democrat-dominated House of Representatives, and the differences will have to be reconciled.
The bill passed by the House backs measures traditionally associated with Democrat values, including additional spending on education, labour and health. But the Senate version now passed gives less money to the federal and state government and more for defence and security.
The version approved by Senators is also heavier on tax relief.
The bill will now go to a joint committee to reconcile the differences, with Republican senators unlikely to be willing to give up the concessions they have won in negotiation.
Obama heard news of the Senate's approval while speaking about the economy in Florida. He said, "This is good news. . . We have a little more work to do over the next few days, but it's a good start." The White House has been repeatedly stressing the importance of passing the bill in recent days.
Since the recession began in 2007 around 3.6 million Americans have lost their jobs – what President Obama's press secretary Robert Gibbs described as "the biggest 13-month change in employment since 1939".
Gibbs added, "The president believes that we are facing dire consequences; that our failure to act will likely result in, as he has said numerous times this week, economic catastrophe."
The lack of true bi-partisan support will come as a disappointment. No Republicans voted yes in the House of Representatives. But the fact it has passed means Obama could be on course to sign off on the bill by President's Day next Monday, as he is strongly hoping to do.
Yesterday's move in the Senate came as steps by the Treasury and Federal Reserve bumped the combined cost of measures to revive the economy and free-up the money markets to over $3 trillion.
Treasury secretary Timothy Geithner said an "aggressive" policy on two fronts was needed to pull the US out of "the worst economic crisis for generations". He said financial policy needed to be comprehensive and forceful as he outlined a changed bank bail-out plan.
He said the strategy would be expensive and would involve risk, but the alternative cost of a complete collapse of the financial system would be "incalculable".
"We have to both jump start job creation and private investment and we must get credit flowing again to businesses and families," Geitner said.
