Bush backs House plan, quick action.
There is bipartisan backing in Congress for an economic stimulus package, but the plan’s size and shape is not clear. The House on Jan. 29 approved a $146-billion stimulus bill, which President Bush supports. But the Senate Finance Committee is developing a competing plan that would go beyond the House’s provisions. Neither the House nor Senate Finance plan has any public-works funds, but industry officials are trying to squeeze infrastructure money into the final legislation.
Senate Finance Chairman Max Baucus (D-Mont.) on Jan. 28 proposed an estimated $155-billion stimulus measure that would extend unemployment insurance benefits for 13 weeks and allow businesses losing money in the economic downturn to write off losses retroactively for as many as five years. “The White House says we mustn’t slow the economic stimulus agreement down or blow it up,” Baucus says. “I agree. We’re going to improve it and get it passed right away.”
The smaller House bill, approved 385-35, includes $100 billion in rebates to taxpayers. Individuals would get up to $600 and married couples as much as $1,200, plus $300 per child for those with children.
It also would increase the amount small companies may “expense” for new capital investments, to $250,000 from $128,000 now. It would allow businesses that buy equipment this year to deduct an additional 50% of the cost of their investments in 2008.
Ken Simonson, the Associated General Contractors’ chief economist, says the House bill would provide “modest benefit” for businesses, but adds, “The best way to provide stimulus and create jobs would be to put some more funding into highways and other public-works investment.”
A group of 22 senators, led by Ron Wyden (D-Ore.), sent a letter to congressional leaders Jan. 29, seeking to add $5 billion for infrastructure projects to the stimulus package. The lawmakers cite an American Association of State Highway and Transportation Officials survey that says 3,027 highway projects in 46 states could have construction contracts awarded within 90 days of receiving such funds. Those projects’ total cost is $17.3 billion.
House Transportation and Infrastructure Committee Chairman James Oberstar (D-Minn.), noting AASHTO’s survey, plans to discuss with his colleagues a possible public-works bill to follow the House-passed stimulus. But he says he does not have assurance from House leaders that such a plan would be adopted.
Nick Yaksich, Association of Equipment Manufacturers’ vice president for global public policy, says the recent National Surface Transportation Policy and Revenue Study Commission report could bolster arguments for infrastructure aid. “The administration may argue about the tax increases that are proposed in the recommendations and how to pay for it, but I don’t think anybody can argue about the need,” he says.