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Jan 29, 2008
Senate Democrats plan add-ons to S$214.8b stimulus package
Senator Mitch McConnell of Kentucky, the Senate Republican minority leader, urged senators to refrain from trying to swell the size of the package. -- PHOTO: AP
WASHINGTON - A TOP Senate Democrat unveiled a US$156 billion (S$214.8 billion) economic stimulus package that awards rebates to senior citizens living off Social Security pension payments and extends unemployment benefits, setting up a clash with President George W. Bush and House leaders pushing a narrower package.

As the House planned a vote on Tuesday on a plan that would speed rebates of up to US$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 Mr Baucus, a Montana Democrat. '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, a Nevada Democrat.

President Bush, in his State of the Union address to Congress 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 US$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 Democratic House Speaker Nancy Pelosi of California and Republican Minority Leader John A. Boehner of Ohio, cut the deal with Treasury Secretary Henry M. Paulson last week - were eager to put their stamp on the high-profile package.

Senator Mitch McConnell of Kentucky, the Senate Republican 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,' Mr 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 recognise that the White House needs to negotiate with the Senate as well as the House,' said Senator Susan M. Collins, a Maine Republican, who backs both the rebates for seniors and the unemployment extension.

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 Mr Baucus to reduce the size of the rebate to US$500 for individuals and US$1,000 for couples, instead of the US$600-US$1,200 rebate plan agreed to by President Bush and House leaders. People would still receive an extra US$300 per child.

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

President 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 labour 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, an advocacy group for senior citizens.

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.'' -- AP

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