Tough talks await House on stimulus bill

WASHINGTON (AP) — Republicans and Democrats offered starkly different assessments of President Barack Obama’s newly renegotiated economic recovery plan Saturday, as the Senate held a rare weekend debate in advance of a key vote on Monday or Tuesday .

Lawmakers are already looking past Senate action to difficult House-Senate negotiations that will test the mettle of a handful of Senate moderates against House Democrats unhappy over more than $100 billion in spending forced from the bill.

Jon Kyl of Arizona, the Senate’s second-ranking Republican, said central elements of Obama’s plan such as the $500 tax cut for most workers would do little to help the economy, just as last year’s $600 rebate checks failed to provide a jolt.

“It was not effective last year,” Kyl said. “There’s nothing to suggest it’s going to be any more effective this year to stimulate the economy.”

Saturday’s debate came a day after a handful of GOP moderates struck a deal with the White House and Democratic leaders following White House Chief of Staff Rahm Emanuel weighing in to urge Democrats make a final round of concessions.

While ensuring passage of Obama’s plan in the Senate within a few days, the deal sets up difficult negotiations with the House. But the Senate GOP moderates votes are crucial to the measure’s success, giving them great leverage going into talks with the House.

Officials put the cost of the bill at $827 billion, including Obama’s signature tax cut of up to $1,000 for working couples. Also included is a tax credit of up to $15,000 for homebuyers and smaller breaks for people buying new cars. Much of the new spending would be for victims of the recession, in the form of unemployment compensation, health care and food stamps.

In a key reduction from the bill that reached the Senate floor earlier in the week, $40 billion would be cut from a “fiscal stabilization fund” for state governments, though $14 billion to boost the maximum for college Pell Grants by $400 to $5,250 would be preserved, as would aid to local school districts for the No Child Left Behind law and special education.

A plan to help the unemployed purchase health insurance would be reduced to a 50 percent subsidy instead of two-thirds.

Senate Majority Leader Harry Reid, D-Nev., who had sought Friday to cut just $63 billion in spending from the bill, throwing a monkey wrench into the talks, called it an imperfect compromise. He warmly praised it nonetheless.