Senate stimulus bill advances in narrow win

President Obama’s economic recovery plan cleared a crucial hurdle in the Senate on Monday as Democrats and a handful of Republicans voted to end debate, opening the way for final approval of the administration’s first big policy initiative.

The 61-36 vote came on a day that Obama took his sales pitch for the $827-billion stimulus package directly to the American public, holding a campaign-style event in Indiana and the first prime-time news conference of his presidency.

The Senate vote sets the stage for key negotiations this week to reconcile major differences between the House and Senate versions of the stimulus plan. Though the two versions carry similar price tags, they differ significantly on their underlying strategies for pulling the economy out of its potentially disastrous tailspin.

In a concession to the handful of Republican moderates and conservative Democrats whose support was crucial for avoiding a GOP filibuster, the Senate bill relies heavily on tax cuts -- a traditional Republican approach. The $819-billion House version focuses more money on federal aid, including helping states maintain health and education programs, renovating local schools, and saving energy through home weatherization and other programs.

Despite such concessions by Senate Democrats, only three Republicans joined 58 Democrats in Monday’s vote to end debate, a procedural decision that requires a 60-vote majority. The bill can now pass today by a simple majority vote.

Still, the victors claimed the accomplishment reached across party lines.

“I am proud of the bipartisan work we have done during the last few days,” said Sen. Susan Collins (R-Maine). “As with any legislation, it still is not perfect. But it can go a long way to creating jobs and addressing the dire economic crisis facing our nation.”

Collins was a principal architect in the defection of three GOP moderates -- herself; her fellow senator from Maine, Olympia J. Snowe; and Pennsylvania’s Arlen Specter. They agreed to support the bill after more than $100 billion in spending was stripped from the package late last week, though much of that was added back by Senate amendments.

Before the vote late Monday, Senate Majority Leader Harry Reid (D-Nev.) warned of political consequences for failing to support the president’s bill.

“Recovery will take time,” Reid said. “The American people understand that. They have patience for the long road that lies ahead. But they do not have patience for a Congress that points fingers, drags its feet or fails to act.”

Republicans spent much of the day before the vote bashing the package on the Senate floor and lamenting that a few of their own had broken ranks to join with the opposite party.

“Should it pass this week, no one should be fooled to think it was done in a bipartisan way,” said Sen. James M. Inhofe (R-Okla.).

Another Republican, Sen. Judd Gregg (R-N.H.), did not vote on the bill, because he is Obama’s choice for Commerce secretary.

The House and Senate bills are similar enough that Democratic leaders still hope to meet their self-imposed deadline of sending the bill to the White House by the weekend.

Both bills propose income-tax credits to boost consumer spending, tax breaks for businesses to promote job creation, expanded benefits for the unemployed and billions in government spending on highway construction and other infrastructure projects.

The House and Senate measures have similar price tags but allocate the funding differently. Those differences provide a window into issues that may slow the bill’s progress, and they spotlight the important concessions that senators made to the GOP.

“There are some changes that were made that the House didn’t believe were good policy,” said House Majority Whip Steny H. Hoyer (D-Md.) in an interview. “We will be in discussions with the Senate about possible compromises.”

House and Senate Democrats have informally been preparing for negotiations on final terms. Key staffers met through the weekend to prepare for the talks.

The overarching political concern for negotiators will be to resolve such differences in a way that does not alienate Collins, Snowe and Specter. Those three could still hold up a final bill in the Senate.

Aid to states will be a particularly thorny issue between House and Senate negotiators. Critics of the state aid -- set at $79 billion in the House bill and $39 billion in the Senate bill -- say the federal government should not be in the business of bailing out states that could do more to cut their own spending.

But state officials are struggling to find a way to cope with dwindling tax revenue, which threatens to force layoffs and service cuts in education and health programs.

Responding to reports that the state aid portion of the Senate bill had been cut, H.D. Palmer, spokesman for the California Department of Finance, said: “That’s why the good Lord invented conference committees.”

The Senate bill also stripped out $19.5 billion that the House provided to build and repair school and college buildings. Critics said such projects were state and local responsibilities, but proponents argued that they were part of a job-creation engine that would contribute to the long-term strength of the economy.

The Senate included $70 billion to keep 20 million taxpayers from paying more under the alternative minimum tax. The House did not include that pricey provision, but Obama has endorsed the provision and the House is expected to accept it.

The Senate also added tax credits for people who buy homes and new cars. But the House bill goes further in provisions extending Medicaid and private health insurance coverage for unemployed people.

There are signs that, as a political matter, time is working against Obama. Polls indicate that the more people learn about the plan, the more they dislike it.

A poll by the Pew Research Center for the People and the Press found that 51% of those who had heard about the plan said it was a good idea, while 34% were disapproving.

In January, 57% were positive and 22% viewed the bill negatively.

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janet.hook@latimes.com

joliphant@tribune.com

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