Rebate Miscalculation?

Altered stimulus bill draws fire

By Kaye A. Thomas
Posted January 30, 2008

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Schedule D made easy

Baucus defends changes; Reid ralphs.

For a while it seemed almost too easy, as the economic stimulus package rapidly took shape in the House of Representatives where it passed yesterday with an overwhelming vote. Now comes Max Baucus, D-Mont, chairman of the Senate Finance Committee, to offer an altered version. His offering is not a minor tweak: it contains provisions that could be deal breakers, some opposed by Republicans and others opposed by Democrats.

In the House of Representatives you might have thought the building was on fire. Democrats and Republicans set aside partisan bickering in negotiations over an economic stimulus package and quickly got down to the serious business of figuring out what it would take to get the deal done. Both sides made significant concessions, recognizing that swift action wouldn't be possible if they held out for a law that worked the way they would prefer. The endless jockeying for political advantage, the constant berating of the opposition, the back and forth of accusations and recriminations, were nowhere to be seen. For a few days, at least, our leaders acted the way we wish they would act all the time. House members fell in line, passing the bill with opposition from fewer than 10% of the Members.

Senate leaders were not included in the negotiations that led to the House bill, though, and Baucus isn't prepared to rubber stamp the agreement hammered out in those talks. His version is more generous in some ways, notably providing "rebate" checks to senior citizens who don't pay income tax. (In the House version, you don't receive a check unless you either pay income tax or have at least $3,000 of earned income.) Other features of his proposal seem likely to stir strong opposition from both parties:

  • It would add extended unemployment benefits, a provision Republicans don't like.
  • It would remove the income limitation, so rebate checks would go to high-income individuals. Senate Majority Leader Harry Reid, D-Nev, was blunt: "To take out the caps causes me to want to gag."

There's also a concern that the Baucus proposal would boost the budget deficit much more than the House bill.

Apart from Reid's ralphing, reaction has been cautious but quizzical. One can hardly suggest that the chairman of the Senate Finance Committee has to go along with legislation agreed by House leaders. There's a sense, though, that Baucus didn't get the memo. If he insists on pushing a bill that neither side likes, the bipartisan agreement for swift action may fall apart.

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