IE 11 is not supported. For an optimal experience visit our site on another browser.

Obama eyes action as parties try to cut stimulus

The passage of economic stimulus legislation on appears to hinge on an agreement in the Senate to changes that would trim the size of the bill now totaling well over $920 billion.
/ Source: The Associated Press

Senate moderates worked to cut tens of billions of dollars from the economic stimulus bill Thursday but fell short of taking a vote on the legislation even as the government spit out grim new jobless figures and President Barack Obama warned of more bad news to come.

"The time for talk is over. The time for action is now," said Obama. He implored lawmakers in both parties to "rise to this moment" and send him legislation to begin fixing the worst economic crisis in decades.

At a retreat Thursday night for House Democrats in Williamsburg, Va., he said Congress can't resort to the same old stalling tactics that often mark Capitol Hill and that voters demanded change when they voted Democrats into power.

He said the plan's scope is right and he reiterated his message that inaction would bring catastrophe. "I don't care if you're driving an SUV or a hybrid, if you're heading for a cliff, you need to change direction," Obama said.

"The American people are watching," Obama said. "They did not send us here to get bogged down with the same old delay and distractions. They did not vote for the false theories of the past. They did not vote for the status quo - they sent us here to bring change, and we owe it to them to act."

Hope for bipartisan support fading
But with the Senate plodding through a fourth day of debate, earlier talk of a large, bipartisan vote for the legislation was fading. Just before 9 p.m. Thursday night, it was announced there would be no vote before Friday.

"As I have explained to people in that group, they cannot hold the president of the United States hostage," said Majority Leader Harry Reid, D-Nev. "If they think they're going to rewrite this bill and Barack Obama is going to walk away from what he is trying to do for the American people, they've got another thought coming."

Republicans countered that neither the president nor Democratic congressional leaders have been willing to seek common ground on the first major bill of the new administration.

"We're not having meaningful negotiations. ... It's a bad way to start," said Sen. John McCain of Arizona, who was Obama's opponent in last fall's presidential campaign.

In an Associated Press interview, he said Obama "gave the Democrats the leeway to basically shut out Republicans starting with the House and now here in the Senate, and I don't think that's good."

McCain's penchant for working across party lines has irritated fellow Republicans in the past, but he was not taking part in bipartisan talks on trimming the stimulus bill.

Nearly 20 senators from both parties met twice during the day and reviewed a list of possible cuts totaling nearly $80 billion. They included elimination of at least $40 billion in aid to the states, which have budget crises of their own, as well as $1.4 billion ticketed for the National Science Foundation.

There was no sign the group of self-appointed compromisers had agreed to support the reductions, but even if they had the numbers were far short of what some were looking for.

"The president made a strong case for a proposal that would be in the neighborhood of $800 billion," said Sen. Susan Collins, R-Maine, who met with Obama at the White House on Wednesday.

The legislation is a blend of federal spending and tax cuts that supporters say can create or preserve at least 3 million jobs. They cite the tax cuts for lower-income workers, as well as more money for jobless benefits, worker training, food stamps, health care, education and public works projects such as highways and mass transit.

Critics contend the bill is bloated with spending for items that won't create jobs, such as smoking prevention programs or efforts to combat a future pandemic flu outbreak.

And while polls show Obama is popular and the public supports recovery legislation, Republicans have maneuvered in the past several days to identify and ridicule relatively small items in the bill.

Whatever the public relations battle, Republicans have tried without success so far to reduce spending in the measure and were ready with additional attempts during the day.

The legislation is a key early test for Obama, who has been in office just two weeks and has made economic recovery his top priority.

His warnings have become increasingly dire, and in remarks to employees at the Department of Energy, he said, "Today, we learned that last week the number of new unemployment claims jumped — jumped to 626,000. Tomorrow, we're expecting another dismal jobs report on top of the 2.6 million jobs that we lost last year. We've lost 500,000 jobs each month for the last two months."

The new jobless claims were reported by the Labor Department, and the total was the highest since October 1982, when the economy was in a steep recession.