Tax rebate, food stamp money possible in aid plan

[October 13, 2008]  WASHINGTON (AP) -- After consulting with Barack Obama, Democratic leaders are likely to call Congress back to work after the election in hopes of passing legislation that would include extended jobless benefits, money for food stamps and possibly a tax rebate, officials said Saturday.

The bill's total cost could reach $150 billion, these officials said.

The officials stressed that no final decisions have been made. They spoke on condition of anonymity, saying they did not want to pre-empt a formal announcement. House Democrats have announced plans for an economic forum on Monday "to help Congress develop an economic recovery plan that focuses on creating jobs and strengthening our economy."

Democrats said Obama's campaign has been involved in discussions on a possible stimulus package. The party's presidential candidate, running ahead in the polls, has outlined his own proposals for stimulating the economy.

Democrats are increasingly confident of capturing the White House and increasing their majorities in the House and Senate on Nov. 4.

If they are successful, a lame-duck session of Congress two weeks later would allow them to start work on a response to the credit crunch that has sent stock prices plummeting and also threatens to trigger a deep recession. It often takes two or three months for a new Congress to begin turning out legislation, particularly when a new president is settling into the White House.

On the other hand, by attempting to pass legislation next month, Democrats would have to negotiate with President Bush, whose term runs until Jan. 20, 2009. Additionally, Senate Republicans, with 49 seats, could block any measure they opposed.

House Speaker Nancy Pelosi told reporters in Denver last Wednesday a $150 billion stimulus package is necessary and she may call the House back into session after the election. Her spokesman, Brendan Daly, added, "Congress just worked in a bipartisan way with the Administration to pass an economic rescue plan to help stabilize our financial markets, and we must now work together to pass a jobs creation and economic recovery stimulus package."

In the Senate, Majority Leader Harry Reid of Nevada has announced a post-election session beginning Nov. 17 to consider public lands legislation. His spokesman, Jim Manley, issued a written statement that said "recent developments only reinforce the need for additional action to reinvigorate the economy." He added, "no decisions have yet been made on how to proceed."

An Obama spokesman, Bill Burton, said the campaign is monitoring the situation.

The candidate has said previously he favors $25 billion to help states meet their own needs, another $25 billion for roads, bridges and other infrastructure, and $65 billion for tax rebates paid for by a windfall profits tax on oil.

Speaking in Ohio on Friday, the Illinois Democrat also said, "we should extend expiring unemployment benefits to those Americans who've lost their jobs and can't find new ones."

The House passed a $61 billion economic stimulus bill before lawmakers adjourned for the elections, but it was largely symbolic since Senate Republicans had already thwarted efforts to pass a companion measure.

It called for up to 13 additional weeks of jobless benefits in states with the highest unemployment, at a cost of $6 billion. Another $14.7 billion was ticketed to help states cover Medicaid costs. Enrollment in the federal-state health care program for the poor and disabled often rises with unemployment.

The measure also included money for road and bridge construction, a relatively easy way to create jobs and pump money into the economy.

With that bill's passage blocked, Pelosi then sought to have it added to the financial bailout legislation making its way to Bush's desk, according to officials in both parties. They said the White House signaled it would accept an extension of unemployment benefits, but the speaker refused to allow the stimulus package to be broken up.

As a result, Congress adjourned without providing additional benefits for the unemployed as increasing numbers of people are losing their jobs.

Congress enacted an earlier stimulus legislation with unusual speed last winter. It provided tax rebate checks of $600 to individuals and $1,200 to couples and included tax breaks to businesses investing in new plants and equipment.

[Associated Press; By DAVID ESPO]

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