$819bn stimulus bill approved but Obama is snubbed by Republicans

Thursday, January 29: Barack Obama's massive $819bn economic stimulus package, made up of $544bn in public spending and $275bn in tax cuts, won the approval of the House of Representatives on Wednesday night and will now pass to the Senate.

But there will be huge frustration at the White House that the new President's charm offensive with Republican congressmen, which involved Coke and cookies at the White House, and a visit to Capitol Hill, did not pay off: not one Republican voted for the bill.

Obama won't give up on his bid to end the "bitter bi-partisanship" of the George Bush era, but it was a rude awakening. As Jonathan Beale wrote on the BBC website on Wednesday night, "After tonight his promises of a new political era, a spirit of 'we're all in this together', may sound a little hollow."

The Daily Telegraph's Philip Sherwell said it was "a clear snub" for the President. "For a new leader to have invested so much time and effort for zero return is quite a slap in the face."

After the vote, Republican Eric Cantor, the minority whip in the House of Representatives, explained his party's objections - simply, the level of public spending proposed was excessive. It includes $40bn for improving America's crumbling infrastructure, $41bn for education, and billions more for health care and energy efficiency. Controversially, there are also parcels of cash earmarked for combating combating sexually transmitted diseases ($300m) and for funding arts projects ($50m).

Cantor said the emphasis should be on cutting taxes. As Ryan Grim reports on the Huffington Post, Cantor "rejected the Keynesian theory that when private sector investment recedes, the government must step in and be the employer and investor of last resort."

Cantor said: "Keynesian economics doesn't hold a candle to the entrepreneurship that made this economy so prosperous up until the last six months."

The New York Times reckons the near-billion-dollar plan allocates money to the right places and should be supported by both parties. "Republicans' objections are mostly ideological," says the paper in an editorial.
"They worry, in particular, that subsidising health insurance may be a step toward universal coverage. They may be right. But that is an argument for another day."

From the right, the talk radio host Rush Limbaugh says: "This 'porkulus' bill is designed to repair the Democratic Party's power losses from the 1990s forward, and to cement the party's majority power for decades."

Writing for the Wall Street Journal, Limbaugh goes on: "Since the American people are not certain that the Obama stimulus plan is the way to go, it seems to me there's an opportunity for genuine compromise." If Obama were to consider ideas proposed by conservative economists, there would be a real opportunity to unite American members of the public and politicians. "Where is the bipartisanship, Mr Obama?... Let's stop the acrimony. Let's start solving our problems, together."

The bill now goes to the Senate, where the debate is expected to start as early as Monday.

FIRST POSTED JANUARY 29, 2009