According to Senate Democrats, Obama team making significant changes to package

[Thrill]

President-elect Barack Obama tried Sunday to shore up support in Congress for his ambitious economic policies, with his top advisers offering concessions on his economic-stimulus proposal and preparing to detail conditions for how the incoming administration will spend the second half of the $700 billion financial rescue package.

Emerging from a two-hour meeting in the Capitol with Obama advisers Lawrence Summers and Jason Furman, Senate Democrats praised the President-elect's team for agreeing to make changes to its stimulus proposal based off of concerns senators raised last week at a meeting with the president-elect’s senior aides.

The Obama team told about 35 Senate Democrats gathered at Sunday’s meeting that it would grow the size of an energy-tax incentive package and modify proposed tax credits for individuals and for businesses that hire new employees, according to meeting attendees. Also, with lawmakers raising concerns that the first half of the $700 billion of the financial rescue law was badly mismanaged, Obama’s team signaled it would lay out precisely how it would spend the second half of that package, which Congress is expected to consider as soon as this week.

“It’s very clear they’ve listened, they’ve heard and that they’re moving to respond,” said Sen. Kent Conrad, chairman of the Budget Committee, who questioned previously whether the tax credits in the stimulus package were enough to encourage new jobs. “It was very, very healthy. They’re not defensive, not arguing back, they’re listening, they’re attempting to hear and they’re responding.”

“I’m not frustrated at all,” said Sen. John F. Kerry (D-Mass.), a member of the Finance Committee who last week criticized Obama’s initial proposal to give companies a $3,000 tax credit for new hires. “I think they’re moving effectively to the issues that we raised the other day, and there are significant changes put in place and being contemplated in the next hours, they’ll be making some judgments with respect to a lot of that.”

Sens. Barbara Boxer (D-Calif.) and Maria Cantwell (D-Wash.) both said that Obama’s team signaled that their new proposal would double the funds dedicated to energy tax credits, to at least $20 billion.

“They’re moving in our direction,” Boxer said, adding that the Obama team assured Democrats that the money given to state governments would reach cities and counties suffering from budget shortfalls.

http://www.politico.com/news/stories/0109/17335_Page2.html

[EconomicLiberal]

1. It appears that the Senate will have to pull Obama to the left his entire term.

Imagine if the Senate gave Obama a blank check to do whatever he wanted with this stimulus bill? The bill would probably be festooned with tax cuts, in the interest of bi-partistanship...

[bigdarryl]

3. thats a receipt for DISASTER!!!!

[Thrill]

4. Or maybe this was his plan the whole time

One of the Reporters from the WP was on XM Radio POTUS saying that he thought Obama wanted the reaction from Dems. Because he thought it was interesting Ron Wyden, Jon Kerry, and Conrad spoke out like they did, almost together. Said Wyden is one of Obama's closest friends in the Senate, Kerry was his biggest supporter in the campaign, and Conrad was the first Senator to support Obama. He thinks it was coordinated.

[camera obscura]

11. Digby said something similar -

http://digbysblog.blogspot.com/2009/01/kabuki-alert-by-digby-considering-his.html

"Considering his strong support of Obama during the primaries, many people wondered what John Kerry's role was going to be since he was passed over for a cabinet position. I think today we saw that he's going to be lead liberal kabuki dancer in the revival the Democratic musical comedy called "How To Succeed In the Village Without Really Trying."

And this actually may be good news. It seems very unlikely to me that Kerry is acting out of school, but is rather playing the role of the liberal stimulus spending obsessive who will (hopefully) balance out the tax cut fetishists in the senate negotiations, giving Obama some space to compromise at least somewhere to the left of The Club For Growth. (Unfortunately, that still leaves us with the Blue Dog deficit hawks, but maybe Rahm has pictures or something.)"

[karynnj]

20. That is interesting

I had forgotten - or never known - that Conrad endorsed Obama in December 2007 - second to Durbin. That is interesting as he chairs the Budget committee and Kerry and Wyden are the two more liberal members of the Finance committee.

It might have been coordinated - or it simply may have been the Senate Democrats saying the plan was too timid and pushing the changes. If you go back to their "complaints" last week, they were constructive complaints. Kerry's and Wyden's statements stressed that infrastructure spending works best - something Obama himself agreed with. Conrad criticized one proposed tax break that he thought was ineffective and poorly designed.

I think that rather than coordinated, this represents a return to normal government. I think it is not the relationship of this Senate and the new President that is out of the norm - but the sick relationship between the vindictive nasty Bush administration and the lockstep Republicans that was out of sync. All three of the Democrats mentioned here are on committees that have the responsibility on the stimulus package.

In fact, in December 2007, they changed the package that Bush gave them significantly. They argued the Bush plan, which was mainly sending checks would be ineffective. One major part of their alternative package was a Kerry/Smith provision that would have given states money to facilitate moving people out of loans nearing foreclosure into loans they could carry. This was when the failure rate was starting its incredible rise. That provision passed the Finance committee with 20 votes from teh 21 members. The alternative Senate bill was (as always) filibustered and failed to get 60 votes (the number was in the high 50s). The Bush bill then passed - because the Senators thought it was better than no stimulus.

[CreekDog]

5. No, no, no, he put out this version to call the Republicans' bluff and teach them a lesson

they can get some of what they want if they get on board and negotiate in good faith. if they snipe at it and reward Obama's reachout to them with silence and/or opposition, then Obama will go where the votes are and if they aren't from Republicans, he will go with Democrats.

now Obama can say he crafted a bill with about half what Democrats wanted and about half what Republicans wanted, but Republicans wouldn't support it, so he negotiated with the folks who were willing to negotiate in the first place, the Democrats.

the lesson to Republicans is to take the deal when it's offered, if changes are made for their benefit and they continue to oppose, those changes will be yanked.

[PM7nj]

16. There was a reason the original was so... blah. It's a strategy.

Obama has pretty much said so himself.

[Beetwasher]

2. A Brilliant Lesson In "Controlling The Debate"

Political Kabuki at it's finest.

I ask you? Where are the REPUBS in these negotiations? Thankfully, nowhere to be found. They will be hard pressed to argue their position after Obama started there, and then was reasonably convinced after vigorous and thoughtful debate that he was wrong.

[elleng]

6. What was Kerry's complaint

about tax credits for new hires?

[Enrique]

8. not a good use of the money

not effective as a stimulus. More effective is investing in government programs.

[elleng]

10. But isn't 'either/or,' is it?

.

[karynnj]

23. Obviously it is not either or - as in black or white

There is a concern on the mix - and all the quoted Senators seemed of the opinion that the original plan needed more infrastructure spending than tax cuts. There was also a concern that some of the tax cuts were not very promising in terms of actually working. Kerry and others said they were not against all tax cuts.

A company struggling to stay viable will not hire a new worker to get a $3000 tax credit. Their hiring decisions will be based on whether the additional person will allow them to make more money than the person's weighted salary plus some additional profit. Especially in companies with a backlog of inventory that is not being bought, new people won't be hired. There was also concern that much of the money would go to hires that would be made without the credit and that there would be some who would find a way to "play" the system.

[elleng]

24. Thanks for the explanation;

I needed that!

[karynnj]

21. His comment was that there needed to be more concentration on

infrastructure spending.

"Sen John Kerry, D-Mass., said, "I'd rather spend the money on the infrastructure, on direct investment, on energy conversion, on other kinds of things that much more directly, much more rapidly and much more certainly create a real job."
http://www.newstimes.com/national/ci_11406750

The last part echoes Conrad's skepticism that a tax credit really would create new jobs. Kerry has spoken of putting money behind technology innovation that will produce the new energy efficient products that could be sold to the world - in 2004 he argued that this would create new good jobs - which are needed more now than then.

Here is a link showing one energy related opportunity where government money could simultaneously create new jobs and move the country to energy efficiency. (this is the aftermarket battery that Kerry spoke of everywhere in 2007 on his book tour and which were the way that you could get 150 miles per gallon that Bill Clinton and McCain spoke of in 2008. )
http://www.johnkerry.com/news/entry/a123systems_announces_plan_to_build_us_based_lithium_ion_battery_mass_produ/

Imagine if in addition to pushing companies to use these batteries, people with cars that can be retrofitted with these were given rebates the batteries very affordable. It would immediately have an environmental impact - with the people already the most energy efficient becoming far more so. This could create the good technological jobs that Kerry has spoken of for years and which all Democrats spoke of in 2008.

That the big new plat would be in SE Michigan is really really good. When Kerry first spoke of the battery, even though the company was in MA and had some ties to MIT, I think the battery was made in Canada.

[Enrique]

7. "they're moving in our direction"

I like the sound of that. :thumbsup:

[Uzybone]

9. Obama and democrats are playing chess

detractors, GOP and media are playing checkers with rusty bottle caps.

[EraOfResponsibility]

12. Right on! n/t

[FrenchieCat]

13. Most on DU playing UNO!

other than those who "get it".

[Occam Bandage]

15. Sadly, the only card most have is "Reverse."

And so round and round and round we go.

[Occam Bandage]

14. I like this a *lot.*

Dems propose something a bit grander than they actually want. Obama proposes something slightly more moderate than they actually want. Obama and the Dems negotiate, and then look--compromise!

Meanwhile, the GOP can't say shit. Obama was fighting to lower the costs, so they can't very well call him a tax-and-spender in cahoots with the san francisco values and the whaargarblgarblgarbl. They can either take the compromise bill or leave it and look like they're more interested in obstruction than results.

[Patsy Stone]

17. Nate Silver strikes again: Obama's Price is Right Negotiating Strategy?

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x4802937

[Uzybone]

18. Silver hit the mark again

Wherever Nate Silver came from, we need more of his kind.

[Patsy Stone]

19. Agreed. n/t

[Jennicut]

22. Damn. He had it right.

Obama is one crafty, clever man.