Democratic Negotiators Cut 50 Billion Out Of Senate Stimulus Bill???!!! Huh?

[Better Believe It]

-Are we going in the wrong direction here or what?

Democratic Negotiators Agree to Cut Cost of Stimulus Package
Formal House-Senate Conference This Afternoon to Determine Bill's Final Form
By Paul Kane and William Branigin
Washington Post Staff Writers
February 11, 2009

Democratic negotiators have reached agreement on reducing the overall cost of President Obama's economic stimulus plan, scaling it down to $789.5 billion, a net reduction of almost $50 billion from what the Senate approved yesterday, according to a senior adviser familiar with the talks.

House and Senate negotiators, including Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry M. Reid (D-Calif.), were huddling this morning trying to iron out the final details on the massive package in advance of a formal House-Senate conference this afternoon in the Lyndon Baines Johnson Room off the Senate floor. Democrats hope the conference will produce quick agreement and set the legislation on a glide path to passage in the House Thursday and the Senate over the weekend.

The agreement on a trimmed stimulus package came as Obama continued his public exhortations to lawmakers to send him legislation he can sign into law.

http://www.washingtonpost.com/wp-dyn/content/article/2009/02/11/AR2009021101836.html

[stray cat]

1. it depends on what they got rid of - tax breaks for buying cars?

they have to get what they want but keep it low enough to get 60 votes

[DCBob]

10. Nelson said they are scaling back a Senate-passed tax credit for homebuyers and

likely eliminating a tax deduction for car buyers.

http://www.cnn.com/2009/POLITICS/02/11/stimulus.plan/index.html

This sounds like they might be trying to get all the bluedog Dems and possibly a few more Republicans on board.

[demokatgurrl]

17. Make sense though- is anyone buying a house

if they are on the verge of losing their job? Only rich folks are buying houses.

[Dappleganger]

23. Some of us

will probably have to relocate because of having to find a new job, so yes some of us may be buying a house.

We live within our means but we are probably going to rent for awhile after we sell this one until the economy stabilizes more.

[Rockholm]

29. The market is busy where I am.

[Zynx]

31. Busy compared to five years ago? I very much doubt that.

The statistical evidence I've seen is that basically any decent sized area has seen at the very least a big decline in sales.

[Rockholm]

33. Comparing to an extermely busy market...no.

Compared to the past 6 months, yes.

[Baby Snooks]

35. Some markets are improving...

Prices have more or less "bottomed-out" in some areas and so some are buying homes if they have relatively secure jobs and good credit.

In some areas, "bottomed-out" means 50% devaluation from two or three years ago. In some areas, from a year ago. It is becoming a buyer's market. The problem in some areas is there aren't that many buyers. But many who rent and have the income and the down payment and the good credit are realizing they will "even out" on the PITI payment versus the rent at this point and have some equity in a home which will increase in value albeit slowly. Prices are down as are interest rates for fixed mortgages. Real estate right now is probably the safest investment someone can make. The foreclosures devalued the market more than it depressed the market. Some new buyers reportedly are those who sold their pre-foreclosed homes through a "short-sale" and managed to salvage their credit. They couldn't afford the old mortgage. They can afford the new one. The reality of ARMs is they were designed for people just starting out. The assumption being as their income increased they could handle the higher rate if it increased which in most cases through the years it did. Instead the ARMs were used to rip people off.

Some predict the market will see actual stabilization over the summer although we are a long way off from another real estate boom. And probably a long way off from a booming economy. But reality is everyone wants to own a home. At this point, a home really is affordable for those who can afford one.

[ProgressiveEconomist]

25. Subsidizing EXISTING houses makes sense, to help sell off

the inventory of unsold homes that's depressing real estate prices and putting mortgages "upside down". But subsidizing the building of NEW houses would be counter-productive (unless you're a construction worker). IMO it would be much better to create jobs for construction workers renovating and building schools and other public structures instead of residential housing.

[Baby Snooks]

36. Adjusted prices...

There has been devaluation. I wouldn't use the word depressed. It really is more an adjustment to "actual value" since in most markets there was overvaluation. In addition to the problem of "loan to value" there is also the problem of the tax bases. At some point in areas where appraised value was approximately the same as market value, the appraised value will have to be adjusted as well. I doubt the appraisal districts will do it willingly so you will see some lawsuits. They always claim the land is where the value is. The reality is people are not buying land they are buying homes. The land value is merely a trick the appraisal districts used to overvalue as well which of course the real estate industry didn't object to. You make much more commission on a $2 million house than you do a $1 million house.

[Zenlitened]

2. I'm gonna wait...

... until I see the final-final version for myself. I don't trust these "early reports" at this point -- too much is in motion.

[Deep13]

3. You're going the wrong direction, Pelosi.

If you want to trim something, how about getting rid of some of these tax cuts.

[Nicholas D Wolfwood]

8. That'd qualify as part of the costs.

I'm holding my opinion until the details of said cut come through. If it's to nearly anything but tax cuts, I'll be rather upset.

[DCBob]

14. Pelosi: "You cannot allow the perfect to be the enemy of the effective and of the necessary."

It's all about compromise now on both sides.

[Occam Bandage]

20. So far, all the evidence is that most of what's being cut is indeed tax cuts. nt

[Better Believe It]

4. We need 50 billion more for education and financial assistance to states

Well, let's just move that 50 billion in cuts into school construction and aide to the states.

So the Senators compromised with the House by cutting another 50 billion from the stimulus.

Sure. That's what I'd call a compromise. If that 50 billion in "savings" isn't now used to increase the funding for education, infrastructure and other badly needed job creation programs I'd hardly call that a compromise.

It would look like 3 Republicans are dictating the terms of a Democratic congressional surrender!

Let's hope it ain't so.

[Deep13]

5. Right!

The states are pretty well fucked without it.

[BeyondGeography]

6. If $18.5 billion of that is the $15K break for home buyers who don't need it, fine

[napi21]

13. Yes, MSNBC just said that was inserted by Isakson of Ga. and then

he didn't vote for the bill anyway, so they don't have to make HIM happy!

Andrea also mentioned some kind of a break for new car buyers having been part of the cut.

It seems like the big stumbling block right now is rebuilding schools.

[grannie4peace]

7. i heard it had something to do with nuclear energy

[stray cat]

9. Targets - decrease in tax break, and decrease in tax breaks for cars and houses

The likely targets are reducing Obama's "Make Work Pay" tax cut, from $500 a year for most individuals and $1,000 a year for most families, down to $400 and $800 respectively. Other reductions are likely in a $15,000 tax credit for all home purchases in the next year as well as a tax credit for the purchase of new cars, both of which were added to the Senate bill after little debate.

[Better Believe It]

11. And use that money saved for education, infrastructure, aide to states

Is that the plan?

If it is, that wouldn't be so bad.

[Occam Bandage]

21. No, it's just getting rid of useless tax cuts that only serve to increase the national debt.

Figures you'd find a way to panic over that, despite the fact that you were panicking over their inclusion just a few days ago.

[Thrill]

12. Its cutting the House credit and the car credit

[Uzybone]

15. Well that was quick

I guess Congress is getting the message.

[pinto]

16. Some more info -

Democratic aides said that Obama's negotiating team had prevailed in restoring some lost funding for school construction projects during talks Tuesday, and had also increased aid to state governments above the $39 billion approved in a compromise with a handful of Senate GOP moderates.

Obama's "Making Work Pay" tax credit would be reduced from $500 per worker to $400, with couples eligible for an $800 credit, instead of $1,000, said a Democratic aide close to the talks. This aide spoke on condition of anonymity because the negotiations are private.

http://www.detnews.com/apps/pbcs.dll/article?AID=/20090211/NATION/902110450

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=102x3733959

[Thrill]

18. I can't believe Obama would allow the tax credit for the middle class

to change after repeating it several times the last few days. So I don't buy that part

[Occam Bandage]

19. Looks like a bunch of that is tax cuts. Good riddance. nt

[ClarkUSA]

22. This is the biggest pro-Dem project spending bill since the 60's... so what if some stuff is cut?

[Better Believe It]

24. Tell the people who won't get jobs or will lose their jobs "so what"

Education is just "stuff"? Rebuilding the nations infrastructure is "stuff"? Aide to states that will maintain badly needed services and prevent hundreds of thousands of people from losing their jobs is just "stuff"?

This is by by far the worst economic crisis since the 1930's and only a small fraction of the stimulus package will be used for creating jobs in the next 24 months. You can't seriously compare this economic situation to the ecoonomic boom of the 1960's. The public works project spending component of this stimulus amounts too far less (taking dollar inflation into consideration) than even President Eisenhower's national interstate highway project in the 1950's!

We need the 80 billion dollars restored that the "gang of 14" Senators cut from education, infrastructure and aide to states.

You're opposed to that on the grounds that this is the most spending for public works since the 1960's? That sounds like a talking point of the "gang of 14".

But even the restoration of that funding isn't adequate if those funds are totally restored by the conference committee.

President Obama will have to go back to Congress later this years for at least a few hundred billion more for public works and state aide because this stimulus will prove to be inadquate for the task, and he'll need to have Congress approve at least one trillion more bucks in new TARP money to prevent the total collapse of the financial and banking system. And we'll need at least a few hundred billion dollars to prevent millions from losing their homes to foreclosure.

If the capitalist economic system collapses on Obama's watch he will be a one-term President. The Republican will regain their control of Congress and the White House in 2012.

[crimsonblue]

26. Ok, this makes no sense..

If both Houses of Congress approved a larger spending bill, why pare it down? I am completely confused at this. They already have the votes they need to pass this legislation. I seriously doubt those in the Senate that voted for the bill would vote against the Conference committee bill, or vice versa.

[JayMusgrove]

27. Because NOW there are 3 Rethuglican "moderates" who have to be satisfied.

Snow, Collins and Spector............they have all the power now, they will either vote or not vote for it.

This is disgusting, yes, but it's the new math in the US Senate, because Franken isn't around yet, and all the other Republicans are neanderthals who haven't got a clue about the "economics" of recessionary spending.

[Better Believe It]

28. So was Congressman Rangel correct when he said that 3 Republicans run the Senate?

I thought the Democrats won control of the Senate. Democrats can defeat any threatened or real filibuster using the so-called "nuclear option" threat that the Republcans used against the Democrats so effectively in 2005.

[Dawgs]

32. He's partly correct. The Democrats still get to write the bills.

Unfortunately, they still have to be tweaked for these three.

That's why 2010 is so important.

[Dawgs]

30. Well, they cut out a bullshit 'house buying incentive' amendment proposed by a jackass Republican.

I'm okay with that part of the cuts.

[MadHound]

34. Gotta love those Dems

They're just trying to out 'Pug the 'Pugs. More cuts to schools, to states, to homeowners. Geez, perhaps we should get these Dems to start negotiating for major league ballplayers, that will bring those obscene salaries down.

This is insane, and simply further proof of the two party/same corporate master system of government at work. That, and the fact that Dems are spineless wimps who shit their pants when 'Pugs say boo.