President Obama hit the right notes Monday night as he made an aggressive pitch for a stimulus package that is critical to slowing an ever-deepening economic crisis. In his first prime time news conference, the president urged Congress to agree on the details this week and not to tilt the legislation too far toward tax cuts that would do little to revive the economy. Now it's up to Congress to move quickly, find the right mix of spending and tax cuts, and offer hope to Americans struggling to stay afloat.
With little evidence of bipartisanship on Capitol Hill, Obama remained optimistic about incorporating ideas from both Democrats and Republicans. But he drew a sharp distinction between those discussing the details of the stimulus packages and those Republicans who seem uninterested in doing anything. He said his bottom line is still to retain or create 4 million jobs with a package of roughly $800 billion. "This is not your ordinary, run of the mill recession,'' he said.
Even if the Senate approves its bipartisan compromise today, it skews priorities in the wrong direction and signals how difficult it will be to reach agreement with the House. The Senate compromise places even more emphasis on tax cuts while trimming proposed spending on school construction, programs such as Head Start, and health care. That is an awfully high price for the support of three Republican moderates, and many of these cuts should be restored in negotiations with the House.
Some of the Senate tax cuts are intriguing. Making interest payments on new car loans tax deductible is an example of a targeted cut that could help the ailing auto industry. It would not be particularly expensive. A $15,000 tax credit for all buyers of homes, regardless of income level, could help revive Florida's real estate market. But it would be expensive at $35 billion, and it would amount to a windfall for many buyers with good credit and ample resources. It certainly should not come at the expense of health care for the poor and other assistance to those Americans in most desperate need of help.
The Senate package makes some reasonable reductions in proposed spending on electronic record-keeping in health care and the expansion of broadband Internet service to rural areas. But too many other cuts would be counterproductive, including large reductions in money to states in areas such as education and the purchase and rehabilitation of foreclosed homes. It makes no sense for Washington to spend billions to stimulate the economy if states are still forced to lay off workers and make deep spending cuts.
Obama has shifted easily back into campaign mode, and he made a compelling argument directly to the American people. Today, he visits Fort Myers, where the unemployment rate has hit 10 percent and the foreclosure rate has been the highest in the country. Those members of Congress fighting the stimulus plan should take another look into the faces of those Floridians.