President-Elect Obama Says Congress Must Pass Economic Stimulus Package Quickly or Economy Likely Will Worsen

President-elect Barack Obama on Thursday in a speech asked Congress to pass the American Recovery and Reinvestment Plan, his proposed two-year, $800 billion economic stimulus package that includes additional federal funds for state Medicaid programs and other funds for health care programs, the Wall Street Journal reports (Weisman/Hitt, Wall Street Journal, 1/9). According to the Washington Post, the speech "marked the start of the formal campaign to move through Congress a stimulus package that Obama portrayed as an effort to 'retrofit America'" (Shear/Fletcher, Washington Post, 1/9). Obama said, "There is no doubt that the cost of this plan will be considerable" and "will certainly add to the budget deficit in the short term," adding, "But equally certain are the consequences of doing too little or nothing at all" (Clarke/Krawzak, CQ Today, 1/8).

The package includes a provision that would seek to computerize all medical records within five years (Shear/Fletcher, Washington Post, 1/9). Obama said that the provision could save lives, reduce health care costs and create jobs (Knowlton, New York Times, 1/9). Obama also said that the package will include an increased investment in science and technology research to develop medical breakthroughs and discoveries (Thomma/Lightman, Miami Herald, 1/9). In addition, the package could extend unemployment insurance and provide subsidies to help recently laid-off workers pay to retain their health insurance through COBRA (Koffler, Roll Call, 1/8).

Congressional Concerns, Schedule
Congressional Democrats have raised concerns about some provisions in the economic stimulus package proposed by Obama and have called for some additions (Murray/Kane, Washington Post, 1/9). Among other concerns, some Democrats, such as Sen. Evan Bayh (D-Ind.), have said that the package should include conditions for financial assistance provided to states (Schatz, CQ Today, 1/8).

House Majority Leader Steny Hoyer (D-Md.) on Wednesday said that committee hearings on the package will begin next week, followed by mark ups. Hoyer said that the House Ways and Means Committee and the House Appropriations Committee will hold hearings and mark ups on the package in the next few weeks (Epstein, CQ Today, 1/7). House Speaker Nancy Pelosi (D-Calif.) on Thursday said that she plans to hold a floor vote on the package during the last week of January (Shear/Fletcher, Washington Post, 1/9). In addition, the House will remain in session during the weeklong Presidents Day recess in the event that Congress has not passed the package by that time, Pelosi said (Bourge/Friedman, CongressDaily, 1/8).

Senate Finance Committee Chair Max Baucus (D-Mont.) on Thursday said that he expects the committee to begin mark ups on the package during the week after the inauguration (Rogers, The Politico, 1/9).

Poll
Seventy-nine percent of registered voters support the economic stimulus package proposed by Obama, according to a poll recently conducted by The Politico and Allstate, The Politico reports. The poll, conducted late last month, included responses from 1,007 registered voters (Barr, The Politico, 1/8).

Editorial
The promise by Obama for an "unprecedented effort to eliminate unwise and unnecessary spending" by the federal government is not "reassuring," as he knows that the "deficit would still be immense even if he eliminated all the waste he could find," a Post editorial states. A "truly 'unprecedented' effort would be one that attacked the structural threats to the federal government's solvency: Medicare, Medicaid and Social Security," the editorial states, adding, "Without some assurance that serious entitlement reform is on the next president's agenda, global financial markets could gradually lose the confidence in America that Mr. Obama said yesterday he is trying to restore."

The editorial concludes, "The present emergency is as good an opportunity to start tackling the structural problems as any president is likely to have before 2019 -- when Medicare's trust fund is projected to run dry. If not now, when?" (Washington Post, 1/9).

Opinion Pieces

• E.J. Dionne, Washington Post: "Nobody has a playbook for consciously and intentionally embarking on large-scale deficit spending," but for Obama, a "highly public war against waste and fraud will ease passage of the stimulus," Post columnist Dionne writes. Obama "has been talking about controlling future entitlement spending" to address the requests from members of the Democratic Blue Dog Coalition to make deficit reduction a goal of the economic stimulus package. However, Obama "is also pushing programs especially important to liberals" through a number of provisions, such as an increase in federal Medicaid funds for states, according to Dionne. He writes, "Help to the state governments is crucial" because expected budget shortfalls could cause states to enact cuts that would "counteract the impact of a federal stimulus," which is "why Obama went out of his way to pledge to 'help struggling states avoid harmful budget cuts'" (Dionne, Washington Post, 1/9).
  
  
• Paul Krugman, New York Times: "Obama's prescription doesn't live up to his diagnosis," as the "economic plan he's offering isn't as strong as his language about the economic threat" and "falls well short of what's needed," Times columnist Krugman writes. "There are only a limited number of 'shovel-ready' public investment projects -- that is, projects that can be started quickly enough to help the economy in the near term," but "there are other forms of public spending, especially on health care, that could do good while aiding the economy in its hour of need," Krugman writes (Krugman, New York Times, 1/9).

Broadcast Coverage

• NPR's "Morning Edition" on Friday included a discussion with David Wessel of the Journal about the economic stimulus package proposed by Obama ("Morning Edition," NPR, 1/9).
  
  
• NPR's "Morning Edition" on Friday included a discussion with Senate Minority Leader Mitch McConnell (R-Ky.) about the package (Montagne, "Morning Edition," NPR, 1/9).
  
  
• American Public Media's "Marketplace" on Thursday reported on the package (Babin, "Marketplace," American Public Media, 1/8).