CHN: Action to Spur the Economy Awaits Congress’ Return in September Not to Mention Funding for Everything Else

Congress will have a lot on its plate during its three weeks in session in September.  As unemployment rises and other economic warning signs accumulate, pressure is building in both the House and Senate to enact an economic recovery bill with funding to create jobs and to alleviate hardship from natural disasters, price spikes in the necessities, and the economic downturn.  House Speaker Pelosi (D-CA) and Senate Majority Leader Reid (D-NV) have both called for variants on such a package.  Concern about rising gas prices has provided a further prod to action, but ideas about what the actions should be vary considerably.   Efforts to move either emergency or regular spending legislation before the August recess were repeatedly stalled by unsuccessful attempts to hold votes on expanded oil drilling.  Some Republican House Members were so intent on demonstrating their eagerness to drill that they remained in the darkened and unamplified House chamber for hours after the body had closed for the August recess, repeating their points to each other.
Chairman Byrd Signals Senate Approach to Economic Recovery Senate Appropriations Chairman Robert Byrd (D-WV) tried to get a jump start on addressing the need for emergency economic recovery legislation by releasing the outline of a “second stimulus supplemental appropriations bill,” which will be taken up in September.  Chairman Byrd’s bill includes more than $24 billion for investments in alternatives to oil, transportation infrastructure, the Women, Infants and Children nutrition program (WIC) and other emergency food aid, protections against foreclosure and other housing assistance, job training for dislocated workers and public jobs for youth, job creation through school repair projects and rural and small business programs.  The bill also includes relief from flood and fire disasters as well as additional aid to rebuild from Hurricane Katrina.  Finally, the bill adds funding for home energy and weatherization assistance and for added investments in science an environmental programs.

As a supplemental spending bill from the Senate Appropriations Committee, the Byrd outline leaves out programs like Food Stamps, Child Support Enforcement, and further weeks of Unemployment Insurance.  These are “mandatory” programs outside the jurisdiction of the Appropriations Committee.  Adding mandatory items will most likely be done on the Senate floor.

House Action Also Sought.  The House will also put together a package in September.  Speaker Pelosi predicted that the bill would have bipartisan support, and suggested that the President would have to be willing to sign it.  At this point, the White House is skeptical about the need for further economic stimulus, although there have been signals they would consider further tax rebates.  The House leadership has also been in consultation with the Obama campaign, which last week made public a plan to boost the economy through $500 – $1,000 tax rebates intended to help offset the high cost of gas, as well as some other items.  The Obama position will add pressure to the House leadership to include some form of tax rebate in their recovery bill, despite the belief by some in House leadership that this time the most effective economic stimulus would involve job creation measures and income boosts to low-income people through increases in programs such as Food Stamps.  The House is also expected to include flood and fire disaster relief in a supplemental spending bill.

Legislative Vehicle Unclear; Need to Act Increasingly Clear.
Whether taking the form of a supplemental spending bill or separate economic stimulus legislation, Congress will push towards additional recovery measures.  Advocates will be pressing to include direct aid to low-income people to help with the cost of necessities – food, energy, and restored child support collections, for example.  They do not favor a replay of February’s tax rebates, believing them to be insufficiently targeted towards low-income people.  (For the advocates’ requests, see Towards Shared Recovery at: .)  The strong bipartisan support for enacting disaster relief increases the chance that a package can be devised that will attract a large majority.

The Rest of Appropriations:  Heading for a Stopgap Spending Bill The House approved its first appropriations bill before the recess – covering Military Construction and Veterans Affairs.  This bill, and perhaps the Defense appropriations bill, may be the only annual spending bills taken up separately this year.  A military/defense bill may be the vehicle to which Congress attaches a temporary spending measure to cover the rest of appropriations through to a new Administration.  Some in Congress have threatened to hold up spending bills, even in the face of a cut-off of funding when the new fiscal year starts on October 1, to increase the pressure for more oil drilling.  House leaders hope that attaching the temporary spending measure to a military bill will make it harder for most Members to vote against it.

Budget and Appropriations
Home Energy Assistance
Policy Analyses and Research