Skip to main content /POLITICS

House passes stripped-down stimulus bill

House passes stripped-down stimulus bill

From Ted Barrett and Dana Bash
CNN Washington Bureau

WASHINGTON (CNN) -- The Republican-controlled House overwhelmingly passed a stripped-down economic stimulus package Thursday, including an extension of jobless benefits, after lawmakers compromised on legislation that has been mired in Congress since last year.

The legislation was quickly sent to the Senate, where a speedy passage appeared possible Thursday afternoon, Senate aides said.

Shortly before the vote, Speaker Dennis Hastert, R-Illinois, told reporters the GOP leadership did not "wave the white flag" when it agreed to remove most Republican-sponsored tax relief provisions from the bill, leaving as its centerpiece a 13-week extension of benefits for the unemployed that Democrats fought to pass.

In fact, Hastert vowed the House would act on a tax package later this year. He declined to specify what might be in a new package but suggested that among other items, he would like to make permanent a recently passed temporary repeal of the inheritance tax.

GOP leaders decided to remove controversial provisions of the long-stalled economic stimulus bill when it became clear they could not get those measures through the Democratic-led Senate, where three previous House-passed stimulus bills died.

"We were broadly criticized by some, especially in the Senate," Hastert said. "We did not back up. We did not wave the white flag. We did not retreat. We had a fight. I think this is a good bill."

Besides the unemployment benefits extension, the $42 billion bill offers tax breaks for businesses, creates a special tax status for lower Manhattan, and extends several expiring tax provisions. The bill passed by an overwhelming 417-3 vote after a short debate.

Missing from the legislation is health insurance assistance for the unemployed. Republicans proposed offering tax credits to unemployed workers to buy insurance. Democrats opposed the tax credits for philosophical and practical reasons. The issue became a major sticking point.

Some politicians and economists questioned whether stimulus provisions were still needed since the economy is showing signs of recovery.

Sen. John Breaux, D-Louisiana, a key moderate, said there could be opposition to the House bill for that very reason.

"A lot of people think the recession is over," he said.

House Republican leaders had pushed a bill costing more the $100 billion that included corporate tax relief, a rebate for some low-income workers, an acceleration of the recently passed income tax reduction, and other provisions.

They changed course, in part, because many rank-and-file Republicans were concerned that unless some type of bill passed, they would appear insensitive to the needs of workers who lost their jobs after September 11 and whose 26 weeks of unemployment benefits will soon expire.

Hastert blamed the Senate for stalling the legislation he described as a "job creation bill."

"The Senate has been belligerent," he said. "They've pulled the plug always when they've gotten close to some sort of agreement."

Meanwhile, Senate Majority Leader Tom Daschle said Thursday he would have preferred the House pass a simple 13-week extension of unemployment benefits without other tax provisions, as the Senate did last month.

"Republicans in the House can't help themselves but to load up a bill. They just can't seem to bring themselves to do the right thing and pass a simple extension of unemployment benefits," said Daschle, D-South Dakota.

Despite his misgivings about the broader House bill, Daschle said he still feels it is important to get legislation with unemployment benefits to President Bush's desk.

At the White House, press secretary Ari Fleischer said Bush would have preferred "by far" the original economic stimulus proposal he sent to Congress last year. But, Fleischer said, Bush support this bill.

"The president endorses this compromise proposal. It's a scaled down stimulus package that includes the unemployment extensions that he has sought," Fleischer said. "He will sign it into law if it is sent to him."




Back to the top