WASHINGTON — Barack Obama is scoring a monster victory three weeks into his presidency with the economic stimulus deal. But he's taken some hits along the way and ultimately will be judged on whether he is able to cure an economy that is mired in recession.
As the stimulus plan works its way toward Obama's desk, plenty of political winners and losers are emerging: Education made out; governors' budgets, not so much. Alternative energy companies are poised to fare well, but defense contractors likely won't reap any benefit.
Taxpayers, reeling from rising unemployment and footing the bill for much of the $790 billion package, could win or lose: It depends on whether the investments — and tax cuts aimed at the middle class — end up paying off. The economy, too, could come out on top or on bottom: It's not certain that the plan is enough to reverse the slide that started more than a year ago.
THE WINNERS:
—Obama. The new Democratic president used his popularity and bully pulpit to get the notoriously sluggish Congress to work through the huge package in relatively short order. But it wasn't all smooth sailing, and Obama knows that his political fate is tied to his ability to reverse the severe economic conditions that he inherited from former President George W. Bush.
—Senate moderates, specifically Susan Collins, R-Maine., and Ben Nelson, D-Neb. They helped broker a deal with Senate Majority Leader Harry Reid and the White House that ultimately cut some $100 billion from the package and paved the way for final passage. Collins, in particular, showed her power in a Senate where Democrats lack a filibuster-proof majority; she was able to make the White House and the Democratic majority bow to her demands.
—Education. The measure includes a $25 billion downpayment on K-12 school reforms and $47 billion to prevent cuts in state aid to school districts.
—The jobless and the poor. Unemployment benefits will be temporarily extended and increased. Food stamps will be boosted. Billions of dollars will flow for job training and temporary welfare payments.
—The alternative energy industry. The package allots $50 billion for energy efficiency and renewable energy programs.
—House Republicans. Adrift after back-to-back electoral losses, they found their voice against a Democratic speaker and an expanded majority. They held to the GOP's cornerstone of fiscal conservatism as they led the effort to define the package as too costly and too quick. As the economy turns around, however, they run the risk of being cast as modern-day Herbert Hoovers who wanted to do nothing.
—Big government. The package melds an unprecedented level of new spending and tax cuts, and it marks an extraordinary intervention of government into people's lives.
—Senate Majority Leader Harry Reid. He was key to brokering a final deal in line with a White House-imposed deadline of mid-February. He delivered for the White House but also may have compromised some of the Senate's independence in the process.
—House Minority Leader John Boehner. He strengthened his hold on his job, keeping his rank-and-file united against the House version.
—General Motors Corp. The struggling automaker got a tax break worth $3.2 billion that preserves its ability to claim refunds against taxes paid when times were good.
—Large hospices. They won a reprieve — worth about $134 million — from cuts in what Medicare pays them to care for dying patients.
—Senate moderates, specifically Susan Collins, R-Maine., and Ben Nelson, D-Neb. They helped broker a deal with Senate Majority Leader Harry Reid and the White House that ultimately cut some $100 billion from the package and paved the way for final passage. Collins, in particular, showed her power in a Senate where Democrats lack a filibuster-proof majority; she was able to make the White House and the Democratic majority bow to her demands.
—Education. The measure includes a $25 billion downpayment on K-12 school reforms and $47 billion to prevent cuts in state aid to school districts.
—The jobless and the poor. Unemployment benefits will be temporarily extended and increased. Food stamps will be boosted. Billions of dollars will flow for job training and temporary welfare payments.
—The alternative energy industry. The package allots $50 billion for energy efficiency and renewable energy programs.
—House Republicans. Adrift after back-to-back electoral losses, they found their voice against a Democratic speaker and an expanded majority. They held to the GOP's cornerstone of fiscal conservatism as they led the effort to define the package as too costly and too quick. As the economy turns around, however, they run the risk of being cast as modern-day Herbert Hoovers who wanted to do nothing.
—Big government. The package melds an unprecedented level of new spending and tax cuts, and it marks an extraordinary intervention of government into people's lives.
—Senate Majority Leader Harry Reid. He was key to brokering a final deal in line with a White House-imposed deadline of mid-February. He delivered for the White House but also may have compromised some of the Senate's independence in the process.
—House Minority Leader John Boehner. He strengthened his hold on his job, keeping his rank-and-file united against the House version.
—General Motors Corp. The struggling automaker got a tax break worth $3.2 billion that preserves its ability to claim refunds against taxes paid when times were good.
—Large hospices. They won a reprieve — worth about $134 million — from cuts in what Medicare pays them to care for dying patients.
THE LOSERS:
—Obama. He spent weeks preaching bipartisanship and spending his political capital but reverted to combative, buck-stops-here talk when Republicans rebelled at the cost and scope of the plan. With the economic downturn worsening on his watch, Obama runs the risk of facing the ultimate political punishment if doesn't turn around — a one-term presidency.
—Bipartisanship. So much for all that talk. Obama wanted broad support from members of both political parties. But House Democrats shut out the GOP as the original bill was written, and no House Republicans voted for the measure. Only three Republicans voted with Democrats in the Senate. A largely party line vote was expected on final passage.
—House Speaker Nancy Pelosi. She struggled to control liberals who demanded more spending, and didn't include Republicans in the process from the start, undercutting Obama's calls for bipartisanship. Her strained relationship with Reid also may have worsened.
—Senate Minority Leader Mitch McConnell. He failed to keep his members in line and was eclipsed by three members of his caucus — Collins, Olympia Snowe of Maine and Arlen Specter of Pennsylvania. They negotiated with the Democrats and ultimately sided with them.
—Homebuilders. They saw a $39 billion tax break that would have provided a $15,000 tax credit for homebuyers scaled back substantially.
—Governors. They'll get just $8 billion to defray budget cuts as they face declining revenues and rising demand for services. On the bright side, they pushed for massive spending on roads, bridges and other construction projects to bring jobs — and got $46 billion.
—The nuclear energy industry. It had lobbied hard for $50 billion worth of federal loan guarantees for technologies that use little or no carbon — but saw it stripped from the package. Count environmental groups and the conservative Taxpayers for Common Sense as the victors here.
—The defense industry. There's no significant money for weapons systems, though lawmakers approved several billion for construction at military facilities.
—Liberals. They yielded to calls from conservatives for deeper tax cuts and less spending.
—Large and medium-sized businesses, including manufacturers. They were cut out of more than $18 billion in tax breaks that would have expanded their ability to use current losses to get refunds against taxes paid when they were making large profits.
—Bipartisanship. So much for all that talk. Obama wanted broad support from members of both political parties. But House Democrats shut out the GOP as the original bill was written, and no House Republicans voted for the measure. Only three Republicans voted with Democrats in the Senate. A largely party line vote was expected on final passage.
—House Speaker Nancy Pelosi. She struggled to control liberals who demanded more spending, and didn't include Republicans in the process from the start, undercutting Obama's calls for bipartisanship. Her strained relationship with Reid also may have worsened.
—Senate Minority Leader Mitch McConnell. He failed to keep his members in line and was eclipsed by three members of his caucus — Collins, Olympia Snowe of Maine and Arlen Specter of Pennsylvania. They negotiated with the Democrats and ultimately sided with them.
—Homebuilders. They saw a $39 billion tax break that would have provided a $15,000 tax credit for homebuyers scaled back substantially.
—Governors. They'll get just $8 billion to defray budget cuts as they face declining revenues and rising demand for services. On the bright side, they pushed for massive spending on roads, bridges and other construction projects to bring jobs — and got $46 billion.
—The nuclear energy industry. It had lobbied hard for $50 billion worth of federal loan guarantees for technologies that use little or no carbon — but saw it stripped from the package. Count environmental groups and the conservative Taxpayers for Common Sense as the victors here.
—The defense industry. There's no significant money for weapons systems, though lawmakers approved several billion for construction at military facilities.
—Liberals. They yielded to calls from conservatives for deeper tax cuts and less spending.
—Large and medium-sized businesses, including manufacturers. They were cut out of more than $18 billion in tax breaks that would have expanded their ability to use current losses to get refunds against taxes paid when they were making large profits.
Copyright The Associated Press
