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Tough Math Ahead for Obama, Stimulus Plan

Posted by tothewire on February 9, 2009

President Barack Obama and both houses of Congress face tricky negotiations to produce a unified version of a stimulus bill. In the main image above, the American flag flies at the U.S. Capitol, Sunday,

President Barack Obama and both houses of Congress face tricky negotiations to produce a unified version of a stimulus bill. In the main image above, the American flag flies at the U.S. Capitol, Sunday,

President Obama returned from his first getaway to Camp David on Sunday to face an urgent priority: pressuring Congress to avert a stimulus stalemate.

The Senate is poised to pass a compromise $827 billion version as soon as Tuesday. The legislation would have to be reconciled with the very different $819 billion version already approved by the House.

Some economists question whether either is enough.

“It’s possible that this won’t be enough to jump start the economy — that, in fact, policy makers will have to come back and provide more help to the economy before all is said and done,” Mark Zandi, economist with Moody’s economy.com, told ABC News in an interview.

Obama’s top economic adviser, Larry Summers, indicated to ABC’s George Stephanopoulos that the president will risk losing fragile support in the Senate by pressing to restore cuts, including up to $20 billion in education funding and $40 billion in aid to state and local governments.

“No question what we’ve got to do is go after support for education. And there are huge problems facing state and local governments,” Summers said on ABC’s “This Week” program. “And the president is certainly going to be active in sharing his views.”

Some economists agree education and aid to state and local governments are key.

“I think it’s a mistake to cut those things out because they help the economy immediately,” Zandi said. “Without that help, state and local governments will be cutting works and they will be cutting programs and that’ll hurt the economy this spring and summer.”

Many economists agree that the specifics of the stimulus might be less important than the speed with which it’s passed and the money enters the economy.

Any change in the Senate version could unravel a fragile coalition — without a single vote to spare.

Few Capitol Hill watchers question whether some form of stimulus will be passed.

“We will get a stimulus package,” Fred Wertheimer of Democracy 21 told ABC News. “No one on Capitol Hill can afford to have the Congress do nothing in the economic straits we exist in now. That would be suicide.”

But major questions remain: Which version will pass? Will it be enough? And will it be in time for Obama to meet his goal of signing it by Feb. 16?

By JOHN HENDREN

http://abcnews.go.com

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