Senate Finance Committee Passes Economic Stimulus Package

By a vote of 14-7, the Senate Finance Committee passed its version of a package of a set of measures designed to stave off a possible recession. The bill's $157 billion total is about $10 billion more than a House economic stimulus bill passed last week. The key elements of the Senate bill include:
  • An extension of unemployment insurance benefits; depending on a state's unemployment rate, those benefits could continue for up to 13 weeks beyond the current 26 week limit
  • A flat $500 tax rebate for individuals and $1000 for couples plus $300 per child

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What's Up? Not Very Much

Only the Size of the Stimulus As noted below, gross domestic product -- the most basic measure of the nation's economic health -- grew by an anemic 0.6 percent in the fourth quarter of 2007. The expansion for all of 2007 was 2.2 percent, the lowest figure in five years.

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State of the Stimulus Package(s)

Yesterday, the U.S. House of Representatives overwhelmingly approved H.R. 5140, the grandly-named Recovery Rebates and Economic Stimulus for the American People Act of 2008 It's the $146 billion economic stimulus package worked out by House and administration negotiators last week.

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New and Improved JCT Website, Pt. 1

The new Joint Committee on Taxation website, new as of this week, is mostly a look-and-feel improvement. Little of the material is new here, but you no longer feel as though you're entering a 19th century crypt when you log into it. There's also a document, posted today, "Inside the JCT Revenue Estimating Process," by Edward Kleinbard, the JCT Chief of Staff, which we'll give a closer look later. Suffice it to say that it begins to demystify the Committee's methodology, but it's unfortunately rendered in bullet points.

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NYT on Bush's Defense Authorization Bill Signing Statement

The New York Times wonders why the president believes that a wartime contracting commission and protection for contractor fraud whistleblowers would hinder his constitutional duty to faithfully execute laws. The [national defense authorization] bill included four important provisions that Mr. Bush decided he will enforce only if he wants to. The president said they impinged on his constitutional powers. We asked the White House to explain that claim, but got no answer, so we'll do our best to figure it out.

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Economy Slows to 0.6% Growth Rate at End of 2007

With the voluminous debate in Washington about the appropriate contours of a economic stimulus package, it should be mentioned (as it occasionally is) that a recession is not necessarily a lock. It's possible that such a package may not be needed. That possibility, however, appears to have narrowed significantly, as the Bureau of Economic Analysis has announced that fourth quarter GDP growth for 2007 was a molasses-in-December slow 0.6%. In the third quarter of last year, GDP grew at a brisk 4.9%. For all of 2007, the economy grew at a 2.2% pace. In 2006, GDP growth was 2.9%.

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Despite Signing Statement, Senate to Move Forward with War Contract Commission

When President Bush signed into law the National Defence Authorization act on Monday evening, not only did he sign into law the authorization for the Webb-McCaskill wartime contracting commission, but he also issued a signing statement indicating that such a commission may interfere with his constitutional obligations. However, the Senate plans to press ahead with its plans to establish a commission that would investigate waste and fraud related to wartime contracts.

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State of the Union, Pt. 2 -- Earmark Inanity

During his State of the Union address last night, President Bush tried to create the impression that he cares about wasteful pork spending and wants to reduce it by a lot and right away:

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Infrastructure Begins in Washington

Bob Herbert's column in the NY Times today elevates an important issue that has been swirling under the radar the last few years in Washington and around the country but has not garnered enough attention - lack of infrastructure investment. Herbert highlights the work of Sens. Chris Dodd (D-CT) and Chuck Hagel (R-NE) to create a national infrastructure bank that would identify, evaluate, and help finance large-scale, long-term infrastructure projects across the country to rebuild and strengthen roads, bridges, levees, transit systems, water treatment facilities, schools, hospitals, electrical grids, and other key infrastructure sectors. Dodd and Hagel are hoping to create a sense of urgency to address the growing infrastructure problems faced by the U.S., framing this as an economic issue as much as a quality of life concern. The need is certainly clear. From Herbert's column: The need for investment on a large scale — and for the long term — is undeniable. According to the American Society of Civil Engineers, in a study that should have gotten much more attention when it was released in 2005, it would take more than a trillion and a half dollars over a five-year period to bring the U.S. infrastructure into reasonably decent shape. ... As things stand now, the American infrastructure is incapable of meeting the competitive demands of the globalized 21st-century economy. Senator Hagel noted that ports are overwhelmed by the ever-expanding volume of international trade. Rail lines are overloaded. Highways are clogged. Herbert's well-reasoned column reminded me of another commentary from the Times editorial board last week entitled "Charity Begins in Washington." This editorial argued there are many aspects of our society - namely social needs - that demand government investment and cannot be left to private philanthropy. Dodd and Hagel have certainly made a strong case that infrastructure projects also warrant considerable and sustained federal investment. Read more about the Dodd-Hagel National Infrastructure Bank Act of 2007. Bill summary and letters of support

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State of the Union, Pt. 1 -- Editorial Reax

Below are excerpts of editorial responses to the president's State of the Union address last night, with a focus on economic and fiscal issues, drawn from some of the nation's leading print and electronic publications... Daniel Gross, in Slate:

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