WASHINGTON — Senate Minority Leader Mitch McConnell and fellow Senate Republicans are gearing up for a fight this week over a proposed $889 billion economic stimulus package, which the GOP says is unwieldy and doesn't go far enough in addressing the housing crisis.
McConnell, Sen. Jim Bunning, R-Ky., and other Senate Republicans say they worry that the spending measure is too costly and unfocused, contains too much entitlement spending, doesn't do enough to help financially strapped homeowners and doesn't contain enough tax cuts—a provision Republicans see as vital to shoring up the private sector.
House GOP lawmakers and nearly a dozen Democrats refused to support a similar $819 billion measure which passed that chamber last week.
The Senate version of the stimulus bill is $70 billion more than the one passed by the House—an increase due to tax breaks. Debate began Monday and is expected to continue through next week.
McConnell has expressed concern that President Barack Obama has been unable to convince House and Senate Democrats to work in a bipartisan fashion on crafting the measure. Republicans complain that amendments offered in Democrat-dominated committees to hone the package were largely left out of the House and Senate versions.
"I think it may be time . . . for the president to kind of get ahold of these Democrats in the Senate and the House . . . and shake them a little bit and say, look, let's do this the right way," McConnell said Sunday on Face the Nation.
Over the past month, Obama sought to woo Democratic and Republican congressional support with varying levels of success. Just before the House vote, Obama convinced Democrats to remove a proposal to spend just under half a billion dollars on family planning to gain GOP support.
Senate Democratic leadership was slated to meet with the president Monday afternoon, and leaders were expected to express their concerns that the package might not do enough to stimulate the economy.
Last week, the president met Senate and House Republicans on Capitol Hill to discuss their objections—an event Bunning skipped citing a scheduling conflict. Later in the week, Bunning joined several Senate Republicans who vowed to vote against the measure if it did not include additional tax relief.
"We know, God, we know, we need a package of some sort, because I fear what's coming in six months to nine months, in this economy, if we don't stimulate it, because we're looking at rather than 9,000 on the Dow, we're looking at 6,000 on the Dow," Bunning said during a press conference. "That is breathtaking to me, having worked 25 years in the brokerage business. So please, we've got to go slow. And we cannot accept this current package as it's written."
Meanwhile, McConnell underscored his concerns during a separate press conference on Monday and made the rounds of television news shows last week.
"Let's fix housing first. That's what started all of this," McConnell said Sunday on Face the Nation. "We ought to go right at the housing problem and right at tax relief to put money in the hands of consumers who can spend it now."
McConnell estimated that under his mortgage plan, the average family would see its monthly mortgage payment drop by $466 a month, or $5,600 a year. Over the life of a 30-year loan, that's a savings of $167,760.
McConnell also wants to cut income tax rates. Currently, according to GOP data, married couples pay a 10 percent tax on income up to $16,700. Republicans would cut that rate to 5 percent, meaning a savings of about $500 per couple.
They would also reduce by 5 percentage points the 15 percent rate now levied on couples earning between $16,700 and $67,900, saving working couples another $1,100, according to Republican estimates. Single filers would get similar reductions. Either way, everyone who works and pays income tax would see an immediate increase in pay, Republicans say.
"Look, this thing needs to be targeted right at the problem, if we're going to spend this enormous amount of money," McConnell said.