All the papers lead with news that a group of centrist senators is furiously working behind the scenes to try to cut the cost of the economic stimulus plan that now clocks in at around $935 billion, give or take a billion or two. The bipartisan group hopes to trim as much as $100 billion from the bill in order to make it more palatable to Republicans. Interestingly enough, as the Los Angeles Timespoints out high in its story, $100 billion is pretty much the amount that the package has grown by since it reached the Senate. But, of course, that has mostly been due to tax cuts, and the bipartisan negotiators want to slash some spending.
The New York Timesand Washington Postsay that the negotiating team, which is being led by Democratic Sen. Ben Nelson and Republican Sen. Susan Collins, has already identified around $80 billion to $90 billion in cuts. The WP, which got an early look at the legislation, says “a huge chunk” of the cuts comes from education-related programs. USA Todayhighlights the tough stance taken by Senate Majority Leader Harry Reid, who said he is still holding out hope for a compromise but is ready to move on the legislation without Republican support if necessary. The Wall Street Journal points out that Democrats might be able to use the January jobs data scheduled to be released tomorrow to pressure Republicans into action. Economists widely expect the U.S. unemployment rate for January to grow to 7.5 percent.
The WSJ points out that the bipartisan group of senators set their goal of getting the stimulus bill down to $800 billion after Sens. Collins and Nelson met with President Obama and were told the package needed to be at least that large in order to give the economy a boost. According to the WP, the biggest cuts will be $40 billion in aid for states that would have been used to bolster school budgets, $14 billion in funds for education programs, and $13.9 billion that was supposed to increase Pell grants for higher education. The NYT adds that the group would also cut $4.1 billion to make federal buildings more energy efficient and $1.5 billion to provide broadband Internet to rural areas. The senators emphasized that they want to cut out programs that wouldn’t create jobs quickly or encourage more spending.
Early in the day, Reid expressed frustration at the discussions going on between the centrist senators, saying that the group “cannot hold the president of the United States hostage.” But later he said he would give the senators until Friday to reach a deal. As the NYT points out, the bipartisan group “essentially tied” Reid’s hands because he would need at least a few Republicans on his side in order to get to the 60 votes required to pass the measure. Democrats technically need two Republicans to go over to their side, but it will probably have to be three since Sen. Edward Kennedy has been away all week. And that’s assuming that all Democrats stick with Obama. Reid might have been confused as to how far he should push because he might not have been receiving clear signs from the White House. While it seems Obama was encouraging the Senate negotiations, he appeared a tad impatient. “The time for talk is over,” he said. “The time for action is now.”
As the centrists tried to come up with a compromise, the rest of the senators were busy in a debate that seemed to turn more heated and more partisan as the day wore on. The WP’s Dana Milbank characterizes it as a battle between the “workhorses” and the “showhorses” of the Senate. “Has bipartisanship been a failure?” asked Sen. Charles Schumer. “Well, so far it’s not working. But it takes two to tango, and the Republicans aren’t dancing.” Republican Sen. Lindsey Graham showed off his vocabulary: “This bill stinks.” And Senate Minority Leader Mitch McConnell showed off his math prowess: “If you started the day Jesus Christ was born and spent $1 million every day since then, you still wouldn’t have spent $1 trillion.”
The WP’s Steven Pearlstein thinks that if we’re going to be spending so much money to stimulate the economy, we might as well throw in another $50 million or so to teach some economic basics to lawmakers. So far, lawmakers seem to be stumbling over each other to provide “silly arguments” against the stimulus bill. For example, it’s ridiculous to say that money that’s not spent within the next two years is “wasted,” as is the argument that some spending won’t stimulate the economy, or that spending money on hiring civil engineers to build a bridge is somehow more stimulative than hiring doctors to carry out health-care research. “Spending is stimulus, no matter what it’s for and who does it,” summarizes Pearlstein. “The best spending is that which creates jobs and economic activity now, has big payoffs later and disappears from future budgets.”
The NYT fronts a look at how, if the recession continues to deepen, women might soon be the majority on the nation’s payrolls. Around 82 percent of job losses have so far affected men, who are disproportionately represented in manufacturing and construction. If the numbers continue to rise, it means that more families would be dependent on women as the breadwinner and might consequently find it more difficult to make ends meet since women generally work fewer hours and earn less than men. But it might also bring about a change in gender roles. That hasn’t happened yet though. Amazingly, it turns out that when women are unemployed, they double the amount of time they spend taking care of the children, but that doesn’t happen with unemployed men, who end up spending more time watching TV, sleeping, and looking for a job.
The Post fronts, and everyone mentions, news that Supreme Court Justice Ruth Bader Ginsburg underwent surgery for pancreatic cancer. It is considered to be a particularly lethal form of cancer, but a statement released by the court said it was caught at an early stage and that Ginsburg had no symptoms. Only about 5 percent of those diagnosed with pancreatic cancer survive for five years, primarily because it’s so difficult to detect in its early stages. But the LAT talks to a doctor who says that since Ginsburg’s tumor appears to have been small and localized she probably has a 30 percent to 40 percent chance of surviving for five years.
The WP goes inside with a new report by congressional investigators that will be released today that says the government overpaid for assets as part of its massive bailout plan to the tune of $78 billion. The Treasury Department put $254 billion into the financial companies, and in return received preferred stocks that, at the time, were worth $176 billion. It doesn’t necessarily mean that the government has lost money, since the companies will be required to pay the cash back, plus interest. Lawmakers are angry because former Treasury Secretary Henry Paulson had vowed that the government would buy the assets at market value.
The WSJ hears some updates on the administration’s new plan to prop up the nation’s ailing financial system, which will be detailed on Monday. The paper warns that there could still be lots of changes, but it looks like the administration is moving away from creating a so-called bad bank that would purchase the toxic assets. (If you’re still confused about what a “bad bank” is, the LAT has a very helpful Q&A.) In order to deal with these troubled assets, the administration is considering expanding what is known as the Term Asset-Backed-Securities Loan Facility, which was set up to boost consumer loans. The administration would also inject more cash into troubled banks, but they would likely have stricter terms and apply more to weaker banks rather than the healthier banks that were preferred in the first round of capital infusions. The WSJ says the plans continue to be fluid partly because officials want to create a plan that is markedly different from the one used by the Bush administration, but they’re “running into many of the same thorny questions” encountered by their predecessors.
Obama plans to hold his first prime-time news conference Monday, and broadcasters are getting a little peeved at the president’s talkative ways, reports the Post’s Lisa de Moraes. Network executives have been warned to expect three prime-time presidential appearances in three weeks, which would translate into three hours of lost programming. Adding salt to the wound is the fact that Monday is one of the biggest days of the week for broadcasters. In order “to accommodate Obamavision” this Monday, Fox will have to pull House at a cost of about $3 million. “His economic stimulus package apparently does not extend to the TV networks,” one executive said.