The pain deepens

WASHINGTON - President Barack Obama and Senate Democratic leaders, propelled by news of the biggest one-month job losses in 35 years, hammered out a deal yesterday evening that clears the way for Senate approval of a huge economic stimulus plan.

Senators said the legislation, which is a cornerstone of Obama's efforts to revive the economy, would carry a price tag of about $780 billion under the compromise deal, though the final figure was unclear.


The measure is expected to cost less than the $819 billion bill approved by the House and far less than the bill as amended on the Senate floor, which had grown to more than $930 billion.

The bill had stalled amid partisan differences, with most Republicans saying it carried unnecessary spending and not enough in tax cuts.


But over the course of several days, a small group of senators from both parties, working with White House Chief of Staff Rahm Emanuel, negotiated the compromise, trimming the bill in hopes of winning support from a handful of moderate Republicans.

Senate Democratic leaders said they believe they will have enough support to pass the legislation, though it was not immediately clear when a vote would be held. Republicans might delay the vote until early next week, but there was little doubt about the outcome.

"For the first time, there's light at the end of the tunnel," said New York Democratic Sen. Charles E. Schumer, predicting that Congress would send the bill to the White House, as promised, by the end of next week.

When the compromise was announced yesterday evening to a closed meeting of Senate Democrats, it was greeted with applause, and Democrats emerged saying that the party had rallied behind it.

The White House applauded as well.

"On the day when we learned 3.6 million people have lost their jobs since this recession began, we are pleased the process is moving forward," said Obama spokesman Robert Gibbs.

Under the deal, the cost of the bill would be lowered by scaling back tax cuts in the legislation by $25 billion. In addition, lawmakers trimmed $85 billion in spending for items that they believed did not belong in a stimulus package because they did not spur economic growth, like $870 million for combating pandemic flu.

Democrats said some of the areas trimmed were muscle, not fat, and hoped it might be restored in the final bill. Funding for school construction took a big hit, and aid to states was reportedly cut from $79 billion to $39 billion.


"Not everybody is going to get every dollar they want, but it's still a very strong package," said Democratic Sen. Barbara Boxer of California. "This package proves three words: 'Yes, we can.' "

Three GOP moderates - Maine Sens. Susan M. Collins and Olympia J. Snowe, and Arlen Specter of Pennsylvania - quickly declared their support for the compromise. But two other GOP moderates - Sens. Lisa Murkowski of Alaska and George V. Voinovich of Ohio - said they would oppose it.

Hoping to drive their vote total up to 61, Senate Democrats are also counting on the vote of Sen. Edward M. Kennedy, the Massachusetts Democrat who is battling brain cancer and has not been in the Capitol since he suffered a seizure on Inauguration Day. He returned to Washington yesterday to be available to vote.

After approval, the Senate and House will have to work out their differences and then vote on a final version of the legislation before sending it to Obama for his signature.

Details of the compromise agreement were not immediately available, but it met the goal set by Obama and some moderate Republicans that the price end up in the neighborhood of $800 billion.

There was confusion, even among senators who wrote the bill, about the fate of amendments that have been adopted on the Senate floor, including tax credits for people buying new cars and homes. If those are included in the bill, it could drive up the cost.


The agreement was announced after days of frenzied behind-the-scenes negotiations, involving close and deep involvement by the Obama administration. The president called Senate Democratic Leader Harry Reid late Thursday night. Emanuel called him five times yesterday morning and joined the negotiations in person in the afternoon.

Yesterday's release of a dire unemployment report added to the urgency of Obama's and Reid's appeal that Congress move with speed. U.S. employers eliminated 598,000 jobs in January, the report said, biggest one-month plunge since 1974. The unemployment rate now stands at 7.6 percent.

"These numbers demand action," Obama said. "It is inexcusable and irresponsible for any of us to get bogged down in distraction, delay or politics as usual while millions of Americans are being put out of work."

The White House announced that Obama would campaign for the bill early next week in Indiana and Florida. The president will also hold his first prime-time news conference Monday, giving himself another platform from which to push for the legislation.

Still, among Republican lawmakers especially, disenchantment with the stimulus package runs deep. These Republicans suggested that Obama's road show will not influence their vote.

Tennessee Republican Sen. Bob Corker said in an interview that Obama's trip reflects a recognition on the president's part that the stimulus package "is a fumble."


Corker added: "I wish that instead of going to Indiana and Florida, he was sitting down with his [Democratic] colleagues here in the Senate and letting them be honest with him. I think that many of them realize what a mistake this is."

In the Senate, the challenge facing negotiators was to trim the bill enough to win Republican support without losing Democratic votes.

The fact that only a handful of Republicans signed onto the agreement was a blow to Obama's hope that the bill would pass with support of a broad bipartisan majority.

At least three Republicans were needed to secure the 60 vote majority needed to overcome procedural hurdles.