Obama Will Get Stimulus Bill First Day, Democrats Say

By Daniel Whitten

Nov. 23 (Bloomberg) -- Congress will send President-elect Barack Obama an economic stimulus package the day he takes office Jan. 20, two Democratic lawmakers said today.

Senator Charles Schumer of New York said on ABC’s “This Week” program that the package will be between $500 billion and $700 billion. House Majority Leader Steny Hoyer, of Maryland, said on “Fox News Sunday” that he believed the Inauguration Day goal would be met, but he declined to put a price tag on the bill.

“I think Congress will work with the president elect starting now and will have a major stimulus package on his desk by Inauguration Day,” Schumer said. “I think it has to be deep. My view it has to be between five and $700 billion.”

Obama said yesterday he aims to save or create 2.5 million jobs in his two-year plan to stimulate an economy facing a “crisis of historic proportions.”

The U.S. economic slowdown has been exacerbated by the worst credit crisis in seven decades. More firings will weigh on the economy and consumer spending will pressure Obama and Congress to agree on legislation that will stimulate growth, economists say.

Economic Team

Obama is moving quickly to assemble his economic team.

Timothy Geithner, head of the Federal Reserve Bank of New York, will be nominated Treasury secretary, and Lawrence Summers will head the National Economic Council, Democratic aides said. Summers served as President Bill Clinton’s last Treasury chief.

House Speaker Nancy Pelosi today said any stimulus package must be several hundred billion dollars. “The sooner we do one, the smaller it can be,” she said on the CBS “Face the Nation” program.

Senator Richard Shelby, the Alabama Republican who is the ranking member of the Senate Banking Committee, said he wants to see the details of a stimulus package before deciding whether to back it. “I want to support things that are meaningful for the economy,” Shelby told ABC.

Obama’s stimulus plan involves an infusion of cash for middle-class tax cuts, rebuilding roads, bridges and schools, building broadband Internet access and investing in clean energy.

Tax Cut Expiration

Obama strategist David Axelrod suggested that Obama might consider delaying a repeal of Bush administration tax cuts for the wealthy by allowing them to expire as scheduled at the end of 2010. “Those considerations will be made,” he said.

The president-elect is “committed to getting middle-class tax relief in the pipeline quickly, and there’s no doubt that we’re going to have to make some hard decisions in order to pay for the things we need,” Axelrod told Fox today. “The main thing right now is to get this economic recovery package on the road, to get money in the pockets of the middle class.”

Senator Carl Levin, a Michigan Democrat, opposed allowing the tax cuts “for the upper brackets” to expire, saying on CNN’s “Late Edition” program that Congress should move more quickly to end them. “We just can’t afford to continue them,” he said.

House Republican Leader John Boehner of Ohio pushed for cutting the capital-gains tax to stimulate the economy.

Capital Gains Tax

“If we’re really serious about creating jobs, what we ought to do is we ought to eliminate the capital-gains tax,” Boehner said on Fox. “Why not lower capital gains taxes for -- and corporate income taxes for corporations in America to help keep jobs here?”

Senator Joe Lieberman, an independent from Connecticut argued for action before President George w. Bush leaves office Jan. 20.

“I’m concerned that we’re between presidents now, and in the meantime, the economy continues to cycle down, and, to a lot of people, out of control,” Lieberman said on CNN’s “Late Edition” program.

Policy makers have “to get banks to start lending money again,” Lieberman said. “They’re not lending money, and, until they do, this economy is going to go nowhere.”

To contact the reporter on this story: tseeley@bloomberg.net; Daniel Whitten in Washington at dwhitten2@bloomberg.net.