Date: 5/27/2009
RAY HENRY
Associated Press Writer
PAWTUCKET, R.I. (AP) — Joanne Devlin needs about 20 prescription drugs to regulate her blood pressure, keep her arthritic joints limber and pain-free and control her asthma.
She counts on financial help from Rhode Island when her Medicare Part D insurance plan maxes out and no longer pays her drug bills, which can reach $3,000 every three months. But that state help may no longer be an option after Jan. 1.
The financial crisis has grown so severe that lawmakers in Rhode Island and five other states have debated whether to cut or reduce the state funding that helps seniors and disabled people like Devlin buy their drugs.
Devlin, 62, who lives off about $10,000 a year, worries she may need to stop taking her arthritis medication to make ends meet. She stocks shelves and helps distribute food as a volunteer at a Salvation Army food shelter.
“I wouldn’t be able to move a lot,” she said. “I probably wouldn’t even be able to come here. I’d probably have to stay home and some days be bedridden, probably.”
Devlin’s predicament is shared by many of the nearly 27 million people enrolled nationally in Medicare Part D, the federal insurance plan that covers prescription drugs for seniors until the total bill reaches $2,700.
Seniors then hit what’s commonly called the “doughnut hole,” and must personally pay the drug bill until their out-of-pocket costs reach $4,350, at which point Medicare coverage resumes. When seniors fall into this gap, 16 states offer financial assistance, said Thomas McCormack, a consultant for the Community Access National Network and editor of the Medicaid Watch newsletter.
Other states offer help to help defray some of the premium costs associated with Medicare.
Eliminating the program in Rhode Island would save about $700,000 and affect around 8,000 people, while a proposal to scale back benefits in South Carolina would have trimmed roughly $7 million. Officials in South Carolina have estimated about 22,000 people are eligible for the program.
Those savings aren’t huge: they amount to less than 1 percent of the total budget in both states.
Vermont’s governor proposed eliminating the funding this year, but lawmakers instead instituted co-payments that cost recipients $1 or $2. New York and Connecticut rejected plans to curtail assistance, while Massachusetts has scaled back co-payment assistance for its seniors.
Advocates for the elderly fear the cuts will force cash-strapped seniors to stop taking their medications, leading to serious health problems.
“What we repeatedly see happen is that people stop taking their medications, they get sick, they end up in emergency rooms and the they get hospitalized for more serious health problems,” said David Certner, the legislative policy director for AARP.
“In the long-term, this is going to cost more money because it’s going to lead to greater health problems,” Certner said.
Bill Flynn, executive director of the Senior Agenda Coalition of Rhode Island, believes the Rhode Island proposal is the result of across-the-board budget cuts run amok.
“The approach in hard times should not be necessarily, ‘Well, everything’s on the table so low-income seniors need to suffer along with everyone else,’” he said. “The human cost of something like this could be pretty profound.”
In January — as South Carolina grappled with worsening unemployment and $1.1 billion in cuts to its $7 billion budget — the state slashed its doughnut-hole help for seniors from 95 percent to 10 percent.
Gov. Mark Sanford vetoed nearly all of a $5.7 billion budget, including all Medicaid and prescription drug spending, in a fight over using $700 million in federal stimulus money. By overriding his veto on May 20, lawmakers raised South Carolina’s doughnut hole coverage to 40 percent.
Sanford, who says it is unconstitutional for lawmakers to require him to use the stimulus cash, has responded by filing a federal lawsuit.
He said the vote to force him to seek the cash was unconstitutional and that he would fight it in court.
In Rhode Island, which is also wrestling with high unemployment and severe budget shortfalls, Gov. Don Carcieri has proposed cutting his state’s prescription drug program for seniors.
“It was a very difficult decision, and it’s strictly a budget decision,” said Corinne Russo, director of the state Department of Elderly Affairs, which runs that program.
Carcieri’s plan would eliminate next Jan. 1 the program that pays 60 percent of drug costs for its poorest enrollees and covers all their costs beyond $1,500. The assistance, which costs $1.5 million and serves more than 8,000 people, mostly targets the poor, Russo said.
About three-quarters of the state’s funding helps the poorest people enrolled in the program, the group Russo most worries might skimp on medication to make ends meets.
“Those are the people who are most at risk either of not purchasing medication or not being compliant with their medication regimen,” she said. “If a doctor says take one a day, they may take one every other day,” she said.
Compromises may keep the assistance operating. Carcieri’s administration is investigating whether it could use federal Medicaid funding to keep the program running, or perhaps restrict it to the neediest only.
Democrats hold a veto-proof majority in the state Legislature, allowing them to rewrite the Republican governor’s spending plans. But Rep. Steven Costantino, the Democratic chairman of the House Finance Committee, said he could not commit to saving it.
Lawmakers have asked Carcieri’s administration to present them with cost-saving alternatives to totally eliminating the program.
“We’re at the point where we need to ask everybody to sacrifice on this budget,” Costantino said.
And that frightens Anne Fortin, 72, who counts on the state’s help to help her pay for drugs that control her asthma and emphysema. Without it, her monthly drug bill would easily double to $400 or more.
“I could never pay that,” Fortin said. “I’ve been thinking about it. I said, ‘My God, what am I going to do?’”
___
Associated Press Writers Jim Davenport in Columbia, S.C., and John Curran in Montpelier, Vt., contributed to this report.
Copyright 2009 The Associated Press.
Groups find common ground on health care overhaul
Date: 3/27/2009
RICARDO ALONSO-ZALDIVAR
Associated Press Writer
WASHINGTON (AP) — Groups often at odds over health care reform — consumers, insurers, doctors, employers — reached a broad agreement Friday that could serve as a starting point for lawmakers trying to overhaul the system.
Although the long-awaited report of the Health Reform Dialogue avoided some of the most contentious issues, the agreement does have the kind of far-reaching support lawmakers will need to meet their goal of passing legislation this year.
“You can bet I’ll be working closely with these groups,” said Senate Finance Committee Chairman Max Baucus, D-Mont., who is trying to find consensus on Capitol Hill.
In their report, the groups said the uninsured should be covered through a mix of expanded government programs and subsidies to purchase private health coverage. They called for savings from making the health care system less wasteful and urged that prevention become the foundation for medical care. Many of their ideas are shared by President Barack Obama and influential lawmakers such as Baucus.
But the five-page proposal was thin on details, starting with how to pay for the plan. And the groups avoided such divisive issues as whether insurers should be forced to compete with a new government-sponsored insurance plan, as Obama has proposed.
Critics minimized the result. “They’ve moved the health care debate forward a few inches,” said Richard Kirsch, director of Health Care for America Now, a grassroots campaign backed by labor.
The 18 groups met for six months. Along the way, two major unions pulled away, but other groups representing seniors, businesses, nurses, drug makers and patients kept talking.
“What the agreement tries to do is achieve a balance for coverage expansion through the two key pillars of health care today,” said Ron Pollack, executive director of Families USA, a liberal advocacy group that stayed in the talks. “One is employer-sponsored private coverage and the other is safety-net coverage.”
Other participants included the National Federation of Independent Business and the health insurance industry, who were instrumental in sinking the last attempt at a health care overhaul in the 1990s. Also in the talks were staunch supporters of guaranteed coverage for all, such as AARP and the American Cancer Society Cancer Action Network.
The Service Employees International Union and the American Federation of State, County and Municipal Employees took part but didn’t sign on to the agreement because some of their concerns could not be satisfied. That underscored the difficulty of getting a health care compromise.
The groups all but endorsed a requirement that every American obtain health insurance. While their agreement avoided the politically loaded term “individual mandate,” it said Congress should “enact reforms necessary so that all individuals will purchase or obtain quality, affordable health insurance.” They avoided the issue of requiring employers to help pay premiums.
The agreement called for a two-prong strategy to cover the estimated 48 million uninsured. First, the Medicaid program should be expanded to cover all adults earning up to the federal poverty level, about $22,000 for a family of four. Then, subsidies or tax credits should be offered to help the middle class.
“I think what this document represents are some tough choices and some very tough consensus,” said Mary Grealy, president of the Healthcare Leadership Council, which represents the medical industry. “It tells Congress: here are some very important components for health care reform that you can now be assured have widespread agreement.”
The groups decided to sidestep the issue of whether to create a government insurance plan to compete with private companies. Many Democrats see that as an essential element of any final compromise. The insurance industry considers it a deal breaker.
The agreement also failed to spell out how to pay for expanded coverage in what is already the world’s costliest health care system. The options lawmakers are considering include taxing some health insurance benefits and limiting tax deductions for high earners, both seen as highly controversial. Independent estimates of the costs range as high as $1.5 trillion over 10 years.
But the agreement did acknowledge that hospitals, doctors, drug companies, insurers and other major elements of the health care system must become more efficient and less wasteful.
The groups will continue to meet as Congress moves ahead on legislation. Their support could prove decisive if a viable compromise does emerge, much as AARP’s backing helped ensure passage of the Medicare prescription drug benefit.
Copyright 2009 The Associated Press.
RICARDO ALONSO-ZALDIVAR
Associated Press Writer
WASHINGTON (AP) — Groups often at odds over health care reform — consumers, insurers, doctors, employers — reached a broad agreement Friday that could serve as a starting point for lawmakers trying to overhaul the system.
Although the long-awaited report of the Health Reform Dialogue avoided some of the most contentious issues, the agreement does have the kind of far-reaching support lawmakers will need to meet their goal of passing legislation this year.
“You can bet I’ll be working closely with these groups,” said Senate Finance Committee Chairman Max Baucus, D-Mont., who is trying to find consensus on Capitol Hill.
In their report, the groups said the uninsured should be covered through a mix of expanded government programs and subsidies to purchase private health coverage. They called for savings from making the health care system less wasteful and urged that prevention become the foundation for medical care. Many of their ideas are shared by President Barack Obama and influential lawmakers such as Baucus.
But the five-page proposal was thin on details, starting with how to pay for the plan. And the groups avoided such divisive issues as whether insurers should be forced to compete with a new government-sponsored insurance plan, as Obama has proposed.
Critics minimized the result. “They’ve moved the health care debate forward a few inches,” said Richard Kirsch, director of Health Care for America Now, a grassroots campaign backed by labor.
The 18 groups met for six months. Along the way, two major unions pulled away, but other groups representing seniors, businesses, nurses, drug makers and patients kept talking.
“What the agreement tries to do is achieve a balance for coverage expansion through the two key pillars of health care today,” said Ron Pollack, executive director of Families USA, a liberal advocacy group that stayed in the talks. “One is employer-sponsored private coverage and the other is safety-net coverage.”
Other participants included the National Federation of Independent Business and the health insurance industry, who were instrumental in sinking the last attempt at a health care overhaul in the 1990s. Also in the talks were staunch supporters of guaranteed coverage for all, such as AARP and the American Cancer Society Cancer Action Network.
The Service Employees International Union and the American Federation of State, County and Municipal Employees took part but didn’t sign on to the agreement because some of their concerns could not be satisfied. That underscored the difficulty of getting a health care compromise.
The groups all but endorsed a requirement that every American obtain health insurance. While their agreement avoided the politically loaded term “individual mandate,” it said Congress should “enact reforms necessary so that all individuals will purchase or obtain quality, affordable health insurance.” They avoided the issue of requiring employers to help pay premiums.
The agreement called for a two-prong strategy to cover the estimated 48 million uninsured. First, the Medicaid program should be expanded to cover all adults earning up to the federal poverty level, about $22,000 for a family of four. Then, subsidies or tax credits should be offered to help the middle class.
“I think what this document represents are some tough choices and some very tough consensus,” said Mary Grealy, president of the Healthcare Leadership Council, which represents the medical industry. “It tells Congress: here are some very important components for health care reform that you can now be assured have widespread agreement.”
The groups decided to sidestep the issue of whether to create a government insurance plan to compete with private companies. Many Democrats see that as an essential element of any final compromise. The insurance industry considers it a deal breaker.
The agreement also failed to spell out how to pay for expanded coverage in what is already the world’s costliest health care system. The options lawmakers are considering include taxing some health insurance benefits and limiting tax deductions for high earners, both seen as highly controversial. Independent estimates of the costs range as high as $1.5 trillion over 10 years.
But the agreement did acknowledge that hospitals, doctors, drug companies, insurers and other major elements of the health care system must become more efficient and less wasteful.
The groups will continue to meet as Congress moves ahead on legislation. Their support could prove decisive if a viable compromise does emerge, much as AARP’s backing helped ensure passage of the Medicare prescription drug benefit.
Copyright 2009 The Associated Press.
The recovery plan: shock & awe for a shaken nation
Date: 2/14/2009
By NANCY BENAC and CALVIN WOODWARD
Associated Press Writers
WASHINGTON (AP) — America is bringing shock and awe to the home front, using dollars instead of bombs.
It’s the military doctrine of lightning force — fast and brute, or as brute as the shaken country can manage — applied to the campaign for economic recovery.
With a record-busting stimulus plan, the U.S. is marshaling resources against economic catastrophe in ways not seen since Franklin Roosevelt put the New Deal in motion.
President Barack Obama is going with the best deal he could get. The stimulus bill is a landmark legislative achievement for a new president who inherited economic spoilage along with the spoils of power. Now the nation anxiously waits to see if it works.
Undermining federal balance sheets that were already deeply in the red, Obama and Congress settled on a nearly $800 billion plan that aims to spend more on the crisis at hand than the government has spent waging the Iraq war for six years.
The idea: fast cash, and lots of it, but with a strategic view to the future.
Some dollars will flow quickly into wallets — and right out again.
The stimulus plan will mean thousands of dollars in tax breaks for first-time home buyers and people buying new cars. Lower- and middle-income taxpayers will get an extra $13 a week in their paychecks this year, and about $8 a week next year. Unemployment checks will go up $25 a week, and keep coming longer. Food stamp benefits for 30 million Americans will rise. Short-term health insurance will become more affordable for many losing their jobs.
The success of the stimulus package may be measured less by visible achievements than by what does not happen — the home that is not foreclosed, the family that doesn’t slip into poverty, the disease that does not go undiagnosed.
“The one thing we’ll never know is what would have happened if we didn’t do it,” said Nigel Gault, chief U.S. economist for IHS Global Insight.
It’s not FDR’s deal and these aren’t his times.
No federally subsidized artists will paint murals glorifying the muscle of American workers or the progress belching from smokestacks, as they did in Roosevelt’s day.
No grand compact is to be formed between generations like the one that promised everyone a federal pension. No institutions will rise to try something brand new.
“We’re not reinventing government,” said historian Kenneth C. Davis, author of the best-selling “Don’t Know Much About” series. “We’re modifying things that exist.”
Yet as the share of the economy taken up by federal spending rises to an anticipated 30 percent, the nation is grappling again with big questions about Washington’s place in people’s lives.
“The stakes are so high now, this is such a big bill, average Americans are following it,” says Princeton historian Julian Zelizer. “It’s become a bill that is an argument about what government can or can’t do.
“If there is no effect and in six months we are talking about the same economy or a worse economy, I think it would be a devastating blow to the president, Democrats, and to liberal claims about what government can do.”
To critics such as Senate Republican leader Mitch McConnell, the package is the “Europeanization of America.” Others call it “Rooseveltian” or “generational theft” in reference to the debt passed on to the future.
They might envision murals glorifying little more than filled potholes, insulated windows, depreciated computers.
Obama said it’s about more than that, and drew parallels with FDR in speaking Friday to the Business Council, formed by corporate leaders in the 1930s to advise Roosevelt’s administration.
“We adapted, we changed,” he said about those days — and these. “President Roosevelt understood the new role of government in this new world, that while extraordinary actions on its part might be the source of recovery, no action on the part of government, no matter how extraordinary, would alone be the source of our prosperity.”
In his radio address Saturday, Obama said he believed the country “will turn this crisis into opportunity and emerge from our painful present into a brighter future.”
Democrats and just enough Republicans in Congress — three — saw the package as the best chance to tamp down the economic wildfires breaking out across the landscape.
Obama came into office saying he wished to be judged on his first 1,000 days instead of the usual benchmark of 100. In some ways he will be judged on his first 10 or 20.
Not even Roosevelt, fast off the mark to deal with a bank crisis, was as fast as this in achieving something so sweeping, so early.
The enormity of the package left politicians grasping for concrete ways to convey its size.
Sen. John Thune, R-S.D., spoke of a stack of hundred-dollar bills 689 miles high, and of bills wrapped side-by-side that would encircle the Earth nearly 39 times. House Republicans predicted that the package’s costs — with interest on the necessary borrowing — could total more than a trillion dollars, enough money to buy about 1,000 boxes of Girl Scout cookies for every American.
It was enough to prompt comic Jon Stewart to riff that if you sewed the $100 bills together, “you would make a blanket for Jupiter.”
The stimulus wasn’t just about throwing cash at the economy, though.
The package is filled with billions for some of the same goals that Obama preached about on the presidential campaign trail — renewable energy and green jobs, computerized medical records, broadband Internet service for underserved areas.
“There are seeds in this bill for long-term change,” says Zelizer. “There are things that can develop out of the research that can change our lives.”
Obama sounded a drumbeat of warnings about the consequences of failing to act. But Americans didn’t need their president to tell them how grim the economic situation was — and could become.
Forty percent of Americans already have been affected by some sort of job problem in the past year, be it unemployment, underemployment, layoffs, reductions in pay or hours, or job losses by members of their households, according to a poll released Friday by the Pew Research Center. Fifty-six percent expect things to be worse or about the same a year from now — and they’ve got solid grounds for their pessimism.
The country could well suffer a net loss of 2 million to 3 million or more jobs this year, economists believe. And the unemployment rate, now 7.6 percent, could top 9 percent by spring of 2010.
The stimulus pull-together was a colossal game of winners and losers shaped and reshaped by the latest set of hands on the package. The fortunes of people, schools, towns and other varied interests rose and fell in blinks of time.
Ready to buy another home?
Poof — you just lost $15,000 that legislators had considered providing.
Buying a first home? You’re still in luck — the government plans to give you an $8,000 credit if you buy by the end of November.
A new car? You’ll be able to deduct the thousands in sales taxes from your income tax but not — as was initially proposed — your loan interest as well.
One day, the government proposed to pay 65 percent of the cost of health coverage for a year for jobless people who lose their workplace insurance. Days later, it was down to half. Ultimately, the subsidy zigzagged back up to 65 percent, but it expires before the end of the year.
Obama declared an end to pork-barrel politics, but legislators still managed to look out for favorite projects.
Senate Majority Leader Harry Reid, D-Nev., was quick to point out that a big chunk of the $8 billion set aside to construct high-speed rail lines could go to a proposed Los Angeles-to-Las Vegas route. Sen. Arlen Specter, R-Pa., helped make sure $10 billion was set aside for the National Institutes of Health, a priority of his.
Long after the dust has settled from the horse trading, the government will be seen to have moved with unaccustomed speed on policies normally subjected to years of deliberation and gridlock.
Deficit hawks found their wings clipped as both parties reached for the treasury. Democrats mainly wished to spend; Republicans, mainly to cut taxes.
After last November, guess who got their way?
Democratic House Speaker Nancy Pelosi said flatly: “We won the election; we wrote the bill.”
The debate was both large and small. Negotiators considered the proper role of government — and how fast a business can depreciate its equipment.
Entering the 1930s, Americans mainly saw the national government as the entity that fought wars, ran post offices and enforced a ban on liquor. Federal spending was only 3.4 percent of the economy.
That more than tripled during the New Deal, topping 10 percent, because of the explosion of public works and other labor programs, rural modernization, bank support, and farm and industrial aid.
“It was a transformation of society in a way that hadn’t been done since the end of the Civil War and the end of slavery,” Davis said.
The government became the entity that guaranteed a minimum wage, controlled farm production, supported artists, set workplace standards, insured deposits in regulated banks and cast the first national safety net for the elderly and handicapped under Social Security.
“The whole scope of what Roosevelt was trying to do is different but the intent is clearly the same: relief and recovery during a time of economic stress,” said John Halpin, senior fellow at the Center for American Progress.
The package won by Obama offers “very important but more subterranean changes in the way the economy works,” he said.
Federal spending as a share of the economy shot above 40 percent during World War II and has hovered around 20 percent most of the years since. That share was already projected to approach 25 percent before Obama’s stimulus plan.
To be sure, there’s still considerable disagreement about how much the New Deal helped to end a depression finally crushed by the humming factories of World War II.
Even FDR’s transformation of the federal government was not universally recognized at the time for what it was. It may be years before the full measure of Obama’s efforts are taken, too.
In 1936, The Economist magazine pronounced the New Deal a “striking success” in improving conditions that existed when FDR took office three years earlier.
But what of the legacy?
What legacy?
“If the criterion be Utopian, the achievements of the New Deal appear to be small,” the editors sniffed. “The great problems of the country are hardly touched.”
___
Associated Press writer Alan Fram contributed to this report.
Copyright 2009 The Associated Press.
By NANCY BENAC and CALVIN WOODWARD
Associated Press Writers
WASHINGTON (AP) — America is bringing shock and awe to the home front, using dollars instead of bombs.
It’s the military doctrine of lightning force — fast and brute, or as brute as the shaken country can manage — applied to the campaign for economic recovery.
With a record-busting stimulus plan, the U.S. is marshaling resources against economic catastrophe in ways not seen since Franklin Roosevelt put the New Deal in motion.
President Barack Obama is going with the best deal he could get. The stimulus bill is a landmark legislative achievement for a new president who inherited economic spoilage along with the spoils of power. Now the nation anxiously waits to see if it works.
Undermining federal balance sheets that were already deeply in the red, Obama and Congress settled on a nearly $800 billion plan that aims to spend more on the crisis at hand than the government has spent waging the Iraq war for six years.
The idea: fast cash, and lots of it, but with a strategic view to the future.
Some dollars will flow quickly into wallets — and right out again.
The stimulus plan will mean thousands of dollars in tax breaks for first-time home buyers and people buying new cars. Lower- and middle-income taxpayers will get an extra $13 a week in their paychecks this year, and about $8 a week next year. Unemployment checks will go up $25 a week, and keep coming longer. Food stamp benefits for 30 million Americans will rise. Short-term health insurance will become more affordable for many losing their jobs.
The success of the stimulus package may be measured less by visible achievements than by what does not happen — the home that is not foreclosed, the family that doesn’t slip into poverty, the disease that does not go undiagnosed.
“The one thing we’ll never know is what would have happened if we didn’t do it,” said Nigel Gault, chief U.S. economist for IHS Global Insight.
It’s not FDR’s deal and these aren’t his times.
No federally subsidized artists will paint murals glorifying the muscle of American workers or the progress belching from smokestacks, as they did in Roosevelt’s day.
No grand compact is to be formed between generations like the one that promised everyone a federal pension. No institutions will rise to try something brand new.
“We’re not reinventing government,” said historian Kenneth C. Davis, author of the best-selling “Don’t Know Much About” series. “We’re modifying things that exist.”
Yet as the share of the economy taken up by federal spending rises to an anticipated 30 percent, the nation is grappling again with big questions about Washington’s place in people’s lives.
“The stakes are so high now, this is such a big bill, average Americans are following it,” says Princeton historian Julian Zelizer. “It’s become a bill that is an argument about what government can or can’t do.
“If there is no effect and in six months we are talking about the same economy or a worse economy, I think it would be a devastating blow to the president, Democrats, and to liberal claims about what government can do.”
To critics such as Senate Republican leader Mitch McConnell, the package is the “Europeanization of America.” Others call it “Rooseveltian” or “generational theft” in reference to the debt passed on to the future.
They might envision murals glorifying little more than filled potholes, insulated windows, depreciated computers.
Obama said it’s about more than that, and drew parallels with FDR in speaking Friday to the Business Council, formed by corporate leaders in the 1930s to advise Roosevelt’s administration.
“We adapted, we changed,” he said about those days — and these. “President Roosevelt understood the new role of government in this new world, that while extraordinary actions on its part might be the source of recovery, no action on the part of government, no matter how extraordinary, would alone be the source of our prosperity.”
In his radio address Saturday, Obama said he believed the country “will turn this crisis into opportunity and emerge from our painful present into a brighter future.”
Democrats and just enough Republicans in Congress — three — saw the package as the best chance to tamp down the economic wildfires breaking out across the landscape.
Obama came into office saying he wished to be judged on his first 1,000 days instead of the usual benchmark of 100. In some ways he will be judged on his first 10 or 20.
Not even Roosevelt, fast off the mark to deal with a bank crisis, was as fast as this in achieving something so sweeping, so early.
The enormity of the package left politicians grasping for concrete ways to convey its size.
Sen. John Thune, R-S.D., spoke of a stack of hundred-dollar bills 689 miles high, and of bills wrapped side-by-side that would encircle the Earth nearly 39 times. House Republicans predicted that the package’s costs — with interest on the necessary borrowing — could total more than a trillion dollars, enough money to buy about 1,000 boxes of Girl Scout cookies for every American.
It was enough to prompt comic Jon Stewart to riff that if you sewed the $100 bills together, “you would make a blanket for Jupiter.”
The stimulus wasn’t just about throwing cash at the economy, though.
The package is filled with billions for some of the same goals that Obama preached about on the presidential campaign trail — renewable energy and green jobs, computerized medical records, broadband Internet service for underserved areas.
“There are seeds in this bill for long-term change,” says Zelizer. “There are things that can develop out of the research that can change our lives.”
Obama sounded a drumbeat of warnings about the consequences of failing to act. But Americans didn’t need their president to tell them how grim the economic situation was — and could become.
Forty percent of Americans already have been affected by some sort of job problem in the past year, be it unemployment, underemployment, layoffs, reductions in pay or hours, or job losses by members of their households, according to a poll released Friday by the Pew Research Center. Fifty-six percent expect things to be worse or about the same a year from now — and they’ve got solid grounds for their pessimism.
The country could well suffer a net loss of 2 million to 3 million or more jobs this year, economists believe. And the unemployment rate, now 7.6 percent, could top 9 percent by spring of 2010.
The stimulus pull-together was a colossal game of winners and losers shaped and reshaped by the latest set of hands on the package. The fortunes of people, schools, towns and other varied interests rose and fell in blinks of time.
Ready to buy another home?
Poof — you just lost $15,000 that legislators had considered providing.
Buying a first home? You’re still in luck — the government plans to give you an $8,000 credit if you buy by the end of November.
A new car? You’ll be able to deduct the thousands in sales taxes from your income tax but not — as was initially proposed — your loan interest as well.
One day, the government proposed to pay 65 percent of the cost of health coverage for a year for jobless people who lose their workplace insurance. Days later, it was down to half. Ultimately, the subsidy zigzagged back up to 65 percent, but it expires before the end of the year.
Obama declared an end to pork-barrel politics, but legislators still managed to look out for favorite projects.
Senate Majority Leader Harry Reid, D-Nev., was quick to point out that a big chunk of the $8 billion set aside to construct high-speed rail lines could go to a proposed Los Angeles-to-Las Vegas route. Sen. Arlen Specter, R-Pa., helped make sure $10 billion was set aside for the National Institutes of Health, a priority of his.
Long after the dust has settled from the horse trading, the government will be seen to have moved with unaccustomed speed on policies normally subjected to years of deliberation and gridlock.
Deficit hawks found their wings clipped as both parties reached for the treasury. Democrats mainly wished to spend; Republicans, mainly to cut taxes.
After last November, guess who got their way?
Democratic House Speaker Nancy Pelosi said flatly: “We won the election; we wrote the bill.”
The debate was both large and small. Negotiators considered the proper role of government — and how fast a business can depreciate its equipment.
Entering the 1930s, Americans mainly saw the national government as the entity that fought wars, ran post offices and enforced a ban on liquor. Federal spending was only 3.4 percent of the economy.
That more than tripled during the New Deal, topping 10 percent, because of the explosion of public works and other labor programs, rural modernization, bank support, and farm and industrial aid.
“It was a transformation of society in a way that hadn’t been done since the end of the Civil War and the end of slavery,” Davis said.
The government became the entity that guaranteed a minimum wage, controlled farm production, supported artists, set workplace standards, insured deposits in regulated banks and cast the first national safety net for the elderly and handicapped under Social Security.
“The whole scope of what Roosevelt was trying to do is different but the intent is clearly the same: relief and recovery during a time of economic stress,” said John Halpin, senior fellow at the Center for American Progress.
The package won by Obama offers “very important but more subterranean changes in the way the economy works,” he said.
Federal spending as a share of the economy shot above 40 percent during World War II and has hovered around 20 percent most of the years since. That share was already projected to approach 25 percent before Obama’s stimulus plan.
To be sure, there’s still considerable disagreement about how much the New Deal helped to end a depression finally crushed by the humming factories of World War II.
Even FDR’s transformation of the federal government was not universally recognized at the time for what it was. It may be years before the full measure of Obama’s efforts are taken, too.
In 1936, The Economist magazine pronounced the New Deal a “striking success” in improving conditions that existed when FDR took office three years earlier.
But what of the legacy?
What legacy?
“If the criterion be Utopian, the achievements of the New Deal appear to be small,” the editors sniffed. “The great problems of the country are hardly touched.”
___
Associated Press writer Alan Fram contributed to this report.
Copyright 2009 The Associated Press.