Barack Obama, Stimulus Package

OBAMA FOR USA. In early January 2009, Mr. Obama began to lay out his plans for a massive economic stimulus package, a bill meant to pump money into the economy to make up for the sudden, sharp contraction of spending by consumers and businesses. His initial outline called for a package in which about 40 percent of the total cost was devoted to tax cuts, an amount criticized by Senate Democrats as too high and by Congressional Republicans as too low. The plan included tax cuts for Americans making less than $200,000, a proposal that had been a centerpiece of Mr. Obama's campaign.

On Jan. 15, House Democrats unveiled an $825 billion stimulus bill. It included aid to states for Medicaid costs, temporary increases in unemployment benefits and a vast array of public works projects to create jobs, as well as measures to vastly expand federal spending on schools and create a temporary new health care entitlement, under which people receiving unemployment would become eligible for Medicaid. The bill passed on Jan. 28 by a vote of 244 to 188, without a single Republican voting in favor.

The Senate began its debate with a bill that already differed significantly from the House's, primarily by including a $70 billion measure, demanded by Republicans, that would extend protection to middle-class families that would otherwise have been hit by the alternative-minimum tax, a measure that Congress had reliably passed every year for a decade. Democrats accepted some other Republican ideas, including a tax credit for first-time homebuyers. But they beat back a series of Republican amendments that would have replaced much of the bill's spending with tax cuts, including on capital gains and the estate tax.

In early February, three moderate Republicans indicated they would break ranks with their party and vote for the measure -- allowing it to attract the 60 votes needed to avoid a filibuster -- if it were cut. On Feb. 9, the Senate voted 61 to 37 in favor of an $838 billion bill, which scaled back Mr. Obama's tax cuts and aid to the states. With Mr. Emanuel as White House chief of staff taking an unusually direct role in the conference committee negotiations that followed to reconcile the House and Senate versions, a deal was struck within 24 hours of the Senate vote. The final $787 billion version -- approved with no Republican votes in the House and the same three Republicans in the Senate -- saw the further trimming of some items.

The bill was seen as representing a gamble on Mr. Obama's part that the concessions he made to win Republican votes were worth the risk that the resulting boost to the economy had been watered down. Republicans, for their part, seized on the bill's size to launch their most consistent criticism of the president -- that he is spending lavishly in a way that will burden future generations with debt. But the bill's passage, well before the Feb. 20 goal Mr. Obama and Congressional leaders had agreed upon, also represented a clear victory for the new president in his first opportunity to put his stamp on the response to the economic crisis.

In a speech on July 14, Mr. Obama urged patience for his economic policies, thundered at critics in Washington and introduced an education plan intended to help displaced workers find jobs. He also announced that the administration was proposing to spend $12 billion to bolster the nation's network of community colleges, which are heavily attended by working adults, some seeking new expertise, others remedial instruction on the way to four-year college. Most of the $12 billion would go toward programs enticing community colleges to do more to lift graduation rates and better prepare students for jobs.