In My Own Words - Ron Centeno

It was quick but a decisive move on both Houses to reach an agreement on stimulus plan worth $789 billion. Apparently, the whopping size of the package was eclipsed by the speed of its passing. For those in the know, getting into an agreement between the House and the Senate would take days. It took hours, instead.

The willingness of the Democrats in both houses to reduce the original tag from $820 billion (House) and $838 billion (Senate) to the compromise amount accelerated the agreement. Thanks to the three moderate Republican senators namely, Olympia Snowe, Susan Collins, and Arlene Specter, who threw in their support to speed up the process. While the Democrats control 58 seats in the 100-seat Senate, they need some Republican support to reach 60 votes and overcome any possible procedural hurdles.

Not all Republicans, however, gave their nods. They wanted more tax cuts instead of merely expanding big government spending. About 36% of the package is geared toward tax cuts, with the rest in spending. Moreover, the Republicans thought the stimulus legislation was poorly crafted and could end up a taxpayer burden. Others complained they have been left out of the final negotiations.

The bill is made up of four categories: tax breaks for individuals and businesses; investments in health care and alternative energy; funding for “shovel-ready” infrastructure projects; and aid to state and local governments, including expanded benefits for individuals who are unemployed and lack health insurance.

Exactly what Obama had promised during his presidential campaign, the stimulus package is “a plan that will provide immediate relief to families and businesses, while investing in priorities like health care, education, energy, and infrastructure that will grow our economy once more.” Further, Obama quipped that without a stimulus bill, the country faces a possible economic “catastrophe” considering the 3.6 million jobs lost since recession began in December 2007.

Obama reiterated his previous pronouncement to “save or create 3.5 million jobs and get our economy back on track.” In particular, Obama cited heavy equipment maker Caterpillar Inc. to rehire some of its 20,000 laid-off workers if the stimulus package is passed. News of the compromise agreement sent U. S. stock markets higher -clearly, a positive tangible result.

I find the urgent passing of the bill crucial. The bottom line is, the U. S., as well as the global economy are in dire straits. Nothing is more precious than what time is. If those men and women in both Houses and the White House fail to get things done in the soonest possible time, then global deflation would be the order of the day, followed by irreversible pain of years to come.

A stimulus package now is meant to convince people that the government is finally working and that help is on the way. One caveat, however, must be put into consideration. The payoff that would be generated from the spending will not take place today or tomorrow. To the economic pundits, their crystal ball indicates 12 to 18 months before we can begin to harvest the fruits of this compromise deal.

Until then, let us hope that those people we sent to Congress would be able to find a way to ameliorate our collective woes that have sunk our confidence to its lowest level.