2nd stimulus package talks

[WSJ]

Rep. Rangel Says Stimulus Should Focus on Cities, States
OCTOBER 29, 2008, 5:12 P.M. ET
By MARTIN VAUGHAN

WASHINGTON -- House Ways and Means Committee Chairman Charles Rangel (D., N.Y.), said he wants upcoming fiscal stimulus legislation to funnel aid to states and localities. He said he hopes that package can be approved shortly after the election.

"Our hope is that the leadership of both parties will be able to confer and come back after the election, and see what we can do to provide assistance to our local and state governments, as we have been able to do for our banking and finance industry," Rep. Rangel said at the outset of a committee hearing Wednesday on stimulus discussions.

U.S. Rep. Charles Rangel said he wants upcoming fiscal stimulus legislation to funnel aid to states and localities.
State governors and local officials testifying at the hearing put forward to lawmakers a wish list worth tens of billions to help shore up their finances. Their argument: we didn't create the financial mess, and we need Washington's help to get out of it.

"The failure of our federal regulatory system has caused too many innocent bystanders to suffer," said New York Gov. David Paterson at the hearing. "Just like the financial services industry, we need a partner in the federal government in order to help stave off an impending calamity and stabilize our fiscal condition."

New York faces a $47 billion budget shortfall over the next four years, and it is far from alone as states face unprecedented expenditures even as the economic recession shrinks their revenues.

Republicans, including South Carolina Gov. Mark Sanford and Louisiana Rep. Jim McCrery warned that Democrats shouldn't draft legislation that would be opposed by Senate Republicans and the White House. Republicans say a $150 billion package -- which is along the lines of what Democrats are discussing -- is too much spending.

"I beg you not to approve a $150 billion stimulus package, for the unintended consequences it would bring for my state, all states in the union and our kids and grandkids," Gov. Sanford told the House panel. "If you go ahead with this, the question has to be asked, who bails out the bailout-or?"

Gov. Paterson asked for a direct injection of federal aid to state budgets. That is more important, Paterson said, than increasing infrastructure funding and boosting federal funding for unemployment and food stamps, initiatives that he also supports.

That fiscal aid could be provided through a temporary boost in the federal share of Medicaid funding. Paterson recommended raising the federal share by at least 5% through 2011 for the states in greatest need, and providing emergency block grant funding to states.

Douglas H. Palmer, the mayor of Trenton, N.J., proposed that Congress approve $90 billion in aid to cities. That aid would go to fund highway, transit and water and sewer infrastructure, as well as Amtrak, schools, public housing and first responders, among other uses.

"In the words of that great poet John Lennon, I say "Help! I need somebody, not just anybody,'" Mr. Palmer joked.

Write to Martin Vaughan at martin.vaughan@dowjones.com

http://online.wsj.com/article/SB122531001010281305.html?mod=googlenews_wsj

[Guest]

[AP]

NY, SC govs disagree on more stimulus amid crisis
By DEVLIN BARRETT – 7 hours ago

WASHINGTON (AP) — Two governors offered Congress starkly different solutions Wednesday for the ailing economy, with New York's David Paterson seeking immediate aid from Congress, and South Carolina's Mark Sanford urging lawmakers not to throw more taxpayer money at the problem.

Paterson, testifying Wednesday before the House Ways and Means Committee, asked Congress to include aid for state budgets as part of any new economic stimulus package. Lawmakers are considering a stimulus package that could be voted on after the Nov. 4 election.

"Just like the financial services industry, we need a partner in the federal government in order to help stave off an impending financial calamity and stabilize our fiscal condition," said Paterson, a Democrat.

On Tuesday, Paterson said New York is facing a $47 billion deficit by 2012.

Twenty-nine states closed budget gaps totaling $48 billion for the 2009 budget year, and the projected shortfall for the following year is $100 billion, said Paterson.

Paterson is seeking higher Medicaid payments to states, greater unemployment benefits, infrastructure spending, and a boost in food stamp benefits to help state budgets.

Sanford, a South Carolina Republican who was also appearing before the committee, contended they should not pass another stimulus package because it will not fix the economic problems but drive the country deeper into debt.

"I'm here to beg of you not to approve or advance the contemplated $150 billion stimulus package," Sanford said. "This $150 billion salve may in fact further infect our economy with unnecessary government influence and unintended fiscal consequences."

By Sanford's count, the federal government has already pumped $2 trillion into the economy this year through a previous stimulus package, the financial services bailout, and rescue actions for specific firms.

After Paterson and Sanford offered heady arguments featuring quotes from noted economists and novelist Ayn Rand, the committee heard from another witness, Mayor Douglas Palmer of Trenton, N.J.

He had a much simpler message, quoting "that great poet John Lennon of the Beatles."

"Help!" the mayor said.

The committee's senior Republican, Jim McCrery of Louisiana, warned his fellow lawmakers against embracing "all sorts of good-sounding spending increases" that may not pass a closely divided Senate or be signed by President Bush in the waning days of his administration.

Committee Chairman Charles Rangel, D-N.Y., said he hoped "leadership of both parties would be able to confer and come back after the election and see what we can do to provide assistance to local and state governments."

A separate hearing before the House Transportation and Infrastructure Committee demonstrated bipartisan support for tens of billions of dollars for infrastructure projects such as highway construction, water and sewer projects and modernization of schools and public housing.

There, lawmakers and witnesses such as New Jersey Gov. Jon Corzine, a Democrat, touted public works projects for both creating jobs and making the economy more efficient.

"Every billion dollars in spending on infrastructure, on highway and transportation expenditures does result in 35,000 new jobs," said Rep. John Mica, R-Fla.

http://ap.google.com/article/ALeqM5jGcBHvnIaKwyq-VPObjMSdZvM4fgD944AJLG0

[Guest]

[Guest]

[mycentraljersey]

Corzine supports second stimulus bill
By RAJU CHEBIUM • Gannett News Service • October 29, 2008

WASHINGTON —Congress should spend $250 billion to $300 billion soon as part of a second stimulus package aimed at jumpstarting the sagging economy, Gov. Jon S. Corzine said Wednesday.

Most of that money must be spent on road, bridge, transit and other infrastructure projects, Corzine told the House Transportation and Infrastructure Committee, and he urged lawmakers to pass a stimulus bill soon after the Nov. 4 election instead of waiting until next year.

Corzine and other supporters argued that infrastructure spending would create tens of thousands of jobs immediately in construction and related industries.

The panel held the hearing during a congressional recess and Democratic leaders plan to convene a lame-duck session in mid-November to pass a second stimulus bill.

Corzine testified that New Jersey's budget, currently $400 million in the red, may be as much as $4 billion in the hole next year, as tax revenue falls amid the economic slowdown.

"New Jersey must act to the best of our ability to stabilize our economy. I clearly and respectfully recommend the federal government act as well," he said in written comments to the panel. "I recommend the committee work to include infrastructure investments as a critical element of any federal effort."

New Jersey has $1.2 billion worth of construction projects that could begin in the next three to four months if Congress passes a stimulus bill quickly, Corzine said.

A nearly $170 billion measure President Bush signed into law in February provided tax rebates to more than 100 million filers. Though many congressional Democrats pushed for a second measure aimed at creating jobs, Republicans and Bush balked.

After the financial meltdown, following which Congress passed an unprecedented $700 billion bailout package, the opposition appears to have softened.

For instance, Florida Rep. John Mica, the senior Republican on the transportation committee, didn't object to another stimulus, but said Republicans would push to include some items important to them, such as small-business tax breaks. He also said he doesn't want congressional pet projects known as "earmarks" to become part of a stimulus bill.

Corzine has been a prominent advocate of infrastructure spending.

This winter, at the National Governors Association meeting in Washington, he joined California GOP Gov. Arnold Schwarzenegger and other Republican and Democratic governors to press for infrastructure spending.

In September, the House passed a $61 billion stimulus bill, which died in the Senate after Bush threatened a veto. Half that amount was to be spent on road and bridge projects.

House leaders now are calling for a bigger amount, about $300 billion, with much of that money going toward infrastructure. House Transportation Committee Chairman James Oberstar of Minnesota said there are more than 3,000 highway and bridge projects nationwide waiting to proceed.

If Congress approves a $300 billion measure, New Jersey's share could be $450 million, the state's transportation commissioner, Kris Kolluri, said after the hearing.

http://www.mycentraljersey.com/article/20081029/STATE/81029041