January 23, 2009
Under the Senate version of President Barack Obama’s economic recovery plan, Senior citizens receiving Social Security would get a bonus of $300. Veterans who get disability payments would also get the $300 under the proposal. The bonus for seniors and poor people receiving Supplementary Security Income payments to the disabled is estimated to cost around $17 billion.
Senior citizens receiving Social Security would get a bonus payment of $300 under the Senate version of President Barack Obama's economic recovery plan.
The tax cuts and spending proposals total $355 billion under the plan released Friday by Finance Committee Chairman Max Baucus, D-Mont., in anticipation of a panel vote on Tuesday. It will be paired with $400 billion in further spending proposed by the Appropriations Committee on the Senate floor.
The bonus for seniors is but one chapter in the Senate proposal. There's also a temporary two-year $500 tax cut for most workers and $1,000 for couples, a $2,500 tax credit to help pay for college, tax cuts for businesses and to promote renewable energy, and $87 billion worth of help to states struggling with their 2009-10 budgets for the Medicaid health care program for the poor and disabled.
The bonus for seniors and poor people receiving Supplemental Security Income payments to the disabled, costing $17 billion, is perhaps the biggest difference between the House and Senate economic recovery plans. Veterans who get disability payments would also get the $300 under the proposal. The emerging House and Senate plans are generally similar otherwise.
The Finance panel also would subsidize health insurance premiums for the unemployed, extend unemployment benefits and provide them to part-time workers, and give a $7,500 tax credit for middle-income, first-time home buyers who purchase homes in the first half of 2009.
Obama wants the bill on his desk by the middle part of next month.
In order to accommodate the $275 billion infusion of tax cuts and even more in new federal spending, the measure would increase the legal limit on borrowing by the federal government by $825 billion, to $12.1 trillion. That means the so-called debt limit will have increased by $1.5 trillion since just October.
Unlike the House plan, which moved through several committees this week in preparation for a floor vote Wednesday, the Senate measure is likely to pick up at least some Republican support.
Republicans are particularly pleased with provisions extending tax cuts for the purchase of new plants and equipment and allowing money-losing businesses to claim refunds on taxes paid up to five years ago.
Workers making $75,000 or less would be eligible for the full $500 tax cut, intended to offset the pain of Social Security payroll taxes, with couples earning up to $150,000 and filing joint returns eligible for a $1,000 credit. The benefits would gradually be phased so that people making between $75,000-$87,500 and couples earning $150,000-$175,000 would get reduced benefits.
Unlike the $600 per worker lump-sum rebates issued last year, taxpayers would have the option of having less withheld from their paychecks. The idea is that people would spend more on goods and services immediately, rather than saving the tax cut or using it to reduce credit card debt.
In a statement, Baucus said the stimulus bill "will create green energy jobs, highway jobs, health care jobs, and other opportunities for folks to get back on their feet."
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