By Sean Mussenden
Media General News Service
Media General News Service
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WASHINGTON-The House passed an economic recovery package Wednesday that would send at least $16 billion to North Carolina, including $1.9 billion over the next two years to help the state patch its gaping budget hole.
The $819 billion package is a mix of spending and targeted tax cuts that supporters hope will immediately create new jobs and kick-start the slumping economy.
Despite President Barack Obama's plea for bipartisan unity, the package passed along party lines, with every Republican and 11 Democrats voting against it. Rep. Heath Shuler was the only North Carolina Democrat to vote against the measure.
"We have an obligation to get ourselves out of a ditch," said Rep. Mel Watt, D-N.C. "I'm sure a lot of Republicans believe they have the luxury of standing back and second guessing and saying, `no, no, no.'"
Republicans complained that the package was loaded with spending projects that would not immediately create jobs while significantly expanding the deficit.
"We can immediately jumpstart the economy by cutting taxes, but that's not what this bill is all about. This bill is all about sneaking in all their pet projects," said Rep. Virginia Foxx, R-N.C.
Foxx and other Republicans backed an alternative package that that included larger tax cuts and less spending. The alternative failed Wednesday.
The package that passed included almost $300 billion in increased tax breaks for the poor, some parents, homebuyers and businesses. Republican and Democratic economists disagree about how effective tax cuts are in stimulating the economy.
It also included more than $500 billion for road projects, school construction, health care for the poor and other programs.
One provision would require the Homeland Security Department to only purchase uniforms made in the United States.
Rep. Larry Kissell, D-N.C., a former textile worker who sponsored the uniform provision, said he hoped it would help North Carolina's ailing textile and apparel manufacturers.
"With our presence in textiles, I feel that it will help us. But, if not, it will help workers somewhere," he said.
Rep. Patrick McHenry, R-N.C., pointed out that many of the tax cuts in the legislation expire within two years. Republicans want more permanent tax breaks. And he took issue with the fact that the package would direct money to the National Endowment for the Arts but would not increase specific assistance for workers who lost jobs when trade deals prompted companies to send jobs overseas.
"There are worthy things not included in the bill," he said.
In a statement, Shuler said he voted against the package because it would significantly expand the deficit and contained "too much additional spending in areas that will not offer immediate economic stimulus."
The Senate is expected to pass a costlier version of the package. Then, a committee of House members and senators will hash out differences between the bills. President Barack Obama hopes to sign it by mid-February.
A state-by-state analysis of the House bill by the Center for American Progress, a progressive think tank, found that North Carolina would receive at least $16 billion from the larger spending and tax cut provisions in the bill.
North Carolina's share includes $937 million in 2009 and again in 2010 to make up a budget shortfall in the state.
Gov. Bev Perdue, D-N.C., flew to Washington earlier this month to tell congressional leaders and Obama's aides that the state faces a $2 billion shortfall this year.
Perdue said she could make up half the deficit by cutting state spending but wanted the federal government to make up the remaining $1 billion.
Because the final version has not been signed by Obama, "We're not quite in a position to say whether it's enough to fix all our problems, but we're hopeful," said Chrissy Pearson, a Perdue spokeswoman.
Sean Mussenden can be reached at smussenden@mediageneral.com or 202-662-7668.
The $819 billion package is a mix of spending and targeted tax cuts that supporters hope will immediately create new jobs and kick-start the slumping economy.
Despite President Barack Obama's plea for bipartisan unity, the package passed along party lines, with every Republican and 11 Democrats voting against it. Rep. Heath Shuler was the only North Carolina Democrat to vote against the measure.
"We have an obligation to get ourselves out of a ditch," said Rep. Mel Watt, D-N.C. "I'm sure a lot of Republicans believe they have the luxury of standing back and second guessing and saying, `no, no, no.'"
Republicans complained that the package was loaded with spending projects that would not immediately create jobs while significantly expanding the deficit.
"We can immediately jumpstart the economy by cutting taxes, but that's not what this bill is all about. This bill is all about sneaking in all their pet projects," said Rep. Virginia Foxx, R-N.C.
Foxx and other Republicans backed an alternative package that that included larger tax cuts and less spending. The alternative failed Wednesday.
The package that passed included almost $300 billion in increased tax breaks for the poor, some parents, homebuyers and businesses. Republican and Democratic economists disagree about how effective tax cuts are in stimulating the economy.
It also included more than $500 billion for road projects, school construction, health care for the poor and other programs.
One provision would require the Homeland Security Department to only purchase uniforms made in the United States.
Rep. Larry Kissell, D-N.C., a former textile worker who sponsored the uniform provision, said he hoped it would help North Carolina's ailing textile and apparel manufacturers.
"With our presence in textiles, I feel that it will help us. But, if not, it will help workers somewhere," he said.
Rep. Patrick McHenry, R-N.C., pointed out that many of the tax cuts in the legislation expire within two years. Republicans want more permanent tax breaks. And he took issue with the fact that the package would direct money to the National Endowment for the Arts but would not increase specific assistance for workers who lost jobs when trade deals prompted companies to send jobs overseas.
"There are worthy things not included in the bill," he said.
In a statement, Shuler said he voted against the package because it would significantly expand the deficit and contained "too much additional spending in areas that will not offer immediate economic stimulus."
The Senate is expected to pass a costlier version of the package. Then, a committee of House members and senators will hash out differences between the bills. President Barack Obama hopes to sign it by mid-February.
A state-by-state analysis of the House bill by the Center for American Progress, a progressive think tank, found that North Carolina would receive at least $16 billion from the larger spending and tax cut provisions in the bill.
North Carolina's share includes $937 million in 2009 and again in 2010 to make up a budget shortfall in the state.
Gov. Bev Perdue, D-N.C., flew to Washington earlier this month to tell congressional leaders and Obama's aides that the state faces a $2 billion shortfall this year.
Perdue said she could make up half the deficit by cutting state spending but wanted the federal government to make up the remaining $1 billion.
Because the final version has not been signed by Obama, "We're not quite in a position to say whether it's enough to fix all our problems, but we're hopeful," said Chrissy Pearson, a Perdue spokeswoman.
Sean Mussenden can be reached at smussenden@mediageneral.com or 202-662-7668.