Obama plan has $200 billion in economic boosters

  @CNNMoney December 4, 2012: 5:38 AM ET
tim geithner 2

Treasury Secretary Tim Geithner is point person for the White House in talks with Congress over how to avoid the fiscal cliff. Over the weekend, he made the case for stimulus.

WASHINGTON (CNNMoney)

The White House initial proposal to avert the fiscal cliff includes $200 billion in economic boosters -- a stimulus plan Republican critics are railing against when they say the country needs to start reducing debt.

But even deficit hawks say spending more now is fine and even warranted to support a fledgling economic recovery. The key is long-term cuts that take effect down the road.

"What the president has pitched is pretty small," said William Gale, who co-directs the Brookings Institution's Tax Policy Center. "There's a lot more that could be done, and it wouldn't have that much of a negative long-term impact."

What's in President Obama's $200 billion plan for economic growth?

Two administration officials confirmed some of the stimulus policies Obama would like to see. The dollar figures are drawn from Congressional Budget Office and Congressional Research Service estimates on past proposals.

* $95 billion to extend the payroll tax cut one year.

* $30 billion to extend unemployment insurance benefits a year.

* $50 billion to fund infrastructure projects like roads and bridges.

* $25 billion for other short-term programs, including extending a tax deduction that lets businesses accelerate depreciation on equipment purchases.

The administration also would include measures to make it easier for homeowners to refinance their mortgages.

However, the world "stimulus" is a nonstarter to many Republicans, especially those who credit their 2010 political takeover of the U.S. House to their campaign to end big government, including stimulus.

"At a time when the entire nation recognizes there's a spending problem, (stimulus) is not serious, it's absurd," said Rep. Peter Roskam of Illinois, a top House Republican.

On Monday, House Speaker John Boehner made a counter-offer to the White House, offering to cut $2.2 trillion from deficits through massive changes to federal programs like Medicaid and Medicare. In the letter, Boehner also blasted Obama's stimulus measures.

To prevent the fiscal cliff, the White House would also stop the Alternative Minimum Tax from expiring, extend corporate tax credits for research and development as well as pass the doc fix to prevent a 27% cut in the rates at which doctors are reimbursed for Medicare.

- CNN's Jessica Yellin contributed to this report. To top of page



Join the Conversation
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.32%4.26%
15 yr fixed3.36%3.27%
5/1 ARM3.37%3.27%
30 yr refi4.31%4.24%
15 yr refi3.34%3.25%
View rates in your area
 
Find personalized rates:
Rate data provided
by Bankrate.com
CNNMoney Sponsors
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.