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. Last Updated: 07/27/2016

Economic Stimulus Bill Approved by U.S. House

WASHINGTON -- The U.S. House of Representatives passed a package of tax cuts and unemployment aid early Thursday, sending the plan for lifting the recession-hobbled U.S economy to the Senate, where staunch opposition from Democratic leaders seemed to guarantee its failure.

"We deserve a vote," Senator Charles Grassley of Iowa, senior Republican on the Senate Finance Committee, argued in advance of the House vote. "This is bipartisan social policy everybody agrees needs to be done."

But Majority Leader Tom Daschle, a Democrat from South Dakota, offered no guarantee of a vote, labeling the bill's business tax cuts too large and its jobless health insurance subsidies too weak.

Republicans hope the House action will put pressure on the Senate to accept the latest White House plan. But, separately, an intense effort by the White House to round up support among centrist Democrats for its stimulus plan appeared to gain little traction, leaving Republicans with too few votes to overcome procedural hurdles in the closely divided Senate.

In recent days, President Bush has personally wooed moderate Democrats to support a plan negotiated with Senator John Breaux, a Democrat from Louisiana, a leading centrist. But aides in both parties said Breaux has been unable to win much support among fellow Democrats. That leaves the White House as many as nine votes short, because at least one Republican has pledged to vote against the president's plan.

The stimulus bill has been mired in disputes between Democrats and Republicans over the best mix of tax cuts and spending, but the biggest hurdle in recent days has involved health insurance. The issue has prompted a fierce philosophical debate, with Republicans pushing individual tax credits and Democrats arguing to keep such credits within the employer-based system.

Both Democrats and Republicans are increasingly nervous about the impasse, with Democrats fearing they would be blamed for failure but some Republicans concerned they can never win a debate over health insurance.

House Speaker Dennis Hastert, a Republican from Illinois, worked Tuesday to broker an agreement on health-care coverage for unemployed workers, meeting with House Minority Leader Dick Gephardt, a Democrat from Missouri.

Daschle emphasized that aid to the unemployed remains the key to reaching a deal with Democrats. "We seem to be able to agree on virtually everything but workers, about everything but health insurance for those workers, and that's really what it's down to," he said.

Senator Max Baucus, a Democrat from Montana and the chief Senate negotiator, Tuesday floated a new approach that would build on the structure proposed by the administration but instead give individuals access to health associations that pool insurance risks of thousands of people. "Republicans and the White House are moving to the realization that the votes for the individual credit aren't there," he said.

Democrats say they oppose an individual insurance credit because they fear it would undermine the employer-based heath insurance system. (WP, AP)