White House and congressional negotiators reached a compromise Wednesday on an economic recovery plan that carries a reduced price tag of under $800 billion, Senate Majority Leader Harry Reid said.
The $789 billion plan pares down some of the tax breaks in the Senate's version of the bill and restores some spending for school repair and construction and state assistance in the House version. The total is lower than the stimulus bills passed separately by the House and Senate.
Reid said more than one-third of the bill is dedicated to tax cuts for the middle class. The Nevada Democrat thanked the three Republican senators who worked to hammer out a compromise — Susan Collins and Olympia Snowe of Maine and Arlen Specter of Pennsylvania, who broke with their party to support the plan.
"The differences between the Senate and House versions, we've resolved," said Reid. "The bills were really quite similar, and I'm pleased to announce that we've been able to bridge those differences."
Reid said the bill could come up for a vote in the next few days. Specter stressed that time is of the essence.
"The economists are virtually uniform in their prediction that if we do not act, we face the potential consequence of a catastrophe and a depression the likes of 1929," said Specter.
House leaders were not present at the news conference unveiling the compromise.
House Speaker Nancy Pelosi, Reid's partner in negotiations over more than 24 intense hours, initially withheld her approval in a lingering disagreement over federal funding for school construction. "We had to make sure the investment in education" was in the bill, the California Democrat said.
Shortly before the deal was announced, White House press secretary Robert Gibbs said, "We think enormous progress in a very short time has been made." He added that "members of our budget team were up on Capitol Hill until late last night" working on the plan.
Democratic Sen. Max Baucus of Montana, one of the negotiators, said 3.5 million jobs will be created by the plan. He said lawmakers agreed to hold the cost well below the cost of both the House and Senate bills.
"This represents the beginning of turning our economy around and getting us back to where we should be," said Connecticut Sen. Joe Lieberman, an independent.
Obama has said he wanted to sign the bill into law by Presidents Day, which is Feb. 16.
Congressional negotiators have worked on a compromise plan since Tuesday, after the Senate narrowly passed an $838 billion measure with support from only three Republicans. The $820 billion House plan, which was passed last month, had no Republican support.
The president has spent much of this week trying to rally support for the economic recovery package. On Wednesday, he visited a construction site in Virginia to call attention to the jobs that would be created by his stimulus plan.
Obama also said that machinery giant Caterpillar Inc. would rehire some of the 20,000 workers it had laid off if Congress approves the bill. The president plans to visit the company's workers in Peoria, Ill., on Thursday.
On Monday, the president held a town hall meeting in Elkhart, Ind., where the unemployment rate is more than 15 percent as recreational vehicle manufacturing has plummeted. "The situation we face could not be more serious. We have inherited an economic crisis as deep and as dire as any since the Great Depression," he told the crowd of 1,700.
He also went to the American people in a televised appeal Monday night as he tried to pressure Congress to act quickly on the stimulus plan.
And Tuesday, he told a crowd in Fort Myers, Fla. — where foreclosures and unemployment are in the double digits — that his economic recovery plan would put people back to work immediately.
The Associated Press contributed to this report.