By Donna Smith and Richard Cowan
WASHINGTON (Reuters) - The U.S. Congress passed a nearly$152 billion (78 billion pound) plan on Thursday to stave offan election-year recession by sending government rebate checksto millions of Americans and providing business tax incentivesto boost spending.
Moving quickly to get the economic package to PresidentGeorge W. Bush, the House of Representatives passed the bill by380-34, just hours after the Senate cleared the measure on avote of 81-16. Bush is expected to sign the bill next week.
The legislation will provide one-time rebates of up to $600for individuals or $1,200 for couples, plus $300 for eachchild. Low-income people, including retirees on Social Securityand disabled veterans who pay no income taxes, would receivechecks of $300. The rebates would start to phase out for peoplewith taxable incomes of more than $75,000 for individuals and$150,000 for couples.
At a news conference with congressional leaders, TreasurySecretary Henry Paulson said the rebate checks would go to morethan 130 million Americans. "We're going to have the checks outbeginning of May and this is largely going to be done by thetime summer's over," he added.
Bush praised the final package.
"This plan is robust, broad-based, timely, and it will beeffective," he said in a statement. "This bill will help tostimulate consumer spending and accelerate needed businessinvestment."
The final bill was broader than the original House-passedpackage backed by Bush. The Senate added the elderly anddisabled veterans who had been left out of the House bill. Towin more Republican support in the closely divided Senate,Democrats had to drop demands for benefits for long-termunemployed workers and other provisions that would have helpedlow-income people pay heating bills and home builders write offcurrent year losses against previous tax years.
The Senate also added language to help ensure illegalimmigrants did not receive rebate checks.
The bill will inject nearly $152 billion into the economythis year and more than $16 billion next year.
UNUSUAL SPEED
With all 435 members of the House and one-third of the100-member Senate up for re-election in November, thelegislation moved through Congress with unusual speed and rarecooperation between the two parties.
Senate Majority Leader Harry Reid, a Nevada Democrat, saidthe stimulus package approved by the Senate would "change theeconomic direction of this country" and added lawmakers likelywould do more this year to stimulate the economy.
The latest economic data suggest the U.S. economy isstalling. Pending sales of previously owned homes fell by 1.5percent in December and were off a sharp 24 percent from a yearago, the National Association of Realtors said on Thursday.
At the same time, the Labor Department said the number ofworkers drawing jobless benefits had hit a 2-1/4-year high andmajor retailers reported a slowdown in consumer spending.
Lawmakers hope the rebate checks and incentives forbusiness investments will send Americans on a shopping spreethat will help jump-start the economy.
The bill also provides for higher loan limits for theFederal Housing Administration insurance program and mortgagefinancing giants Fannie Mae and Freddie Mac to help lift thesagging housing market.
Even as Congress acted on the bill, some lawmakers werediscussing a possible second package to help the economy.
Senate Finance Committee Chairman Max Baucus, a MontanaDemocrat, said Congress would move more stimulus legislation"if the economy continues to go south, if there are significantincreases in foreclosures and bankruptcies and so forth."
Reid said Republican opposition to expanded unemploymentbenefits and aid to low-income families for paying winterheating bills would haunt them in the November elections.
"They are following this president right off a cliff," Reidsaid.
Senate Republican Leader Mitch McConnell of Kentucky saidthe economic package transcended politics.
"This is not a victory for Republicans or Democrats. Thisis a victory for the American people," McConnell said.
Reid and other Democratic senators said they would try tomove legislation later this year expanding unemploymentbenefits and helping the housing industry.
(Editing by Eric Walsh)
