By Thomas Ferraro and Richard Cowan
WASHINGTON (Reuters) - Democrats will pack greater clout when the new Congress convenes on Tuesday but they face enormous expectations from voters as they grapple with two wars, a financial crisis and record budget deficits.
Lawmakers begin work 14 days before Barack Obama is sworn in as president. When he takes the oath on January 20, Democrats will control the White House and Congress for the first time in 14 years.
Having rolled to victory in the November election with a promise of change after eight turbulent years under Republican President George W. Bush, Democrats need to produce results.
Their top priority will be approval of a mix of middle-class tax cuts and emergency spending they hope will prime an economy that has been shrinking for more than a year.
This package could end up costing around $775 billion (533.7 billion pounds).
The Democratic-led Senate plans to move quickly to confirm Obama's Cabinet nominees, who include Sen. Hillary Clinton of New York as secretary of state and New York Federal Reserve chief Timothy Geithner as secretary of the treasury.
Other Democratic promises include: withdrawing U.S. troops from Iraq and redeploying many of them in Afghanistan; expanding health care; bolstering regulation of the financial industry and developing alternative energy sources while curbing pollution that contributes to global warming.
"The 111th Congress will hit the ground running in January with an ambitious schedule," House of Representatives Speaker Nancy Pelosi wrote in an open letter to Democratic colleagues.
'HISTORIC GAP'
"Congress will respond in time. But Obama needs to lower expectations," said Paul Light of New York University's Centre for the Study of Congress.
"There is a historic gap between promises made and promises fulfilled. Converting promises into reality is a difficult process," Light said, noting major legislation must wind through a maze of committees.
Expectations are high that Congress will move fast, maybe by the end of January, on the economic stimulus package. But some Republicans are threatening to slow it down, citing concerns about wasteful spending.
Senate Republican Leader Mitch McConnell warned there should be no rush to judgement on what he predicted could be "the largest spending bill in history." McConnell will use what leverage he has to try to win concessions that could allow the stimulus bill to pass with bipartisan support.
Obama plans to meet in coming days with congressional leaders of both parties to discuss his push for a stimulus package.
"I am optimistic that if we come together to seek solutions that advance not the interests of any party, or the agenda of any one group, but the aspirations of all Americans, then we will meet the challenges of our time," he said in his party's weekly radio address.
Ethan Siegal of The Washington Exchange, a private firm that tracks Congress for institutional investors, said, "In the end, Republicans will not block the stimulus package. ... The country is not behind them. It's behind Barack Obama."
WANTED: MODERATE REPUBLICANS
Despite record federal budget deficits -- they could hit $1 trillion just for this year -- Obama has plans to extend health coverage to an estimated 46 million uninsured Americans.
He is aiming for an overhaul of the U.S. health care system, a $2.3 trillion industry that accounts for about 16 percent of the U.S. economy. Some of the cost could be covered by letting Bush's tax cuts for the rich expire next year.
Democrats controlled Congress during the past two years, but Senate Republicans routinely blocked much of their agenda with procedural hurdles known as filibusters.
Democrats hope that with their expanded Senate majority and help from some moderate Republicans, they will be able to pass a number of measures previously stalled.
These include ones to:
* Allow the government to negotiate companies' prices for drugs covered under Medicare's health program for the elderly.
* Overhaul U.S. immigration policy by tightening border security while giving some illegals a path towards citizenship.
* Reverse a U.S. Supreme Court decision that made it tougher for workers to sue for pay discrimination.
WORD OF CAUTION
Sixty votes are needed in the 100-member Senate to end filibusters. Republicans will hold at least 41 seats, barely enough to sustain a filibuster provided they keep all members in line.
In the 435-member House, there will be 257 Democrats, up from 235.
Linda Fowler, a political science professor at Dartmouth College, voiced a word of caution.
"A Democratic majority doesn't necessarily mean a compliant Congress," she said, citing problems that Democratic Presidents Jimmy Carter and Bill Clinton had with legislatures held by their parties.
Democratic hopes for an opening-day show of unity were dashed this week by a fight likely to end up in court over the Senate seat vacated by Obama.
Democrats vow to block Illinois Gov. Rod Blagojevich's appointment of a former state official to replace Obama. That appointee, if seated, would be the only black senator. The governor is accused of having earlier tried to sell the seat to the highest bidder.
(Additional reporting by Donna Smith; Editing by David Alexander and Xavier Briand)
