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Tennessee: Congress considers second stimulus package

By: Herman Wang
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Lincoln Davis
Zach Wamp

WASHINGTON — With projections of a worsening economy and rising unemployment, Democratic leaders in Congress are drafting a second economic stimulus package, and Tennessee and Georgia lawmakers appear divided along party lines on whether it will succeed.

“When you look at conditions where they are today, yeah, we need to do something to be sure our economy picks up,” said Rep. Lincoln Davis, D-Tenn.

While the first stimulus package, passed in February, included rebate checks of up to $600 for individuals and $1,200 for families, the new package likely will center around a combination of increased unemployment benefits, food stamps, heating assistance for the poor and funding for highway and school construction.

No new rebate checks are planned, according to aides familiar with the proposals being considered by Democratic leaders.

“I have a real problem voting for another round of rebates, but what I would feel comfortable doing is voting for a bill that would address our infrastructure needs,” Rep. Davis said. “If we borrow money for that, at least it’s something that can be used by the next generation. It needs to be for the basic needs of America, and that’s infrastructure.”

Republicans, however, say the package, which could total more than $50 billion, will only worsen the country’s growing deficit, already projected by the Congressional Budget Office to be a record $438 billion next year.

“One thing we’ve got to remember right now is that we can’t spend our way into prosperity,” said Rep. Zach Wamp, R-Tenn., who supported the February stimulus package, which cost $168 billion.

Stimulus packages are used to give a short-term boost to the economy through creating jobs or encouraging spending.

“I supported the first one because I really felt like it would have some impact, (but) I’m disappointed at the effects of the first stimulus,” Rep. Wamp said. “I don’t think it accomplished as much.”

If a second stimulus package is enacted, he said he would like to see it include incentives for improving energy efficiency, whether by helping people purchase more fuel-efficient cars or reduce their home’s energy consumption.

“That’s the kind of stimulus we need, to make energy more accessible, more affordable and more available,” he said. “Usually when the Democrats do a stimulus, it’s a social engineering approach, rather than some kind of investments to get people to do the things that need to get done.”

Sen. Bob Corker, R-Tenn., who opposed the first stimulus, said a second stimulus would be just as fiscally irresponsible.

Sen. Johnny Isakson, R-Ga., who formerly worked in the real estate industry, said the recovery of the housing market is crucial to helping the economy rebound, and he pointed to the recently announced federal takeovers of mortgage giants Freddie Mae and Fannie Mae as a positive move.

“Nothing would get the economy to recover faster than liquidity in the mortgage market,” Sen. Isakson said. “I supported the bill in July that provided the opportunity for (the takeovers) to happen. When you make a decision like that, you have to compare it to the consequences of doing nothing.”

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