Ensign backs home loan plan; opposes $885B plan

LAS VEGAS " Nevada Sen. John Ensign says President Barack Obama's stimulus bill would do little to boost the economy and is a waste of taxpayer dollars.

In a speech on the Senate floor Tuesday, the Republican called the $885 billion stimulus bill "a laundry list of spending priorities with token tax relief."

Ensign, instead, endorses a proposal that would attempt to address the slowdown in the housing market. The plan would give banks an incentive to make loans at interest rates around 4 percent to borrowers with good credit.

Ensign described the idea as "like a permanent tax cut." The proposal would not aid homeowners who do not quality for refinancing because they owe more than their homes are worth.

In the Senate the first vote on a stimulus amendment, a failed effort Tuesday to add more infrastructure spending to the package, signaled the change in course. For weeks, the measure has grown to meet a worsening economic crisis with the largest possible infusion of government cash. Despite warnings of dire consequences if Congress does not act boldly, Republicans have become resolute in their opposition to what they view as runaway and unnecessary spending in the legislation. And as the total in the Senate version climbs to $900 billion, unease also is stirring among moderate Democrats.

Extensive Senate revisions would force lawmakers to work at a frantic pace to meet a self-imposed Feb. 13 deadline for completing a compromise bill with the House, which passed an $819 billion version last week. Obama reiterated his call for urgent action in a Monday night meeting with Democratic leaders and by letter to Senate Majority Leader Harry Reid, D-Nev., Tuesday.

To remove obstacles from the measure's path, Reid said numerous items could fall by the wayside. "The president, the Democratic leaders, the Republican leaders certainly have every intention of moving forward to getting everything out of the bill that causes heartburn to a significant number of senators," he told reporters Tuesday.

What Senate leaders cannot predict is which provisions will stay in and which will fall out. It also remains unclear whether Democrats are willing to tamper with measures that are considered high priorities for Obama, but that tackle longer-term challenges such as health-care reform and alternative energy development, rather than providing the quick jolt of expanded unemployment and food-stamp benefits and individual tax relief.

The most ambitious effort to cut the bill is being led by Sens. Ben Nelson, D-Neb., and Susan Collins, R-Maine, moderates in their parties who share a dislike of the current version. Collins is scheduled to visit Obama at the White House this afternoon. "I'm going to go to him with a list" of suggested deletions, she said.

Nelson said he and Collins have agreed to "tens of billions" in cuts, although he said he is skeptical that the effort will reach Collins' target of $200 billion in reductions. The pair has counted up to 20 allies in their effort, with more Democrats than Republicans at this point.

Sen. Olympia Snowe, R-Maine, a moderate who has been considered the most likely GOP vote in favor of the plan, said Tuesday that she cannot support it until items that would not do enough to stimulate the economy or create jobs are dropped.

"They should scrub it," said Snowe, who voted for the tax relief portion in the Senate Finance Committee last week. She said many of the provisions were jammed into the legislation by members of the Appropriations Committee who were "trying to short-circuit the normal legislative process."