House Approves Obama's $819 Billion Stimulus Plan

By: • Wed, Jan 28 2009, 6:35 PM

The U.S. House of Representatives passed Barack Obama's $819 billion stimulus plan Wednesday night.

Parts of the plan include spending on welfare, food stamps, unemployment benefits and community action agencies. Also, $40 billion will go towards healthcare, $43 billion to public infrastructure projects to create jobs and $41 billion in grants to school districts.

Billions more will also go to renewable energy projects and research.

Hours before the vote, Barack Obama spoke from the White House, urging the House to pass the bill.

"We don't have a moment to spare," he said, and called the current crisis a "perilous moment."

Obama's budget director, Peter Orszag, has said more than three-quarters of the two-year stimulus, which nears $900 billion in total, will impact the economy within 18 months. Many Republicans have been calling for less spending projects and more tax cuts, which they argue would help consumers more quickly.

Republicans spoke out against aspects of Obama's plan today, calling it "wasteful spending" and proposed a plan that would cost half as much and create 6.2 million jobs - more than double the job creation in Obama's proposal.

Economists at Goldman Sachs said the stimulus bill "is a major step in the right direction," but that the package is too small to be sufficient.

"We reckon that the appropriate level of stimulus is $600 billion (bn) at an annual rate, or 4% of GDP, with the remaining 2% filled by a narrowing in the current account deficit," they said, adding that on a five-year view, the stimulus package should total $2 trillion.