So the Conference Committee of Senate and House honchos has reached a deal: U.S. Lawmakers Agree on $789 Billion Stimulus Plan (Update4). The $789 billion price tag means that the bill is indeed smaller than either the House or Senate bill – but at first blush the outcome doesn’t look bad (at least not to my distinctly layman ears).

It’s a little distasteful to see the centrists strut themselves on the bill in the most sanctimonious way: 

“It is a jobs bill,” said Democratic Senator Ben Nelson of Nebraska, an architect of the compromise. “And today you might call us the jobs squad.” Nelson and several other senators had insisted that the stimulus plan total less than $800 billion.

Think about this for a second – he prides himself on having cut stuff from the plan – stuff, obviously, that would have created jobs – and even as he touts this dubious achievement, he frames it as having created “a jobs bill,” actually praising himself as part of “the jobs squad”. Never mind that, if it hadn’t been for the vanity tour of his crew, it would have been more of a jobs bill. The chutzpah these people demonstrate, as Matt Yglesias already laid bare earlier, is truly a piece of work.

But all of that is transient. What’s important is the actual bill. And there seems to be a fair bit of good news about this latest revision, going on the Bloomberg update now. At least if you judge the bill by the criteria of liberal criticism this past month – which I am admittedly reduced to somewhat since I have little economic schooling of my own. (So do chime in!)

All in all, about 35% of the plan has ended up as tax cuts and the remainder as government spending. Just to take a step back from the fray: considering just how much tax cuts have been regarded as the holy grail by every administration since Reagan’s, and extra government spending has been widely framed as almost a bad thing in principle, that’s not bad.

Tax cuts

The tax cuts seem overall revised in the right direction. For example, the biggest tax cut that had been included for businesses, which would have let companies convert losses into tax refunds, has been “all but eliminated”. This was a measure that had been criticized as yielding little immediate stimulus and doing little to help the people most in need – Dean Baker of the Center for Economic Progress called it “simply a give-away to the financial industry and homebuilders,” which “has nothing to do with stimulus” and wouldn’t “even be considered if it were not for the political power of the financial industry.”

A proposed $15,000 tax credit for homebuyers was reduced to $8,000. Funding for the plan to let car buyers take a tax write-off on their interest payments has been slashed from $11 billion to $2 billion. These, too, were ideas I’ve seen criticized by liberal pundits. The auto measure would have had little immediate stimulus effect, because it would have primarily resulted in the auto industry emptying the current vast stocks of unsold cars and using the profit to plug debts – all things that would be good, but wouldn’t create new jobs. The tax credit for homebuyers, at this point in the housing market, would be like carrying water to the sea.

On the other hand, Obama’s proposed payroll tax credit has mostly survived, reduced from $500 for individuals and $1,000 for families to will be $400 and $800 respectively.

Can’t have it all though – the plan still includes an Alternative Minimum Tax patch, which, if I’m reading his chart right, ranks very poorly in terms of stimulus impact according to James Galbraith.

Spending

As for the actual spending, there’s these tidbits:

• Nancy Pelosi “said she was reassured by Reid that some of the money Democrats in her chamber sought for school construction were included as part of a stabilization fund for states”. That fund will apparently total $54 billion.
• There’s “$59 billion in aid for unemployed workers in families, including $27 billion to extend unemployment benefits for 20 additional weeks in most states and 33 additional weeks in states with high unemployment rates”. 
  Note that the Progressive Caucus in the House was already very proud of having gotten “at least $12.7 billion” in the stimulus bill the House passed to extend unemployment benefits – so that means that this end result is actually even better, right? 
• It “also increases weekly [unemployment] benefits by $25.”
• The bill “expands a federal subsidy to help jobless workers keep their health benefits by paying 60 percent of their premiums for nine months for married couples who earn under $250,000.”
  Judging on this side-by-side overview of the differences between the House and Senate bills, this seems to have been one of the House bill’s provisions that the Senate centrists had scrapped in theirs.
• It “authorizes a one-time $250 payment for senior citizens, disabled veterans and disabled people living on Social Security benefits.”
  Judging on the above-linked overview, that looks like a more generous scope than the House bill’s, in which only Social Security beneficiaries would have received it.
• It provides $90 billion for federal funds for Medicaid and $19 billion to facilitate the digitization of health records.

All sounds like good stuff that will immediately aid those hardest hit by the crisis, as well as nicely reverse the trend of the last decade or two to squeeze the benefits for the poorest ever further.

The New Yorker is a pricey purchase here in Central Europe, but every so often I make it anyway, because its in-depth reportage is often unparalleled. One such piece of reportage I still vividly remember one or two years later dealt with valiant efforts to reform the education system in Denver. Nominally, at least. In truth, it was a both heart-wrenching and challenging panorama of how deep the roots are of the inequality of educational opportunity, and the problems of poverty, exclusion and ghettoisation that underlie it.

Even as the article covered chunks of policy debate, it didn’t get abstract and made you feel the human challenges involved. It resonated with personal experience, and I felt like forcing people to read it. Foremost those with glib answers about poverty and how people should just get themselves to work and pull themselves up by their bootstraps. It sounds stupid when you try to explain that even just getting yourself to another part of town for a job or better school can be an insurmountable obstacle if you’re – well, fill in your cliché – on the outside. But this article made you feel it.

Reading it you couldn’t help identifying with the Schools Superintendent who was trying so strenuously to make sense of it all, and to undertake a daunting effort, from the ground up, to make changes that would spread the benefits of education beyond the middle class.

Michael Bennet with family and, behind him, Governor Ritter. (Image used under CC license from Jeffrey Beall)

Well, that Superintendent, Michael Bennet, last week was selected by Colorado Governor Ritter to take Ken Salazar’s seat in the Senate.

All I know about him is that New Yorker article. Taniel at Campaign Diaries, however, explains that “Bennet looks to be among the most centrists of Ritter’s potential choices” and that “Ritter himself emphasized Bennet’s centrist politics, describing him with the “postpartisan” terminology that has become the cloak of the ideological center.” Practical, pragmatic, not dogmatic, that kind of thing.

Bennet himself pledged to follow in Salazar’s “bootsteps”, which are distinctly conservative for a Democrat. In short, the Bennet pick will “be frustrating progressives”, and he might oppose card check. Not exactly encouraging stuff.

And yet I can’t help feeling happy about the pick. Such is the power of good journalism. Happy except, of course, for the fact that the man will now no longer be heading Denver’s school system. When one of the major problems with the efforts there have been to improve the school system is inconsistency. The lack of follow-through: a burst of activity as the latest reform model is implemented, and just as effects start moving some of the intractable problems, a change in regime or a new model. Maybe you should make Schools Superintendent as prestigious a position as US Senator …