Economic Stimulus Plan

According to CNN, negotiators have lowered the proposed American stimulus bill to $789 billion. The bill is still being debated in congress as the House proposes an $819 billion stimulus and the Senate offers an $838 billion plan. Both the House and the Senate must come to a compromise in a joint House-Senate committee hearing before it can be voted into law. Republican senator Susan Collins told reporters they are getting closer to a compromise every day.

Originally the Senate cut $20 billion for the construction of schools out of the plan in order to get the Republican vote. However, the democrats in the house refused to cut the spending on schools so they refused to pass the bill. As a result, negotiators have restored some of the funding for schools but will use it to modernize facilities rather than construct new ones.

More differences that need to be reconciled:

· The Senate version of the bill makes changes to the president's signature middle-class tax cuts. Obama campaigned on tax breaks for those making $75,000 or less. The Senate version provides tax breaks for individuals making $70,000 or less, or for couples making $140,000 a year or less. That's different from the $150,000 in the House bill.

· The Senate bill, unlike the House version, would make the first $2,400 in unemployment benefits tax-free. Both the Senate and House bills extend the time that jobless workers can collect benefits.

Ultimately the Senate Democrats need two Republican votes to pass the bill, while the House has a large enough majority that they passed the bill without any need for Republican help. BBC reports that the bill will be passed in the House on Thursday and the Senate on Friday, just ahead of President Obama’s Monday deadline.

In other bailout news, eight national bank heads are under fire for questionable lending practices with regard to the $125 billion the government used to bail them out last October. According to The New York Times, Congress is looking into where the money is being spent and if it is being loaned to other businesses like it was supposed to be. Congress fears that the banks misused funds to provide bonuses for their employees.

Each of the bankers outlined the ways in which they had used the government capital. Goldman, for instance, increased its financing to lend to clients like Sallie Mae and Verizon Wireless. Morgan Stanley said it had made $10.6 billion in new commercial loans and $650 million in loan commitments to consumers.

The fall in lending trends is attributed to a retreat in lenders like money market and hedge funds.

As an American citizen I think it is important to be paying attention to our economic situation and our government's attempt at a bailout. I don't have a great personal knowledge on the workings of the economy but I do know that weak banks leads to a weak currency and a weak currency leads to a lose of power. I also now know that changes in power can lead to war for that power. So does that mean the War in Iraq is not the only one we'll have to fight? Historically war has helped restore our economy, but this time it seems it has ruined our economy. Has the United States finally stretched itself too thin? Have we concerned ourselves with everyone else's business to a point that we don't even bother to fix our domestic issues? I don't know, only time will tell, but perhaps it's time that we focus on us... before it's too late.