The House approved its version of the stimulus package on Jan. 28, estimated to cost $819 billion. The Senate is set to vote soon on its version, which carries a price tag nearing $920 billion.

Before that vote takes place, a bipartisan group of about 20 senators looks to cut provisions from the bill that would not quickly create jobs or encourage spending by consumers and businesses.

The bipartisan group drafted a list of nearly $90 billion in cuts, including, as The New York Times reports, “$40 billion in aid for states, more than $14 billion for various education programs, $4.1 billion to make federal buildings energy efficient and $1.5 billion for broadband Internet service in rural areas.”

As the Senate delays passage of the bill, it was reported today that the U.S. lost almost 600,000 jobs in January and the unemployment rate rose to 7.6 percent, its highest level in more than 16 years, the Labor Department said.

In response, President Obama called the hold up in Congress “inexcusable and irresponsible.” The President also said in an address at the Department of Energy that Republican proposals are “rooted in the idea that tax cuts alone can solve all our problems, that government doesn’t have a role to play, that half measures and tinkering are somehow enough, that we can afford to ignore our most fundamental economic challenges. Those ideas have been tested, and they have failed.”

The support of at least two Republicans – and probably more – will be needed by the Democrats to pass the stimulus bill, which for procedural reasons requires 60 votes.

Originally $820 billion in the House-passed bill, the cost of the Senate measure has risen substantially with a $64 billion provision to allow middle class Americans to forgo paying the alternative minimum tax in 2009, and the inclusion of $30 billion in tax breaks for purchases of homes and cars.

What about infrastructure?

As the stimulus package touted to rebuild the American economy with infrastructure spending continues to just add tax-cut provisions – even rejecting an additional amendment to provide more funding for public works projects – President Obama is again emphasizing the importance of infrastructure investment.

On Feb. 3, the President sat down with the anchors of the major American television networks to defend his economic stimulus plan. In an interview with ABC’s Charles Gibson, President Obama said:

“I actually think that if you look at the package that came out of the House, here’s what we’ve got. We’ve got provisions to help states who are seeing record numbers of people unemployed, providing them unemployment insurance, food stamps, making sure that they don’t lose their health care. That’s the right thing to do. Not only does it stimulate the economy, but it gives families immediate relief. We focus on making sure that in addition to creating jobs, we’re laying the foundation for long-term economic growth. So we invest in infrastructure, around new green jobs and energy, making sure that we are weatherizing homes to save on our energy bills long term…

… The criticisms have generally been around some policy initiatives that were placed in the bill that I think are actually good policy, but some people may say is not going to actually stimulate jobs quickly enough. I think that there’s legitimate room for working through those issues over the next several weeks to make sure that we get the best possible bill. But here’s the thing that I think we have to understand. The economy is in desperate straits. What I won’t do is adopt the same economic theories that helped land us in the worst economy since the Great Depression. What I will do is work with anybody of good faith to make sure that we can come up with the best possible package to not only create jobs and provide support to families, but also to lay the groundwork for long-term economic growth…”

[Download the Recovery Plan Metrics Report (PDF) from the Obama Administration]

Sources: ABC, The New York Times, The Wall Street Journal, whitehouse.gov

As Americans have slashed consumer spending, congressional Democrats want to buy American with stimulus spending.

The gross domestic product (GDP), the indicator of the country’s output, fell at a 3.8 percent annual rate in the fourth quarter of this past year, adjusted for inflation, from the previous quarter. Still, that number is not entirely accurate as the U.S. counts unwanted buildup of goods on store shelves as growth. Excluding the inventory adjustment then, GDP fell at a 5.1 percent annual rate.

Private sector jobs also declined 522,000 in the U.S. in January, according to Automatic Data Processing Inc. and consultancy Macroeconomic Advisers. The Bureau of Labor Statistics reported 524,000 nonfarm jobs were lost in December and a Dow Jones Newswires survey predicts a loss of 525,000 for January, when the bureau reports at the end of this week.

Already, on Jan. 28, the House approved its version of the stimulus package, estimated to cost $819 billion. The Senate is set to vote soon on its version, which carries a price tag nearing $900 billion. Eventually, Democrats hope to pass the bill by mid-February – sometime within the next two weeks.

The House version contains a provision that would mostly keep foreign steel and iron from being used in infrastructure projects funded by the stimulus package. The Senate version goes even further, requiring, with some exceptions, that all stimulus-funded projects use only American-made equipment and goods.

The consequence of this kind of legislation, however, would be a protectionist society. Reuters reports, “The governments of both the European Union and Canada sent letters to Congress on Monday urging the provision be dropped.”

In response, the Peterson Institute for International Economics published, “Buy American: Bad for Jobs, Worse for Reputation.”

“Buy American” provisions, according to The Peterson Institute for International Economics, could create only 1,000 new steel industry jobs and might cost as many as 65,000 across a number of associated sectors.

In contrast, Reuters also reports, “A study done earlier this year for the Alliance for American Manufacturing, whose members include the United Steelworkers union, U.S. Steel and other metal manufacturers such as Allegheny Technologies, estimated that requiring 100 percent U.S. content in infrastructure projects would create 77,000 new jobs.”

President Barack Obama, at the same time, is backing away. In an interview with ABC, he said, “I think we need to make sure that any provisions that are in there are not going to trigger a trade war.”

Douglas A. Irwin, professor of economics at Dartmouth and author of “Free Trade Under Fire,” recently wrote in The New York Times in response to the “Buy American” provisions, “When the United States imposed the Smoot-Hawley Tariff in 1930, it helped set off a worldwide movement toward higher tariffs. When everyone tried to restrict imports, the combined effect was a deeper global economic slump. It took decades to undo the accumulated trade restrictions of that period. Let’s not make the same mistake again.”

Here are some of infrastructure-related things that caught my attention over the past week:

Americans are fond of infrastructure. Even politicians get it.

Matt Yglesias kept up an ongoing thread on urban planning and parking with a post on a proposal to change regulations in Ithaca, NY. Atrios looks at related issues in Philly.

Matt also had good links to analysis of Ray LaHood’s confirmation hearing as Transportation Secretary.

Streetsblog was chockablock with great posts, as usual: An analysis of how the scaled-back transit provisions in the stimulus package could actually increase unemployment; how the package won’t do anything to change the way that state Departments of Transportation plan; and a link to a cool, nerdy-in-a-good-way piece on urban design’s relationship to transit, infrastructure, stimulus, and quality of life.

Finally, railcar manufacturer Bombardier has announced a trolley car that doesn’t need overhead wires. I propose that we dub these cars Teslas, not to be confused with the Tesla.

America lost 524,000 jobs in December. The unemployment rate, at the same time, is at a 16-year-high of 7.2 percent, the Bureau of Labor Statistics reported. There are currently 11.1 million unemployed throughout the country, which is nearly double the number out of work at the start of the economic recession a year ago.

President Barack Obama has promised to sustain Americans in these hard times with an $825 billion economic stimulus package – the American Recovery and Reinvestment Bill of 2009.

While campaigning, candidate Obama said he would create one million jobs, and, after winning the election, he proposed a plan to create up to three million. Just prior to being sworn into office, the then President-elect’s transition team released a report that estimated 3.7 million jobs could be created by the end of 2010 with his stimulus plan.

However, of the $825 billion stimulus plan, only $355 billion would be spent on highways, bridges, transit, green technology and other job-creating investments. And of that $355 billion, according to the nonpartisan Congressional Budget Office, less than half would be used by 2010.

The Federal Highway Administration also analyzed how long it takes before money from transportation projects is paid out to workers, and found that 27 percent of it is paid in the first year and 41 percent in the second year.

Consequently, Republicans argue the American Recovery and Reinvestment Bill, which was drafted by Democrats and is backed by the Obama Administration, will not create enough jobs in order to immediately stimulate the struggling economy.

On the other hand, Democrats argue the other Two-Thirds of the $825 billion plan will directly boost the economy as there would be a release tens of billions of dollars to help pay for jobless benefits and health care for the poor, and tax cuts for middle-class families.

At the same time, the Obama Administration has now promised $3 of every $4 in the package should be spent within 18 months to have maximum impact on jobs and taxpayers.

[From the Associated Press: Watch video of President Obama commenting on the progress of the stimulus bill in Congress as he still expects it to be approved by mid-February]