AUGUSTA, Maine — All four members of Maine’s congressional delegation voted for the $787.2 billion stimulus package, but all say it is not enough to solve the nation’s economic crisis and a lot of work remains.
“This fiscal stimulus cannot stand on its own,” Sen. Olympia Snowe said in an interview. “It really needs to go hand in glove with lending. We have got to get the credit markets going.”
Snowe, a Republican, said that during the final stimulus package negotiations last week she had stressed to other senators that the measure was just one part of what is needed to get the nation’s economy going again.
The plan has provisions to increase direct cash payments to those out of work and the poor, has broad tax cuts, and has longer-term government spending on public works projects, education, health care, energy and technology. President Obama is expected to sign it this week.
“We have to have both happening simultaneously — the credit markets operating again and the stimulus bill working — to give the economy the boost it needs,” Snowe said.
First District Rep. Chellie Pingree, a Democrat, agreed. She said in an interview that while the stimulus package has a good balance of direct tax breaks and payments that will put additional cash into the economy, more needs to be done to “fix” the financial markets.
“There is more money going into the credit markets and community banks under the second round of the [Troubled Asset Relief Program], and that will help,” she said. “I think we will see more accountability and transparency in how this money is spent along the lines of what we passed here in the House.”
Pingree said she agrees with the anger expressed by many Mainers when some banks that received TARP funds used the money for bonuses and buying other banks instead of providing loans to businesses and individuals.
“We have to make sure this money goes to the credit markets and is loaned by banks,” she said. “We have to have the markets unfrozen along with the stimulus bill.”
Republican Sen. Susan Collins, who was one of the negotiators of the stimulus bill, said she is concerned that before the measure was finally passed some in Congress were already talking of an additional stimulus bill and additional money to “unfreeze” the credit markets.
“Congress has already appropriated $750 billion for that purpose,” she said in an interview, “and I have seen very little results.”
Collins said she will not vote for additional funding for the credit markets or for another stimulus bill until there is a detailed plan of how existing appropriations will be used to get the credit markets operating properly.
“I voted against the second release of the TARP funds because there was not the needed transparency and accountability in how the funds will be used,” she said. “The Obama administration is going to have to do far better than the plan sketched out by [Treasury Secretary Timothy] Geithner that really wasn’t much of a plan at all.”
She noted the financial markets went down after the release of the plan with many raising questions about its lack of specificity.
Second District Rep. Mike Michaud, a Democrat, blasted Geithner last week when the plan was released, saying it was inadequate. He said he agrees with Collins’ fear that some will push additional spending without adequate oversight.
“When the Blue Dogs met with the president, I made it clear I will not support spending more without the oversight that is clearly needed,” he said in an interview. “I agree we need to spend to stimulate the economy, but this all has to be paid back with interest, and some people here in Washington forget that.”
And while all supported the stimulus measure, they all had reservations with the final package. Both Collins and Michaud wanted greater spending on construction projects. Pingree would have liked more direct aid to the poor, and Snowe would have liked more tax breaks as a way to stimulate business investments.
“This was a tough vote for me,” Michaud said. “I have listened to the debate, and I am not sure all of this is going to do what is needed.”
Congress is on break this week, but Maine’s delegation expects work will begin immediately next week on legislation aimed at “fixing” the nation’s credit markets.
“These are extraordinary times,” Snowe said. “We need to find extraordinary answers.”