President Obama speaking to a group of business leaders in the White House, on Wed Jan 28, 2009

On Wednesday, the US House of Representatives passed the Obama economic stimulus plan without a single Republican vote and 11 Democrat defections.

The 244-188 vote without bipartisan support, followed a week of presidential lobbying including a visit to the Capitol, a return visit to the White House by moderate House Republicans and a bipartisan cocktail party Wednesday night.

The US Senate will now consider the $819 billion economic recovery plan.

President Obama met business leaders in the White House on Wednesday and commented:"I know that there are some who are skeptical of the size and scale of this recovery plan. And I understand that skepticism, given some of the things that have happened in this town in the past. That's why this recovery plan will include unprecedented measures that will allow the American people to hold my administration accountable. Instead of just throwing money at our problems, we'll try something new in Washington -- we will invest in what works. Instead of politicians doling out money behind a veil of secrecy, decisions about where we invest will be made public on the Internet, and will be informed by independent experts whenever possible."

Senate Democrats plan to bring their version of the stimulus to the floor on Monday and is expected to include a provision that would adjust the alternative minimum tax to hold down many middle-class Americans’ income taxes for 2009. The provision was not in the House bill.

Its cost will push the overall package’s cost to nearly $900 billion.

More than $500 billion, will be spent in 2009 and 2010, spending on some programs, including student-loan programs, clean-water projects and housing assistance, is expected to continue  beyond the current recession. The House bill also extends access to health care for the unemployed, expands the federal government's role in education financing ever and begins what the President promised will be a push toward renewable energy. The plan provides $5 billion for the construction and repair of public housing.

According to the CBO (Congressional Budget Office), less than half of the $355 billion the bill allocates to infrastructure and other "discretionary" projects would actually be spent by the end of 2010; of that, a mere $26 billion would be spent in the current fiscal year. "The rest would come in future years," the Washington Post reported,"long after the CBO and other economists predict the recession will have ended."

The US annual deficit is expected to reach between 10% and 12% of the gross domestic product in 2009 and 2010, roughly double the previous peacetime record, according to projections by Decision Economics Inc., a New York economic forecasting firm.

Federal debt levels could soon reach 100% of GDP, levels not seen since World War II, said Allan Sinai, chief economist at Decision Economics. This would put the US in the same league as Italy, whose debt equals 104% of GDP.

Writing for the Financial Times, Prof. Jeffrey Sachs of Columbia University, warned on Tuesday that the stimulus is a financial straight-jacket.“The most obvious problem with the stimulus package is that it has been turned into a fiscal piñata – with a mad scramble for candy on the floor. We seem all too eager to rectify a generation of a nation saving too little by saving even less – this time through expanding government borrowing. First it was former US Federal Reserve chairman Alan Greenspan’s bubble, then Wall Street’s, and now – in the third act – it will be Washington’s."

Sachs wrote: "In rough numbers, the US federal tax system collects about 18% of gross national product, while the total of just five categories of public spending – Social Security (retirement and disability), health (Medicare, Medicaid), veterans’ benefits, defence and homeland security and interest payments – eat up about 18% of GNP. Yet government has more to do – for example, providing the justice system; help for the poor and unemployed; science and technology research; energy systems, transport and other infrastructure; diplomacy and international aid; natural hazards mitigation; training; and the future costs of financial clean-up. Let us add in the fact that state and local governments are broke and need increased federal transfers, and that America’s ageing population, broken healthcare system and growing underclass all require increased fiscal attention. We currently pay for all of this, if we do so at all, by borrowing from China and from the future."