Obama seeks Republican support for stimulus plans

By Thomas Ferraro and Caren Bohan

WASHINGTON (Reuters) - Democratic President Barack Obama tried on Tuesday to placate Republicans in Congress who insist his $825 billion plan for reviving the U.S. economy should include bigger tax cuts.

"The key right now is to make sure that we keep politics to a minimum," said the president, who met Republicans in both houses of Congress a week after taking office on a promise to seek consensus and end partisan gridlock.

Republicans complain Obama's plan would finance Democratic pet projects -- such as $16 billion in grants for college students -- rather than create jobs or get people spending again.

"I think the president is sincere," said House of Representatives Republican Leader John Boehner. "We look forward to continue to work with him to improve this package."

Republicans agree the stumbling economy needs a rescue package. They complain the Democratic $550 billion spending proposal is excessive while a proposal to cut taxes by about $275 billion does not go far enough.

The Democratic-led House and Senate are expected to approve a package by the middle of February, regardless of how many Republicans embrace it.

Obama, who succeeded Republican President George W. Bush, needs the political cover that having some support from the opposition party would bring for an unproven plan that will hugely increase America's budget deficit and may or may not stop a downward economic slide.

REPUBLICANS COMPLAIN

Some Republicans said their complaints were more with Democrats in Congress than with Obama.

An aide said the House Republicans' message to Obama was: "We need your help to intervene with House Democrats and make changes to eliminate wasteful spending and increase tax relief and incorporate some of our ideas."

"I think everybody there felt good ... that I was willing to explain how we put the package together, how we were thinking about it, and that we continue it welcome some good ideas," Obama said.

Obama added: "The main message I have is that the statistics everyday underscore the urgency of the economic situation. The American people expect action."

The new president faces an economic crisis that seems to worsen by the day. U.S. consumer confidence slipped to a record low and major U.S. companies are cutting tens of thousands of jobs as financial industry troubles mount.

Obama faces jitters from some fellow Democrats as well.

With the House set to vote on its version of the plan on Wednesday, a co-chair of the coalition of fiscally conservative Democrats said his 50-member group had concerns.