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By Russ Britt, MarketWatch

LOS ANGELES (MarketWatch) -- In an effort to boost the job market, President-elect Barack Obama has proposed a massive stimulus package of up to $775 billion over two years as part of an unprecedented spending plan designed to overhaul the nation's infrastructure, schools, broadband networks and energy consumption, a Congressional source said Thursday.

Obama has conveyed a package worth in the range of $675 billion to $775 billion over two years to Congressional leaders, the source said. Obama talked to House and Senate officials Wednesday but the size of the package is likely to change, the source said.

Obama officials have not returned calls for comment but already Congressional leaders were calling for its passage. House Majority Leader Steny Hoyer, D-Md., said a package similar to what Obama proposes was needed in light of the Labor Department's report Thursday that another 554,000 Americans filed for unemployment benefits.

"This package must renew our infrastructure, stimulate our economy by extending unemployment insurance, invest in new energy technologies, and help cash-strapped states protect vital services like education and health care from damaging cuts," Hoyer said in a prepared statement.
The Wall Street Journal reported there is concern the package could expand to as much as $850 billion as it works its way through Capitol Hill. But Obama is trying to keep the stimulus below $1 trillion, an important psychological barrier, as those on Capitol Hill and Wall Street would be wary of what the source called "the 'T' word."

The president-elect has said the stimulus package needs to be big enough to "jolt" the moribund American economy. Since the recession officially began last December, almost 2 million workers have lost their jobs, and more than 500,000 jobs were shed in November alone, according to government data.

The package does not consist of another rebate for taxpayers, the source said. Instead, a number of other programs such as infrastructure, schools, energy efficiency and health care will be targeted.

States also will receive aid, and the package would assume more of the cost of Medicaid. It is expected that $100 billion would go to that cause.
Passage would allow Obama to kill several birds with one stone. He'll essentially try to jump-start the economy on one hand while fulfilling a number of campaign promises with the other.

The president-elect hopes to get lawmakers to put together a package that could hit the House and Senate floors when the 111th Congress convenes on Jan. 6. Obama is to be inaugurated on Jan. 20.

Reports say that Obama would like to have Congress debate and approve the bill in the two weeks between when lawmakers convene and the inauguration so that the new president could sign the legislation shortly after he is sworn in.

"Congressional Democrats urge President Bush to drop his opposition to the recovery package; but if he does not, Congress will ensure that President-elect Obama can sign it soon after taking the oath of office," Hoyer went on to say in his statement.
Republican lawmakers have been skeptical of this quick time frame, saying that a bill this massive and expensive needs to be transparent and debated thoroughly.

Democrats' inability to elect 60 members and get a filibuster-proof Senate in this year's elections may manifest itself with the passage of this bill as Republicans could well employ the measure to gain concessions from the other side of the aisle.

Russ Britt is the Los Angeles bureau chief for MarketWatch.