School teacherThe House of Representatives on Tuesday passed a $26 billion bill that Democrats say will save the jobs of over 300,000 school teachers, municipal workers and first responders such as police officers and firefighters. The measure's passage hands President Barack Obama a key election-year victory as he seeks to convince skeptical voters that his economic recovery plan is working.

The bill passed the Democratic-controlled House by an almost entirely party-line vote of 247 to 161. Obama quickly signed the legislation into law.

"Today we will create or save 300,000 jobs and not just any jobs, but jobs that are essential to our country," House Speaker Nancy Pelosi (D-Calif.) said during a press conference after the vote.

In a highly unusual move, Pelosi recalled House lawmakers Tuesday for an emergency vote on the bill just as they were settling into the six-week summer recess. The bill allocates $16 billion to help states with Medicare payments and $10 billion to keep teachers on the job, just in time for the resumption of classes for millions of students. Senate Democrats approved the $26 billion measure last week.

Classrooms With No Teachers

Democrats say the legislation will save the jobs of 160,000 teachers across the country, as well as 150,000 first-responders, including police officers and firefighters. The measure would also provide billions in Medicare aid for cash-strapped states.

Earlier Tuesday, Obama urged lawmakers to pass the bill during a speech in the Rose Garden. "We can't stand by and do nothing while pink slips are given to the men and women who educate our children or protect our communities," Obama said. "That doesn't make sense. If we do nothing, these educators won't be returning to the classroom this fall."

Republicans decried the bill as a pre-election union handout. Before the vote, House Minority Leader John Boehner (R-Ohio) said in a statement: "The American people don't want more Washington 'stimulus' spending, especially in the form of a payoff to union bosses and liberal special interests."

Democrats say the measure is a critical step to save the jobs of hundreds of thousands of teachers, police officers and firefighters -- a move that would inject a boost of stimulus funding as the economy sputters. House Republicans opposed the measure as a handout to teachers' and municipal unions.

Good Bang for the Buck

Before the final vote, Gus Faucher, an economist at Moody's Analytics, (formerly Moody's Economy.com), told DailyFinance that the measure is a good idea and if anything, it doesn't spend enough money. "We think that the economy could actually use even more stimulus," Faucher said. He added that aid to state and local governments "is a particularly effective stimulus because you get more bang for your buck," Faucher says. "We estimate that for every dollar in state and local spending you get $1.41 back in the form of economic stimulus."

The House of Representatives has now adjourned for the summer recess.

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