Saturday, January 26, 2008
Bush: to derail economic stimulus package, a mistake (10:00 a.m.)
WASHINGTON (AP) - President George W. Bush is urging Congress to
pass quickly an economic stimulus package without weighting it down
with extraneous spending because fast action is needed to kick-start
the sputtering U.S. economy.
"I understand the desire to add provisions from both the right
and the left," the president said Friday, but "I strongly believe
it would be a mistake to delay or derail this bill."
As negotiated Wednesday night and announced Thursday, the
stimulus package would pump about $150 billion (euro102.01 billion)
into the U.S. economy this year and perhaps stave off the first U.S.
recession since 2001. At a news conference on Thursday, the
negotiators - Rep. Nancy Pelosi, Democratic speaker of the House of
Representatives, House Republican leader Rep. John Boehner and
Treasury Secretary Henry Paulson - were careful to respect the
Senate's right to change the bill after the House passes it and
sends it to the Senate for passage.
Pelosi plans to bring up the $150 billion (euro102 billion) measure
as early as next week, leaving the Senate more than two weeks to get
its bill through, iron out any differences with the House and Bush
and then meet Senate Majority Leader Harry Reid's promise of
wrapping it all up by Feb. 15.
It has become increasingly clear that the economy is teetering on
the edge of recession, if it has not already gone over that line.
The crisis in risky home loans has hit hard at many lending
institutions and cramped credit for almost everyone else. Economic
growth has all but disappeared, and companies are reporting big
losses. Wall Street had been tumbling day after day, even after
emergency Federal Reserve interest rate-cutting, until Wednesday's
hopeful talk about the stimulus deal. The Dow Jones industrial
average was up more than 100 points Thursday after soaring nearly
300 the day before, but on Friday, it plummeted again by more than
170 points.
The Senate very often wins its battles with the House. But with
the power of the administration behind them, House leaders are
optimistic that their simply drawn measure to provide rebate checks
to 117 million families and $50 billion (euro34 billion) in incentives
for businesses to invest in new plants and equipment - would prevent
the Senate from making significant changes.
The president made his comments at a gathering with House
Republicans attending a congressional retreat at a mountain resort
near Washington.
"It would be irresponsible for Senate Democrats to load this
bill up with pork and other spending," Republican negotiator
Boehner said. "Families and small businesses need help now, and
this agreement shouldn't be derailed because of partisan politics."
Under the agreement announced by the White House, Boehner and
Pelosi, individual taxpayers would get up to $600 (euro410)in rebates,
working couples $1,200 (euro815) and those with children an additional
$300 (euro205) per child. In a major concession to Democrats, 35
million families who make at least $3,000 (euro2,040) but do not pay
taxes would get $300 (euro205) rebates.
"This package will lead to higher consumer spending and
increased business investment," Bush said in hailing the agreement.
If the Senate gives quick approval, the first rebate payments
could begin going out in May and most people could have them by
July.
For businesses, the stimulus measure would allow immediate tax
write-offs for 50 percent of the purchase price of plants and other
capital equipment and permit small businesses to write off
additional purchases of equipment. A provision to allow businesses
suffering losses now to reclaim taxes previously paid was dropped in
end-stage talks.
Senate Majority Leader Harry Reid, said the goal was to send the
package to the White House by Feb. 15 for Bush's signature. He
noted, however, that the Senate was likely to try to add more
spending for the unemployed, food stamp recipients and states
suffering budget crunches.
Bush had supported larger rebates of $800-$1,600 (euro545-euro1,090),
but his plan would have left out 30 million working households of
people who earn paychecks but do not make enough to pay income tax,
according to calculations by the Urban Institute-Brookings
Institution Tax Policy Center.
To deal with the mortgage crisis, the package raises the limit on
Federal Housing Administration loans from $362,790 (euro246,710) to as
high as $729,750 (euro496,260) in expensive areas, allowing more risky
subprime mortgage holders to refinance into federally insured loans.
To widen the availability of mortgages across the country, it also
provides a one-year boost to the cap on loans that Fannie Mae and
Freddie Mac can buy, from $417,000 (euro283,580) up to$729,750
(euro496,260) in high-cost markets.(AP) |
