White House: Bush remains open to larger economic stimulus package
WASHINGTON (AP) — President Bush won’t rule out the possibility of a larger economic stimulus package than the $150 billion program already outlined to reinvigorate the ailing economy, the White House said today.
Bush last week offered the outline of a short-term economic boost, but the slumping of the global economic market since then has raised the question about whether he’s willing to broaden the package. Word of the administration’s thinking came on the same day that the Federal Reserve announced a three-quarter percentage point cut in a key interest rate to steady the economy.
Discussing the White House’s options, press secretary Dana Perino told reporters: “I’m not going to close the door, but I’m not suggesting that anyone believes it has to be bigger” than the $150 billion figure already discussed.
On Friday, the president put forward the broad outlines of a stimulus plan that would include tax cuts for individuals and businesses. Bush said any plan, to be effective, would need to represent roughly 1 percent of the gross domestic product, or about $140 billion to $150 billion.
On Wall Street, stocks plunged at the opening of trading, propelling the Dow Jones industrials down about 400 points after the Fed’s announcement of its rate cut failed to assuage investors fearing a recession. U.S. markets joined stock exchanges around the globe that have fallen precipitously in recent days amid concerns that a downturn might spread around the world.
Bush is meeting at the White House with congressional leaders to discuss details of the economic package, which both sides hope to act on quickly.
Perino said the White House is not proposing an even bigger economic package at this point, but she declined to rule one out, either. The sharp decline of markets in the United States and around the globe is tied in part to the perception that Bush’s outlined stimulus package would not do enough to avert a recession.
She said the White House does not comment on daily market fluctuations. But she did say that people should have confidence in the underlying strength and long-term prospects of the U.S. economy. “We are not forecasting a recession,” she said. “Clearly there is a slowdown.”
Published in The Messenger 1.22.08