Bush calls for quick $130bn stimulus plan

18 January 2008 17:44  [Source: ICIS news]

WASHINGTON (ICIS news)--President George Bush called on Friday for an estimated $130bn (€88bn) worth of immediate tax rebates for US consumers and investment tax credits for businesses as part of a federal stimulus package aimed at reviving the country’s economy.


The statements came at a time when the US chemical industry is keeping a close eye on comments from federal officials about economic growth in 2008 and the possibility of a recession.


In a televised White House address, Bush said a stimulus package “should be built on broad-based tax relief that will directly affect economic growth, not Federal spending that would have little immediate impact on our economy”.


The stimulus package also “should be temporary and take effect right away so we can get help to our economy when it is needed most”, Bush said, adding that the deal to be worked out with Congress on boosting the US economy “should not include any tax increases”.


Although he said the US economy continues to have a solid foundation, “there are also areas of real concern”.


“Our economy has seen the longest uninterrupted period of job growth on record - 52 months of job growth - but job creation has slowed recently,” Bush said.


“Consumer spending has been growing, but the housing market is declining,” the president added, citing the year-long and precipitous fall in new home construction that has threatened the overall economy.


“Business investment and exports are still rising, but the cost of imported oil has increased,” Bush noted.


“By passing an effective growth package quickly, we can provide a shot in the arm to keep our fundamentally strong economy healthy and help keep instability in the housing and financial markets from more adversely affecting the overall economy,” he said.


Bush said he has asked Treasury Secretary Henry Paulson to lead the administration’s negotiations with Democrat leaders in Congress “so that we can deliver this needed boost to our economy as quickly as possible”.


He said the stimulus package should be about 1% of US gross domestic product, which is around $13,250bn, “to make a difference in an economy as large and dynamic as ours”.


($1 = €.68)

By: Joe Kamalick
+1 713 525 2653

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