US retailers urge special session of Congress

15 October 2008 17:16  [Source: ICIS news]

WASHINGTON (ICIS news)--The US retail industry said on Wednesday that the country’s consumers face a “profound economic emergency” and called for a special session of Congress in November to pass urgent tax cuts and stimulus spending.

 

The National Retail Federation (NRF) called for the emergency session of Congress, saying that “Extraordinary measures are needed to address this profound economic emergency that has affected every American”.

 

The federation, which represents some 1.6m companies that sell products to consumers, cited Wednesday’s retail sales figures from the US Commerce Department as further reason for urgent congressional action.

 

The department reported that overall retail sales fell by 1.2% in September from August, the third monthly decline in a row and the largest single-month decline in three years.

 

“Consumer confidence has been badly eroded by the foundering economy and instability of the financial markets,” said NRF president Tracy Mullin.

 

“Because consumer spending represents two-thirds of GDP [gross domestic product] and supports tens of millions of jobs, it is difficult if not impossible to foresee an improvement in overall economic growth until consumer confidence and spending improve,” Mullin said.

 

Many economists contend that consumer spending is the principal driving force of the US economy, responsible for 70% of commercial activity and production.

 

The federation urged Congress to pass another stimulus bill similar to the one enacted in February this year that pumped $150bn (€109bn) into the US economy.

 

“We believe a second round of economic stimulus is needed and must include relief for the consumer,” the federation said.  “Increased consumer spending would create demand throughout all sectors of the nation’s economy.”

 

Representative Nancy Pelosi (Democrat-California), the top official in the US House, has already said she is considering a special session after the 4 November US elections to consider economic stimulus legislation.  The Senate is scheduled to reconvene on 17 November.

 

A session of Congress held after national elections is known as a “lame duck” because some sitting members of the House and Senate will have lost their bids for re-election.  A lame duck congressional session typically does not take any major votes because some of those voting will not be in office to account for their decisions later.

 

However, the federation urged action by Congress in the post-election session, saying that “the US is in the midst of a national crisis” requiring immediate and significant economic stimulus measures by the legislature.

 

($1 = €0.73)

 

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