Saturday, January 10, 2009

Recession Will Worsen If No Bold Action. Barack Obama

WASHINGTON: President-elect Barack Obama will seek to rally support for a massive fiscal stimulus package by warning that the United States could remain mired in recession for years without bold action. Obama, who will take office on Jan 20, promised to set a new course for the economy and to move quickly to toughen the financial regulatory system.

“I don’t believe it’s too late to change course, but it will be if we don’t take dramatic action as soon as possible,” Obama said in excerpts from a speech that was delivered late yesterday. “If nothing is done, this recession could linger for years. The unemployment rate could reach double digits.”

As he prepares to take over from Republican President George W Bush, Obama is about to inherit an economy that has been in recession for more than a year.

The package will include tax cuts and money for the building of new roads, bridges and schools. It would also pay for renewable energy projects, aid to cash-strapped state governments and enhanced unemployment benefits. Obama hopes to secure passage of the economic plan by mid-February.

“For every day we wait or point fingers or drag our feet, more Americans will lose their jobs,” he said in the speech excerpts. “More families will lose their savings.” On Wednesday, a report on the US budget outlook painted a bleak picture that might add to Obama’s challenges in pushing his plan through Congress. The budget deficit for the current 2009 fiscal year ending Sept 30 is expected to nearly triple to around US$1.2 trillion, according to the Congressional Budget Office. — Reuters

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