Obama to sign $787 bn stimulus bill
President Barack Obama signs into law his hard-fought stimulus plan, hoping the measure will put a floor under the collapsing US economy.world Updated: Feb 17, 2009 19:51 IST
President Barack Obama signs into law on Tuesday his hard-fought stimulus plan, hoping the measure will put a floor under the collapsing US economy.
The president will put his signature on the bill in a highly unusual ceremony away from the partisan tensions still gripping Washington. He travels to Denver near the end of his first month in office opening days of a new administration that have seen a relentless storm of economic bad news and public pessimism. After his legislative victory with the $787 billion stimulus measure, Obama now must take equally vigorous steps to prop up the country's deeply troubled financial system, ease the pain of Americans facing home mortgage foreclosures and save the teetering auto industry.
Automakers General Motors Corp. and Chrysler, now kept afloat on a combined $13.4 billion in federal emergency loans, were to report on Tuesday their plans for reorganizing toward long-term survival. Obama has turned to appearances throughout the country to sell his economic plans, hoping to sustain support and foster hope among Americans who are giving him high marks in opinion polls. The president's travels pointedly contrast public backing for his economic plan to the partisan atmosphere still consuming Washington, where Republicans were nearly unanimous in opposing the stimulus measure.
Obama will use the ceremony surrounding the stimulus bill at the Denver Museum of Nature & Science, underscoring investments the spending plan will make in the "green" energy-related jobs. On Wednesday he moves to Arizona for the unveiling of a program to help millions of homeowners fend off home mortgage foreclosures. Tuesday's signing of the massive stimulus measure was designed to start the flow of federal money nationwide toward infrastructure projects, health care, renewable energy development and conservation with twin goals of short-term job creation and longer-term economic healing.
The measure includes a $400 tax break for most individual workers and $800 for couples, including those who do not earn enough to pay income taxes. It delivers tens of billions of dollars to states to prevent deep spending cuts and more job layoffs. Consumers will receive tax incentives to buy first homes and new cars. Poor people and laid-off workers will benefit from increased unemployment and food benefits and subsides for health insurance. The bill also includes a controversial "Buy American" provision that, despite being watered down, has drawn the ire of US trading partners.
Even with such massive spending plans, it's expected to take time for the economy to recover. So part of Obama's message as he has traveled the county is designed to lower expectations. Presidential spokesman Robert Gibbs said over the long holiday weekend that "things have not yet bottomed out. They are probably going to get worse before they improve. But this is a big step forward toward making that improvement and putting people back to work." Monday was a US holiday, Presidents Day. The unemployment rate is now at 7.6 per cent, the highest in more than 16 years. Analysts warn the economy will remain feeble through 2009.
Republican lawmakers, who largely balked at the economic package, complained that it was short on cutting taxes and that the spending measures didn't target the vast sums of money well enough toward short-term job creation, which was the major goal of the bill. Many private economists are forecasting that the budget deficit for the current year will hit $1.6 trillion, including the stimulus spending. That's about three times last year's shortfall, and such year-to-year deficits contribute toward a mounting national debt. Meanwhile, the Obama administration continues to review its policy toward Afghanistan, some seven years after US-led forces toppled the Taliban-led government. Gibbs cautioned that no firm timetable had been set, nor had administration officials settled on how many if any new troops would be involved. "Without getting into broad time lines, I wouldn't I don't think this is anything that involves weeks," Gibbs said. Obama has taken a cautious approach to the addition of forces in Afghanistan. He is expected to initially approve only part of a military request for as many as 30,000 this year, while military and civilian advisers revamp US goals.