WASHINGTON: With recession fears rising and the stock market tumbling, President George W Bush is advocating up to $150 billion in tax relief for consumers and businesses and says there is no time to waste.
Bush's urgent remarks gave fresh impetus on Friday to congressional leaders already at work on an economic rescue package that would include extra money for food stamps, scrip with which the poor can buy food, and jobless benefits in addition to tax rebates of hundreds of dollars each for millions of Americans. The hope is that people would immediately spend the rebates and give the debilitated economy a boost.
I believe we can come together on a growth package very quickly, and we're going to need to,'' Bush said.
Wall Street remained skeptical. The Dow Jones industrial average dropped 59.91 points after plummeting 306 points a day earlier.
Bush said the rescue effort should be quick and temporary, a one-time boost for a national economy that is in danger of sliding into the first recession since 2001 if it has not already crossed that line. The president's tone was somber in his remarks at the White House, but his mood was upbeat later as he visited a factory to underscore his focus on the economy.
`Crank this sucker up,' he exclaimed, an exhortation that could fit his hopes for economic revival, though he was referring specifically to a huge riding mower at Wright Manufacturing Inc. Once the engine was roaring, Bush jumped on and steered the mower playfully.
Despite darkening economic reports, he said that if Congress should pass a quick federal relief package, `We're going to be just fine.'
The president and Congress are scrambling to act as fears mount that a continuing severe housing slump and painful credit crisis could cause people to close their wallets and force businesses to put a lid on hiring, throwing the world's largest economy into its first recession since 2001. The state of the economy has become a major topic in the US presidential campaign, supplanting the Iraq war.
At the White House earlier, Bush avoided the word `recession' but acknowledged the economy was severely strained by a long housing slump and high oil prices and said a downturn could occur.
For a stimulus package to have much impact, he said, it would need to represent roughly 1 per cent of the gross domestic product, or about $140 billion to $150 billion.
In Congress, Democratic leaders pledged to cooperate with Bush and congressional Republicans. Sen. Harry Reid, leader of the Senate's Democratic majority, had criticized Bush on Thursday for deciding to speak publicly on the package before a deal was struck, but Reid said on Friday he was encouraged by the president's remarks.
Some Democrats said they were disappointed that Bush had focused only on taxes.
Democratic congressional leaders agree that tax relief should be a part of the package. Lawmakers are considering tax breaks for businesses investing in new equipment and $500 rebates for individuals, said congressional aides involved in the talks. Details for couples and people with children were being negotiated.
Senior aides to House Democrats and Republicans said the measure also could contain increases for food stamps and higher unemployment benefits.
Bush has gone down the tax rebate road before. In 2001, he added refunds of up to $300 per individual and $600 per household as a recession-fighting element of the tax cut plan that had been the centerpiece of his 2000 campaign.
George Bush making the speech
George W. Bush, the president of the United States has suggested an economic growth package that could be worth almost 1% of the United States' GDP (the US GDP is appoximately US$15 trillion). The package is expected to come in the form of tax cuts. 

In a speech which took place yesterday Mr.Bush said that the economy is an area of "real concern," to the US government. He added that the US "economy is still creating jobs, though at a reduced pace."

Democrats want the tax refunds to cover payroll taxes paid by lower-income groups and be combined with more unemployment benefits, food stamps and federal aid to states. It warned against bundling proposals to make Bush's first term tax cuts permanent with the stimulus package, and the Bush administration has separated the two in this proposal. 

When announcing the proposal George Bush said that "as Congress considers such a plan, there are certain principles that must guide its deliberations: This growth package must be big enough to make a difference in an economy as large and dynamic as ours -- which means it should be about 1 percent of GDP." He added that "this growth package must be built on broad-based tax relief that will directly affect economic growth -- and not the kind of spending projects that would have little immediate impact on our economy. This growth package must be temporary and take effect right away -- so we can get help to our economy when it needs it most." He also added that he believed the package "must not include any tax increases."

In the speech George Bush also made it clear that he believes the package should be passed through congress quickly. He said that his belief was that by passing the package through congress quickly would "provide a shot in the arm to keep a fundamentally strong economy healthy. And it will help keep economic sectors that are going through adjustments, such as the housing market, from adversely affecting other parts of our economy."