Fill out this form to email this article to a friend
Politics
Economy rescue plan closer amid big deficit news
Associated Press
Published January 24, 2008
WASHINGTON - Pushing deficit concerns aside, Democratic and Republican leaders moved closer to agreement with the White House on Wednesday night on emergency tax cuts and benefit increases to jolt the economy out of its slump, including opening new financing windows for some home loans. Congressional leaders were to negotiate into the evening with Treasury Secretary Henry Paulson, underscoring the urgency of the effort. Lawmakers learned during the day that the government's deficit already would swell to $250-billion this year because of falling corporate tax revenues - then they signaled they were willing to send it higher by more than $100-billion with a stimulus package. As they met behind closed doors, Wall Street defined volatility, dropping again for most of the day before soaring to a big gain just before closing. The Dow Jones industrials ended the day up just under 300 points. The federal deficit, which has been dropping in recent years, could reach $379-billion for 2008 - more than twice last year's red ink - once the costs of the economic rescue measures are factored in, said House Budget Committee Chairman John Spratt Jr., D-S.C. "We should act, and act now, to strengthen the economy ... mindful, however, of the long-term budget challenges, the structural deficits that we face unless we act and act seriously," Spratt said. The economic growth measure would add about $116-billion to the deficit for the budget year ending Oct. 1, according to quick calculations by Spratt. All sides agree that the stimulus measures should be temporary. The aim is to have legislation ready for Bush to sign in a few weeks, lightning speed for tax and spending measures that can take months or years to win approval. Weighing options Congressional leaders and Treasury Secretary Henry Paulson are working toward a bipartisan economic stimulus deal. What's in Tax rebates: Checks of at least $400 for individuals and more for married couples and people with children. The White House is pushing for higher rebates; Democrats want to extend them to low-income people and impose an income cap. Business tax writeoffs: Spurring business investments with bonus depreciation, more generous expensing rules and a change to allow businesses suffering losses now to reclaim taxes previously paid. Housing rescue: Making it easier for homeowners with ballooning interest rates to refinance into federally insured loans and allowing Fannie Mae and Freddie Mac to buy loans larger than $417,000. Unemployment insurance: Extending benefits past 26 weeks. The White House wants to limit extensions to the handful of states with unemployment rates exceeding 5.5 percent. Food stamps: A boost for benefits. What's out - Permanent tax cuts - Medicaid payments to states - Low-income heating subsidies - Infrastructure spending on projects already under way Associated Press
[Last modified January 24, 2008, 01:35:08]
Share your thoughts on this story
|
News
Fifty years ago, they were screwed-up kids sent to the Florida School for Boys to be straightened out. But now they are screwed-up men, scarred by the whippings they endured. Read the story and see a video and portrait gallery.
Print
Email story
Comment
Letter to the editor
