By DPA
Washington : President George W. Bush signed a $152 billion plan to fortify the flagging US economy against a recession with tax incentives for businesses and average Americans.
Passed by Congress with unusual speed after Bush proposed an economic stimulus package last month, the temporary measures are mainly designed to put more spending money in US consumers’ pockets.
“You know, I know a lot of Americans are concerned about our economic future,” Bush said at a White House signing ceremony Wednesday. “The bill is large enough to have an impact.”
Individuals will get the bulk of the one-time income tax relief – rebate cheques this year of up to $600 for singles, $1,200 for married couples, plus $300 per child. Consumers account for about two-thirds of the US economy.
“This package gets money into the hands of Americans struggling to make ends meet, helps families with children, cuts taxes for small businesses that will create new jobs and stimulates our slowing economy,” said Democrat Nancy Pelosi, the speaker of the House of Representatives.
The Bush administration and Congress worked closely to create the package, aimed at giving a shot in the arm to an economy hit by a housing market slump, high energy prices and rising unemployment. In an election year, both parties are under pressure to address voter concerns about the economy.
Democrats, who have a narrow majority in both houses, also wanted the package to lengthen jobless benefits and help people pay heating bills. Bush’s Republicans blocked the effort, saying those measures were too costly.
But the final version, agreed in the Senate last week, retained tax rebates specifically for 250,000 disabled veterans and 21 million senior citizens living on government pensions.
The package does not directly address the wave of foreclosures, which is forcing some 200,000 Americans a month to give up their homes because they can’t pay their mortgages.
The Bush administration has worked with lenders to offer aid to a limited group of people forced to give up their homes, including a plan unveiled Tuesday for a 30-day suspension of foreclosures.
Democratic presidential candidates, notably former first lady Hillary Clinton, have called for broader efforts to shield overstretched homeowners against lenders.
Bush has said the US economy remains fundamentally sound despite hitting a rough patch.
“In a dynamic market economy, there will always be times when we experience uncertainties and fluctuations,” he said Wednesday.
Bush and congressional leaders said the stimulus plan showed that the two parties could overcome ideological divisions and work together for the good of the country.
Working separately to ward off a recession, the US Federal Reserve last month slashed its key interest rate in two steps by a combined 1.25 percentage points to three percent.
Economists have said that any temporary tax relief would have to reach consumers quickly to offset a recession, and Bush had urged Congress not to load the stimulus package with what he called unnecessary spending.