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Market Turmoil Gives Stimulus Plan a Boost


Here in Washington, Republicans and Democrats alike say they want to help the economy. Both sides are suggesting they can work together. And we'll find out soon if they can do that any better on the economy than they have on so many other issues.

NPR's David Welna has this report.

DAVID WELNA: As stock markets continued on a southward slide yesterday, Speaker of the House Nancy Pelosi and other top congressional leaders tried to convey a sense of urgency. They sat around a table with Treasury Secretary Henry Paulson, but took no questions from the reporters they'd invited in to record the scene. Pelosi did declare, though, that Congress now has another reason to act.

Representative NANCY PELOSI (Democrat, California; Speaker of the House): And whether it's by herd mentality or restructuring of their markets or whatever it is, the world's markets are reacting to the situation in the United States. For this reason, but especially because of the impact on households of America, it's important that we have a stimulus package that is timely, that is temporary, and that is targeted.

WELNA: And when President Bush met with these congressional leaders at the White House later in the day, he was upbeat about the prospects of getting such a stimulus package.

President GEORGE W. BUSH: I believe we can find common ground to get something done that's big enough and effective enough so that - so that a - an economy that is inherently strong gets a boost to make sure that this uncertainty doesn't translate into, you know, more economic woes for our workers and small business people.

WELNA: The White House would like to inject about $150 billion into the economy. As Senate Majority Leader Harry Reid left the White House meeting yesterday, he was asked whether that's enough money to revive the economy. Reid sounded dubious.

Senator HARRY REID (Democrat, Nevada; Majority Leader): If we were able to legislate today, for me personally - I think that's a good number. But we aren't legislating today. With what's happened in the markets, today even, we have to take another look at this.

WELNA: Whatever Congress comes up with, Reid wants it finished by the time lawmakers leave for their Presidents Day break three and a half weeks from now. His Republican counterpart in the Senate, Mitch McConnell, agreed on that goal, but he also warned that a stimulus package has to do two things - create jobs and cut taxes.

Senator MITCH McCONNELL (Republican, Kentucky; Minority Leader): It would be broad-based for maximum effect and it won't include wasteful spending on programs that might make us feel good but would have no positive impact on the economy.

WELNA: Republicans in general question the kind of extended unemployment benefits and increased food stamps that Massachusetts Democrat Edward Kennedy called for yesterday on the Senate floor.

Senator EDWARD KENNEDY (Democrat, Massachusetts): We must do the most for those who need the help the most. Targeting families at the very bottom of the economic ladder is essential because it also provides the biggest economic boost. Every dollar a low-income household receive is spent on basic needs, putting money back into the local economy right away.

WELNA: But New Hampshire GOP Senator Judd Gregg was skeptical.

Senator JUDD GREGG (Republican, New Hampshire): That money will be spent, but does it stimulate our economy? I'm not so sure. So much of the product that we buy in America today, that we consume in America today, is produced outside the United States - maybe it stimulates the Chinese economy, but I'm not so sure it stimulates our economy.

WELNA: Agreeing on the need for a stimulus was clearly the easy part. The hard part will be coming up with one quickly.

David Welna, NPR News, the Capitol. Transcript provided by NPR, Copyright NPR.

NPR transcripts are created on a rush deadline by an NPR contractor. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.

David Welna is NPR's national security correspondent.
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