Obama in Washington to finalise economic plans

Only 15 days before his inauguration as US president, Barack Obama arrived in Washington to meet with congressional leaders and discuss the finishing touches on a multi-billion-dollar rescue package for the US economy.


REUTERS - U.S. President-elect Barack Obama went to the U.S. Capitol on Monday to press for swift passage of a huge spending and tax-cut package amid signs his centerpiece economic stimulus plan may face delays.

"The reason we're here today is because the people's business can't wait," Obama, who takes office on Jan. 20, told reporters at a start of a meeting with Speaker of the House of Representatives Nancy Pelosi, a California Democrat.

"We've got an extraordinary economic challenge ahead of us," Obama said. "We're expecting a sobering job report at the end of the week."

The current U.S. recession began in December 2007 and, according to a Reuters poll, economists are expecting Labor Department data on Friday to show payroll jobs dropping by 500,000, bringing job losses for 2008 to about 2.5 million.

Obama's first visit to the Capitol since the Nov. 4 election came on the eve of the opening of the new Congress where passage of a recession-fighting stimulus package, expected to cost about $775 billion over two years, will be the top initial objective.

Obama's fellow Democrats had hoped to have such a package ready for the new president to sign as soon as he takes office in two weeks.

But they now say it will take at least a month or so longer to put together an initiative that can draw bipartisan support to clear a possible Senate Republican roadblock.

Republicans -- who have voiced objections to government moves to bail out the financial industry and U.S. automakers -- are raising concerns the Obama stimulus plan may presage a new era of uncontrolled government spending.

But they are certain to face public pressure, in wake of the widespread repudiation of Republicans in the November elections, to find common ground with Obama and clear the way for passage of a stimulus package.


Obama planned meet later on Monday with Senate Democratic Leader Harry Reid and then hold talks with key lawmakers of both parties, including including Senate Republican Leader Mitch McConnell and House Republican Leader John Boehner.

The president-elect, who flew to Washington last night from his home in Chicago, was also to meet on Monday with his economic advisers.

An Obama aide said that later this week, possibly on Thursday, Obama is expected to give a speech to stress the urgency of the economic crisis and what is needed to respond to it.

Obama's appearance on Capitol Hill underscored his campaign promise to work with members of both parties to curb mounting partisan bickering and congressional gridlock.

U.S. President George W. Bush took office in 2001, declaring himself to be "a uniter, not a divider." Yet during his eight years in office, battles between Democrats and Republicans escalated.

Obama vows to work with members of both parties on a range of issues, including an economic stimulus package of about $775 billion. Critics charge the figure will likely swell and Republicans have raised concerns it could top $1 trillion.

Sixty percent of Obama's proposal would go to federal spending on such basics as roads, bridges, education and health care, with the remainder, about $310 billion, in tax cuts for the middle class and businesses, party aides said.

As Obama proposed during the campaign, workers would get a $500 payroll tax credit and businesses would receive tax incentives aimed at job creation.

The tax relief is designed to help draw support from fiscal conservatives on Capitol Hill, who prefer cutting taxes to increasing federal spending and the already record deficit.

Republicans had plenty of questions for Obama.

"We'll need to know more about the specifics," a Republican aide said before Obama's meeting with congressional leaders of both parties.

The aide said much of the concern is about if the initiative will be worth it. "Some will ask about the merits of saddling every taxpayer with nearly $10,000 in new debt, and giving them only $500 in return," the aide said.


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