Business | Economy
Obama says US deficit may reach $1 trillion
President-elect Barack Obama said on Tuesday he expects to inherit a US budget deficit approaching $1 trillion and his administration would have to make some tough budget choices.
- Reuters
- Published: 23:38 January 7, 2009
- Image Credit: Reuters
- A sign hangs in a window at Fishs Eddy store in New York.
Washington: President-elect Barack Obama said on Tuesday he expects to inherit a US budget deficit approaching $1 trillion (Dh3.67 trillion) and his administration would have to make some tough budget choices.
Just after meeting with his economic team, Obama said it was possible that trillion-dollar deficits could stretch into coming years and that he and his team want to instill a "sense of responsibility" about future budget choices.
Obama, who takes over from President George W. Bush on January 20, is seeking quick action from Congress on a package of spending and tax-cut measures that would total nearly $775 billion over next two years.
The president-elect is to deliver a speech today about the economy, where he will lay out more details about the plan that he says would save or create three million jobs and is aimed at helping lift the US economy out of a deepening recession.
Obama and congressional Democrats are talking about a package that would include money for the building of roads, bridges and schools as well as money to promote renewable energy projects. It may also include more than $300 billion in tax cuts.
Obama fears a delay could bring double-digit unemployment. The current jobless rate nationally is 6.7 per cent.
While many in the Democratic-led Congress also are eager to move swiftly on an economic stimulus, Republicans are insisting that the package receive careful scrutiny to avoid wasteful spending.
Obama initially had said he hoped the package could be approved and ready for his signature shortly after he takes office but now his aides and congressional sources say mid-February seems like a more realistic time frame for passage of the measure.
The stimulus package would add to already growing budget deficits.
Obama spoke about the fiscal outlook a day before the Congressional Budget Office plans to unveil its latest estimates on the budget deficit.
Business Editor's choice
-
Do unemployment figures flatter to deceive?
Jobseekers and recruiters give out mixed signals ranging from optimism to downright despair even as official data show recovery
-
Banks can increase their share
Longer opening hours, more locations outside cities and lower charges can help
-
Geepas idea blossomed in Dubai
The journey led from a small shop in Bahrain to a $1.27b company in the UAE
