A major policy speech by Barack Obama, outlining his plans to revive the ailing US economy, has been met with a mixed reaction.
Wall Street would have liked more specifics from the US President-elect who focussed on government spending and tax cuts. Despite a budget deficit, forecast to top one trillion dollars this year, Obama said the economic price of not taking bold action would be far worse. “There is no doubt that the cost of this plan will be considerable,” Obama told an audience at George Mason University in Fairfax, Virginia. “It will certainly add to the budget deficit in the short term. But equally certain are the consequences of doing too little or doing nothing at all.” With further gloom on the jobs front expected in a report today, Obama is under pressure to stimulate the US economy as soon as he takes office. But his hopes that Congress would approve the plan by January 20 have faded, amid Republican caution over adding to America’s debt. “Yes, we want to act quickly and I think a month or so is probably a reasonable definition of quick around here,” said Senate Republican Minority Leader Mitch McConnell. “But we don’t want to make big mistakes that exacerbate the problem we already have which is a dramatic eye-popping deficit.” Top Democrats meanwhile have raised concerns about some of the tax breaks Obama is proposing. It remains to be seen whether American consumers’ confidence will be boosted by the plan, set to be worth the equivalent of 566 billion euros.