US president-elect Barack Obama is laying the groundwork for a giant economic stimulus package, possibly US$850 billion over two years, in his first test of legislative give and take with Congress.
The package, aimed at reviving the flagging US economy, would rival drastic government actions taken to fight the Great Depression in the 1930s.
Obama has not settled on a grand total, and the final figure could be smaller. But after consulting with both liberal and conservative economists, his advisers have begun telling Congress the stimulus should be bigger than the US$600 billion initially envisioned, the officials said.
Like public works projects of the depression era, Obama’s plan would feature spending on roads and other infrastructure projects, as well as new and renovated schools.
It also would aim for energy-efficient government buildings and development of environment-friendly technologies.
There would also be some form of tax relief, according to the Obama team, which is well aware of the political difficulty of pushing such a large package through Congress, even in a time of recession. Any tax cuts would be aimed at middle and lower-income taxpayers, and aides have said there would be no tax increases for wealthy Americans.
The president-elect also continued to select Cabinet members.
On Wednesday, he named former Iowa governor Tom Vilsack as agriculture secretary and Senator Ken Salazar of Colorado to head the Interior Department. Both must be confirmed by the Senate.
Obama also intends to name former Securities and Exchange commissioner Mary Schapiro to head the much-criticized agency, Democratic officials said. And sources said Obama wanted Republican Representative Ray LaHood of Illinois as transportation secretary.
While some economists consulted by Obama’s team recommended spending of up to US$1 trillion over two years, a more likely figure seems to be US$850 billion. There is concern that a package that looks too large could worry financial markets and the incoming economic team also wants to signal fiscal restraint.
In addition to spending on construction projects, Obama is expected to seek additional funds for programs to help the unemployed, including unemployment insurance and job training, one Democratic official said.
The advisers said they agreed with economic forecasts that predict that without a government infusion, unemployment will rise above 9 percent and not begin to come down until 2011.
Meanwhile, musical luminaries Aretha Franklin, Yo-Yo Ma and Itzhak Perlman will be among the performers at Obama’s presidential inauguration, the committee handling the event said on Wednesday.
The US Marine band will open the Jan. 20 ceremony, to be followed by performances by children’s choirs from San Francisco, said Senator Dianne Feinstein, who heads the inaugural ceremonies committee.
After welcoming remarks by Feinstein, and a religious invocation by evangelical Pastor Rick Warren, Franklin will perform.
Vice president-elect Joe Biden will then take the oath of office, to be followed by performances from violinist Perlman, cellist Yo-Yo Ma, pianist Gabriela Montero and clarinetist Anthony McGill.
Supreme Court Chief Justice John Roberts will then administer the oath of office to Obama and the new president will deliver his inaugural address.
After Obama speaks there will be a reading by poet Elizabeth Alexander, a blessing by Joseph Lowery — a pastor and civil rights era leader — and a US naval band will play the national anthem.
Obama was named Person of the Year by US magazine Time on Wednesday.
Time cited Obama’s unlikely run for the presidency, his ability to energize voters and the expectations abounding for his presidency at home and abroad as some of its reasons for picking him as the top story of the year.
“The real story of Obama’s year is the steady march of seemingly impossible accomplishments,” the magazine wrote.
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