Bush seeks Congress help to fight economic crisis

March 16th, 2008 - 12:52 pm ICT by admin  

By Arun Kumar
Washington, March 16 (IANS) President George W. Bush has asked the US Congress to help fight an extended economic downturn by making his tax cuts permanent, passing free trade deals and sensibly addressing problems in the ailing housing market. Focusing his weekly radio address on assuring Americans that his administration is taking steps to deal with what many view as a serious economic crisis, Bush Saturday pointed to the passage of a stimulus package as well as steps he has taken to help the housing markets.

Bush warned Congress that he would oppose any measure that would “artificially prop up home prices”, adding: “When you are steering a car in a rough patch, one of the worst things you can do is overcorrect.”

The president also urged Congress to “modernise the Federal House Administration, and allow state housing agencies to issue tax-free bonds to help homeowners refinance their mortgages”.

The stimulus package giving tax rebates for families and businesses should begin to lift the economy in the second quarter of the year and have an even stronger impact in the third quarter, Bush said.

But he urged caution about doing more, particularly about the crisis in the housing market where prices are tumbling and home foreclosures have soared to an all-time high.

“If we were to pursue some of the sweeping government solutions that we hear about in Washington, we would make a complicated problem even worse - and end up hurting far more homeowners than we help,” the president said.

“In the long run, we can be confident that our economy will continue to grow, but in the short run, it is clear that growth has slowed,” he said.

Bush said he opposed several measures pending on Capitol Hill to deal with the housing crisis. They included proposals to allocate $400 billion to purchase foreclosed-upon and now-abandoned homes, to change the bankruptcy code to allow judges to adjust mortgage rates and to artificially prop up home prices.

“Many young couples trying to buy their first home have been priced out of the market because of inflated prices,” the president said. “The market now is in the process of correcting itself, and delaying that correction would only prolong the problem.”

Bush said his administration has put forth steps offering flexibility for refinancing to homeowners with good credit histories yet having trouble paying their mortgage.

However, the Democrats who control the Congress said they would try to strengthen the economy with measures dealing with housing, energy efficiency and renewable energy.

“The president continues to convince himself that inaction is the cure-all for the economic problems hurting hardworking Americans,” Senate Majority Leader Harry Reid said.

“But Democrats know that wait-and-see is not a responsible strategy for an economy that is teetering on the brink of recession.

“Wages and home values are down,” Reid said, “but prices for everything from health care to tuition to energy are up. Just this week, oil and gas prices reached record highs, while the value of the dollar reached historic lows.

“I hope the president, who has been slow to acknowledge this problem, joins us in recognising how urgently we need a solution.”

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