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(AP)
Vice President Joe Biden stood behind President Barack Obama as he signed the $787 billion economic stimulus bill at the Museum of Nature and Science in central Denver Tuesday.
WASHINGTON - President Obama, seeking to stabilize the nation's staggering economy, signed into law yesterday the massive $787 billion economic stimulus bill - even as two automakers asked for billions more in federal help and the stock market plummeted to a near 5 1/2-year low.
Calling it the most sweeping economic recovery package in American history, Obama said the hastily-crafted collection of tax cuts, cash for states, increased unemployment benefits, and other spending programs will put the brakes on a rapidly accelerating unemployment rate, rebuild the nation's crumbling infrastructure and schools, and inspire confidence in consumers and hope in laid-off workers.
"We have begun the essential work of keeping the American dream alive in our time," the president declared in Denver, returning to the city where he accepted the Democratic nomination and promised to restore that dream.
But he quickly acknowledged that the task of repairing the US economy has just begun, and that things may get worse before they improve.
"I don't want to pretend that today marks the end of our economic problems, nor does it constitute all of what we're going to have to do to turn our economy around," said Obama, who signed the bill at the Denver Museum of Nature & Science, underscoring its hope of creating environmentally-friendly jobs.
"But today does mark the beginning of the end; the beginning of what we need to do to create jobs for Americans scrambling in the wake of layoffs; the beginning of what we need to do to provide relief for families worried that they won't be able to pay next month's bills; the beginnings of the first steps to set our economy on a firmer foundation, paving the way to long-term growth and prosperity."
In a flurry of moves, Obama will follow up today with a speech in Phoenix - a city with one of the nation's highest foreclosure rates - outlining a $50 billion plan to help more than 2 million struggling homeowners facing foreclosure.
His administration in the coming weeks will flesh out plans to overhaul the nation's crippled banking industry and to free up credit.
And Obama plans to put together his own proposal to help the ailing auto industry survive.
Yesterday, two struggling Detroit automakers,
"It is clear that going forward, more will be required from everyone involved - creditors, suppliers, dealers, labor, and auto executives themselves - to ensure the viability of these companies," White House spokesman Robert Gibbs said last night.
The stimulus package, however, has been the centerpiece of Obama's plan to revive the economy - a plan he has often likened to President Franklin Roosevelt's blueprint for the New Deal - and is the most important piece of legislation in his month-old presidency.
Despite intense lobbying and the president's high-profile call for bipartisanship, however, no Republicans in the House voted for the bill, and only three voted yes in the Senate.
In Denver yesterday, Obama said the bill had broad support from labor and business and from Democratic lawmakers and some Republicans, including legislators, governors, and local officeholders. But Republicans on Capitol Hill continued their drumbeat of complaint that Democrats ignored their suggestions to include more tax cuts and less spending, and argued that the stimulus plan adds nearly $1 trillion to an already swollen federal deficit, a debt they say will take more than a generation to pay off.
Representative John Boehner of Ohio, the top Republican in the House, issued a blistering statement, calling the package "a raw deal for American families" and a "trillion-dollar, special-interest pork-laden, partisan, backroom deal that will do little to get our economy back on track."
Obama said the package will create or preserve 3.5 million jobs in the next two years - about the same number of jobs lost since the recession began in December 2007.
The plan pumps money into infrastructure projects, healthcare, and renewable energy, with twin goals of short-term job production and longer-term economic viability. It includes a $400 tax break for most workers and $800 for couples, including those who do not earn enough to pay income taxes. It dishes out tens of billions of dollars to states facing deep cuts and layoffs; helps the unemployed with increased benefits, food stamps, and subsidies for health insurance; and provides financial incentives for people to start buying again, from first homes to new cars.
What the legislation is not expected to do is quickly reverse the economic slide, manifested in the national unemployment rate of 7.6 percent, the highest in more than 16 years, the 46 states with crisis-level budget deficits, and in the rocky stock market. The bellwether Dow Jones industrial average plunged another nearly 300 points yesterday, finishing barely above the close on Nov. 20 of 7552.29 that was the lowest since early 2003.
Analysts say the package is intended to shore up confidence that the government is tackling what Obama has described as the worst economic crisis since the Great Depression as much as to reverse the economic tailspin.
"Once it starts to work, it won't turn things around very quickly," said Chad Stone, chief economist of the Center on Budget and Policy Priorities in Washington.
That could be whyObama and his allies continued to sell the stimulus package to a public that is more enamored of him than of the bill. Public opinion polls show about 50 percent of the nation approves of the plan, but the president's popularity rating still exceeds 60 percent.
He said the bill will "improve travel and commerce throughout the nation," will put the nation on track to transforming "the way we use energy," and "represents the biggest increase in basic research funding" in US history.
Combined with an expansion of a children's healthcare program he also signed, "we have done more in 30 days to advance the cause of health reform than this country has done in an entire decade," he added.
