Stumbling Economy

KFSN How to prevent a recession was the subject of much debate Thursday on Capitol Hill.

The discussions show just how difficult it will be for the administration to steer a path through competing strategies.

The stock market continued to plummet Thursday, despite word that President Bush will unveil his plan Friday to jumpstart the ailing US economy.

Nancy Pelosi, House Speaker: "Give the tax relief in a way that puts it in the hands of those that need it most."

Democrats want targeted tax cuts for low and middle income earners.

Republicans are focused on tax breaks for businesses to try to spark investment.

Rep. John Boehner, House Republican Leader: "It can't become a Christmas tree that means we can't be raising taxes in this package."

The President had a conference call with the congressional leadership today to discuss the plan.

Also on Capitol Hill, FED chairman Ben Bernanke said he supports efforts to craft an economic stimulus package as long as it's quick and temporary.

Ben Bernanke, Federal Reserve Chairman: "Fiscal measures that involve long lead times or result in additional economic activity only over a protracted period//will not provide stimulus when it is most needed."

Cleary, Americans are hurting.

"You're working harder to make the same dollars."

"We don't eat out as much probably, because we're trying to put more back towards gas money."

While no one is saying the US economy is experiencing a recession, another ominous sign: Merrill Lynch, the world's largest brokerage house, reported its biggest quarterly losses in its history.

Tony Fratto, Deputy White House Press Secretary: "The headwinds that we're dealing with right now are things that we see over the next coming quarters. So we do want to try to pass something quickly."

As if we needed more indicators that the economy is hurting, it was just reported that construction of new homes dropped to its lowest level in 27-years.

Copyright © 2021 KFSN-TV. All Rights Reserved.