US House passes Obama’s economic stimulus bill
House votes 246-183 to pass Obama $787bn (£547bn) plan to resuscitate the economy
The US House of Representatives has passed a $787bn (£547bn) plan to resuscitate the economy, handing President Barack Obama a big victory.
The measure passed 246-183, with no Republican votes. It will now go to the Senate, where a vote is expected later today.
The eight-inch-thick stimulus bill combines tax cuts for individuals and businesses with half a trillion dollars in government spending for infrastructure, health care and help for cash-starved state governments. Older Americans would get a $250 bonus social security check.
Seven Democrats voted against the bill.
Obama claims that the plan will save or create 3.5m jobs. But Republicans said it will not work because it has too little in tax cuts and spreads too much money around to everyday projects like computer upgrades for federal agencies.
Sourced from The Guardian
Brown under siege as Congress caps bankers’ bonuses
A dramatic vote on Capitol Hill is set to bring major change to Wall Street’s risk culture as cash incentives for executives, brokers and traders are limited to a third of their salaries. Gaby Hinsliff, Zoe Wood and Paul Harris report on the implications for Britain.
Gordon Brown was under rising pressure to clamp down on the City’s bonus culture last night after the US Congress agreed to drastic curbs capping senior bankers’ bonuses at a third of their salary.
The measures, which are expected to be signed into law by President Barack Obama (Barack Obama page on the Guardin website) this week, would apply to dozens of staff at American banks bailed out by the taxpayer and could cost Wall Street’s wealthiest millions. Cash bonuses would be banned in favour of long-term share options, with the restrictions extending beyond a handful of top executives to senior brokers and traders.
read full article from The Gardian
US jobless rate increases to 8.1%
The US jobless rate jumped in February to 8.1%, according to official figures from the Labor Department. The number of people out of work rose by 651,000 during the month. Both figures were bigger than expected. The number of job cuts in January was revised up to 655,000 while December’s losses were pushed up to 681,000. December’s figure was the biggest job loss in a single month since October 1949. The unemployment rate was the highest since December 1983.
Rising unemployment has meant greater demand for free meals President Obama said that the number of jobs lost so far in the recession was “astounding”. Speaking in Ohio, he added: “I don’t need to tell the people of this state what statistics like this mean,” saying that he had signed his economic stimulus package in order to save jobs. The extra 161,000 jobs added to December and January’s figures mean that almost two million jobs have been lost in the past three months. A total of 12.5 million people are now unemployed in the US. “It just continues to show the grim state of the labour market, which suggests a deepening US recession,” said Joe Manimbo, currency trader at Ruesch International in Washington. Across sectors There were further signs of companies cutting back on their spending with the news that the number of people who wanted to work full-time but were forced to work part-time for economic reasons rising 787,000 to 8.6 million.
The average working week stood at 33.3 hours, matching the record low set in December. Jobs were cut in most sectors, with only government, education and health services adding staff. In the manufacturing sector 168,000 jobs were cut in the month while 104,000 jobs went in construction and 375,000 were cut in the service sector. “The payroll numbers are very weak. With the revisions, we’ve had significant job losses in the past four months,” said Gary Thayer, senior economist at Wachovia Securities in St Louis. “Companies are reducing workers and output in order to bring inventories into line with weak sales.” Among the companies that announced big job cuts in February were Goodyear, Estee Lauder, Macy’s and General Motors. Federal Reserve Chairman Ben Bernanke told Congress earlier in the week that economic indicators “show little sign of improvement” and suggest that “labour market conditions may have worsened further in recent weeks”. |
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Obama calls for G20 joint action
US President Barack Obama has said that countries must take concerted action to spur global economic growth.
President Obama was speaking ahead of this weekend’s meeting of G20 finance ministers in West Sussex near London.
He said the US had two goals at the G20 – to ensure joint action to jump-start economies and to move forward on a regulatory reform agenda.
He added that he was optimistic about the meeting’s prospects. “We are in this together,” he said.
Earlier, UK Chancellor Alistair Darling had also called for co-ordinated global action.
“We must work together not as a small group of advanced economies but globally, including the emerging and developing economies,” he told reporters in London.
Growing rift
The finance ministers meet ahead of the main G20 summit of world leaders in London on 2 April.
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 It’s very important to make sure that other countries are moving in the same direction, because the global economy is all tied together  US President Barack Obama
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President Obama’s comments came amid reports of a growing rift between the US and Europe over the G20 in recent weeks.
Washington has been calling for more spending plans, while most European leaders have been pressing for increased global regulation of the financial system.
Speaking at a meeting in the Oval Office with Treasury Secretary Timothy Geithner, Mr Obama said the $787bn stimulus package he signed into law last month was “doing a good job” stimulating the US economy.
He added: “It’s very important for the American people to understand that, as aggressive as the actions we are taking have been so far, it’s very important to make sure that other countries are moving in the same direction, because the global economy is all tied together.”
On Tuesday the head of the US Federal Reserve, Ben Bernanke, also called for the revamping of the global system of financial regulation.
