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Obama signs $787bn stimulus plan

2009-02-18 13:21:15

US President Barack Obama has signed his hard-fought economic stimulus plan in

Denver, after Congress approved the $787bn ( 548bn) package last week.

Speaking at a signing ceremony he said it was "the most sweeping recovery

package in our history".

The plan is aimed at saving or creating 3.5 million jobs and boosting consumer

spending and rebuilding infrastructure.

Republicans say its tax cuts are insufficient, and that the economy will be

saddled with debt for years to come.

The signing of the massive stimulus measure is designed to start the flow of

federal money toward infrastructure projects, health care, renewable energy

development and conservation programmes.

The approved version of the plan is split into 36% for tax cuts and 64% percent

in spending and money for social programmes.

Mr Obama said: "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, but today does mark the beginning of the end."

He said part of the plan would put Americans back to work in critical areas

such as roads and rail infrastructure.

"[Today is] the beginning of first steps to set our economy on a firmer

foundation," Mr Obama told an audience at a museum in Denver.

Mr Obama also hopes to stimulate technical innovation.

"Just as President Kennedy sparked an explosion of innovation when he set

America's sights on the Moon, I hope this investment will ignite our

imagination once more, spurring new discoveries and breakthroughs in science,

in medicine, in energy, to make our economy stronger and our nation more

secure, and our planet safer for our children."

US Vice-president Joe Biden praised Mr Obama's swift work since coming to

office in January.

"Less than a month into his presidency, the president is about to sign into law

what is, I believe, a landmark achievement.

"Because of what he did America can take a first very strong step leading us

out of this very difficult road to recovery we find ourselves with. So, on

behalf of our country and its people, Mr President, let me presume to say:

thank you, we owe you a great deal."

STIMULUS PACKAGE

$240bn in tax breaks for individuals and businesses

$140bn for health care

$100bn for education

$48bn for transportation projects Source: Associated Press

The plan got no Republican support in the House of Representatives and just

three Republican votes in the Senate.

As the bill was signed, the Republican National Committee chairman Michael

Steele said Americans looking for jobs would be disappointed by it.

He dismissed the president's claims of a bi-partisan approach.

"In these difficult economic times, it is imperative that Republicans and

Democrats work together to create new jobs and grow the economy.

"Instead, Congressional Democrats worked behind closed doors to write

legislation that will fall short of creating the promised new jobs, but will

guarantee a larger debt burden on our children and grandchildren."

Protectionism

The bill also includes a controversial "Buy American" provision that, despite

being watered down, has angered US trading partners.

On Monday, Brazil's Foreign Minister, Celso Amorim, threatened to challenge the

legality of the clause at the World Trade Organization (WTO).

"It's a complex legal analysis, but we're doing it," Mr Amorim told state

television. "[Going to the WTO] is a real option," he added.

The approved plan stipulates that public works and building projects funded by

the stimulus use only US-made goods, including iron and steel.

The EU and Canada had earlier said that provisions favouring American-produced

materials for government projects risked provoking retaliatory protectionist

measures.

Earlier this month, Brazil's President Luiz Inacio Lula da Silva told the BBC

that in the good years, the rich countries had talked a lot about free trade

and the market.

Now they had created a crisis they should not turn to the protectionism which

had so often held the world back, President Lula said.