Economists look to Obama to rescue ailing economy

By The Associated Press Modified: November 6, 2008 at 4:42 am •  Published: November 6, 2008
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photo - President-elect Barack Obama gives his acceptance speech Tuesday in Chicago Tuesday. AP PHOTO
President-elect Barack Obama gives his acceptance speech Tuesday in Chicago Tuesday. AP PHOTO
WASHINGTON — Barack Obama rode a wave of economic discontent to the White House and now faces the daunting task of turning the weakening economy around.

Obama’s victory makes a new economic stimulus package — perhaps as large as $150 billion — more likely, economists said. The U.S. Chamber of Commerce on Wednesday called on the current Congress to approve a stimulus measure this year.

"We have to get the economy back on track,” said John Castellani, president of the Business Roundtable, in a television interview.

Concerns about the budget deficit, which could approach $1 trillion in the budget year that began Oct. 1, will likely take a back seat in the short term, economists said.

"It’s going to be ‘damn the deficit and full speed ahead on the stimulus,’”said Stuart Hoffman, chief economist at PNC Financial Services.

The Illinois senator has pledged to offset some expenditures by raising income taxes on families making more than $250,000.

Obama supported a $50 billion stimulus during the campaign that included funds for infrastructure spending and grants to state and local governments to prevent cuts to health, education and other services.

Permanent tax cuts?

Hoffman said the stimulus will likely include an extension for unemployment benefits and potentially even permanent tax cuts for middle and lower-income families.


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