Democrats Are Working For Bipartisan Progress on a Stimulus Package
- The economic downturn demands immediate, bipartisan action from Congress and the President to get our economy back on track.
- We are working to find common ground with President Bush and Congressional Republicans to craft a bipartisan stimulus plan that is timely, targeted, and temporary.
- House Democratic Economic Forum, December, 12/7
- Ongoing discussions between House Leaders and Secretary Paulson
- Democratic Leadership letter to President Bush, Friday, 1/11
- Speaker Meeting with Federal Reserve Chairman Ben Bernanke, Monday 1/14
- Democratic Leadership Meeting with Republican Leadership, Wednesday, 1/16
- Americans who are facing the prospect of losing their home or job, and struggling with the high cost of gas or home heating bills, health care or groceries, cannot afford delay.
- We are committed to working together to pass a stimulus plan to jumpstart the slowing U.S. economy and address the severe strains being felt by millions of American families and continue our long-term efforts to strengthen America's economy.
The American Economy is in Peril and Americans are Feeling the Impact
- First job losses in four years. The December unemployment rate shot up to a two-year high of 5 percent with nearly 500,000 more American looking for work, private employers cut payrolls for the first time in more than four years, with job losses in manufacturing, construction, financial services and retail sales.
- Family income is down. Since 2001, the real income of a typical working age family has fallen by $2,500.
- December sales and consumer confidence are at a five- year low. Retailers suffered their worst December shopping season in five years, consumer confidence fell in January to its lowest point on record dating back to 2002, and wholesale inflation last year shot up more than 6 percent the largest jump in 26 years.
- American families are falling behind on their bills. American Express has warned of rising delinquencies and slowing spending among its cardholders; AT&T and Capital One are seeing more unpaid bills; and Citigroup has set aside $4 billion to cover anticipated losses on loans to American consumers.
- Skyrocketing energy prices. Gas prices have risen 10 cents a gallon in the last three weeks to $3.07 a gallon, with new price projections of $3.50 a gallon price this spring. Crude oil prices have topped $100 a barrel and this winter's heating oil cost may climb to more than $2,000 per family - more than three times 2001 costs.
- Rising health care costs. Since 2001, families' share of their employer-sponsored health care premiums have climbed $1,500, with a record 47 million Americans without health insurance.
- Mortgage foreclosures jump and home values drop. As many as 2 million Americans will see their mortgage rates increase in the next two years, with many of them losing their homes as a result of bad lending practices. This fall, home foreclosures have shot up to an all-time high. As a result of the overall housing slump, tens of millions of homeowners could see the value of their home--their primary investment--drop in value.
Broad Range of Economists Agree on the Urgent Need for Action on Weakening Economy
'We are looking at things that could be done quickly...Time is of the essence...There are signs [the economy] is slowing down fairly rapidly...If something were to be done here, I think the focus would be on something that's temporary and that could get done and make a difference soon.' Treasury Secretary Henry Paulson, Jr. [Bloomberg, 1/12/08]
'We are forecasting slow growth. But as I mentioned today, there are downside risks and therefore it's very important for us to stand ready . . . to take substantive action to address those risks and provide some insurance against those negative outcomes.' Federal Reserve Chairman Ben Bernanke [Washington Post, 1/11/08]
'All of these things that are taking place -- credit markets, energy prices, housing -- are hitting consumers right now...We're in the teeth of the storm.' -- Bruce Kasman, chief economist at J.P. Morgan [Wall Street Journal, 1/12/08]
'The question is not whether we will have a recession, but how deep and prolonged it will be.' David Rosenberg, chief North American economist at Merrill Lynch [New York Times, 1/13/08]
'We're facing the risk of a systemic financial crisis...It's not just subprime mortgages. The same kind of reckless lending has been occurring throughout the financial system. And it's not only mortgages: Now it's credit cards and auto loans, where we see problems increasing. The toxic junk is popping up everywhere.' Nouriel Roubini, an economist at the NYU's Stern School of Business [New York Times, 1/13/08]
'We are now talking about more likely than not [for a recession]...I have been saying about 50 percent. This now pushes it up a bit above that.' Martin Feldstein, Harvard University economist and former Chief Economic Advisor to President Reagan [1/7/08]
'The economy is on the edge of recession, if we're not already engulfed in one.' Mark Zandi, chief economist of Moody's Economy.com [1/5/08]