Bush pledges extension benefits to jobless

Washington (Reuters): With a new economic team in place, U.S. President George W. Bush on Saturday promised measures to shore up economic growth and investor confidence, starting with the extension of unemployment benefits for 750,000 Americans in need of urgent aid.

Bush has in the past week named cargo rail company CSX Corp. Chairman John Snow as Treasury secretary, former Goldman Sachs chief Stephen Friedman as top White House economic adviser, and investment banker William Donaldson as the new chairman of the Securities and Exchange Commission.

"These leaders will assume their duties at an important moment for our economy," Bush said in his weekly radio address. While he cited "many good signs" for the U.S. economy, including low inflation and mortgage interest rates, Bush acknowledged, "We also face specific challenges that could slow the recovery and limit future growth."

The Democrats, who have pounded Republicans for not extending the benefits sooner, said in their own radio address that they would return to Washington in early January to finish their own economic strategy of tax relief and job creation, without waiting for the new Congress to get down to work later in the month.

Bush is expected to propose an economic stimulus package early next year totaling up to US$300 billion, including tax breaks for corporations and individuals, hoping to reinvigorate the ailing U.S. economy and stock market before his 2004 reelection campaign.

Bush said Congress first priority should be extending federal unemployment bene cans whose benefits will expire on Dec. 28.

"Many Americans have very little money left over after taxes. Some struggle under a weight of debt that makes it difficult to save for retirement. Investor confidence needs to be strengthened in practical ways. And the nation's rate of unemployment is now 6 percent, and significantly higher in some parts of America," Bush said.

Rep. Robert Menendez, in the Democrats radio address, blamed Bush for not extending unemployment benefits when he had the chance last month and said they would unveil their own proposals to kick-start the economy and provide more aid to those who have lost their jobs.

"These breadwinners are out of work not at their own doing — but because of President Bush's economic failures that left them and their families out in the cold," he said.

Democrats this week declined to give specifics about the package they were planning, but congressional aides said it would likely include tax breaks aimed at the middle class and low-income workers, as well as some tax relief on dividends paid by corporations to investors.

The Senate, as it shifted from Democratic to Republican control in November, passed a bipartisan bill to extend benefits through March 31, 2003. But the Republican-led House of Representatives adjourned for the year without approving the measure.

Bush said unemployment benefits were a top administration priority and he would push lawmakers to make passage of an extension "a first order of business" when they reconvenes in January.