'Obama will stick to tax promise'

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WASHINGTON, Dec 29 (Internet): President-elect Barack Obama's top advisers said Sunday that they wouldn't back away from a promise to cut taxes on the middle class and raise them for the wealthiest Americans, as they made the case for a massive new stimulus package geared toward reviving the slumping economy.
Speaking Sunday talk shows and in a newspaper opinion piece, Obama aides stepped up a drive to build a broad political consensus behind Obama's core economic proposals: a two-year spending package that could exceed $775 billion, coupled with tax policies weighted in favor of the middle class.
Appearing on NBC's 'Meet the Press', David Axelrod, a senior advisor to Obama, said, "We have to act. Every economist from left to right agrees that we have to do something big in terms of job creation, but we want to do it in a way that will leave a lasting footprint."
Obama wants lawmakers to give him a stimulus bill to sign soon after he is sworn in January 20.
Writing Sunday in the Washington Post, Lawrence H Summers, Obama's incoming director of the White House National Economic Council, said the bleak economic climate called for substantial new spending.
"Economic forecasts have been revised significantly downward over the past several months; today, many experts believe that unemployment could reach 10 per cent by the end of next year," Summers wrote. As of November, unemployment stood at 6.7 per cent.
Summers added: "In this crisis, doing too little poses a greater threat than doing too much."
Since his November 4 victory, Obama has been confronted with signs that the economy is worsening: rising unemployment, sinking home values and a contracting gross domestic product. Last week there were reports of a dismal holiday shopping season. Retail sales dropped 5.5 per cent in November and 8.0 per cent in December through Christmas Eve, compared with a year earlier.
Though he called for a more modest stimulus during the campaign, Obama is now raising the ante. He wants to buoy the economy through hundreds of billions in new spending that also would be a step toward the broader economic transformation that he outlined as a candidate.
The money would go toward classrooms, libraries and labs meant to help students compete in a modern global economy; repairing aging bridges, roads and public transit systems; the computerization of healthcare records; and investments in energy sources to curb US dependence on foreign oil.