White House dampens stimulus expectations

Sun Feb 15, 2009 3:17pm EST
 
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By Alan Elsner

WASHINGTON (Reuters)- President Barack Obama's aides warned Americans on Sunday not to expect instant miracles from the $787 billion economic stimulus bill he will sign this week, but said it would help eventually.

Obama is due to sign the bill passed last week by Congress in Denver on Tuesday. It was the first major legislative victory of his young presidency, which could rise or fall with its success or failure.

"There will be signs of activity very quickly," David Axelrod, the White House senior adviser, said on "Fox News Sunday." "But it's going to take time for that to show up in the statistics. The president has said it's likely to get worse before it gets better."

White House spokesman Robert Gibbs used similar language on CBS' "Face the Nation."

"I don't think there's any doubt that we've seen this economy has gotten worse just in the last few months. The acceleration in job loss probably means that this economy is going to get worse before it gets better," he said.

Obama himself said last week that if he failed to heal the economy, he would be out of a job by 2012, when he faces re-election.

The White House hopes the package will save or create 3.5 million jobs. Mark Zandi, chief economist at Moody's Economy.com, said on "Fox News Sunday" that was likely too optimistic.

"By my estimate, it will add 2 to 2.5 million jobs, more than would be the case without stimulus, by the end of 2010. That translates into a lower unemployment rate of about a point to a point and a half," he said.   Continued...

 
<p>U.S. President Barack Obama speaks at a Caterpillar Plant in East Peroria, Illinois, February 12, 2009. REUTERS/Jim Young</p>