Next Bailout Sees Big Expectations

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Consumer spending is a key part of what made the economy strong.

Still, with a dwindling economy, even well-off families --like the Gilberts of Doylestown, Penn., are panicking.

"Consumers have been spending beyond their income for 25 years, and they could do it, because they could borrow," said economist Mark Zandi of Moody's "That's (now) over."

The Gilberts say they are "petrified" of what the future may hold for their finances. But Zandi warns now is not the time for panic.

"If you lose faith, then you're in recession, and if you panic, you're in depression," he said. "We're somewhere between recession and depression at this point, and that's why it's so important for policy makers to act very aggressively."

President Obama wants to do just that-- promising the $825 billion stimulus plan will work, and be spent wisely.

"We won't just throw money at our problems," Obama said. "We'll invest in what works."

House speaker Nancy Pelosi says the plan will be bipartisan, as long as Republican suggestions "create jobs, turn the economy and do so in a cost-effective way."

But Republican leaders like Sen. John McCain and House leader John Boehner say too much in the package won't take effect for a long time, or is a waste.

"I think a lot of Republicans will vote no. Because they see this as a lot of wasteful Washington spending padding the bureaucracy and doing nothing to create jobs and preserve jobs," Boehner said.

Lawrence Summers, one of Obama's top money men, disagreed saying results would be seen almost immediately.

"Tax measures are going to change withholding checks within weeks after they're enacted," he explained. "Cities across the country are going to see help so they don't have to layoff teachers or cops within weeks after the program is passed."

Some analysts do see much stimulus, but also Democrats having their way.

"This is a twofer," political analyst Larry Sabato said. "It's a stimulus plan, but its also a Democratic party wish list.

Obama will meet privately with Republican lawmakers this Tuesday to hear their complaints and proposals.

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CBN News
Paul Strand

Paul Strand

Wahington Sr. Correspondent

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