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GUEST: Mark Weisbrot, co-director of the Center for Economic and Policy Research

The Senate passed a slightly expanded 168 billion dollar stimulus plan today in the wake of the U.S. service industry slowing down for the first time in five years. News of the economic slowdown of the country’s banks, retail outlets, travel companies and contractors exacerbated fears of a recession that may already be here. As investor confidence eroded, the stock market tumbled last Tuesday with the Dow Jones plunging 370 points, marking the biggest one-day drop since August. Senate Republicans objected to adding more than forty billion dollars of add-ons for disabled veterans, the elderly and the unemployed. Some economists say that even the slightly modified stimulus plan is inadequate to deal both with the size of the recession and its effects on low-income people. The Center for Economic Policy and Research estimates that the scope of the coming recession could mean an increase in poverty by 4.7 to 10.4 million people. The Bush Administration recently announced a budget that would expand military expenditures to its highest level since World War II. With economic hard times ahead for many in the U.S. Bush’s budget proposal also includes key cuts in government social services. Food stamps, Energy Assistance, Block Grants, and Housing programs would see significant reductions and eliminations.

For more information, visit http://cepr.net/