Obama economic advisor says a U.S. economic stimulus program to revive economic activity would need to be bigger than first thought
WASHINGTON (Reuters) – A top economic adviser to President-elect Barack Obama said on Monday a U.S. economic stimulus program to revive economic activity would need to be bigger than first thought as the financial storm intensifies.
"We don't have the exact number," Austan Goolsbee said on CNBC television. "In the campaign he (Obama) was talking about $175 billion. The economy's gotten substantially worse so we know it'll be bigger than that."
Goolsbee added that ensuring an economic recovery will be a "front-burner issue" for the incoming Obama administration that will take power January 20.
Goolsbee, a University of Chicago economics professor, has been a key economic expert throughout Obama's campaign, but so far has not been tipped for any high post in the president-elect's staff.
Obama is expected to announce New York Federal Reserve President Timothy Geithner as his pick for Treasury Secretary and former Treasury Secretary Lawrence Summers as White House National Economic Council head later on Monday.
Obama said on Saturday he would craft an aggressive, two-year stimulus plan to revive the flagging economy, which is expected to shrink at least through the middle of 2009. The president-elect in October called for a $175 billion stimulus, but did not update the price tag on Saturday.
The government stepped in to rescue major U.S. bank Citigroup on Sunday as the institution staggered under losses from high-risk assets.
Healing the faltering economy will be Obama's main focus when he takes office, Goolsbee said. The adviser declined to be pinned down on whether Obama will put off raising Bush-era tax rates for high-income taxpayers.
"How to install this economic recovery package the day he arrives, that includes major tax cuts, major infrastructure spending, spending on green energy -- that will be his first focus, everything else, we'll have to deal with later," he said.