US Senate approves economic stimulus bill

Feb 8, 2008, 0:45 GMT

Washington - The US Senate overwhelmingly approved a 152-billion-dollar economic stimulus package on Thursday, bringing Congress closer to completing legislation called for by President George W Bush to boost the flagging economy.

The Senate passed the bill 81-16 after Democrats agreed to a compromise scaling back the size of the package of tax breaks and benefits, but it still remains higher than the 146-billion-dollar House version.

Under both plans, most US taxpayers would receive at least a 600- dollar tax rebate check later this year. Families could receive as much as 1,200 dollars and an additional 300 dollars for each child.

'I congratulate the Senate leaders for their quick action to pass a bipartisan economic growth package that is temporary, broad-based, and will get money into our economy quickly,' Treasury Secretary Henry Paulson said.

Senate Majority Leader Harry Reid said the Senate and House of Representatives will have a joint meeting next week to work out differences between the two bills so final legislation can be sent to the White House.

The Republicans blocked a vote on the Senate bill late Wednesday over concerns it was too costly. The Democrats agreed to remove language that would extend unemployment benefits and help people pay heating bills, but managed to keep in tax rebates for 21 million senior citizens living off of Social Security and 250,000 disabled veterans.

The Bush administration and Congress have worked closely together to create legislation aimed at stimulating an economy hit hard by the housing market crisis, high energy prices and rising unemployment. The economic woes have sparked worries of a recession.

The Federal Reserve has warned of slower economic growth for 2008 and has slashed interest rates. The Fed twice cut the key interest rate by a combined 1.25 points to 3 per cent last month.

Economists have said that any temporary tax relief would have to reach consumers quickly to offset a recession, and Bush had urged the Senate to avoid loading up the stimulus package with unnecessary spending or benefits.