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James Turk: Gold breaks out against the dollar
By Terence Hunt
Associated Press
Friday, September 16, 2005
http://news.yahoo.com/s/ap/20050916/ap_on_go_pr_wh/katrina_bush_52;_y
lt=AivOe9sZ6ziXTbm_KZ3Tg8JqP0AC;_ylu=X3oDMTBiMW04NW9mBHNlYwMlJVRPUCUl
WASHINGTON -- President Bush on Friday ruled out raising taxes to
pay the massive costs of Gulf Coast reconstruction, saying other
government spending must be cut to pay for a recovery effort
expected to swell the national debt by $200 billion or more.
Hours earlier, Bush vowed to help rebuild the region with an eye
toward wiping out the persistent poverty and racial injustice that
exist there.
"As we clear away the debris of a hurricane, let us also clear away
the legacy of inequality," he said at a prayer service at Washington
National Cathedral in memory of Hurricane Katrina's victims. Polls
suggest a majority of Americans believe the president should have
responded quicker to Katrina, and high percentages of blacks tell
pollsters they believe race played a role in the slow response by
all levels of government.
At the White House, the chairman of Bush's National Economic
Council, Al Hubbard, made clear that Hurricane Katrina recovery
costs are "coming from the American taxpayer." Another top aide,
domestic policy adviser Claude Allen, said the administration had
not identified any budget cuts to offset the disaster expense, and
Bush did not name any either.
Congress already has approved $62 billion for the disaster, but that
is expected to run out next month and require another budget-busting
installment. The federal deficit was projected at $333 billion for
the current year before the storm slammed into the Gulf Coast more
than two weeks ago.
Some fiscal conservatives are expressing alarm at the prospect of
such massive federal outlays without cutting other spending.
"It is inexcusable for the White House and Congress to not even make
the effort to find at least some offsets to this new spending," said
Sen. Tom Coburn, R-Okla.
Bush, who declined to try to put a price tag on the costs, expressed
no worry.
"You bet it's going to cost money. But I'm confident we can handle
it and I'm confident we can handle our other priorities," he said
during a news conference with Russian President Vladimir
Putin. "It's going to cost whatever it costs."
Bush said it's important that government quickly restore the region
to give people hope, and repeated his statement from Thursday
night's speech from the heart of the New Orleans' French Quarter
that the federal government would cover most of the cost of
rebuilding schools, bridges and other infrastructure. Asked who
would pay for the work and how it would impact the nation's rising
debt, Bush said "the key question is to make sure that the costs are
wisely spent."
"It means we're going to have to make sure we cut unnecessary
spending," he said. "It's going to mean that we maintain economic
growth and we should not raise taxes."
Without being asked, Putin stepped up to respond to Republican
worries that Bush was writing a blank check for hurricane recovery
that would increase the debt on generations to come.
The old Soviet Union had lived by the rule that money should not be
taken from the pockets of future generations, Putin said. "But we
never thought about the existing, current, present generations. And
at the end of the day, we have destroyed the country not thinking
about the people living today."
"Therefore, of course, yes, we need to spend money," the Russian
leader said. "There is no two ways about it."
Opening Friday's joint news conference with Putin, Bush thanked his
guest for sending supplies to the Katrina relief effort, saying the
gesture would help "lift the spirits" of hurricane victims. The
Russian said that Katrina provided "serious lessons" for Russia and
other countries. Putin did not specifically mention the criticism of
relief efforts in the Gulf Coast.
The hurricane killed hundreds of people across five states, forced
major evacuations and caused untold property damage.
Bush also said he wants Congress to consider changing the law to
allow the military to step in immediately if a catastrophic disaster
occurs again. "It's important for us to learn from the storm what
could have been done better," he said. Under fire, the White House
has accused state and city officials of not authorizing federal
involvement quickly enough, although critics say the administration
didn't need approval to act.
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