In his final State of the Union address, President George W Bush has finally acknowledged that the US economy is in rather poor shape. President Bush’s address was significant in more than one way, besides being his last such Presidential address before he leaves office in January next year, this address took place amidst his popularity touching its nadir according to a recent Gallup poll.
Despite all the niceties in his speech, it is not clear how serious was the US President in pinpointing the exact causes for the recent downturn in the US economy – a tumbling dollar, risk of large number of Americans losing their homes, mortgage market crisis, and financial market crisis. Though the President believes that the Congressional plan of pumping $150 billion, equivalent to about 1% of US GDP, will provide the much needed multiplier effect from fiscal spending the economy needs but a possibility nonetheless remains of a part of the economic gain being wiped away by US ‘surge’ strategy in Iraq.
In the Democratic reply to the President’s speech, the Kansas Governor Kathleen Sebelius was correct in pointing out:
There is a chance, Mr. President, in the next 357 days to get real results and give the American people renewed optimism that their challenges are the top priority.
The new economic plan of the administration that includes tax cuts and tax benefits to entrepreneurs willing to undertake new investments can pull up the US economy from recession. With soaring oil prices, the countries overdependence on oil imports has been blamed by the President. It is clear that USA’s oil politics has been one of the primary reason’s for the country’s interest in the Gulf countries. Can development of alternate energy sources be a way of salvaging the country from its ‘oil dependence’?
Source: BBC
