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House panel, Bernanke discuss economy

Jan. 17, 2008 at 2:17 PM

WASHINGTON, Jan. 17 (UPI) -- Rep. John M. Spratt Jr., D-S.C., saying "ominous indicators" surround the U.S. economy, told the House Budget Committee a slow down has started.

"It's become increasingly clear that our economy is beginning to slow down, entering a slump, if not a recession," Spratt said as he welcomed Federal Reserve Chairman Ben Bernanke to the committee. "(There) are ominous indicators all around us."

Bernanke has said he favors a quick, temporary stimulus plan.

Spratt said the Fed has eased monetary supply and credit access, "(but) monetary policy has its limits."

Rep. Paul Ryan, R-Wis., in his opening statement, said Congress and the Bush administration were considering measures to stimulate the economy, but must consider "key principles."

"I'm concerned that in our rush to help, we talk ourselves into a quick, feel-good hit today that will leave us a bigger budgetary hangover tomorrow," he said.

Ryan warned against raising taxes and argued for making Bush's tax cuts permanent. Congressional leaders, however, indicated making the cuts permanent was off the table.

Finally, Ryan said he was concerned that the Democratic majority in Congress would "push through new entitlement spending proposals ... building up a spending baseline that worsens our economic future."

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