President Bush says he will work with Congress to lower U.S. budget deficits as part of an effort to answer European concerns about the weak dollar. Mr. Bush spoke following talks with Italian Prime Minister Silvio Berlusconi.
President Bush says he will pursue his "strong dollar" policy in the upcoming legislative session by working seriously with Congress to lower deficits, which he says should cause people to want to buy dollars.
"We believe that the markets should make the decision about the relationship between the dollar and the euro," the president said.
President Bush met with Prime Minister Berlusconi a day after Washington announced a monthly record trade deficit for October of $55.5 billion.
That has helped drive down the value of the dollar. That helps U.S. manufacturers because American goods are less expensive for foreign buyers. The dollar is of particular concern in Europe where much of its decline has come against the euro and the British pound.
President Bush says the decision to raise U.S. interest rates again is a signal to world markets that Federal Reserve Chairman Alan Greenspan is aware of the relative values of the euro and the dollar.
President Bush says the best way to strengthen the dollar is to address long-term U.S. government borrowing, which is caused by budget deficits.
The president is especially concerned about the projected costs of the U.S. retirement plan known as Social Security. Mr. Bush wants to privatize part of that plan so younger workers can invest some of their retirement money in financial markets.
"I campaigned on the issue," he said. "I look forward to working with members of Congress to resolve this long-term unfunded issue so that the world financiers can take comfort in the fact that this government will address one part of the budget deficit."
Congressional Democrats oppose the president's Social Security plan, saying it will cut benefits for older Americans and threatens the retirements of younger workers who could lose money invested in potentially risky financial markets.