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Congress Works on Economic Recovery Measure

As President Obama meets with his economic advisers, Congress is moving forward with steps to pass a huge economic recovery package.

With a mid-February deadline for getting legislation to President Obama's desk, the measure was the first major item of business, following the inauguration, in the House appropriations committee.

At present it contains $825 billion in spending on infrastructure, transportation, energy, and health care among other things, with $275 billion in tax cuts.

House Democratic leaders envision passage by the end of this month, followed by consideration in the Senate. Minority Republicans say they have no differences with President Obama and Democrats on the need for quick action.

But they have renewed complaints about what they call tax and spend policies that will not help the economy.

House Minority Leader John Boehner and Republican Caucus Chairman Mike Pence:

BOEHNER: "It is clear that [the Democratic proposal] does not create the jobs or preserve the jobs that need to happen."

PENCE: "There is a clear conflict of visions between the two [Republican and Democratic approaches]."

The House appropriations chairman, Democrat David Obey, responded to concerns voiced by Republican Jerry Lewis:

LEWIS: "Let us try to be honest with one another. All of this spending is placing a tremendous burden of debt on future generations."

OBEY: "The fact is that when the economy is collapsing, we have no choice but to either stimulate consumer demand or see the economy fall further into the abyss and if it does we will have deficits far larger than the deficits we have today."

The recovery package also featured in the Senate confirmation hearing for Timothy Geithner, President Obama's nominee to be Treasury Secretary.

Senator John Kerry, a Democrat, voiced concern about the economic plan.

"As it is currently proposed, the House package and the investment package, I fear stand a good chance of simply being wasted and of not having the impact our overall economic package to have because the system underneath it is broken," said John Kerry.

Former Federal Reserve Chairman Paul Volcker, who supported Geithner's nomination, delivered this chilling message about the economy:

"The financial system is broken," said Paul Volcker. "It is a serious obstacle to recovery. There is no escape from the imperative need for the federal government to come to the rescue to right the economic and financial ship of state."

Dealing with the crisis, Volcker added, will require federal government spending in the form of regular budgetary commitments, various credit and insurance guarantees of several trillion dollars over time.

Geithner urged rapid enactment of the recovery measure.

"The ultimate cost of this crisis will be greater if we do not act with sufficient speed now," he said.

Geithner said Senate approval before President Obama's inauguration of the $350-billion second half of the financial institution rescue plan will help.

But he added that other steps must accompany economic stimulus, to address the U.S. housing and mortgage crisis, and financial reforms to correct what Geithner called a system that has been shown to be unfair and unjust.