The government may roll out a second stimulus package early next year if unemployment rates fail to improve, according to analysts and business leaders.
Unemployment rates could stay high in both urban and rural areas, and cash-strapped state budgets will put political pressure on Washington to unveil fresh stimulus measures.
“Though they won't call it a second stimulus, they'll call it a creative name,” says Harold Ford, Jr., vice chairman and senior policy adviser at Bank of America Merrill Lynch, according to Dow Jones newswires.
Furthermore, Democratic legislators approaching the 2010 elections will not want to face their opponents without having made a dent in unemployment rates, says Ethan Harris, Bank of America Merrill Lynch's head of North America economics.
More government spending would likely target technology, clean energy and exports, participants said at a Merrill Lynch Global Wealth Management panel.
“We just have to think about this country more as an exporter in the future,” says General Electric Chairman and CEO Jeffrey Immelt.
Some in Congress are already pushing for new legislation designed to create jobs but stop short of calling it a stimulus.
Democratic House Majority Leader Steny Hoyer said he wants a new bill passed by Dec. 18, according to the AFP newswire.
“I wouldn't characterize it as a second stimulus. I don't want to be as broad as that. I want to be very targeted on jobs,” says Hoyer, who declined to provide monetary details of what the bill might include.
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