TOPICS > Economy

Economic Aftermath

September 19, 2001 at 12:00 AM EDT


KWAME HOLMAN: Concern about the state of the economy brought Federal Reserve Chairman Alan Greenspan and former Treasury Secretary Robert Rubin to the Capitol this afternoon for a closed meeting with the four top leaders of Congress.

REPORTER: Mr. Speaker, what do you hope to accomplish at this meeting?

REP. DENNIS HASTERT: I think we’ll have comments later this afternoon, thank you.

KWAME HOLMAN: A Federal Reserve report today described the economy as “sluggish,” adding consumer spending was flat to down, and there has been no significant boost from the income tax cut. At the same time, the House Transportation Committee was hearing from airline executives that the one-tenth of the U.S. economy their industry represents is in danger of collapse because of lost revenue after last week’s attacks. They pushed a scaled-back request for an immediate federal infusion of $5 billion, plus $12.5 billion in loan guarantees. Leo Mullin is chairman and CEO of Delta Airlines.

LEO MULLIN, Chairman & CEO, Delta Airlines: Our proposal is only intended to stabilize the financial condition of this industry. It is not a bailout, but rather a package designed solely to recover the damages associated with the heinous acts of September 11, and it gives the airlines a chance to continue to serve as the economic engine and offer the public service it is our duty to provide.

KWAME HOLMAN: Teamsters Union President James Hoffa argued for aid for the 51,000 airline employees already laid off before this afternoon’s announcement by American Airlines that it would lay off 20,000 more.

JAMES HOFFA: There has to be an equality of sacrifice in any program we come up with. Everybody should have to tighten their belts with regard to what we’re going to be doing with regard to this crisis. That could take the form of longer-term unemployment benefits, and job placement and job training for those who have been displaced.

KWAME HOLMAN: Committee members generally agreed immediate assistance for the airline industry is warranted. But the committee’s top democrat, James Oberstar, said that alone won’t be enough to get the airlines off the ground.

REP. JAMES OBERSTAR, (D) Minnesota: But if we address only the dire financial circumstances of the industry and do not at the same time elevate security, air travelers will have little confidence that they can fly safely, and airline load factors will not improve.

KWAME HOLMAN: A financial rescue bill for the airlines could be ready for a congressional vote by the end of the week. Late this afternoon, President Bush hosted the congressional leaders in the Oval Office. The President said this about the economy.

PRESIDENT GEORGE W. BUSH: And I’m going to work with Congress to send a clear message to America, American workers, American business people, that this government will respond to this emergency. We’ll respond to the emergency in terms of working on a package for the airline industry that has been severely affected. We’ll respond to work to fight terrorism. The definition of “how much?” is: Enough to get America going again, is to be able to endure this emergency.

KWAME HOLMAN: Leaving the White House, congressional leaders said they’ll wait for a detailed presidential request regarding any new economic stimulus package.