President Bush yesterday warned Americans that the economic damage to the US will be ‘painful and lasting’ if Congress fails to pass his $700 billion bailout bill.
Bush said he was ‘disappointed’ that the House of Representatives had voted to reject his Wall Street bailout plan.
In an effort to calm nervous investors in the wake of Monday’s record 778 points fall on Wall Street, which he noted saw $1trillion wiped off share prices, Bush said: ‘I can assure our citizens and citizens around the world that this is not the end of the legislative process.’
But he stressed: ‘We’re in an urgent situation and consequences will grow worse each day we do not act.
‘If our nation continues on this course, the economic damage will be painful and lasting.’
He claimed that ‘our country is not facing a choice between government action and the smooth functioning of the free market.
‘We’re facing a choice between action and the real prospect of economic hardship for millions of Americans.’
He concluded: ‘For the financial security of many Americans, Congress must act.’
Share prices rose as traders sought to make opportunist profits while shares were cheap, but no-one believed they have seen the end of the crisis.
In the UK, the latest figures from the Office for National Statistics showed the economy has ground to a halt, with zero GDP growth for a second quarter.
The semblance of a national government has begun to emerge in this situation.
While Brown was closeted in talks with Bank of England Governor Mervyn King and City regulator, the Financial Services Authority, Chancellor Darling was in discussions with Tory shadow chancellor Osborne and Liberal Democrats treasury spokesman Vince Cable.
Brown and Darling reiterated that they will ‘take whatever action necessary to ensure continued stability for Britain.’
Tory leader David Cameron made an emergency statement to his party conference in Birmingham, saying: ‘We’re in this together.’
Pledging the Tories’ support for the Brown government he cautioned against the ‘political wrangling’ seen in the US.
Liberal Democrat leader Nick Clegg said: ‘I believe these exceptional times require a suspension of normal political hostilities and a rapid move towards a cross-party consensus on how we might prepare for the worst-case scenario.’
In the face of these developments, the TUC told News Line yesterday that ‘we’re monitoring the situation’.
