U.S. Chamber Applauds Fed's Rate Cut

WASHINGTON, D.C. – The United States Chamber of Commerce welcomed today's Fed action to lower interest rates by another half-point – the second half-point cut this month – in the wake of economic data confirming the sharp slowdown in economic growth.

"With the economy braking hard, the Fed's move to cut rates another 50 basis points should help to shore up withering consumer confidence," said Martin Regalia, Chamber chief economist. "While it will take time for the full effect of the Fed's action to work through the economy, such an aggressive move should create an immediate rebound effect in consumer and business confidence.

"Today's dismal economic numbers and the Fed's reaction should give clear direction to the White House and Congress that the time for a tax cut is now," Regalia added. "And the Congressional Budget Office's new estimate that the federal surplus will be $5.6 trillion over the next ten years – a trillion dollars more than their earlier forecast – should make tax cuts more politically acceptable.

"This puts the ball in Congress' court. Based on these estimates, the Administration and Congress have little excuse not to provide a significant pro-growth tax cut," Regalia concluded.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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