U.S. efforts to take action on slowing business activity, joblessness and reduced credit grew on Wednesday as U.S. lawmakers moved to pump tax dollars into the economy, reduce taxes going forward and grilled top U.S. bank executives amid widespread concern.
Lawmakers announced they had reached a deal to pass a $789 billion economic stimulus package to President Barack Obama so he could sign it into law. Meanwhile members of a financial committee in Congress questioned bankers about how they had spent more than $160 billion in taxpayer money to help the economy.
The deal was initially announced Wednesday night by Senate Majority leader Harry Reid (D-Nev.) in a press conference, according to reports. House Speaker Nancy Pelosi (D-Calif.) also confirmed the deal separately.
Earlier in the day, lawmakers met with the chief executives of some of the largest U.S. banks in a public hearing to question them about their U.S. of federal funds to avert a fiscal crisis. The bankers represented have received a combined $165 billion from an initial fund of $350 billion allocated by lawmakers last year.
Several of the bankers told lawmakers that they were lending despite a credit crisis which has tightened credit markets, especially in secondary markets which contain. Others were apologetic.
As an industry, clearly, we made mistakes, said Morgan Stanley chief executive John Mack, according to the Washington Post. I think the entire industry shares some of that responsibility and for that, we are sorry for it.
Meanwhile, financial markets declined Wednesday despite measures announced on Tuesday by the Obama administration to help restore the U.S. financial system. Investors widely faulted Treasury Secretary Timothy Geithner for creating uncertainty for failing to fill in the details of his overall plan. Geithner said he would work in the coming weeks to elaborate on the plans.