Obama Signs $787bn Bill, and It May Not Be Last

President Barack Obama hinted that there could be a second economic stimulus package yesterday, hours before he signed into law one of the most expensive bills in US history.

Obama is pinning his hopes of saving America's tumbling economy on the $787bn package. But if that fails, he is prepared to bring forward another one.

He described the American Recovery and Reinvestment Act, designed to create or save 3.6 million jobs, as the "most sweeping economic package in US history". But stockmarkets in the US and around the world plunged on skepticism that the package, which includes spending on rebuilding America's infrastructure and education, and help for the unemployed and poor, will have much impact.

Obama flew from Washington to Denver to sign the stimulus package instead of performing the ceremony at the White House. He is keen to demonstrate that he is not a creature of Washington and is aware of the impact of the economic crisis on the whole of America.

He admitted that the law by itself was not enough to deal with the crisis. "But today does mark the beginning of the end," he said.

The White House press secretary, Robert Gibbs, speaking to reporters on the flight to Denver, refused to rule out a second package. He said the president would do whatever it took to make the economy grow, and while "there are no particular plans at this point for a second stimulus package, I wouldn't foreclose it".

In a separate move, Obama is to follow up the stimulus package with at least $50bn in aid for millions of homeowners struggling to meet mortgage payments.

The Obama administration yesterday received proposals from America's ailing car giants, General Motors and Chrysler, which are being propped up by $14bn in federal aid, on how they plan to restructure their industry. GM is proposing to cut 47,000 jobs and ask the federal government for a further $16.6bn.

Obama's landmark act puts him on course to achieve the most in the first 100 days of his presidency since Roosevelt in the 1930s.

He said of the new act: "It will make the most significant investment in America's roads, bridges, mass transit and other infrastructure since the construction of the interstate highway system. It will make investments to foster reform in education, double renewable energy, while fostering efficiency in the use of our energy, and improve quality while bringing down costs in healthcare. Middle-class families will get tax cuts and the most vulnerable will get the largest increase in assistance in decades."

Of the $787bn, about 33% will be spent on tax cuts, down from the 40% originally proposed. The tax cuts were put in partly as a sweetener for Republicans but the tactic failed: no Republican in the House voted for the package and only three in the Senate.

More than $89bn is to be spent on infrastructure projects to include roads, bridges, railways, public housing, water systems and broadband internet service to rural areas. A further $81bn will go towards improved unemployment benefits. About $141bn is for healthcare, while $87bn will go towards stopping cuts in state funds to schools and $86bn for green energy plans.

Surge for Afghanistan

Barack Obama approved a further 17,000 US troops for Afghanistan last night. The US has 30,000 troops in Afghanistan but the security situation has deteriorated over the last year as the Taliban have enjoyed a revival. There has been speculation in the US media for weeks that Obama would double the existing US force and the 17,000 announced yesterday may be followed by a further 13,000 later in the year. Obama, in a statement, said: "This increase is necessary to stabilize a deteriorating situation in Afghanistan, which has not received the strategic attention, direction and resources it urgently requires."