MEDIA REACTION: U.S. ECONOMY

UNCLAS HONG KONG 000025 DEPT FOR INR/R/MR, INR/IC/CD, I/FW DEPT FOR EAP/PD, EAP/CM, EAP/P DEPT FOR VOA/BRF, TV-WPA WHITE HOUSE FOR NSC PRC POSTS FOR PA AIT USPACOM FOR FOR CIS PD ADVISER E.O. 12958: N/A TAGS: OPRC KMDR SUBJECT: MEDIA REACTION: U.S. ECONOMY TOPIC: U.S. economy HEADLINES AND EXCERPTS: "Obama's tax cuts will not be favorable for creating new jobs" The independent Chinese-language Hong Kong Economic Times commented in an editorial (1/6): "As part of the US$770 billion economic-stimulus package proposed by U.S. President-elect Obama, US$300 would be spent on tax cuts to win Republican support, so that the package can be implemented as soon as possible. However, the tax cuts will largely cripple the power of the economic-stimulus package. Obama would then need to increase the total amount of the package before the economy could be saved and the target of creating 3 million jobs could be reached.... Tax cuts have greatly weakened the power of the US$700 billion economic-stimulus package to create jobs. By cutting US$300 billion for infrastructure developments and for promoting industries like environmental protection, etc., it is feared that the stimulus package will hardly be able to reach the original target of creating 2.5 million jobs, not to mention creating 3 million jobs.... It is not at all unjustifiable for Obama to make political compromises. However, if Obama wants to create 3 million jobs and to stabilize the economy and the society, he must increase the total amount of the economic-stimulus package. And he cannot but put aside the future trouble of a financial deficit at the moment." DONOVAN