"Week in Review: Giving the Economy a Jumpstart"

SCOTT SIMON, host:

This is WEEKEND EDITION from NPR News. I'm Scott Simon.

This week, the White House, the Federal Reserve chairman, many members of Congress all agreed in principle: the economy needs some kind of stimulus to fend off a recession. And senior U.S. military officials say it may be another decade before Iraq is able to defend its own borders.

NPR senior news analyst Dan Schorr joins us.

Hello, Dan.

DAN SCHORR: Hi, Scott.

SIMON: And let's begin with the economy.

SCHORR: Yeah.

SIMON: President Bush had asked Congress to move quickly to approve his economic stimulus plan, which he called a shot in the arm for the economy. It's made up mainly of tax rebates for consumers and temporary tax breaks for businesses. What's you're estimation for it?

SCHORR: Well, my estimation doesn't count. But Wall Street, on a Friday, indicated that it was not really convinced that anything was going to get better in this slide towards recession. And when the president offers a stimulus package, everybody says yes, but you got to do it very fast. And the question is how it comes out when it's negotiated with Congress.

Clearly, in the Congress, there'll be a greater tendency to favor the middle class and poorer people in giving these tax rebates. The administration typically wanted to give them across the board. And for speaking not any logically but purely economically, if you want money to have an effect, you're much better off giving it to poor people who go out and spend it right away than to rich people who will simply suck it away.

SIMON: In a situation like this, are people's perceptions about the economy, which after all usually begin and end with their own personal economy…

SCHORR: Right.

SIMON: …does that matter more than what the overall reality of the economic picture is?

SCHORR: I don't know if it matters more. It certainly matters as much. I mean, the way people perceive the economy and the way the economy is going will affect their behavior in many, many ways. And so, if you cannot convince them that the United States is not speaking of the right track, poll indicates that 70 percent of Americans believe the United States is on the wrong track, and that goes for the economy as well. So they have to be reassured.

SIMON: Which gets us into the election season. And, of course, polls now indicate this election that was supposed to be about Iraq and immigration, the number one concern in the mind of America's voters now…

SCHORR: Yeah. Right.

SCHORR: …is the economy.

SCHORR: That's right. Well, on the one hand, things are little bit better in Iraq in terms of the surge and how things are going there and a little bit worse in the economy. So it's quite natural as to say that we worried about it. And remember after the last election, it was predicted that Iraq would dominate the political campaign. But, yes, things are better then than was here. And, now, we are back where we tend to be in most election years. The pocket book is what counts.

SIMON: And does this get to be unchartered territory for the campaigns, although I imagine they plot up most everything. But here was an election that was supposed to be about certain issues and now they have to make a mid-course correction.

SCHORR: Well, yes, of course. And every candidate is now asked where he or she goes, about what would you do about the economy or come out with basically the same thing and we have the stimulus. I mean, there are not great many things you can say about how you stay out of recession, but they'll say them and life will go on.

SIMON: This week, the House Armed Services Committee heard testimony from Lieutenant General James Dubik. He heads the Multinational Security Transition…

SCHORR: Yes.

SIMON: …Command in Iraq. General Dubik quoted Iraqi officials as saying that Iraq may not be ready to take responsibility for its own internal security until - four years from now. It won't be able to defend its borders until 2018.

SCHORR: Yes.

SIMON: What are the implications of that statement?

SCHORR: Well, the implications are if the Iraqis say that's what's needed, that's one thing. It's another thing for American president to make a commitment that goes past his tenure in office. I'm not quite clear on what happens if President Bush decides all right, yes, we'll be there for the next eight years and 10 years, you can count on it. We'll have American bases there. And then leave it for the next president to have to enforce. Can the president tie the hands of the next one or two or three presidents?

SIMON: I was going to ask you, I mean, for example, there are still U.S. troops even in Bosnia…

SCHORR: Right.

SIMON: …which were committed during a previous administration.

SCHORR: And Korea, of course.

SIMON: Yeah. So there is certainly a precedent for that.

SCHORR: There is precedent for that, but in most previous cases, there've been acceptance by the Senate, and it's not clear that any of these will be submitted to the Senate for ratification.

SIMON: I want to ask you about Bobby Fischer, who died this week in Iceland. He was 64 years old, reportedly had been in poor health for, at least, the last few months of his life. This is a real figure from history, someone who was an important figure during the Cold War, someone who slipped into pathetic and sometimes really very wretched decline also.

SCHORR: Yes. We learned from this that a great chess player can also be a great jerk. And other than…

(Soundbite of laughter)

SCHORR: …other than…

SIMON: Well, he was beyond even a jerk.

SCHORR: …was beyond - he (unintelligible) something wrong. After 9/11, he said he wanted to see the United States wiped out. Although, his mother or maybe his father were Jewish, he talked about the Jews being live, being peeving bastards. I'm not saying that's Bobby Fischer. And, well - I'll tell you as a chess player, he was unrivaled, but in other ways, he was - how shall I say - rivaled.

SIMON: Senior news analyst Dan Schorr.

Dan, thank you very much.

SCHORR: Sure thing.