Sen. Frist: Boosting consumer confidence not easy in time of fear and uncertainty
Boosting consumer confidence is the key to an economic recovery, but achieving it won't be easy when the recent terrorist attacks are scaring people into staying home and not spending, U.S. Sen. William Frist said Friday in a speech on campus.
Frist praised the Federal Reserve for lowering interest rates earlier this week, but cautioned that it will take more than that to get the economy moving. "No matter how cheap the money gets, that's not going to trigger new investment if inventory is full and if consumers are cocooning and simply not buying," said Frist, who graduated from Princeton's Woodrow Wilson School of Public and International Affairs in 1974.
The anthrax attacks -- and the possibility of other bioterrorism in the future -- are especially unnerving for consumers, and, he pointed out, "fear and uncertainty are things economists don't like to see." Frist, who was a heart and lung transplant surgeon before being elected to represent Tennessee in the Senate in 1994, said there is a possibility of more threats from anthrax in the future.
"There are likely letters in the system now that have anthrax," he said. "The threat is small, but the threat is real." He also spoke about the threat of smallpox: "The risk is tiny, but our vulnerability is high because no one is immunized.... If I had it right now, at least a third of you would be infected."
Because of his medical background, Frist is regarded as a leading authority on health matters in the Senate. He is sponsoring a bill that calls for spending $3 billion to beef up the public health infrastructure. The money would be used on prevention, preparedness, protecting the food supply and enhancing treatment capabilities.
In terms of boosting the economy, Frist predicted that the Congress would pass a stimulus bill that would "likely be around $100 billion." He said he could not predict whether that would succeed in dealing with recent developments such as higher unemployment, negative growth and less consumer spending.
However, Frist closed his speech on a positive note: "To win this war on terrorism, it's going to take a lot of resources, a lot of leadership, a lot of patience and a lot of prayer. We are clearly united in a way that we've never been in my lifetime. I'm optimistic about our economy, I'm optimistic about the resiliency of the American people and I'm optimistic about the leadership in the White House."
Contact: Marilyn Marks (609) 258-3601