NEW YORK -- Recent indicators showing weakness in the U.S. economic recovery prove that the Clinton administration's proposed stimulus package is not as superfluous as critics say, Laura D'Andrea Tyson, chairwoman of the Council of Economic Advisers, said yesterday.
At the same time, however, Ms. Tyson said that attempting to pass the economic plan would effectively put a world trade agreement on hold for some time. She said pushing the plan as well as health care reform through Congress would take priority to concluding a deal on the General Agreement on Tariffs and Trade.
"We don't want to get into a situation where we try to do all things simultaneously and get gridlock. We have a strong commitment to bring GATT to a conclusion, but the feasibility depends on the domestic political actors," Ms. Tyson said at the opening address of the Conference Board's annual meeting on the U.S. economy.
Ms. Tyson also blamed U.S.trading partners for the delay in securing a GATT agreement, which would limit protectionism among world trading nations.
Although few countries other than the United States have the weight to push for a GATT deal, Ms. Tyson said the delay was "not entirely or largely due to U.S. fault."
Speaking at the start of a day-long conference on the economy, Ms. Tyson said the stimulus package took priority because the economic recovery was not as robust as the administration and others would like.
Statistics showing an increasing number of people on food stamps, declining consumer confidence and plummeting housing starts, for example, prove that the recovery was uneven, she said.
"The situation is mixed. Based on partial information, there are signs of deceleration," said Ms. Tyson, a former academic and author who was tapped by President Clinton to become head of the influential advisory council.
And even if the economy grows as quickly as it did in the last three months of 1992, when it surged ahead at an annual rate of 4.8 percent, the lingering high unemployment rate shows some sort of action is needed, she said.
Ms. Tyson defended the $16 billion stimulus package from charges that it was so small as to be meaningless. The money would ripple through the economy, with benefits beyond the people who get hired, she said. It should be looked at as a "down payment" on President Clinton's plan to invest more in the economy, she said.