Obama defends economic stimulus

US President Barack Obama has defended his economic stimulus plan as "absolutely necessary", and urged Congress to quickly approve it.

The Senate was holding a rare Saturday session to debate a pared-down version of the original $900bn (£612bn) plan to revive the flagging US economy.

Mr Obama praised moderate Democratic and Republican senators for coming up with the tentative compromise deal.

The Senate is now expected to vote on the bill early next week.

Senior Democrats, backed by a few Republicans, agreed on Friday to support a version of the bill worth $780bn (£528bn), instead of the $900bn sought by the president.

Most Senate Republicans said they would oppose the bill, however, saying much of the spending was unwarranted and it would impose a crushing burden of debt on future generations.

Catastrophe warning

"The scale and scope of this plan is right, and the time for action is now," Mr Obama said in his weekly radio and internet address.

"If we don't move swiftly to put this plan in motion, our economic crisis could become a national catastrophe."

Senate Majority Leader Harry Reid said he thought his 58 Democratic senators had just enough Republican support to gain the 60 of the 100 Senate votes needed to avoid legislative delaying tactics.

If the Senate passes its version of the bill, it must then be reconciled with the House of Representatives version already passed before both houses vote on the reconciled version to send to President Obama to sign.

House of Representatives Speaker Nancy Pelosi said she expected a finished version to be ready by the president's deadline of 16 February.

Mr Obama hailed the draft Senate bill as one that would provide "jobs that rebuild our crumbling roads, bridges and levees and dams... [and] immediate tax relief for our struggling middle class."

New US employment figures were released on Friday showing that nearly 600,000 jobs were lost in January, pushing the unemployment rate to 7.6% - its highest in 17 years.

Republicans said even the reduced Senate bill contained too much spending and not enough tax cuts.

"For the last two weeks, they've been trying to force a massive spending bill through Congress under the guise of economic relief," said Republican National Committee Chairman Michael Steele.

"The fastest way to help those [struggling] families is by letting them keep more of the money they earn."