Jan. 17 (Bloomberg) -- President George W. Bush has decided the U.S. needs a short-term stimulus to counter an economic slowdown and is ``getting closer'' to forming a proposal, his spokesman said today.

``The president does believe that over the short term, to deal with this softening of the economy, that some boost is necessary,'' Deputy Press Secretary Tony Fratto said today.

He refused to discuss the timing of any announcement, saying the president ``still has decisions to make'' about what will be included in a proposal. The administration wants ``to pass something quickly. I see no obstacle to that.''

With some lawmakers and private economists warning the country risks falling into a recession, Democrats in Congress are pushing to enact a stimulus plan within the next 30 days. House Republican leader John Boehner said that a package of $100 billion to $150 billion is being discussed by administration officials and lawmakers.

Fratto spoke as Federal Reserve Chairman Ben S. Bernanke was telling the House Budget Committee that a ``temporary'' fiscal stimulus would help the central bank buttress economic growth. He warned against measures that would worsen the budget deficit beyond the next 12 months.

Consulting Congress

Bush is scheduled to talk with congressional leaders by conference call later today to solicit their ideas for a stimulus proposal. Treasury Secretary Henry Paulson will join Bush on the call with House Speaker Nancy Pelosi, Majority Leader Steny Hoyer, Boehner, Senate Majority Leader Harry Reid and his Republican counterpart, Mitch McConnell.

Fratto described the call as a ``consultation'' rather than a negotiating session.

An economic stimulus package, under consideration for weeks, will require congressional approval and would be Bush's first major effort to confront the broad economic slowdown beyond the steps taken to combat home foreclosures last year.

The administration doesn't plan to offset costs with cuts or tax increases elsewhere, which may add to the deficit. ``The idea is to put money into the economy, not take money out of the economy,'' Fratto said.

At the Capitol, Bernanke reiterated to lawmakers that the outlook for growth in 2008 ``has worsened'' and a well-timed package of measures would help.

Joint Actions

``Fiscal action could be helpful in principle, as fiscal and monetary stimulus together may provide broader support for the economy than monetary policy actions alone,'' Bernanke said.

In response to a question from Representative John Spratt, a South Carolina Democrat who is chairman of the Budget Committee, Bernanke said the Fed is ``not forecasting a recession'' for this year.

At the White House, Fratto was asked if the administration considers the economy is about to fall into a recession.

``Private sector economists are saying, the overwhelming number of them, are saying that they expect a slowdown in the economy in the short term. Most are not predicting a recession,'' Fratto said.

The jobless rate rose to 5 percent in December from 4.7 a month earlier, and economists at Goldman Sachs Group Inc., Merrill Lynch & Co. and Morgan Stanley say the U.S. is probably sliding into a recession.

Tax Cuts

Bush still wants the 2001 and 2003 tax cuts to be made permanent, Fratto said, but he wouldn't say explicitly whether they should be part of a short-term recovery package. ``I'm not going to get into what may be the components,'' Fratto said.

The economy has surpassed Iraq as most pressing issue for voters as Bush, members of Congress and presidential candidates offer competing plans to give a boost to the economy.

Congressional Democrats are leaning toward a package that would cost about $100 billion and include a tax rebate for middle-income taxpayers as well as expanded unemployment and food-stamp benefits.

House Republicans suggest cutting business taxes and including temporary incentives for businesses to invest in equipment. This would include reducing the corporate tax rate to 25 percent from 35 percent, allowing 50 percent more depreciation of equipment for two years, and boosting the amount of equipment costs companies can expense to $250,000 on purchases up to $1 million. Some measures would be temporary.

``We're putting this out there as a marker,'' Republican Representative Eric Cantor of Virginia said in a news conference at the Capitol.

Move Quickly

Both sides agree they want to move fast.

Pelosi said today that she thinks the legislation could be passed and in effect within 30 days.

``My confidence springs from the fact that it is so urgent for the American people,'' she said in Washington.

Democratic Senator Charles Schumer of New York said Democrats ``are quite united'' in bypassing pay-as-you-go rules to inject money into the economy quickly. ``The consensus is that it won't stand in the way,'' he said, referring to the rule that would require cuts elsewhere in the budget to pay for a stimulus package.

Democrats will announce their package before the State of the Union address on Jan. 28, he said.

To contact the reporter on this story: Roger Runningen in Washington at rrunningen@bloomberg.net

Last Updated: January 17, 2008 14:38 EST