Student senate sustains scrupulous spending
■The ASUO Student Senate tightly
doled out surplus funds Wednesday
By Emily Gust
Oregon Daily Emerald
Sen. Mary Elizabeth Madden took a hard
line Wednesday, as she prevented more than
$2,000 from leaving the general surplus.
A number of students plan to attend a
protest against the Free Trade Area of the
Americas in San Diego this weekend. Oona
Holcomb, a member of the Survival Center,
asked the student senate to help cover travel
expenses.
Madden, upon examining the Survival Cen
ter’s account information, pointed out there
were a lot of places where the group had extra
money that did not seem to be in use. She sug
gested transferring funds
from those areas rather than
providing for the entire spe
cial request through the sur
plus.
Specifically, Madden
wanted to take money from
the group’s Earth Week
fund.
But Holcomb said it was
not in her jurisdiction to touch that area of the
budget because the Survival Center is split up
into several different authorities, each of
which governs a different segment of the budg
et.
ASUO Vice President Holly Magner agreed,
and Sen. Katie Howard said she didn’t think
the senate should consider draining funds
from a project that is still going on. Earth Day is
this weekend.
But Madden asked if the group planned to
spend much more on Earth Week celebrations.
“To be honest, probably not,” Holcomb said.
“But at the same time I’m not supposed to use
it... I don’t want to be stepping on the toes of
anyone.”
The senate eventually decided to give the
Survival Center $700 from the surplus, and to
transfer the additional funds from within the
group’s budget. A five-minute recess to figure
out the specifics ended, however, when a rep
resentative from the Women’s Law Forum
suddenly announced her group would offer
the Survival Center a co-sponsorship for the
event.
Madden subjected the Designated Driver
Shuttle to similar scrutiny.
“We are out of gas money,” said Jeff Salchen
berg, co-director for DDS. “There’s really not
much to it.”
Madden asked Salchenberg about $6,000
resting in the group’s maintenance fund, and
suggested transferring money from the group’s
own funds rather than taking it from the gener
al surplus.
But Sen. Tex Arnold hesitated on moving
money out of the group’s maintenance fund.
“What if something breaks down?” he asked
the senate. “Cars don’t run forever.”
Madden said if that were the case, the group
could come and ask for more money.
And many senators seemed to agree. In a
unanimous decision, the senate voted to move
$1,800 from DDS’s maintenance fund to pay
for gas, and avoided dipping even further into
surplus.
Fed surprises Wall Street with unexpected rate cut
By Martin Crutsinger
The Associate Press
WASHINGTON — Acting in an
emergency conference call, the Fed
eral Reserve moved Wednesday to
bolster the flagging economy by cut
ting interest rates by half a point for
the fourth time this year.
It marked the most aggressive
credit easing during Federal Reserve
Chairman Alan Greenspan’s nearly
14 years at the helm and sent a clear
message that the central bank is pre
pared to do whatever it can to-'pre
vent a recession.
Wall Street, which had given up
hope that the Fed would cut rates
again before its meeting on May 15,
soared on the news.
The Dow Jones industrial average
enjoyed its third biggest one-day
point gain in history, rising by
399.10 points, or 3.9 percent, to
close at 10,615.64. The technology
heavy Nasdaq rose 8.1 percent, its
fourth best percentage gain, to close
at 2,079.44.
“Tactically, this was a masterful
stroke on the part of the Fed because
the markets had completely elimi
nated the possibility of a Fed cut be
fore the next meeting,” said David
Jones, chief economist at Aubrey G.
Lanston & Co. in New York.
The Fed’s decision to cut the fed
eral funds rate, the interest that
banks charge each other, to 4.5 per
cent will translate into lower bor
rowing costs for millions of Ameri
cans.
Commercial banks immediately
followed suit with a half-point cut
in their prime lending rate, pushing
the benchmark for many consumer
and business loans down to 7.5 per
cent, the lowest level in more than
six years.
In a brief statement announcing
its decision, the Fed said it was con
cerned about recent declines in busi
ness investment in new plants and
equipment, one of the major driving
forces in the record 10-year econom
ic expansion.
A further decline in investment
spending, combined with the nega
tive effects on consumer spending
from a falling stock market and with
economic weakness in other coun
tries, “threatens to keep the pace of
economic' activity unacceptably
weak,” the Fed said.
“This is exactly the right decision,
made at exactly the right time,” said
Gordon Richards, chief economist
for the National Association of Man
ufacturers. “It is much-needed
adrenaline for a weak economy. ”
The big Wall Street rally Wednes
day was the most positive immedi
ate response since the Fed began the
series of rate reductions on Jan. 3. Its
reduction that day, the first cut out
side of a regular meeting since the
Asian crisis of 1998, triggered a 300
point Dow rally.
The market was disappointed in
the next two rate cuts, which came
during regularly scheduled Fed
meetings, especially the March 20
announcement when investors had
been hoping for a bigger three-quar
ter-point Fed move.
Analysts said Greenspan and his
colleagues clearly had investors in
mind in the timing of Wednesday’s
move, hoping to bolster consumer
confidence, which has been sagging
as Americans watched trillions of
dollars of paper wealth evaporate
over the past year.
The rate decision was made dur
ing a telephone conference call
among Fed policy-makers begin
ning at 8:30 a.m. EDT. The an
nouncement of the change came
shortly before 11 a.m.
Greenspan has said in congres
sional testimony this year that the
biggest threat of a recession would
come from a sudden plunge in con
sumer and business confidence,
which could be triggered by a steep
stock market sell-off.
The Fed announcement said risks
to the economy remained “weight
ed mainly toward” weakness rather
than inflation, and analysts took that
language to signal further rate cuts
were likely. The Fed was given ma
neuvering room by Tuesday’s be
nign report on inflation which
showed consumer prices were up
just 0.1 percent in March.
Many analysts believed the next
rate cut would occur at the Fed’s reg
ular May 15 meeting, but they were
uncertain whether it would be an
other half-point cut or Greenspan’s
more normal quarter-point reduc
tion.
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