US President George W Bush's economic stimulus package, which would have pumped some $89 billion (€103.5 billion) into the US economy this year, bit the dust in the Senate yesterday when both parties failed to win the minimum 60 votes needed for their distinct versions of the bill to survive.

The bill had bitterly divided the Democrats and the Republicans. The latter had proposed major tax breaks for large firms and top taxpayers, while the former emphasised extra assistance to the unemployed. Economists doubt if such a relatively small package could be stimulatory in any case and accused both of using the opportunity to press for spending or tax cuts on pet projects.

The vote means the proposed deficit of $109 billion for 2002 in the Bush $2.13 trillion budget presented last week could be largely eliminated unless Congress decides to spend the money saved some other way.