World economists lash out at US leaders

Jittery stocks plummeted amid fears of global economic crisis, as President Barack Obama and his Republican rivals bickered over competing plans to avoid defaulting on US debt.Asian markets in Tokyo, Hong Kong and Sydney followed Wednesdays big losses on Wall Street as the deadline approaches for US lawmakers to strike a deal to avoid a disastrous default.Meanwhile, the House of Representatives was to take up Republican Speaker John Boehners plan for raising Washingtons $14.3 trillion debt ceiling as the US Treasury warned the government will not be able to pay all of its bills past the August 2 deadline.But the measure, which faced a White House veto threat, seemed sure to die in the Democratic-held Senate even if it cleared the Republican-controlled House -- sparking a frantic 11th-hour hunt for a compromise and final, razors-edge votes in both chambers.Its clear this is already putting a very dangerous cloud over the American economy, White House adviser David Plouffe told PBS television on Wednesday.We need the leaders on Capitol Hill.to compromise in the coming days here, so that we can avoid default next Tuesday and make sure we dont have things like interest rate spikes, Plouffe said, adding that from the administrations perspective theres actually quite a bit of common ground between the Senate and the House proposal.Democrats rallied behind a rival plan crafted by Senate Majority Leader Harry Reid but unlikely in its current form to pass the House, amid quiet efforts behind closed doors to plot an escape from a dangerous fiscal trap.Magic things can happen here in Congress in a very short period of time, under the right circumstances, Reid told reporters, declining to elaborate.At the White House, spokesman Jay Carney said a compromise was essential and do-able and said it was essential for the health of the economy to let cash-strapped Washington borrow to pay for its obligations.Worried global markets feared the stalemates possibly disastrous effects on the world economy, with US stocks dropping for the fourth straight trading session while investors seeking safe haven briefly sent gold to a new record.