WASHINGTON - WARNED that the economy may get considerably worse, President-elect Barack Obama has more than tripled the size of the economic stimulus package he embraced during the campaign and is aiming to create or save three million jobs, up from 2.5 million, according to transition officials.

Mr Obama's team is crafting a massive new economic stimulus package to reach his revised job goal. Though the President-elect has declined to specify the amount, transition aides told Capitol Hill staff last week that the plan may cost US$675 billion to US$775 billion (S$985 billion to S$1.1 trillion) over two years.

Those numbers far exceed the more modest stimulus package that Mr Obama laid out during the campaign, underscoring a growing worry that the economy is in a tailspin. As recently as mid-October, the President-elect was touting a stimulus of about US$175 billion.

Summarising the incoming administration's view, Vice President-elect Joe Biden said in an interview with ABC's George Stephanopoulos aired yesterday that the economy is at risk of 'absolutely tanking'.

Mr Obama met privately with top economic advisers last Tuesday and received a sobering briefing. Aides cautioned that without an aggressive recovery plan, the economy could lose as many as four million jobs through 2011 and the unemployment rate could rise above 9 per cent.

Unemployment last month reached 6.7 per cent, the highest level in 15 years. The last time the jobless rate topped 9 per cent was in 1983, during Ronald Reagan's first term as president. Ms Christina Romer, incoming chairman of the Council of Economic Advisers and an expert on the Great Depression, told Mr Obama that forecasts over the short- and long-term had darkened in recent weeks and that looming economic troubles eclipsed anything seen in the last 50 years, transition officials said.

Confronted with that prospect, Mr Obama said that the job creation figure he had announced in his weekly radio address last month - 2.5 million - would not be enough to avert disaster. He called for creating or preserving an additional 500,000 jobs over the next two years.

Since his election, the President-elect has heard nothing but dire reports about the economy he is about to inherit. Last month, employers eliminated 533,000 jobs, the most since 1974.

His call for a more ambitious plan to create and retain jobs may involve a bit of psychology.

Consumers fearful of losing their jobs have stopped opening their wallets, dampening consumer spending. With Mr Obama pledging to aggressively save jobs as well as create new ones, he is sending a message that people need not worry about being out of work, one economic adviser said. That, in turn, could encourage spending and bolster the economy.

'The big fear people have is loss of jobs. That's haunting the whole economy,' said the adviser, who spoke on condition of anonymity. 'People are holding back from buying because of fear of job loss. So, presumably, if people hear the goal is to create or preserve three million jobs, layoffs aren't quite as scary.'

Mr Obama's plans to revive the economy hinge on the passage of his stimulus package, which Congress plans to take up on Jan 6. Though he has the votes in the House, the Senate is another matter. Republicans could delay or derail it.

Republican leaders have voiced scepticism about the stimulus, warning that there must be a thorough public vetting of a Bill that costs so much. They have also vowed to oppose any plan that includes pork-barrel projects meant to reward special interests.

In one notable example, Republicans cite with derision a proposal by US mayors that includes a US$1.5 million initiative to chase prostitutes off the streets of Dayton, Ohio.

To reassure sceptics and build a durable coalition, the President-elect is insisting that the stimulus package meet certain standards, transition officials said. The Bill must: