US President Barack Obama, in the first nationally televised evening news conference of his young presidency, demanded that lawmakers pass an US$800-billion-plus economic recovery plan or risk turning “a crisis into a catastrophe.”
The administration and Congress were both moving on parallel tracks yesterday toward a new round of heavy intervention to pull the US economy out of its recessionary spiral.
The US Treasury Department planned to announce a revamped bank rescue plan, one calling for a stepped-up role by private investors. And an US$838 billion stimulus bill was headed for expected Senate approval after clearing a critical procedural hurdle on Monday.
As part of his campaign to build public support for quick passage of his economic stimulus plan, he took his message to a nationwide audience watching his news conference live during television’s prime evening viewing hours.
In opening remarks, he said the federal government “is the only entity left with the resources to jolt our economy back to life.”
“The plan is not perfect,” he said. “No plan is. I can’t tell you for sure that everything in this plan will work exactly as we hope, but I can tell you with complete confidence that a failure to act will only deepen this crisis as well as the pain felt by millions of Americans.”
The Treasury Department was ready to announce how it will spend the remaining US$350 billion of the US$700 billion financial rescue program started by the Bush administration last fall. The plan envisions big investors buying more than US$1 trillion in troubled assets from the banks, according to congressional staffers briefed on the plan on Monday night by Treasury officials.
Obama depicted his administration’s rewrite of the bank bailout effort as a template for “restoring market confidence.”
“The credit crisis is real, and it’s not over,” he said.
Obama issued a dire warning of the consequences if Congress fails to agree on a stimulus package.
“This is not your ordinary, run-of-the-mill recession,” he said.
He cited Japan’s failure to take bold actions in time to reverse a recession that turned the 1990s into a “lost decade” with no economic growth. He said failure to act quickly “could turn a crisis into a catastrophe.”
Obama said the US could well be in better shape by next year, as measured by increased hiring, lending, home values and other factors.
He said bringing politicians of both parties behind the task of saving the economy was “the test facing the United States of America in this winter of our hardship.” But he also said bipartisanship has its limits.
“What I won’t do is return to the failed theories of the last eight years that got us into this fix in the first place,” he said.
As for the economic stimulus bill in Congress, Democratic Senate leaders were able to rally the votes needed to clear a procedural barrier on Monday to open the way toward final passage yesterday.