January 23rd, 2009
11:45 AM ET
11 months ago

Obama: Recovery to be multi-pronged

NEW YORK (CNNMoney.com) – President Barack Obama offered more detail on his plan to restore economic growth Friday, saying the economic stimulus program being debated in Congress is just one of at least three parts to his recovery plan.

In a meeting to discuss the stimulus proposal with Vice President Joe Biden and Democratic and Republican congressional leadership, Obama said America also needs an improved financial system stability program as well as financial market regulation reform.

"The recovery package that we're passing is only going to be one leg in, at least, a three-legged stool," said Obama. "We are also starting to put in place the kinds of reform elements – oversight, transparency, accountability – that's going to be required in order for the American people to have confidence in what we're doing."

The president cited a Government Accountability Office report released Thursday that said the government's regulation of the financial markets had "major weaknesses" that can lead to wasteful government spending.
He also said financial institutions that get bailout funds from the government must manage those funds appropriately.

Obama made an apparent allusion to reports that former Merrill Lynch CEO John Thain spent over $1 million renovating his office after he was hired as an executive at Bank of America (BAC, Fortune 500), to which he sold Merrill late last year.

He cited reports about companies "going out and renovating bathrooms or offices" and "the lack of accountability and transparency in how we are managing some of these programs to stabilize the financial system."

As for the first leg of the stool – the economic stimulus package – the president said he stressed swift and aggressive movement to pass the bill. Though he said the plan appears to be on the path towards reaching his desk on Presidents Day, much more maneuvering to reach a bipartisan agreement on the expensive and sweeping recovery plan appears likely.

The president has received some pushback from both sides of the aisle on his stimulus plan, as he tries to sell a plan that includes tax cuts and massive spending efforts.

After Friday's meeting, House Minority Leader John Boehner, R-Ohio, said he was concerned about the size of the bill, arguing that less spending and more tax cuts were needed to have a real and fast impact on the economy.

"At this point we believe spending nearly $1 trillion is really more than we ought to be putting on the backs of our kids and their kids," Boehner said. "[With tax cuts], the American people can invest it, spend it or save it, all of which are good for the economy."

House Speaker Nancy Pelosi, D-Calif., countered that the cost of the stimulus plan is less important than the quality of the recovery it creates.

"It's not just about how big the package is," Pelosi said. "It's about how fast jobs are created and how those initiatives that were added in the spending will contribute to long-term stabilization of our economy."

Those negotiations are set to continue next week, as the House is expected to hold a vote on its stimulus plan on Wednesday. The Senate is set to begin its own deliberation over its stimulus proposal next week, after announcing its own plan on Friday to meet Obama's goal of creating three to four million jobs.


Filed under: President Obama • stimulus plan
soundoff (55 Responses)
  1. KC

    President Obama. I don't care what you do for the economy right now. I know that's irresponsible...but I have selfish motives. The only thing I care about are our troops. Please, please, please do not cut funding to our troops and keep them well provided for while they are serving. God bless them all.

    January 23, 2009 12:32 pm at 12:32 pm |
  2. Maddie

    One word, "oversight!" Something that our country is sorely missing.
    I'm more than ready for the end of "executive priviledge" and all the secrecy that comes with it.
    Our new president is a very smart man and he will do our country proud.
    No more joe-six-packs in the white house!

    January 23, 2009 12:33 pm at 12:33 pm |
  3. nom deplume, esq.

    Since I am a hard-working, reasonably successful member of the class Obama decided should fund his agenda, I shudder to think about what "multi-pronged" means for me.

    Being a HENRY (high earner, not rich yet) in Obama's America is gonna be like being a Jew in 1930's Germany. So I will follow the lead of those that survived those perilous times: Spend less, hoard cash, and get what little net worth I have TFO of Dodge.

    As a tax lawyer, I counsel those with some means to NOT buy property, NOT support the economy through conspicuous consumption, DO move to investments that minimize taxes and defer gains, and DO move assets so as to avoid confiscatory taxation and the effects of the coming hyperinflation.

    You can call it unpatriotic if you like. But it was the Left that declared me and those like me to be the enemy. What do you expect of an enemy?

    January 23, 2009 12:39 pm at 12:39 pm |
  4. katiec

    I am not an economist, thus, have to believe that President Obama, with the intelligent, qualified people he picked will do what is right for our country. But, nothing can be accomplished without unification of our politicians and making the survival of our country their primary goal. No more politics as usual. We voted for and demand change.

    January 23, 2009 12:40 pm at 12:40 pm |
  5. Ray Fisher

    Any recovery plan must be a "Life-cycle" plan able to be adjusted and adapted to any contingency. It must include labor incentives, investment opportunities and tax advantages. It must NOT include any give-aways. Every single infusion of capital into our economy from now on should be a "Loan" charging at least minimal interest whereby progress can be measured via at least some type of return. Any business entity which cannot survive with a 0 or low interest loan must be shuttered and allow market forces to replace. We must gradually return to a free-market albeit regulated economy as the chaff is removed from the markets.

    January 23, 2009 12:43 pm at 12:43 pm |
  6. LLT

    Congress has to get on with confirming the Cabinet members needed to get things done. As McCain said on Larry King Live: President Obama won the election; he gets to pick his Cabinet!! No treasury Secretary, No Attorney General, No Labour Secretary as the Republicans play party politics~!!

    January 23, 2009 12:48 pm at 12:48 pm |
  7. Veronica

    I have all the confidence in you Mr President.

    January 23, 2009 12:50 pm at 12:50 pm |
  8. joek

    AGREED!

    January 23, 2009 12:51 pm at 12:51 pm |
  9. Frostlanta

    Looks like we have the right man for the job so far, So how does everyone like the current leadership???? He seems to put the people's interests first and looks like he is willing to go against status quo for politicians and not pander to far left or right.

    BARACK OBAMA – The next best president ever!!!!!

    January 23, 2009 12:54 pm at 12:54 pm |
  10. Jon in CA

    We're drowning in debt and Obama thinks running up a charge-card is a better solution than reducing expenses.

    The CORRECT SOLUTION is reducing the Governments' expenses!

    Obama doesn't have to make that choice because WE THE PEOPLE are his never-ending charge-card. Get ready for the next GREAT DEPRESSION – as Obama is following the EXACT mis-steps of FDR in 1932.

    FDR and Democrats created "The New Deal" – empowering labor unions and farmers and by raising taxes on corporate profits. THIS caused our country to wither until World War II in the 1940's.

    Obama COULD learn from history... however his ego is too large.

    January 23, 2009 12:56 pm at 12:56 pm |
  11. Rich, Alexandria, Virginia.

    Throwing taxpayer's money at the economic mess we are in right now is not going to clean it up until Wall Street and the mega-corporations and the banks clean up their mess. If they don't clean up their mess all the money in Ft. Knox will not help.

    January 23, 2009 01:04 pm at 1:04 pm |
  12. Rich, Alexandria, Virginia.

    Hey mister or miss what's your problem? Facts are facts. Besides, rose colored glasses went out style 8 years ago. Thank yoy.

    January 23, 2009 01:06 pm at 1:06 pm |
  13. Mari

    With an approval rating of .......83%........ President Obama clearly has a mandate from, we, the People!

    We have confidence in you, President Obama!

    Congress better get with it!

    January 23, 2009 01:07 pm at 1:07 pm |
  14. Matt

    Enter GOP stage left, opposing nominations to the cabinet in order to prevent or delay congress from focusing on the economic recovery package so Obama can be blamed for the state of the economy...

    January 23, 2009 01:09 pm at 1:09 pm |
  15. barack Obama is still just B.O.

    Talk is cheap.
    Let's see when our grandchildren are paying for his plan how they feel about "the best president ever"?

    I think bailing out everyone is a good way to teach irresposibility.

    January 23, 2009 01:11 pm at 1:11 pm |
  16. Turnabout is Fair Play

    katiec January 23rd, 2009 12:40 pm ET

    I am not an economist, thus, have to believe that President Obama, with the intelligent, qualified people he picked will do what is right for our country. But, nothing can be accomplished without unification of our politicians and making the survival of our country their primary goal. No more politics as usual. We voted for and demand change.
    ------------------------------–

    We voted for and demanded change, that's true but you should focus your message on the Republicans in the House and Senate who are already starting to play the "politics as usual" game with President Obama. They just never learn because most Republicans are rich, spoiled, and paid for by lobbyists who are telling them what to do.

    January 23, 2009 01:15 pm at 1:15 pm |
  17. Barack wins and we collectively lose.

    Government is excellent at creating more problems then they solve, so why are we doing this? It is madness, and it is a mortgage on our future. We may not have much of a standard of living when we bankrupt this country with trillions upon trillions upon trillions of dollars of debt.

    IT HAS NEVER WORKED in the history of recorded history.

    January 23, 2009 01:19 pm at 1:19 pm |
  18. 4 more years

    He is working toward another 4-year term, period.

    January 23, 2009 01:20 pm at 1:20 pm |
  19. MaryanneAZ

    I have the utmost faith in President Obama and his administration. I do, however, wish that someone would approach companies with a moratorium on layoffs and push for restructuring companies' workforce to keep people employed (shorter work weeks, voluntary unpaid sabbaticals or shorter-term weeks off, reduced salaries or benefits, suspend profit shares, suspend stock dividends, etc.). A well-thought out plan would enable companies to keep their employees on the books and working. A temporary "break even" plan on the part of companies, especially large employers, would not hurt the companies in the short-term and would benefit the employees and the economy in the long-term. Companies could return to "profit" plans when the economy rebounds.

    January 23, 2009 01:23 pm at 1:23 pm |
  20. Matt

    Multi-pronged? Good. Prong 1 = prosecute the living daylights out of all the executives involved in misusing the first $350B, thereby setting precedent and deterring future nonsense.

    January 23, 2009 01:29 pm at 1:29 pm |
  21. Greed is not good

    Mostly bottom-up ...while still having part of the plan top – down. Make sense, sounds like a great plan.

    January 23, 2009 01:29 pm at 1:29 pm |
  22. hello

    there should be accountability for the 350 billion dollars of the taxpayers money that has already been spent, every dime that went to petty projects shoul be paid back with interest, these banks and others that received this bailout should be made to apologize to every american taxpayer.

    January 23, 2009 01:41 pm at 1:41 pm |
  23. FreeNLovIt

    Do whatever you need to do, but remember, STOP PROVIDING WELFARE TO CORPORATIONS!!! Change the laws so that CEOs cannot fire peopel to increase their pay.

    January 23, 2009 01:44 pm at 1:44 pm |
  24. James

    Not even a week in and President Obama seems to be grabbing the bull by the horns, even more than the Texan himself. Now we need the rest of our elected officials to not stand in the way of progress!

    January 23, 2009 01:51 pm at 1:51 pm |
  25. Brenda

    The federal building in kansas city does not have President Obama's picture up. They just recently took Bush down. This is very disappointing.

    January 23, 2009 01:52 pm at 1:52 pm |
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