March 13th, 2009
03:17 PM ET
9 years ago

Obama: U.S. needs return to economic fundamentals

The president met with Paul Volcker Friday.

The president met with Paul Volcker Friday.

WASHINGTON (CNN) - President Barack Obama continued to hammer home a "back-to-basics" economic message Friday, saying that U.S. markets, while fundamentally sound, need a systemic overhaul of financial-sector regulations to ensure a "post-bubble" model of future growth.

The president also reiterated his claim that sustainable long-term growth will not be possible without a restructuring of the nation's health-care, energy, and education systems.

America still has the "most dynamic free-market economy on Earth," Obama said in an Oval Office meeting with one of his top economic advisors, former Federal Reserve Chairman Paul Volcker.

But the country needs to "go back to fundamentals. And that means driving our health-care costs down. It means improving our education system so our children are prepared and we're innovating in science and technology. And it means that we're making this transition to the clean-energy economy.

"Those are the priorities reflected in our budget, and that is part and parcel with the short-term steps that we're taking to make sure that the economy gets back on its feet."

The president once again emphasized that the administration is "spending every day working through how to get credit flowing again so that businesses, large and small, as well as consumers, are able to obtain credit and ... get this economy moving again."

The administration's plan for easing the credit crunch, while still vague, appears to involve enticing private investment firms to borrow billions from the federal government to buy up toxic investments from troubled banks.

On the housing side, the Obama plan calls for companies to help struggling borrowers change their mortgage-loan terms, but it applies only to those whose payments are less than 31 percent of their monthly income, or about 4 million people.

In a different initiative, about 5 million homeowners who haven't missed a payment can refinance into lower-cost loans even if they have little or no equity.

Earlier Friday, National Economic Council Director Larry Summers said it is still unclear how long it will take for a broad-based economic recovery to take hold.

Summers, speaking about the administration's overall economic plan to a packed crowd at the Brookings Institution think tank, admitted that "no one can know just when and how its positive effects will be fully felt."

Summers did say that he sees some early signs that the economic crisis could be starting to ease. He pointed to consumer spending, which collapsed during the holiday season but now appears to be stabilizing.

- CNN's Jennifer Liberto contributed to this report

Filed under: Economy • Obama administration • President Obama
soundoff (35 Responses)
  1. Kevin B

    Sounds like the hounds from hell are all over this blog. The hate for Obama is palpable. I wonder if you folks ever give it a rest.

    This guy has been in office less than 90 days and you would think the economic mess started the day he was inaugurated.

    The incompetence over the last 8 years was breath taking and you have a nation in tatters economically.

    Even if you awoke tomorrow and the american economy was back on its feet and our reputaion world wide was restored, you would still be hating.

    get a life..............

    March 13, 2009 05:08 pm at 5:08 pm |
  2. Neal

    Now I understand Why the Chinese Govedrment is worried. Mr. Oresident. THE DREAM. Dreaming and dreaming.

    March 13, 2009 05:14 pm at 5:14 pm |
  3. Joe, Georgia

    I have read the comments already posted and find it amazing how uninformed most of these people are. The comments are repeats of the misrepresentations of Rush Limbaugh, Bill O'Reilly and Sean Hannity. The stimulus bill does not contain 25 years of liberal policies. Of the total size of the bill, about 40% is tax cuts and the AMT patch. The remainder of the bill is job creating money for roads, bridges, schools and technology or money to support unemployment benefits, health care and other services in growing demand because of the state of the economy. The vast majority of business leaders, economists and thoughtful government leaders believe government stimulus is absolutely necessary in times of economy crisis to jump start an economic recovery and provide a safety net of services. The most frequent criticism of this bill by informed main stream individuals is that it may not be big enough and provide enough infrastructure investment.

    March 13, 2009 05:19 pm at 5:19 pm |
  4. An American

    Obama never stops with his speeches. He has just put us in a deep financial hole for years to come (and it not over yet) and he is talking his usual baloney. Blah blah blah. God, is there no end to his phoney statments.

    March 13, 2009 05:31 pm at 5:31 pm |
  5. MOVE ON !!!!!

    @Interesting March 13th, 2009 5:07 pm ET
    Prez scored a big "F" from those economists that had supported him, interesting!!****Figure out what that F stands that you realize what it stands for ....Point it toward You and the economists

    March 13, 2009 05:41 pm at 5:41 pm |
  6. Jim

    I am still laughing. I cannot believe he can sit there and say we need to return to financial fundamentals. Want to hear the best joke is he says he is going to halve the deficit by 2013 or 533Billion. He is so tight with our money and has the economy going along soooooo well I know we can make that happen.

    March 13, 2009 05:41 pm at 5:41 pm |
  7. Rick

    Ok James. I will keep working day and night to pay your share. Get off your a$$ something yourself.

    March 13, 2009 05:45 pm at 5:45 pm |
  8. Anonymous

    Yes the administration is, as quoted, "spending every day".

    Isn't there a guy whose sole job it is to stop his boss from making poor word choices?

    March 13, 2009 06:09 pm at 6:09 pm |
  9. Mike Syracuse, NY

    AB in MN March 13th, 2009 4:55 pm ET
    Saying he has pork is just plain stupid. 40% is from republicans and the other 60% was written in before 1/20/09.

    And who controlled Congress which wrote the bill prior to 1/20/09? Why it was the Dems! It's their spending bill, pork and all. Are you saying that we can create a $700 billion stimulus bill from scratch in a few weeks, yet can't figure out how to get earmarks out of this spending bill? It defies belief. Stop making excuses. To say the Dems are spending like drunken sailors is to insult drunken sailors.

    March 13, 2009 06:16 pm at 6:16 pm |
  10. Mike Syracuse, NY

    When he was elected I didn't hope he would fail, I just expected that he would. He's living up to expectations. He's so over his head it's pathethic.

    March 13, 2009 06:17 pm at 6:17 pm |
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