July 19th, 2009
11:22 AM ET
12 years ago

Orszag: 'We've stepped back' from economic 'free fall'

[cnn-photo-caption image= http://i2.cdn.turner.com/cnn/2009/images/07/19/art.orszagwall0719.cnn.jpg caption="White House Budget Director Peter Orszag said Sunday that unemployment will lag behind the rest of the economy once the economy begins to turn around."]
WASHINGTON (CNN) – White House Budget Direct Peter Orszag said Sunday that the struggling economy has backed away from the precipice it was teetering on late last year but a return to economic growth has not occurred yet.

“Where we are is the sense of free fall that we had back in December . . . we’ve stepped back from that precipice but we’re not yet in the growth zone,” Orszag said on CNN’s State of the Union. “Most private sector forecasters are suggesting that won’t happen till later this year.”

Orszag also said Sunday that unemployment – now approaching 10 percent nationally – could take some time to turn around.

“Unemployment will lag somewhat,” Orszag told CNN Chief National Correspondent John King, as the economy begins to turn around later this year.

“Firms - usually even after the economy begins to pick up again – they still remain reluctant to hire people for some period of time. So, the unemployment rate is going to remain elevated – too elevated and there are too many people who are suffering – for some period of time.”

“It’s going to take some time to work our way out of it,” Orszag also said.

Filed under: Economy • Peter Orszag • Popular Posts • State of the Union
soundoff (80 Responses)
  1. LAR

    There have been monthly pronouncements from the administration on the improvements in the economy, yet the unemployment rate continues to climb to levels seen only once during the past 60 years. Regardless of spin about jobs that have been saved the fact of the matter is; jobs have been lost and continue to be lost. Plus the unemployment statistics only count those actively seeking work, if an individual has simply given up and is no longer looking, they aren’t counted which it could be argued; gives an undeserved optimism to the current 9.5% figure.

    July 19, 2009 12:13 pm at 12:13 pm |
  2. Frank

    Thank you President Obama for saving our nation from the disasterous consequenses of the failed Bush/Cheney administration.

    We understand that correcting the problems created by Bush/Cheney and the rabid, right-wing neocons will take more time. Honest, hardworking, patriotic Americans stand with you Mr. President. in you fight to bring this coujntry back from the brink of catastrophe.

    Keep up the good fight for accessable & affordable healthcare with a public option for ALL Americans. The "Wallstreet run Healthcare" schemes of Conservatives has failed us and it is time for a government solution!


    July 19, 2009 12:14 pm at 12:14 pm |
  3. MikeH

    JD, unemployment is still not as bad as it was under your god-king Ronald Reagan.

    Geraldo, your real name is probably something like Billy-Bob, and you're a paid red-neck shill for the fat cats who almost destroyed this country.

    We were told in January this would take years to turn around, if we act responsibly. Any American with half a brain understands that. Judging by some of these posts there are some pretty empty skulls hanging out on the Ticker.

    I'm not pleased with all of what Obama's doing or not doing, but I'm responsible enough to know that it will take time money and effort to reverse the horrendous economic damage caused by the Great Bush Incompetency (nothing presidential about him) and Obama is intelligent ant rsponsible enough to do the job far better than the what the alternative (McCain/Palin) would have done.

    July 19, 2009 12:15 pm at 12:15 pm |
  4. riteaidbob

    BTW "richie"...
    It's YOU the liberal who is in the miniority... the VAST majoriy in this country is conservative.

    Problem is you have the unethical LIBERAL media behind you who refuse to do their job and report President "disaster" as is their job.

    You should be so PROUD!

    July 19, 2009 12:15 pm at 12:15 pm |
  5. Frank


    July 19, 2009 12:15 pm at 12:15 pm |
  6. jrzshor

    did the guy who operated the economic roller coaster get laid off?

    July 19, 2009 12:16 pm at 12:16 pm |
  7. Byron

    May I say that 45% of us Americans are pessimists? When Bush was in office, i think everbody could come to the general consensus that he was indeed the worst president since the Depression. And cleaning up his mess is a tough duty that I think nobody could instantly fix. 7 months in his admin. and we've seen so drastic changes. He is workin very productively, as if we had Bush in office, we'd be paying 5.39 a gallon for reg unleaded. So leave Obama alone guys. Prejudice is why we can't function as a somewhat perfect society today. Rome wasn't built overnight.

    July 19, 2009 12:17 pm at 12:17 pm |
  8. We are divided

    We are now going down the 'third world country' road that we are destined to because we are such a 'me myself and I' society. We have doomed the family and now this country will be either the very rich or the very poor – no middle anymore.

    July 19, 2009 12:18 pm at 12:18 pm |
  9. Expat American

    So many Americans love to blame their problems on others, whereas personal accountability no longer exists in this country.
    The economy for what it is at the moment is not solely the fault of Bush nor is it the fault of the Democratic leadership since 2006. It is the fault of the USG as a whole. When will people begin to realize that the homes of lawmakers are paid for, their children's health is protected and their pensions will never be affected? It is you (us) who will suffer and only you (us).
    Knowing full well that the transition from Bush's White House would be tough on any new administration (even a McCain administration), I planned ahead, and I am glad that I did so that my loved ones are as safe as those of our elected officials.
    I trust that President Obama's heart is in the right place in regards to fixing the economy, rebuilding diplomatic relations and ending the war in Iraq; but Rome wasn't built in a day nor was it built in 6 months.

    July 19, 2009 12:18 pm at 12:18 pm |
  10. Anonymous

    The truth is that debt fueled prosperity in America is OVER!

    Our economy is in shambles and there is not much there to stimulate with stimulus driven by government debt.

    The US is headed towards a third world economic structure with an impovrished working class and an obscenely wealthy ruling class.

    Never again will people en mass be able to make middle class wages in manufacturing or other sources of large scale employment.

    Prosperity comes from economic advantage.
    Economic advantage comes either from technology or organizational sources.
    We have given away our technology and our organizers have chosen to outsource to other countries rather than investing in America.
    Free trade brought short term material prosperity at the expense of our future.

    Get used to competing with folks from the third world who make enough to live there but not enough to live here.
    Get used to minimum wage menial jobs.
    Get used to decayed infrastructure (how many train crashes recently?)

    America's long slide has begun and we are choosing to put our grandkids in debt rather than facing up to the fact we have given away our economic advantage so that a few can live like Kings of old.

    America's class war is over and the workers didn't fight.

    July 19, 2009 12:19 pm at 12:19 pm |
  11. TangledThorns

    Orszag is cheerleading Obama's failed economic agenda, nothing more. Seriously, how did America think Obama was going to be better with the economy? He has no experience in anything!!

    July 19, 2009 12:20 pm at 12:20 pm |
  12. Russell, NC

    Believe that one and he will tell you another one.

    July 19, 2009 12:22 pm at 12:22 pm |
  13. We are divided

    It doesn't matter who made the White House this last election, the fact remains the prez still had to try to fix many decades of selfish politician-only interest which has ruined this country. We are all guilty of not being better at letting these so-called officials know what this country needs – a bunch of sheep being ran by the wolves on the hill.

    July 19, 2009 12:23 pm at 12:23 pm |
  14. Frank

    Thank you Mr. President for saving our nation from the disaterous policies of Bush/Cheney.

    The "Wallstreet run" schemes of healthcare in America offered by Conservatives have failed us. It is time for a public option in healthcare. We need meaningful healthcare reform legislation that mandates a government run option to provide accessible & affordable healthcare for ALL Americans.

    Congress must stop the petty, partisan, political fighting against a public option in healthcare.

    Congress must stop promoting a "Wallstreet Run" scheme that only gives huge profits to insurance companies and Pharmaceutical companies and lobyists, while leaving a majority of Americans with little or no healthcare coverage.

    Congress must support a government option in healthcare delivery for ALL Americans.

    God Bless you President Obama .....


    July 19, 2009 12:25 pm at 12:25 pm |
  15. In the West

    You Obama haters are a sad joke. Take an honest look at where the economy was when Bush left office. Do you think McCain could have fixed this? The radical right couldn't think themselves out of a paper bag at this point.

    July 19, 2009 12:26 pm at 12:26 pm |
  16. S Callahan

    I do think President Obama and his team has been trying to make a wrong right....but there are forces working against this that even he can not control..... While the poor get poorer and the middle class learn what it is to start going without...you see big Corps with stomach churing profits...but it won't last for them...they will crash because they have ignored the needs of the poor and of the earth.
    I do know there is a hope for the future but it's not the hope of the dollar. You can know it too if you would just seek.

    July 19, 2009 12:36 pm at 12:36 pm |
  17. Peter

    Folks did you know that?, Brand Pharmaceutical companies pay off generic drugmakers to delay availability of their low cost versions which would annually save consumers $ 3.5 billion and reap $ 1.2 billion in savings for the federal government, which shoulders about one-third of all prescription drug cost? add the special insterest groups, lobbyist and the insures. You are being duped! the only loosers is us the common folks otherwise the rest makes 6 figure. The hypocrisy lies in greediness wrapped with ethos of capitalism. The free market!!? belive me there is nothing ln the world called free market. You have seen the results of deregulations in some industries!. If America don't act now we can as well start learning mandarin because China will buy every industry! Ni hao!!!

    July 19, 2009 12:45 pm at 12:45 pm |
  18. Mike, Syracuse, NY

    The one area where Obama has admitted things are going better than hoped is the banking stabilization. That just also happens to be one piece of recovery legislation passed under Bush (remember TARP?). So how has Obama helped at all?

    July 19, 2009 12:55 pm at 12:55 pm |
  19. Aunt Bea and Opie

    John King is a zero in our book.

    July 19, 2009 12:57 pm at 12:57 pm |
  20. JoblessInSeattle

    I think it's time the Obama Admin should stop using the old excuse of "inheriting a big mess from the previous admin" and take some responsibilities of their own.

    July 19, 2009 01:01 pm at 1:01 pm |
  21. shootingmans

    What I want to know is, what's the government going to do if China decides to stop buying up our debt?

    July 19, 2009 01:01 pm at 1:01 pm |
  22. cat

    Another boy genius to guide us astray. Those thought of as the best and brightess are seldom either. As far as I am concerned anything out of the White House is pure propaganda these days. Regean-era spin doctors are nothing compared to these guys and gals.

    July 19, 2009 01:02 pm at 1:02 pm |
  23. Zero.

    So Canadians and British forces are dying in Afghanistan, because you elected a muslim spy into the whitehouse.

    July 19, 2009 01:03 pm at 1:03 pm |
  24. prez press

    From reading and looking at the GOP ideas versus the Democrats ideas, If we would have had a Republican as president, the U.S. economy would have been in trouble. That line about growing small business need to be helped is really bogus because small businesses don't have the capital that large corporate businesses have. Also, small business are a risk because they are competing with other small businesses. The truth is that the majority of GOP has small businesses and are afraid of their downfall. Also the GOP don't have an understanding of the job market and unemployment rate because most of them are well above 200,000 or more income. That is not middle class America as they claim. Their ideas were used back when the Bushs and Reagans were in office, but now we have to revert to new tactics and ways to prevent people from losing jobs and being poor. I see now how the president Obama is making this happen. You have to ignite the fire so you can get things moving in different directions. Most economist say that when the economy rebounds, unemployment is the last thing to increase because it takes time for confidence in hiring by companies. Right now the recession is ending and we are seeing consumer spending. I predict in the last quarter of this year, the employment rate will slowly grow

    July 19, 2009 01:03 pm at 1:03 pm |
  25. Darth Vadik, CA

    Mark these words:

    When the economy improves, in six months to a year, all these Obama haters, who have just blasted Obama about the economy will come out and say, we told you Bush put it on a right path.

    The evil ideology of a republicsums will never cease to amaze me.

    July 19, 2009 01:06 pm at 1:06 pm |
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