On anniversary of recession, Obama set to herald economic record
September 15th, 2013
08:00 PM ET
8 years ago

On anniversary of recession, Obama set to herald economic record

Washington (CNN) – Five years after the economic collapse that defined the first 100 days of President Barack Obama's presidency, the White House is taking credit for "strengthening" the economy, with the president preparing to embark on a week of events aimed at making that argument.

Gene Sperling, a senior economic adviser to the president, said Sunday that while the economic decisions the Obama administration made in 2009 were controversial – citing the Troubled Asset Relief Program, the auto bailout and revamped banking regulations – all have outperformed their original forecasts.

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"These very difficult, bold and politically controversial measures that the president took in 2009 have uniformly performed better than almost anyone could have projected," Sperling, the outgoing director of the National Economic Council, said on a call with reporters.

After Lehman Brothers declared bankruptcy in 2008, the U.S. economy went into freefall in the final days of the George W. Bush presidency. After Obama took office in January 2009, he took controversial and expensive steps to stabilize the U.S. economy.

In a flurry of economic policy, the Obama administration pumped $250 billion into banks both large and small to shore up their capital, known at the TARP program, and pledged $85 billion to rescue the insurance firm AIG from collapse.

Economic security and the Obama administration's decisions appear to be the White House's focus in the coming week.

On Monday, the president will use a Rose Garden speech to herald his economic decisions. To hammer home the point, a White House spokesperson said Sunday that Obama will be flanked by people who represent different sectors of the economy aided by Obama's decisions.

Obama will sit down for an interview with the Spanish-language news channel Telemundo on Tuesday, and on Wednesday and Thursday he will deliver remarks at two different economic meetings.

On Friday, the president will take his message to the road, traveling to a Ford production plant in Kansas City, Missouri, where he is expected to tout the 2009 auto bailout and his next economic steps.

A White House report released Sunday, which Sperling previewed on the call, credited Obama with making these tough decisions, stating that "America has fought our way back" largely because of these steps.

"Thanks to the grit and resilience of the American people, we've cleared away the rubble from the financial crisis and begun to lay a new foundation for stronger, more durable economic growth," reads the 49-page report.

Expectedly, not everyone agrees that Obama's economic decisions have strengthened the economy.

Republicans, such as House Speaker John Boehner, have long criticized Obama for "mediocre" job growth and growing the national debt.

"The sooner President Obama starts working with both parties to … solve Washington's spending problem, the stronger our economy will be for all Americans," Boehner said earlier this month.

But it isn't just Republicans who doubt the stability of the U.S. economy.

Six in 10 Americans told Gallup in August that economic conditions are getting worse, and earlier this month, an economist at the University of California, Berkeley, found that 95% of income gains from 2009 to 2012 went to the top 1% of earners.

In short, the study found, the slow economic growth the United States has experienced since the economic crash of 2008 has primarily favored top earners, while incomes for the vast majority of people have stagnated.

While Sperling acknowledged on the call that the United States has not fully recovered from the economic downturn, Obama said in an interview with ABC on Sunday that the rich have fared far better than the poor during his time in the White House.

"The folks in the middle and at the bottom haven't seen wage or income growth, not just over the last three, four years, but over the last 15 years," the president said on ABC's "This Week with George Stephanopoulos."

Sperling argued on Sunday that things would have been worse if auto companies had not been bailed out and the president's scheduled visit to the Ford plant signals that the White House plans to tout its accomplishments with the auto industry.

In 2008 and 2009, General Motors, Chrysler Group and Ally Financial, the finance firm then known as GMAC, received $79.7 billion. While some of that assistance came in the form of loans, most of it was given to the companies in return for their stock. Stock sales, dividend and loan payments together have returned only $52.7 billion to the government, leaving a $27 billion deficit.

Sperling argued, however, that they were a net positive.

"Autos is striking," Sperling said on Sunday. "The president made the right and very politically difficult call. I don't know that anybody at the time would have predicted that by the first quarter of 2011, the big three would not only have survived by have been profitable for the first time since 2004."

Obama's handling of the auto bailout was controversial at the time and became a flashpoint point in the 2012 election.

Some Republicans – including the GOP nominee, Mitt Romney – argued that the White House should have allowed the auto companies to go into a structured bankruptcy and criticized Obama's decision to use government money to prop up the industry.

Filed under: Economy • President Obama
soundoff (296 Responses)
  1. ralphco

    wow – all I can say is wow. The delusional misguided propaganda machine is, well wow. Check what the fed has done in the last 5 years – it's unprecedented – and it's the only reason the market is up – inflated by artificial fed printing – with the future cost of inflation and high interest rates – the economy is maybe barely better – but after how much more tax debt? wow – they say it's good? LOL.

    September 16, 2013 01:12 am at 1:12 am |
  2. Anonymous

    So why are the big banks even bigger?

    September 16, 2013 01:13 am at 1:13 am |
  3. liberal hypocrite = redundancy

    why won't he take credit for what really happened – DESTROYING the economy. granted he did have help from the Grand Idiot Clinton for starting the whole mess...

    September 16, 2013 01:14 am at 1:14 am |
  4. Anonymous

    Gap between rich and poor biggest...

    September 16, 2013 01:14 am at 1:14 am |
  5. Tester

    He has to convince us the everything is so much better?

    September 16, 2013 01:17 am at 1:17 am |
  6. Donna

    After Obama took office in January 2009, he took controversial and expensive steps to stabilize the U.S. economy.

    The recession ended in July 2009, exactly 18 months after it started, just as almost every other recession has ended. This occurred before ANY of Obama's grand and glorious wastes of money occurred. All Obama and his nutty policies have done is to make the recovery very slow, almost non-existent.

    We aren't creating enough jobs to meet population growth demands, let alone put all the people that lost their jobs back to work. The ONLY reason the unemployment rate is lower than it was is because millions have dropped out of the workforce. We have the lowest labor participation rate in over 30 years, many many millions have resorted to filing for disability to get an income and many millions more are exploding the food stamp rolls. Just ask the black community if they are better off. The unemployment rate there is even higher than when Obama took office.

    And we, actually our kids and grand kids, are $7 TRILLION (and climbing to $10 TRILLION) further in debt, with fewer and fewer people paying taxes.

    Obama takes the American people for fools. He and his policies have been a total failure. This will be known as the Lost Obama Decade.

    September 16, 2013 01:28 am at 1:28 am |
  7. Michael

    Obama phone was a great idea.

    That's all I have to say.

    September 16, 2013 01:32 am at 1:32 am |
  8. MontanaTrace

    How can anyone not believe Pres. Obama is not the best black President we've ever had?!

    September 16, 2013 01:32 am at 1:32 am |
  9. pat


    PLEASE...why don't you go back to licking Obama's boot's and sleeping at his feet, just waiting for his next proclomation?

    September 16, 2013 01:33 am at 1:33 am |
  10. Rebecca

    So why are 100 corporations petitioning Congress to immediately legalize all illegal aliens and step up the massive 125k legal aliens added each month? We are losing jobs and corporations are loving it.

    September 16, 2013 01:38 am at 1:38 am |
  11. Tracy

    Shhhhh....CNN, don't say that the collapse started under Bush. Republicans call facts like that "finger pointing".

    September 16, 2013 01:39 am at 1:39 am |
  12. brian

    Should have let the banks and auto industry fall. Better to let the corrupt and/or inefficient fail so the responsible and efficient companies can prosper. Before you chime in on what a mess letting those industries fail will be, remember that the best economic success story so far has been the country that let their banks fail (Iceland).

    September 16, 2013 01:39 am at 1:39 am |
  13. HJC

    Watch where you step Mr. president...

    "and by "did its job" I wish I were talking about lowering unemployment and stimulating growth; but, alas, I'm talking about bolstering bank balance sheets and driving equity prices to unsustainable and unfairly valued levels."

    – Grant Williams on $84 billion in QE......... PER MONTH since 2009-2010

    September 16, 2013 01:40 am at 1:40 am |
  14. Logic N LA

    Can't wait to hear the spin from the right.

    September 16, 2013 01:41 am at 1:41 am |
  15. Rebecca

    Corporations want legalization of aliens and more more more work visas. 100 signed a petition to Congress. Too many psychopaths at the top.

    September 16, 2013 01:42 am at 1:42 am |
  16. ThinkAgain

    Our retirement savings were cut in half by the 2008 crash, which was a direct result of unscrupulous mortgage lenders giving loans to people who should never have qualified and by the immoral, gambling-addicts morons on Wall Street who bet they would fail and then did everything they could to make it happen. (BTW, I don't want to hear that "It's Barney Frank's fault" crap because the law NEVER said that mortgage lenders should falsify income statements and write loans doomed for default or that Wall Street firms should bundle subprime, toxic mortgages and pass them off as A-Rated, or that Standard & Poors should lie about those ratings.)

    Under President Obama's leadership, our retirement savings have been restored.

    What would really make my day would be the return of the Glass-Steagall Act to keep the filthy, greedy, short-term-thinking, lying SOB hands of the Wall Street gambling houses off my money. If I want to put it in high-risk funds (a modest amount of which, I do), but it's immoral and wrong to take what investors think are safe investments and use that money to satisfy the sociopathic greed of some dweeb in a suit who doesn't give a rat's fanny about anyone except himself.

    September 16, 2013 01:43 am at 1:43 am |
  17. Sean

    The TARP program was started under George W. Bush. This article ignores that. And yes THAT has not cost as much as predicted

    September 16, 2013 01:43 am at 1:43 am |
  18. VTbobby

    Why is he going to the Ford Plant in KCMO? Ford did not take bail out money...

    September 16, 2013 01:43 am at 1:43 am |
  19. ThinkAgain

    Correction: If I want to put my money in high-risk funds (a modest amount of which, I do), that should be my choice.

    But it's immoral and wrong to take what investors think are safe investments and use that money to satisfy the sociopathic greed of some dweeb in a suit who doesn't give a rat's fanny about anyone except himself.

    September 16, 2013 01:44 am at 1:44 am |
  20. jerome

    I'm guessing that if the government gave my business $27 billion, it could also survive and be profitable.

    September 16, 2013 01:53 am at 1:53 am |
  21. ScoobyDude

    If we're so much better off, then how come gold is at $1,328.10 / oz. instead of $400 / oz......?? Job market still SUCKS, housing market still SUCKS, politicians still SUCK...

    September 16, 2013 01:58 am at 1:58 am |
  22. Harry

    If a president has to embark on a week of events to make his case that the economy has recovered after 5 long years, then it's pretty obvious that the economy hasn't improved at all unless you think burger flipping is the hallmark of a robust economy.

    September 16, 2013 01:58 am at 1:58 am |
  23. cadavra

    "Six in 10 Americans told Gallup in August that economic conditions are getting worse..."

    In a related story, six in 10 Americans told Gallup in August that they only get their news from Fox.

    September 16, 2013 01:59 am at 1:59 am |
  24. SeeThruIt2

    He`s taking credit for TARP?

    Bernacke, Paulson, and Bush set up TARP. And Bush even had to go to Congress the second time to get Pelosi to release the second half of the fund on his last days in Office for Obama to use. But, Obama now takes credit for TARP.

    And the bailout was not for The Big Three automakers. Ford didn't take bailout money. And the only reason GM and Chrysler are "competitive" is that taxpayers had to "pay" an extra $60 billion for their union handouts by Obama.

    September 16, 2013 02:00 am at 2:00 am |
  25. Larry

    Slowest recover since the Great Depression and worst job growth, with most being part time. But I suppose it the best he could do, so he might as well give a speech about it after his morning round of golf and before tonight's celebrity concert at the White House.

    September 16, 2013 02:02 am at 2:02 am |
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