Obama's Economics Speech: The Man Is Good

Please watch, if you haven’t seen it already, Obama’s Speech on the Economy at Georgetown University. He explains the crisis in a clear way and his policy in a way to address those who disagree with it (transcript). Here he addresses my concerns:

On the other hand, there have been some who don’t dispute that we need to shore up the banking system, but suggest that we have been too timid in how we go about it. They say that the federal government should have already preemptively stepped in and taken over major financial institutions the way that the FDIC currently intervenes in smaller banks, and that our failure to do so is yet another example of Washington coddling Wall Street. So let me be clear – the reason we have not taken this step has nothing to do with any ideological or political judgment we’ve made about government involvement in banks, and it’s certainly not because of any concern we have for the management and shareholders whose actions have helped cause this mess.

Rather, it is because we believe that preemptive government takeovers are likely to end up costing taxpayers even more in the end, and because it is more likely to undermine than to create confidence. Governments should practice the same principle as doctors: first do no harm. So rest assured – we will do whatever is necessary to get credit flowing again, but we will do so in ways that minimize risks to taxpayers and to the broader economy. To that end, in addition to the program to provide capital to the banks, we have launched a plan that will pair government resources with private investment in order to clear away the old loans and securities – the so-called toxic assets – that are also preventing our banks from lending money. (18m15s)

Shut up, just shut up. You had me at ‘hello.’

Every time Obama steps to the plate and explains his Administration’s actions vis-a-vis the economy or international relations, it always addresses my concerns in such a perfect way. The man is good, and is clearly aware of all the concerns, both from the left and the right, of his actions. That is all you can ask of a President, and he is pulling it off perfectly.

Given that we are facing the biggest economy downturn of my life, and my parents’ lives, it is good to see a guy in charge who understands all the disagreements that are being brought to the plate. This is a total must read - I hope the historians lock it down for future generations…

Comments

[{5U}:]

Obama is a guy who knows how to spin spin spin and you are buying into the propaganda.

Do you write for the Huffington Post too? Are you buddies with Zach Karabell?

Apr 16 08:48 AM

[Old Rick:]

You probably also believe that the 2 month old $800B Porkulus is pulling us out of recession now. I guess it must be all the spending that is scheduled for 2012-2014 that has people excited.

As far as the biggest economic downturn of your life, it is if you are under 25 y/o. Review the downturn of 80-82 when in order to wring inflation out of the economy, Paul Volker had short rates into the (very) high teens and mortgages were 14+%.

Review the downturn of '73-'74 if you are over 35. Not too pleasant either. The difference this time from both of these periods is the future inflationary effects that are almost certainly cooked into the economy by (stupid) Govt actions. Bernanke is NO Volker and Volker is being marginalized by Mr. Teleprompter because he disagrees with the massive bailouts and spending.

Apr 16 09:23 AM

[a. palmer jr.:]

Pres. Obama is good at making speeches, I'll give you that, however it's one thing to make speeches and another to get something worthwhile done. I wish he would add to some of his speeches the harm to our country that illegal immigration has caused and is causing. It has bankrupted California, with help from other causes, I'm sure. But you don't see any wide-spread action on anyone's part to solve the problem with the possible exception of maybe those whom are affected directly.
Another thing is that Pres. Obama is kinda naive about several things. One is merit raises for teachers, etc. Does he really think that a school superintendent's wife whom is a teacher won't get a merit raise before a teacher who is unconnected? That sort of corruption goes on in all businesses and I see it almost every day. We all say we are serious about ethics but nothing seems to change. It will take some real courage to break the corruption in America and I don't see it happening.

Apr 16 09:44 AM

[SivBum:]

Why, you folks missed the 20+% rally since Mar 9th? LOL! Cash out your CDs and donate them to Palin for 2013 now.

Apr 16 10:58 AM

[jdl51:]

On Apr 16 09:23 AM Old Rick wrote:

> You probably also believe that the 2 month old $800B Porkulus is
> pulling us out of recession now. I guess it must be all the spending
> that is scheduled for 2012-2014 that has people excited.
>

Half of the stimulus package was tax cuts that take effect now. There's also billions to extend unemployment benefits that take effect now. Some of the construction money for roads, bridges, etc. is being spent now. I see some republican governors thumping their chests, saying they don't want the stimulus money, yet their legislators are forcing them too anyway. They've put politics and their personal ambitions before the good of their constituents.
As far as this downturn being the worst since the 1930's, I've lived through them all, worked through them all since the '60s. This is by far the worst recession that we've had in almost 80 years. Someone that doesn't think so doesn't have a clue as far as economics is concerned. Never have we been as close to complete collapse of the world's financial system as we were a few months ago. Never before has the entire U.S. auto industry been on the brink of bankruptcy and still may go over the edge. Never before has the housing market had such a prolonged and deep contraction as we're having now. I have never seen as many empty storefronts in malls as I have seen now. And now to hear republicans rant about the deficits while we're still operating on the last republican administrations' budget with a 1.3 trillion deficit and a combined $11 trillion in deficits under republican presidents since Reagan is beyond comprehension. I understand that republicans feel obligated to their party to make excuses for the past eight years and try to whitewash what happened, but sometimes you have to put country before party and common sense before ideology.

Apr 16 11:23 AM

[KK:]

A President finally speaks clearly to a topic and you call it spin. Please explain the logic behind your comment.

On Apr 16 08:48 AM {5U} wrote:

> Obama is a guy who knows how to spin spin spin and you are buying
> into the propaganda.
>
> Do you write for the Huffington Post too? Are you buddies with Zach
> Karabell?
>

Apr 16 11:26 AM

[brokerinbir...:]

Since when does community orgainizing equate with 30 years on the job experience running a world-wide corporation? (Or the world's only superpower, complete with nuclear warheads and the way-out-front leading economy for that matter?) Rorty maybe you are watching too much CNN or MSNBC. Try looking at the picture through the capitalist point of view. Ws it the President's business to fire Waggoner? Ws it his business to force Chrysler to merge with Fiat? He's qualified to run not one, but three of the world's largest auto makers now? I think we're beinning to see a centarlly planned economy, and that is what scares the heck out of many people. Should Waggoner be fired? probably, but that should have been a decision for the board and the shareholders, not the President.

Apr 16 11:30 AM

[brokerinbir...:]

KK, I would submit that the Pres is not behaving Preisdential. He has been having Imperial. When he speaks he spins. For example yesterday he vowed to simplify the tax code. In context of his former writings, speeches, and musings, longing for the Socialist path, one can conclude that to simplify means a two step process: 1)how much did you make; 2)that's how much you owe. The allowed deductions: are you illegal alien or a citizen who paid no taxes?, please visit your local IRS office for a refund, free medical care, free housing, and free pension (vote Democrat!). Are you a Citizen who had earned income? If yes, see 1 and 2, you arrogant, derisive, dismissive right-wing scum.

Apr 16 11:41 AM

[Jimbo:]

As a voter who pulled the lever for McCain as the lesser evil, I think it is too early to judge the prophet Obama's performance. I certainly hope he is not surprised to find how very difficult it is to function as President of the U.S. I see our entire political system as broken with both major parties sharing equal culpability. The situation will not get better until we have term limits on Congress and criminal penalties for former members of Congress to lobby. Pelosi's "culture of Corruption" lives on.

Apr 16 11:47 AM

[mikesa69:]

Spin = Says one thing, but Does another. Therefore the rhetoric is "spin", because I at least know that actions speak louder than words.

The primary advantage of politicians' use of spin is to fool people like you. The reason they keep doing it is because it apparently works. Unlike you, who probably do not work.


On Apr 16 11:26 AM KK wrote:

> A President finally speaks clearly to a topic and you call it spin.
> Please explain the logic behind your comment.
>

Apr 16 11:48 AM

[Bolton Peck:]

@jdl51-Word.

It's about time people saw the 'fiscally conservative republican administration' for what it is-a myth! And let's not mention what the protracted war in Afghanistan is going to do for us over time-talk about a great sucking sound!

I am personally very aware of what the deregulation in the housing market did to the mortgage industry and working class folks like me. I'm also aware on a personal level of just how bad the economy is right now. Because of the above two items, I'm also aware of how Obama's 'Make Housing Affordable' program can re-negotiate and somewhat make right the years of sub prime mortgage interest. And keep us from losing our home.

I know it's sad when the stock market tanks and you lose a third of your retirement savings in three weeks. That sucks. But it sucks worse when the primary bread winner in the family can't find a job for six months. When stuff like the last eight years happens, it affects real people. Finally, a president who seems to understand this!

I'm a fan-I'll say it. God Bless Obama. Because We'd be living in our RV without him.

Apr 16 11:56 AM

[mikesa69:]

I agree with everything you said except that you think it's too early to judge obama's performance. I think it's very easy to see his clearly-established agenda; just don't listen to what he says when he's pacifying the sheeple on TV. Instead look at what he's asked CONgress for. Look at what CONgress has been doing in response. Try getting your "news" from thomas.loc.gov or govtrack.us.com instead of CNN.

I think you are being too kind to give him any additional leeway after the crap he's already burdened us with. Financially, as well as in loss of freedom. Agreed Bush was terrible, but obama has pushed the same big brother - big government agenda into hyperdrive.


On Apr 16 11:47 AM Jimbo wrote:

> As a voter who pulled the lever for McCain as the lesser evil, I
> think it is too early to judge the prophet Obama's performance. I
> certainly hope he is not surprised to find how very difficult it
> is to function as President of the U.S. I see our entire political
> system as broken with both major parties sharing equal culpability.
> The situation will not get better until we have term limits on Congress
> and criminal penalties for former members of Congress to lobby. Pelosi's
> "culture of Corruption" lives on.

Apr 16 11:57 AM

[rosey99:]

Granted he is eloquent in defense of his actions, but it is not his speech that I question, it is his willingness, nay his determination, to recreate the conditions that led us here: a huge and dominant financial sector, massive public and private debt, and of course huge trade deficits. Like Jimbo above, I pulled the lever for the lesser of two evils, in my case Obama. At this point I feel pretty awful about it.

No matter how well couched in fine rhetoric, I do not believe that a return to the former status quo is either viable, or advisable. And despite his fine speeches, that is precisely what Obama and his team are proposing. So far, this is hardly change, and it is certainly not something I can believe in. I certainly hope to be wrong, but it seems that the darkest days may be ahead of us if we continue down this road.

Apr 16 03:32 PM

[Pstoneki:]

Two main factors qualify someone for great things - education and intelligence. Some future CEOs (whether of a company or a country) gain both education and intelligence through experience. Obama seems to have both the education and the natural born intelligence to lead the US forward. Boy genius Bush, regardless of his Yale and Harvard creds, did not.

Oh yeah - when you are the primary investor in a business enterprise you can fire anyone you want. GM and Chrysler took the money. Obama's team calls the shots.


On Apr 16 11:30 AM brokerinbirmingham wrote:

> Since when does community orgainizing equate with 30 years on the
> job experience running a world-wide corporation? (Or the world's
> only superpower, complete with nuclear warheads and the way-out-front
> leading economy for that matter?) Rorty maybe you are watching too
> much CNN or MSNBC. Try looking at the picture through the capitalist
> point of view. Ws it the President's business to fire Waggoner? Ws
> it his business to force Chrysler to merge with Fiat? He's qualified
> to run not one, but three of the world's largest auto makers now?
> I think we're beinning to see a centarlly planned economy, and that
> is what scares the heck out of many people. Should Waggoner be fired?
> probably, but that should have been a decision for the board and
> the shareholders, not the President.

Apr 16 03:53 PM

[Ouch$:]

Why would the president of US blame the stockholders, of the banks for the mess that was caused by the members of Congress? Does anyone understand how the " toxic assets" will be handled? Does anyone understand what part Barney Franks played in all this mortgage mess? Did anyone notice that the banks are piling up more foreclosures, so that they can put them in the " toxic assets " package?

Apr 16 09:37 PM

[brokerinbir...:]

Good point Pstoneki. so, what part of the Constitution provides for private investment in a public company by the federal government?

Apr 16 09:49 PM

[desoto Dude:]

Barney Frank was a member of the minority from 2000 to January 2007. Please check the originations of sub-prime/Alt A loans and the volumes bought and/or securitized from 2000 to 2007 by Fannie and Freddie. Evidently, he was the most powerful minority member of his committee in history. I guess the ranking minority Republican must now be running the committee and not being crushed by the Democratic majority.




On Apr 16 09:37 PM Ouch$ wrote:

> Why would the president of US blame the stockholders, of the banks
> for the mess that was caused by the members of Congress? Does anyone
> understand how the " toxic assets" will be handled? Does anyone
> understand what part Barney Franks played in all this mortgage mess?
> Did anyone notice that the banks are piling up more foreclosures,
> so that they can put them in the " toxic assets " package?

Apr 16 11:01 PM

[TCK:]

Obama is trying to model our economy after France. One percent growth rate, country wide strikes, and ten percent unemployment.

Brilliant !

Apr 17 08:30 AM

[Pstoneki:]

Happens all of the time. Whether it is seed money for research or project development (A&D, pharma, etc) or outright purchase (such as GM). Nothing preventing it on the scale we have seen lately other than politics and good sense.


On Apr 16 09:49 PM brokerinbirmingham wrote:

> Good point Pstoneki. so, what part of the Constitution provides for
> private investment in a public company by the federal government?
>

Apr 17 01:16 PM