Obama Takes Responsibility for Fixing Economy

Obama Takes Responsibility for Fixing Economy
By Michael Bowman White House 02 February 2009

President Barack Obama says he will be held accountable for turning around the nation's ailing economy, and making sure that federal funds used to rescue financial institutions and spur growth are well spent.  

Less than two weeks in office, President Obama inherited a deepening recession that began more than a year ago. But if blame for the current economic pain and dislocation cannot be pinned on him, the president says he is fully aware that responsibility for reviving the economy falls on his shoulders.

Mr. Obama spoke in a pre-recorded interview that aired on the NBC television network.

"I will be held accountable. I have got four years [first term in office]," the president said. "I think a year from now people are going to see that we are starting to make some progress, but there is still going to be some pain out there. If I do not have this [economic recovery] done in three years, then there is going to be a one-term proposition [will not be re-elected]."

The president is pushing an $800 billion package of tax cuts and new government spending to stimulate an economy that contracted at a 3.8 percent annual rate in the final three months of 2008. The bill is before the U.S. Senate, after being approved by the House of Representatives on a party-line vote last week.

Republicans blast stimulus package

Republicans have blasted the measure, saying it is laden with wasteful spending that will increase the deficit without spurring growth. Democrats say the bill will boost the economy immediately and make investments in energy and infrastructure that will promote long-term economic expansion.  

Mr. Obama says U.S. banks and other financial institutions continue to be at risk of failure, despite receiving hundreds of billions of dollars in federal bailout money in recent months. The president says additional funds will be required to prop up those institutions, as well as regulations to ensure the money is not wasted and there is no repeat of the debacle.

"It is my job as president, and Congress' job, to make sure that there are some rules of the road that people are going to abide by, and that we have got transparency and accountability," the president said.

'It will take time' to correct situation

Mr. Obama added that it will take time to correct the situation, which began more than a year ago with a rash of home-mortgage defaults and foreclosures, prompting a credit squeeze that spread around the globe.

Meanwhile, the Commerce Department reports Americans continue to cut back on purchases. U.S. consumer spending, which accounts for more than half of the nation's economic activity, fell for a sixth consecutive month in December. While the nation's collective savings rate rose, incomes dipped. Analysts say falling consumer spending is an indication that Americans are increasingly worried about their economic security.

U.S. unemployment has surged more than two percentage points during the past year. A private economic research firm (the Conference Board) is reporting that job vacancies advertised on the Internet have fallen by more than 20 percent in the past two months.