From NBC's Domenico Montanaro and Ali Weinberg
In a wholehearted defense of his administration's actions to right the economy in the first months of his presidency, President Obama outlined his plans going forward to try and create more jobs and spur economic growth.
"These were not decisions that were popular or satisfying," Obama said, referring to the financial and auto industry bailouts at a speech at the Brookings Institution this morning. "These were decisions that were necessary."
After ticking off a long list of the administration's economic decisions in addition to the bailouts, Obama said, "Partly as a result of these and other steps, we're in a very different place today than we were a year ago. We can safely say that we are no longer facing the potential collapse of our financial system and we've avoided the depression many feared. Our economy is growing for the first time in a year -- and the swing from contraction to expansion since the beginning of the year is the largest in nearly three decades."
But, he added, "[O]ur work is far from done. For even though we have reduced the deluge of job losses to a relative trickle, we are not yet creating jobs at a pace to help all those families who have been swept up in the flood."
Because of that, Obama wants his administration and Congress to focus on encouraging small-businesses growth, expand infrastructure projects, provide incentives for consumers to retrofit their homes to become more energy efficient and extend relief provided in the Recovery Act -- for seniors, COBRA health-care benefits for those between jobs or out of work and provide more funds for states and municipalities to prevent further layoffs.
For small businesses, the president said he is in favor of eliminating capital gains taxes, providing tax incentives to expand payroll, working to free up bank lending, waiving start-up fees, increasing guarantees for Small-Business-Administration-backed loans and providing them with some repaid funds from the Troubled Asset Relief Program, or TARP.
(By the way, he lauded the much-maligned TARP: "There has rarely been a less loved or more necessary emergency program than TARP, which -- as galling as the assistance to banks may have been -- indisputably helped prevent a collapse of the entire financial system.")
Missing from the broad outlines were details of how the plans would be implemented -- though the president vowed to work with Congress to create legislation that would be in line with his goals. And he only alluded to how they would be paid for -- in part with repaid TARP money.
Also, in what is perhaps a sign of the times, missing from this speech were President Obama's early calls for bipartisanship.
"[W]e undertook a series of difficult steps to prevent that outcome," Obama said, referring his economic team's philosophy that if the government took no action, another Great Depression could ensue. "And we were forced to take those steps largely without the help of an opposition party which, unfortunately, after having presided over the decision-making that led to the crisis, decided to hand it over to others to solve."
He said TARP was "launched hastily under the last administration." "We have worked hard to correct those flaws and manage it properly," Obama said, laying blame at the feet of the Bush administration.
And he went after Republican critics of his fiscal policy. "Despite what some have claimed," Obama said, "the cost of the Recovery Act is only a very small part of our current budget imbalance. In reality, the deficit had been building dramatically over the previous eight years. Folks passed tax cuts and expensive entitlement programs without paying for any of it -- even as health care costs kept rising, year after year. As a result, the deficit had reached $1.3 trillion when we walked into the White House. And I'd note: these budget busting tax cuts and spending programs were approved by many of the same people who are now waxing political about fiscal responsibility while opposing our efforts to reduce deficits by getting health care costs under control. It's a sight to see."
Obama further defended the Recovery Act and spending, saying that increased spending in public works projects "beyond what was included in the Recovery Act," would mean "even more work -- and workers -- on Recovery projects in the next six months than we saw in the last six months."
He also proposed expanding "select Recovery Act initiatives to promote energy efficiency and clean energy jobs," saying that funding areas like wind turbine and solar panel manufacturing will "help turn good ideas into good private-sector jobs," although he did not specify which Recovery Act programs would be involved or how much money would be siphoned from them.
Obama did herald a new program, already nicknamed "cash for caulkers," that would provide incentives for consumers to weatherize their homes. Earlier today, senior administration officials suggested they were "considering" a ballpark figure of $50 billion for the program.