Obama, Stimulate This

Transcript

PRESIDENT-ELECT OBAMA DELIVERS DEMOCRATIC RESPONSE TO THE PRESIDENT’S WEEKLY RADIO ADDRESS, AS RELEASED BY THE OBAMA-BIDEN PRESIDENTIAL TRANSITION TEAM

JANUARY 10, 2009

SPEAKER: PRESIDENT-ELECT BARACK OBAMA

OBAMA: We start this new year in the midst of an economic crisis unlike any we have seen in our lifetime. We learned yesterday that in the past month alone, we lost more than half a million jobs - a total of nearly 2.6 million in the year 2008. Another 3.4 million Americans who want and need full-time work have had to settle for part-time jobs. And families across America are feeling the pinch as they watch debts mount, bills pile up and savings disappear.

How does this economic crisis, the one Obama says is "unlike any we have seen in our lifetime," compare to past recessions?

I guess that would depend on how one defines "lifetime."

The Roosevelt Recession: (May 1937 - June 1938)

--Duration: 13 months
--Magnitude:

GDP Decline: 3.4
Unemployment Rate: 19.1% (more than four million unemployed)

--Reasons and Causes: The stock market crashed in late 1937. Business blamed the "New Deal", a series of government-financed infrastructure work projects through the Works Projects Administration (WPA) and Civilian Conservation Corps (CCC). These camps provided work and room and board for more than 250,000 men. Government blamed a "capital strike" (lack of investment) on the part of business while "New Dealers" blamed cuts in WPA funding. The first Social Security Insurance deductions pulled $2 billion out of circulation at this time.

The "Rolling Adjustment" Recession: (April 1960 - February 1961)

--Duration: 10 months
--Magnitude:

GDP Decline: 2.4
Unemployment Rate: 6.9%

--Reasons and Causes: This recession was also known as the "rolling adjustment" for many major U.S. industries, including the automotive industry. Americans shifted to buying compact and often foreign-made cars and industry drew down inventories. Gross national product (GNP) and product demand declined.

The Oil Crisis Recession: (November 1973 - March 1975)

--Duration: 16 months
--Magnitude:

GDP Decline: 3.6
Unemployment Rate: 8.8%

--Reasons and Causes: This long, deep recession was brought on by the quadrupling of oil prices and high government spending on the Vietnam War. This led to "stagflation" and high unemployment. Unemployment finally reached 9% in May of 1975.

The Energy Crisis Recession: (January 1980 - July 1980)

--Duration: 6 months
--Magnitude:

GDP decline: 1.1%
Unemployment Rate: 7.8%

--Reasons and Causes: Inflation had reached 13.5% and the Federal Reserve raised interest rates and slowed money supply growth, which slowed the economy and caused unemployment to rise. Energy prices and supply were put at risk causing a confidence crisis as well as inflation.

The Iran/Energy Crisis Recession: (July 1981 - November 1982)

--Duration: 16 months.
--Magnitude:

GDP decline: 3.6%
Unemployment Rate: 10.8%

--Reasons and Causes: This long and deep recession was caused by the regime change in Iran; the world's second largest producer of oil at the time, the country came to regard the U.S. as a supporter of its ousted regime. The "New" Iran exported oil at inconsistent intervals and at lower volumes, forcing prices higher. The U.S. government enforced a tighter monetary policy to control rampant inflation, which had been carried over from the previous two oil and energy crises. The prime rate reached 21.5% in 1982.

Obama should be honest with the American people. He doesn't need to hype the current crisis. He doesn't need to create fear. That's not solving the problem. That's helping it to snowball. That's poor leadership.

These numbers are a stark reminder that we simply cannot continue on our current path. If nothing is done, economists from across the spectrum tell us that this recession could linger for years and the unemployment rate could reach double digits - and they warn that our nation could lose the competitive edge that has served as a foundation for our strength and standing in the world.

It’s not too late to change course - but only if we take immediate and dramatic action. Our first job is to put people back to work and get our economy working again. This is an extraordinary challenge, which is why I’ve taken the extraordinary step of working - even before I take office - with my economic team and leaders of both parties on an American Recovery and Reinvestment Plan that will call for major investments to revive our economy, create jobs, and lay a solid foundation for future growth.

I asked my nominee for Chair of the Council of Economic Advisers, Dr. Christina Romer, and the Vice President-Elect’s Chief Economic Adviser, Dr. Jared Bernstein, to conduct a rigorous analysis of this plan and come up with projections of how many jobs it will create - and what kind of jobs they will be. Today, I am releasing a report of their findings so that the American people can see exactly what this plan will mean for their families, their communities, and our economy.

The report confirms that our plan will likely save or create three to four million jobs. 90 percent of these jobs will be created in the private sector - the remaining 10 percent are mainly public sector jobs we save, like the teachers, police officers, firefighters and others who provide vital services in our communities.

The jobs we create will be in businesses large and small across a wide range of industries. And they’ll be the kind of jobs that don’t just put people to work in the short term, but position our economy to lead the world in the long-term.

We’ll create nearly half a million jobs by investing in clean energy - by committing to double the production of alternative energy in the next three years, and by modernizing more than 75% of federal buildings and improving the energy efficiency of two million American homes. These made-in-America jobs building solar panels and wind turbines, developing fuel-efficient cars and new energy technologies pay well, and they can’t be outsourced.

So if somebody wants to build a coal-powered plant, they can; it's just that it will bankrupt them because they're going to be charged a huge sum for all that greenhouse gas that's being emitted.

--BARACK OBAMA

We’ll create hundreds of thousands of jobs by improving health care - transitioning to a nationwide system of computerized medical records that won’t just save money, but save lives by preventing deadly medical errors. And we’ll create hundreds of thousands more jobs in education, equipping tens of thousands of schools with 21st century classrooms, labs and computers to help our kids compete with any worker in the world for any job.

We’ll put nearly 400,000 people to work by repairing our infrastructure - our crumbling roads, bridges and schools. And we’ll build the new infrastructure we need to succeed in this new century, investing in science and technology, and laying down miles of new broadband lines so that businesses across our nation can compete with their counterparts around the world.

Everybody's watching what's going on in Beijing right now in the Olympics. Think about the money that China has spent on infrastructure. Their ports, their train systems, their airports are all vastly superior to us now, which means if you're a corperation deciding where to do business, you're starting to think Beijing looks like a pretty good option. Why aren't we doing the same thing?

---BARACK OBAMA

Finally, we won’t just create jobs, we’ll also provide help for those who’ve lost theirs, and for states and families who’ve been hardest-hit by this recession. That means bi-partisan extensions of unemployment insurance and health care coverage; a $1,000 tax cut for 95 percent of working families; and assistance to help states avoid harmful budget cuts in essential services like police, fire, education and health care.

My attitude is that if the economy's good for folks from the bottom up, it's gonna be good for everybody. If you've got a plumbing business, you're gonna be better off if you've got a whole bunch of customers who can afford to hire you, and right now everybody’s so pinched that business is bad for everybody and I think when you spread the wealth around, it's good for everybody.

--BARACK OBAMA

Now, given the magnitude of the challenges we face, none of this will come easy. Recovery won’t happen overnight, and it’s likely that things will get worse before they get better.

But we have come through moments like this before. We are the nation that has faced down war, depression and fear itself - each time, refusing to yield; each time, refusing to accept a lesser fate. That is the spirit that has always sustained us - that belief that our destiny is not written for us, but by us; that our success is not a matter of chance, but of our own courage and determination. Our resources may be finite, but our will is infinite. And I am confident that if we come together and summon that great American spirit once again, we will meet the challenges of our time and write the next great chapter in our American story.

"Fear itself."

Obama is channeling FDR.

At least he didn't start his weekly address by saying "Eleven score and thirteen years ago..."