Remains mum on treasury appointment
By Zenitha Prince
Washington Bureau Chief
(November 7, 2008) -- With an ailing economy needing immediate attention, President-elect Barack Obama and Vice President-elect Joe Biden had little reprieve before they were huddled, Friday morning, with a 17-member transitional council of economic advisers.
The advisers included former Treasury Secretaries Lawrence Summers and Robert Rubin, former Fed Chairman Paul Volcker, billionaire businessman Warren Buffett and other leaders in business and politics.
"I do not underestimate the enormity of the task that lies ahead," Obama told reporters at the Hilton Hotel in Chicago at his first post-election news conference. "We have taken some major action to date, and we will take further action."
Obama said that passing a stimulus package will be his first move if the lame-duck Congress fails to do so before he takes office January 20.
Those looking for a detailed, in-depth policy briefing from the president-elect’s first press outing, which was held immediately after his council of economic advisers’ meeting, were disappointed.
“I don’t feel like we got any more detail than we got during his campaign,” said Heidi Shierholz, an economist with the Economic Policy Institute based in Washington, D.C.
Obama defended the paucity of new information by asserting that “the United States only has one government and one president at a time and until Jan. 20 of next year, that government is the current administration.”
His intention, it seemed, was to project an air of confidence and ease anxiety about his administration’s commitment and ability to restore the nation’s economy to an even keel.
“Immediately after I become president I am going to confront this economic crisis head on by taking all necessary steps to ease the credit crisis, help hard-working families and restore growth and prosperity,” said Obama, surrounded by Rahm Emanuel, his pick for chief of staff, and his economic advisors, who he said were already working on developing “a strong set of policies” to respond to the crisis.
“Some of the choices we make are going to be difficult,” he continued. “It is not going to be quick and easy to dig ourselves out of the hole that we’re in. But America is a strong and resilient country and I know we will succeed if we put aside partisanship and politics and work together as one nation. That’s what I intend to do.”
The Obama-Biden appearance came on the heels of more dour economic news. According to the Labor Department’s monthly jobs report issued Friday morning, 240,000 jobs were lost in October, increasing the tally of lost jobs to 1.2 million this year and pushing the unemployment rate up to 6.5 percent. The nation hasn’t seen such a towering jobless rate in 14 years.
And as corporate giants falter, it’s expected to get worse.
Also on Friday, Ford Motor Co. said it may have to cut staff and stem spending after a $3 billion operating loss in the last quarter. And limping auto behemoth General Motors Corp. announced it bled a copious $4.2 billion in losses and that it, too. is in danger of running out of cash.
This “hardship goes far beyond the individual auto companies to the countless suppliers, small businesses and communities throughout our nation who depend on a vibrant American auto industry,” Obama said. “The auto industry is the backbone of American manufacturing and a critical part of our attempt to reduce our dependence on foreign oil.”
The president-elect said he would like to see President Bush push through the resources for retooling the auto industry that Congress has already OKed and reiterated his commitment to investing in alternative sources of energy.
More generally, he renewed his commitment to carefully overseeing the administration of the $850 billion Wall Street bailout package and to championing a short-term and long-term rescue plan for the middle-class, an issue on which he spoke with the most authority.
“One thing I can say with certainty is we’re going to need to see a stimulus package passed,” Obama said, emphasizing his preference to see it passed “sooner rather than “later.”
“If it doesn’t get done during the lame duck session of Congress, it will be the first thing I get done as president of the United States,” he added.
In addition to a stimulus package, Obama said he would also extend unemployment insurance benefits and award tax cuts to 95 percent of working-class families.
“The kind of stimulative elements they’re talking about are the right ones,” Shierholz, the economist, said.
On the uppermost question in people’s minds, however—Obama’s choice for treasury secretary—he said not a word.
Some names being bandied about so far include Summers and Volcker, who, as Obama’s current advisors may have an inside track.
Summers was the World Bank’s chief economist from 1991 to 1993. From July 1999 to January 2001 he served as treasury secretary under President Bill Clinton.
Volcker, an investment banker by trade, served as chairman of the Federal Reserve Board under Presidents Carter and Reagan and headed the investigation into the U.N. oil-for-food program for Iraq.
Also in the running is Timothy Geithner, president of the Federal Reserve Bank of New York. Geithner has the advantage of being already baptized in the crucible of the current financial crisis. Earlier this year, he helped steer the acquisition of Bear Stearns by JPMorgan Chase and the bailouts of American International Group Inc. and Lehman Brothers.
“There’s no doubt people want to know who’s going to make up our team. And I want to move with all deliberate haste but I want to emphasize ‘deliberate’ as well as ‘haste,’” he said.
“I’m proud of the choice I made of vice president partly because we did it right. I’m proud of the choice we made of chief of staff because we thought it through, I think it’s important in all these key positions to get it right and not be so rushed that we end up making mistakes.”