President Barack Obama held his first press conference tonight. The press conference mostly focused on the economy and the proposed stimulus package. After eight years of bumbling buffoonery at the White House it was a shock and a relief to see an intelligent President deliver articulate well-thought out responses to reporters’ questions. Obama made the case, during his prepared remarks and the Q&A, for his economic stimulus plan. Agree with the President or not, it was clear that he had command of the subject matter.
I happen to believe that Obama is taking the right approach in his stimulus plan. His plan is a good mix of quick acting government spending and more slower acting tax cuts targetted at the middle class. It seems to me that the shouting between those on the Left who demand a stimulus plan that contains nothing but government spending and those on the Right who demand a stimulus plan that contains nothing but tax cuts ignores reality. Both government spending and tax cuts stimulate the economy, and the one-two punch of stimulus provided by these two approaches is far more preferable to dying at the alter of ideological purity by passing no stimulus bill.
Tonight the President did his job by talking directly to the American people about what needs to be done. Tomorrow the bickering Senators need to do their job and pass the Stimulus Plan. Whether the bill the Congress finally passes will be enough to slow and reverse our economic slide cannot be known now. But, one thing is certain. Congress has wasted precious time as more Americans have lost their jobs and their homes. Enough already.
[Watch the President’s press conference here.]
Pretty weak economic analysis from such a talented analyst 🙁
Joe, I have to agree. Its pretty weak 🙁
But I do think the stimulus plan is necessary, though I would be surprised if it is big enough.
On stimulus, I have not much more to say beyond saying I am for it. I think economic stimulus is not rocket science. Government pumps spending into the economy that creates jobs; people with jobs have more money that they spend, causing consumer demand; and that creates need for more products and services and hopefully private capital comes in and picks it up from there. The economy starts to rebound, credit begins to flow, and everyone is happy. Tax cuts put money back into the pockets of consumers and investors and the same effects follow (job creation, etc). The main difference, it seems to me, between government spending and tax cuts as stimulus is that the spending creates the jobs upfront. But, ultimately, both stimulate.
It seems to me, any stimulus plan that has government spending helps. The tax cuts dont help as much or as quickly, but they also help. I also think that tax cuts on top of government spending may help fuel the economic recovery further – a second wind of sorts after the initial stimulus from government spending. If the stimulus was all tax cuts, I would be against it. And it is clear to me, doing nothing is not an option.
So, I am unimpressed by the arguments of the purists who argue for all tax cuts or all spending. I am ready to see a stimulus go into action, and have real data to see if it is making a difference or if adjustments need to be made. Now that the Senate has passed its bill, I will be curious to see what comes out of conference. I would expect the final bill to have some more spending added on to it as some of what was cut from the House bill gets put back in.
Now, the thing that concerns me is Geithner’s new TARP plan (or meta plan if you will). I am still not sure I heard a plan this morning 🙁