Obama Unveils Team to Tackle ‘Historic’ Crisis in Economy

Spencer Collins · #1 (**permalink**) 11-24-2008, 01:29 PM

Obama Unveils Team to Tackle ‘Historic’ Crisis in Economy

By JEFF ZELENY

Quote:

CHICAGO — With the financial crisis looming as a priority of his term, President-elect Barack Obama sought to put his imprint on efforts to stem the turmoil as he introduced his economic team on Monday, nominating Timothy F. Geithner as Treasury secretary and Lawrence H. Summers to head the White House Economic Council.

By naming a team deeply experienced in dealing with financial crises — Mr. Geithner was heavily involved over the weekend in the efforts to stabilize Citigroup — Mr. Obama underscored his determination to assure Americans and foreign investors that he would aggressively step into a leadership vacuum in Washington during the transition.

Moreover, by pledging that his economic team would begin work “today” on recommendations to help middle-class families as well as the financial markets, the president-elect sought to convey an impression of continuity and coordination, so that his administration can “hit the ground running.”

The president-elect also announced that he had chosen Christina D. Romer to head his Council of Economic Advisers and Melody Barnes as director of his White House Domestic Policy Council. Ms. Romer is an economics professor at the University of California, Berkeley, while Ms. Barnes is a longtime aide to Senator Edward M. Kennedy of Massachusetts.

The recent economic news, capped by the Citigroup effort, “has made it even more clear that we are facing an economic crisis of historic proportions,” Mr. Obama said at a news conference. He listed the drop in new home purchases, the surge in unemployment claims to an 18-year high and the likelihood of up to a million further job losses in the coming year.

“While we can’t underestimate the challenges we face,” he said, “we also can’t underestimate our capacity to overcome them to summon that spirit of determination and optimism that has always defined us, and move forward in a new direction to create new jobs, reform our financial system, and fuel long-term economic growth.”

Responding to questions, Mr. Obama said that the struggling automobile industry could not be allowed “simply to vanish,” but that the companies should not get “a blank check” from taxpayers. And he said he was “surprised” that the auto companies’ chief executives were not better prepared with specific recovery proposals in their appearances last week on Capitol Hill. And he all but promised that the tax cuts pushed through Congress by President Bush would be repealed, or at least not renewed when they are scheduled to expire in 2010.

In an effort to inject confidence into the quavering financial markets, Mr. Obama made certain that his first formal cabinet announcement dealt with the economy, not, as is often the case with national security or diplomacy.

In announcing the nominations of Mr. Geithner, president of the Federal Reserve Bank in New York, and Mr. Summers, a Harvard economist, Mr. Obama sent a signal that he was set to pursue aggressive, yet centrist policies, in crafting moves to help jumpstart the economy. He was stretching his economic announcement into a two-day affair, planning another news conference Tuesday to present the rest of his team.

The televised news conference, which came shortly after President George W. Bush made brief remarks at the Treasury Department with Secretary Henry M. Paulson Jr., created a stark image of the transfer of power that is under way in Washington. Mr. Obama and his new team arrived in a room of dozens of reporters, while Bush stood nearly alone on the steps of the Treasury Department.

“This is a tough situation for America,” Mr. Bush said, adding that he had spoken to Mr. Paulson by phone Sunday while returning from an economic summit meeting in Peru. He said that he would keep Mr. Obama and his team informed of any major decisions, and added that Mr. Paulson was working in “close cooperation” with the Obama team.

Mr. Bush spoke to Mr. Obama on Monday about the rescue plan for Citigroup. Mr. Obama said he had also spoken Monday to Ben S. Bernanke, the chairman of the Federal Reserve.

Mr. Geithner worked through the weekend on the plan to stabilize Citigroup. Earlier, he was deeply involved in the bailout of the American International Group. So he is intimately familiar with the developing crisis — and the controversial efforts so far to stanch it.

Mr. Obama has said repeatedly that there is “only one president at a time,” but the markets’ apparent concerns at the specter of a do-nothing transition — with neither President nor Mr. Obama seeming to be aggressively steer recovery efforts — has forced him into a more active role.

The Dow Jones industrial average soared Friday by nearly 500 points on word of the Geithner appointment, and markets were up again by more than 200 points at midday Monday.

David Stout in Washington contributed reporting.

http://www.nytimes.com/2008/11/25/us...s/24obama.html

The longest journey begins with the first step

faithful_servant · #2 (**permalink**) 11-24-2008, 02:03 PM

A couple more Clinton retreads....

Geithner seems like a reasonably qualified person, but Summers is a baggage dragging nightmare. Makes me wonder if the Harvard connection is what's bringing him in.

Michael1 · #3 (**permalink**) 11-24-2008, 03:43 PM

I'm actually getting a bit tired of hearing about how 'massive' this financial crisis is. I think there's a 'could get' possibility but the way people talk, it's a forgone conclusion that the sky has actually fallen.

There have been some foreclosures, a slight uptick in unemployment, on paper losses in the market, but the crisis isn't exactly upon us. Steps have already been taken and may in fact be having an impact. Some certainly think so.

Some find it fun to take over a new position and immediately bitch about what a horrible mess your predecessor left you. I don't like those people who linger on that too long, so I really hope Obama and his camp get on with it soon ... this isn't a campaign any more. Stop with the superlatives and tell us what you want to do.

Spencer Collins · #4 (**permalink**) 11-24-2008, 04:08 PM

Quote:

Originally Posted by faithful_servant

A couple more Clinton retreads....

Geithner seems like a reasonably qualified person, but Summers is a baggage dragging nightmare. Makes me wonder if the Harvard connection is what's bringing him in.

I duuno..makes sense to me,many applaud Geithner. Looks like Obama is trying to appoint a qualified team why oppose this? Could it be that some people WANT him to fail?...could be that they fear he will get a 2nd term OH NO...

hussein · #5 (**permalink**) 11-24-2008, 04:37 PM

Quote:

I'm actually getting a bit tired of hearing about how 'massive' this financial crisis is. I think there's a 'could get' possibility but the way people talk, it's a forgone conclusion that the sky has actually fallen.

There have been some foreclosures, a slight uptick in unemployment, on paper losses in the market, but the crisis isn't exactly upon us. Steps have already been taken and may in fact be having an impact. Some certainly think so.

Some find it fun to take over a new position and immediately bitch about what a horrible mess your predecessor left you. I don't like those people who linger on that too long, so I really hope Obama and his camp get on with it soon ... this isn't a campaign any more. Stop with the superlatives and tell us what you want to do.

Might want to read this first before dismissing the scale of the financial crisis...

Quote:

Citigroup surges on bailout

Pandit announced a plan last week to eliminate 52,000 jobs and cut costs by about billion per quarter. He and three top deputies bought 1.3 million shares in a show of confidence, and Prince Alwaleed bin Talal, one of the bank's biggest investors, said he would boost his stake to about 5% from 4%.

Full story can be found at: Citigroup surges on bail-out | smh.com.au

cnredd · #6 (**permalink**) 11-24-2008, 04:43 PM

Quote:

Originally Posted by hussein

Might want to read this first before dismissing the scale of the financial crisis...

This doesn't happen in a financial crisis...

Storm Watch: Early morning lines form for BlackBerry Storm

Quote:

Customers lined up outside Verizon stores all over Washington, D.C., and all over the country today to snap up Research In Motion's BlackBerry Storm, which Verizon Wireless is launching today.

One FierceWireless team member was able to snap a few shots of the lines earlier this morning. Verizon's Storm Center website was also reporting lines elsewhere in the Washington metro area.

The phone retails at $199 with a two-year contract. This will mark the first touchscreen device from RIM and another contender for "iPhone Killer" crown.

foundit66 · #7 (**permalink**) 11-24-2008, 05:33 PM

Quote:

Originally Posted by cnredd

This doesn't happen in a financial crisis...

Storm Watch: Early morning lines form for BlackBerry Storm

Are you serious?
What's this strategy? Deny the existence of a financial crisis until Obama becomes president, then suddenly "realize" that the economy is in trouble and claim he is responsible?

I guess the Republicans and President Bush have supported a bailout and the "economic stimulus" package that was never even needed, cause there is nothing to worry about...

< end sarcasm >

Yes.
That DOES happen in an economic crisis when you have a SERIOUS DISJOINT between the upper segments in society and the lower segments in society.

But I guess you'll continue to look at the "haves" in order to ignore the growing population of the "have nots"...

Michael1 · #8 (**permalink**) 11-25-2008, 08:07 AM

Quote:

Originally Posted by foundit66

Are you serious?
What's this strategy? Deny the existence of a financial crisis until Obama becomes president, then suddenly "realize" that the economy is in trouble and claim he is responsible?

I don't think anyone is denying that there are real economic troubles. I for one simply feel that the over the top adjectives just need to stop. This is not the great depression all over again ... hell, it's not even the late 70's/early 80's yet. I'm not even sure it's gotten as bad as the early 90's recession.

There certainly can be some downturns, and things likely will get worse. I'm a bit concerned that all these rescue packages might not be the wisest thing to do. I think that a little bit of failure might not be the worst thing for the economy in the long haul. I'm also concerned about the possibility of an overreaction, like some massive stimulus package in which the government sends people a few hundred dollars only to realize it really has no effect...

cnredd · #9 (**permalink**) 11-25-2008, 03:42 PM

Quote:

Originally Posted by foundit66

Are you serious?
What's this strategy? Deny the existence of a financial crisis until Obama becomes president, then suddenly "realize" that the economy is in trouble and claim he is responsible?

Quote:

Originally Posted by Michael1

I don't think anyone is denying that there are real economic troubles. I for one simply feel that the over the top adjectives just need to stop.

Thanks Mike...That was EXCATLY the point being made...

Yes...the economy is in a downturn...But it's NOT close to being the way it's portrayed..."The sky is falling" mentality is pure ignorance...

saltwn · #10 (**permalink**) 11-25-2008, 03:58 PM

Quote:

Originally Posted by Michael1

I don't think anyone is denying that there are real economic troubles. I for one simply feel that the over the top adjectives just need to stop. This is not the great depression all over again ... hell, it's not even the late 70's/early 80's yet. I'm not even sure it's gotten as bad as the early 90's recession.

There certainly can be some downturns, and things likely will get worse. I'm a bit concerned that all these rescue packages might not be the wisest thing to do. I think that a little bit of failure might not be the worst thing for the economy in the long haul. I'm also concerned about the possibility of an overreaction, like some massive stimulus package in which the government sends people a few hundred dollars only to realize it really has no effect...

Quote:

Originally Posted by cnredd

Thanks Mike...That was EXCATLY the point being made...

Yes...the economy is in a downturn...But it's NOT close to being the way it's portrayed..."The sky is falling" mentality is pure ignorance...

500 billion...700 billion..20 more here...30 more there
Uh...the sky is falling.

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