October 2, 2009 2:27 PM

Larry Summers: The Economic Worst has Passed

By
Brian Montopoli
Topics
Economy
(CBS)
National Economic Council Director Lawrence Summers said Friday that despite bad news on the unemployment front, the worst of the economic downturn "is passed," arguing that "we're going to see a basic pattern of recovery."

"The challenge is going to be is to make that recovery be as strong and robust as we can," he said at the First Draft of History conference in Washington D.C.

Summers said the unemployment numbers weren't a surprise, as "the process of convalescence is never…completely smooth." Still, he said, "we're in a very different place than we were nine months ago."

He pointed to a decline in the rate of job loss and positive GDP growth, and noted that "discussions of Depression that were pervasive nine months ago aren't where the economy is" today.

The Obama administration advisor acknowledged, however, that "it's going to be a while" before the economy is completely back on track, adding: "We've got an enormous amount to do."

Summers, following the lead of Vice President Joe Biden, praised the effects of the economic stimulus package, saying it kept policemen and teachers from losing their jobs. He said there was still progress to be made in areas such as digitizing medical records, stating that the average hospital has worse information technology capabilities than the average supermarket.

Summers declined to directly address questions about a second stimulus package, saying he doesn't know exactly what the phrase means. He said "we certainly need to continue to support people who are in need," and stressed the importance of "continuing public investments."

Asked about the budget deficit, he said it's an important issue but suggested that it isn't a reason to refrain from public investment.

"We're not going to have a healthy budget in a profoundly unhealthy economy," he said.

Asked if companies should be allowed to be "too big to fail," Summers said regulatory reform was "absolutely essential." He pointed to the need for higher capital standards, a "harmonization of regulation" and resolution authority.

Summers said officials should never again be in the position of having to decide between a "problematic bailout" and "chaos and collapse."

More from the "First Draft of History" Conference:
Steve Schmidt: Palin 2012 Would be "Catastrophic" Pick
Lindsey Graham Hits Glenn Beck and Bill O'Reilly
Geithner: Goal is not to Save People From Mistakes
Petraeus: Afghanistan is not Iraq or Vietnam
Doctor: U.S. Needs to Control "Tsunami of Obesity"
McCain Pushes for More Troops for Afghanistan
Greenspan: Banks Shouldn't Be "Too Big to Fail"

Add a Comment See all 13 Comments
by robham777 October 3, 2009 7:10 PM EDT
An optimist believes we live in the best of all possible worlds, and a pessimist fears this is true.
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by covalentblue October 3, 2009 2:01 PM EDT
Larry,
Hurry up and tell those that have lost their homes and their retirements in the stock market! Oh, and don't forget the former Enron Employees! Hey, the worst is over folks!
www.hatecards.net
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by sjc_1 October 3, 2009 1:33 PM EDT
Bush was AWOL in Crawford, Texas a lot of the time. If they were trying to have an Olympics in Dallas, you would have seen him and the first lady over there. Try to be a bit more honest in your attempts at slanting and biasing your arguments.
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by valwayne October 2, 2009 10:33 PM EDT
Unemployment keep shooting up and is getting to a level where it may kill any possible recovery. Yet we have VP Biden saying the corrupt stimulous bill worked beyond their wildest dreams? And Summer says the worst has passed. I guess if your Commander in Chief is AWOL in Copenhangen and you're stuck responding to the horrible news you try and put the best light on it? But this is a joke! 9.8% UNEMPLOYMENT, We are truly on the road to hell!
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by stn_sage October 2, 2009 7:49 PM EDT
So, 'the worst is passed', huh? LMAO. Sure, it is.

Just keep saying that, buddy! Maybe by saying it, you can 'give it life'!

I got news for you---the worst hasn't gotten here---YET!
Reply to this comment
by danceswithtrees October 2, 2009 7:35 PM EDT
Obama and his economic team have shown to be in the tank for Wall street at the expense of mailn street. 2010 and 2012 will be a bloodbath for the Dems and they will devere it for not looking out for the average American.
Reply to this comment
by stn_sage October 2, 2009 7:46 PM EDT
You're absolutely correct! I don't know if it will be a 'bloodbath' in 2010/2012, but at the rate the Dems are ruling against America and Americans and in favor of big business, it very well could be!

And, you're right, they would deserve it, too!
by sjc_1 October 2, 2009 4:16 PM EDT
First of all the ARRA is NOT a stimulus program, it is a recovery program. The stimulus plan was done by Bush in 2008 when he sent $140 billion in checks to tax payers that mostly went to buy big screen TVs made in Asia at Wal-Mart.

Second, Larry Summers is an adviser. He is not Treasury and he is not the Federal Reserve. Mr. Summers IS a very smart guy that was ONCE Treasury Secretary after Robert Rubens stepped down. He knows what he is talking about. At times he may be too out spoken and may not use all the right words to say it, but he IS very smart and capable.
Reply to this comment
by stuart-johns1 October 3, 2009 6:47 PM EDT
Thank you for the correction. You are right, of course that it is a "recovery" program. That is what I meant.
by stuart-johns1 October 2, 2009 3:22 PM EDT
Well I agree that the stimulus IS working in spite of what republican extremist trolls like BubbaWrong say. We did avoid a national catastrophe in not allowing the largest recession in history from taking us into a terrible depression.

But still, be that as it may, I am not sure Mr. Sumner, that the worst is over.
Reply to this comment
by stuart-johns1 October 2, 2009 3:23 PM EDT
I meant Mr. Summers.
by BubbaRight October 2, 2009 3:15 PM EDT
Your Stimulus Plan ain't workin' Larry. All those "shovel ready" jobs aren't happening. Looks like Keynesian economics is dead.
Reply to this comment
by Stop_the_crying October 5, 2009 12:03 PM EDT
Oh So Sorry, Charlie. The bad generated by bush is being fixed by the Prez. I bet Bubbaright has a shot gun in his pickup window!!!!!! Really irritates Bubbaright.....RIGHT!!!!!!!!!!
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