Obama: Economy Worse Before It Gets Better

Pledges A Recovery Plan "That Is Equal To The Task Ahead"

(AP)  President-elect Barack Obama said the U.S. economy seems destined to get worse before it gets better and he pledged a recovery plan "that is equal to the task ahead."

Obama also said in an interview broadcast Sunday that the survival of the domestic car-making capacity is important, yet any bailout must be "conditioned on an auto industry emerging at the end of the process that actually works."

Less than six weeks before he takes office, Obama said that help for homeowners facing foreclosure is an option as part of his plan. He sidestepped a question about when he plans to raise taxes on wealthy Americans.

Obama's interview on NBC television's "Meet the Press" was his most extensive since winning the White House more than a month ago.

In the intervening weeks, the economy has showed clear signs of worsening. Employers said they eliminated more than 500,000 jobs in November alone and retailers reported disappointing holiday-season sales.

"The economy is going to get worse before it gets better," he said twice in the early moments of the interview, taped Saturday in Chicago.

The president-elect announced on Saturday he would call for the most massive spending on public works since the creation of the interstate highway system a half-century ago. In a word of caution to powerful lawmakers, he said the first priority would be "shovel-ready" projects - those that could create jobs rights away.

"The days of just pork coming out of Congress as a strategy, those days are over," he added.

Obama said repeatedly that his economic advisers are at work on an economic aid package, but he has largely stayed out of the public debate over bailout aid to the Detroit automakers. Congress and the Bush administration are at work on a plan for roughly $15 billion for General Motors Corp., Ford Motor Co. and Chrysler LLC. Congressional leader hope to pass the measure this week.

Obama suggested he would support such a plan, so long as it was accompanied by conditions to "keep the automakers' feet to the fire in making the changes that are necessary" for longer-term survival. He also indicated he did not believe bankruptcy is an acceptable course of action for any of the companies.

The president-elect sidestepped a question about the pace of a troop withdrawal from Iraq, saying he would direct U.S. generals to come up with a plan "for a responsible drawdown." He said in the campaign he wanted most U.S. troops withdrawn within 16 months, but did not say then, nor has he now, how large a deployment should be left behind.

Obama also spoke about his latest Cabinet selection, retired Gen. Eric Shinseki to head the Veterans Affairs Department. Shinseki was forced into retirement by the Bush administration after he said the original invasion plan for Iraq did not include enough troops.

"He was right," Obama said.

The president-elect declined to comment on the possible appointment of Caroline Kennedy to New York Sen. Hillary Rodham Clinton's seat in the Senate. Obama tapped Clinton recently as his secretary of state.

[u-r-right]

Well now, I have a feeling this announcement by our incoming president won''t look good on Wall Street by the end of the day on Monday.

[marcosis78]

Like I said before, lets take all this billions of dollars and divide it up amongst all actual taxpayers and let us spend it to stimulate the economy. That way, not just 1 or 2 businesses profit from it.

[devilspeaks]

Im hoping it gets worse!

[sincity_q]

FDR, he is not. we won''t be hearing anything like ''The only thing we have to fear is, fear itself'' speeches from this one. Especially when ones like ''It''s gonna get worse before it gets better'' covers his rear in case his plans fall flat.

We haven''t had a good, couragous president in a long time... and Obama is no exception to this truth.

[babooph]

No one can fix the Bush mess -the damage is beyond belief!

[longtree-2009]

the jury is still out but obama does not give too many people warm feelings since his staffing is mostly former bill clinton staffers. where is the change? sure would like obama to stop with the negative comments regarding the economy and start giving positive comments and plans. he has to realize and quickly that when he opens his pie hole, the market reacts just as it did with bush. so if he has nothing positive to say, he should just shut it. still obama is better than running the risk of palin sitting in the white house. sure wish mccain had picked someone else and not palin. mccain might be potus today but for his dumb butt selection for vp.

[wango2007-2009]

""The economy is going to get worse before it gets better," he said twice..."

Obama is just saying what smart people already know... no single president can cause a financal meltdown, and no single president can cure one.

Economic cycles run independently of whoever is in office, as history clearly shows.

All Obama can do is blame Bush to cover his own new administrations ineptness. All Obama''s followers can do is support Obama''s blame game, but that just proves how stupid some Americans can be. Bush certainly had no motive to ruin the economy.

[lewiston14]

Like I said before, lets take all this billions of dollars and divide it up amongst all actual taxpayers and let us spend it to stimulate the economy.

Posted by marcosis78

You still have to learn math. US population 300 million. Give each $1 that is 300 million, give each $2 that is 600 million. Give each $3 that is 900 million. Do you get it yet?

[steamed2]

As a retired financial crimes investigator I can only shake my head at the clueless comments being made on-line by the general public. It''s the Republicans fault, it''s the Democrats fault, it''s the Tooth Fairy''s fault! Meanwhile Congress screams and runs around crying that the sky is falling, and doing it''s best to sow enough confusion so that taxpayers don''t notice the two and a half billion-plus dollars that professional lobbyists of the Finance, Insurance & Real Estate industry paid our fine Senators and Congressmen in just the past ten years alone to dismantle 80 years of regulatory laws which had protected us. American taxpayers are like domestic sheep, no wonder they are so easy to shear. There are ''reasons'' for the mess, they are easily identified, and they can be traced back to the ''bad actors'' that are responsible! Take a minute to check a few things out- http://www.peak.org/~LW584

[schoolmarm22]

No one man, regardless of political affiliation, can instantly turn the economy around. It will take some time, maybe even years, to undo the financial crisis our country is in. Everyone is so quick to blame politicians for this mess, but some of the responsibility must be shouldered by the American citizens who have lived beyond their means and depended on credit for everything. What ever happened to saving up for what you want? This spend now, pay later mentality has to be addressed or this recession will surely become a full on depression.

[debinok1]

You still have to learn math. US population 300 million. Give each $1 that is 300 million, give each $2 that is 600 million. Give each $3 that is 900 million. Do you get it yet?

Posted by lewiston14
*********************************
700,000,000,000 divided between 300,000,000 americans minus the top 5%, would equal almost 2,500 a person, for a family of 2 thats 5,000 for a family of 4 thats 10,000, Do YOU get it? The 700 Billion bail out would have had more affect on the economy had it been put into the hands of the consumer.

[debinok1]

People get offended when they hear that their lifestyle has to change, when they hear they can''t continue to live on credit and so far above their means. This is why it doesn''t matter who got in office, because the consumer doesn''t want to change their spending habits, they like that oversized house, they like that oversized SUV and all of the other fluff that comes with credit living.

[jfrance5]

I like Obama''s picks. All of you sheep out there that think we should just throw new faces into politics need to get a life. You need every good, experienced, politican to get on board with Obama to get us through what is probably going to be a most difficult next several years. There is going to be no quick fix. And, for you idiots out there expecting daddy to fix everything you have some surprises coming. Economic meltdowns crawl into everybody''s window. I don''t care who you are. Get ready for some belt tightning. Also get off your butt and pay attention to what your political leaders are actually doing for you. So far they have been busy voting away your rights and protection for a lot of big bucks, billions, from the special interest groups. Or, just keep on grazing.....Baaaa Baaaaa

[cariboubarbi]

Obama isn''t even President yet and the rabid partisan wingnuts are lining up to blame Bush''s failures on him.

Perhaps they can take their heads out of their backsides long enough to realise we''re all on this sinking ship together.

We''re all Americans.

[cariboubarbi]

Obama isn''t even President yet and the rabid partisan wingnuts are lining up to blame Bush''''s failures on him.

Perhaps they can take their heads out of their backsides long enough to realise we''''re all on this sinking ship together.

We''re all Americans.

Stop ********* and start bailing.

[cariboubarbi]

Dear right wing partisan hacks,

If Obama fails, we all fail. Plain and simple.

Try to step away from your hate for a second and realise that we''re all on this sinking ship together.

We''re all Americans.

Stop ********* and start bailing.

If you can''t help just sit down and shut up.

[bleechdahole]

obama had a prophesy!

[McHineguy]

Dear right wing partisan hacks,

If Obama fails, we all fail. Plain and simple.

Try to step away from your hate for a second and realise that we''''re all on this sinking ship together.

We''''re all Americans.

Stop ********* and start bailing.

If you can''''t help just sit down and shut up.








--------------------------------------------------------------------------------

Posted by CaribouBarbi at 01:58 PM : Dec 07, 2008

You are right on!!! And I am a conservative!! But I am no hack.

Its hard to find constructive commentary on these boards. Some of the discension is sown by foreigners trying to play with us. But a lot of it is unwarranted anger from our own countrymen.

[bleechdahole]

Translation: Nobody better blame my Savior Bush! We RINOs always want to blame somebody else!

Posted by FloydZeppd at 01:55 PM : Dec 07, 2008
+ report abuse

****

translation:

"i blame bush for all of my credit card debts..how dare he not stop me on making these mistakes and taking the chance on calling him a facist for doing so"

[cariboubarbi]

Dear right wing partisan hacks,

If Obama fails, we all fail. Plain and simple.

Try to step away from your hate for a second and realise that we''''''''re all on this sinking ship together.

We''''''''re all Americans.

Stop ********* and start bailing.

If you can''''''''t help just sit down and shut up.








-------------------
----------------------------------------
---------------------

Posted by CaribouBarbi at 01:58 PM : Dec 07, 2008

You are right on!!! And I am a conservative!! But I am no hack.

Its hard to find constructive commentary on these boards. Some of the discension is sown by foreigners trying to play with us. But a lot of it is unwarranted anger from our own countrymen.


--------------------------------------------------------------------------------

Posted by machineguy at 02:09 PM : Dec 07, 2008




Thanks man. I don''t think people realise how serious our situation is. The time for all this partisan bickering is over.

[McHineguy]

I heard this comment several times on how deocrats pushed so that poor people to get homes with no down ..
Wells now they all cash in and leave , and they drag all the banks with them get it????

Posted by demdump at 01:51 PM : Dec 07, 2008
-------

Translation: Nobody better blame my Savior Bush! We RINOs always want to blame somebody else!


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Posted by FloydZeppd at 01:55 PM : Dec 07, 2008

Dems, repubs, rich wall street, unqualified mortgae holders. There aint no clean skirts on this dance floor.

The Dems did demand mortgages be made "more available" to "under advantaged" homebuyers. FannieMac did lobby hard to extend and promote these bad loans. Wall Street did find a way legal to insure them through AIG (launder their history). The Repubs did fail to cry "foul" in a loud voice that we could near. Many of those mortgage holders knew they could never make the payments but had "plans" to move before it crashed.

No clean skirts. Names like Clinton, Barney Frank, Chris Dodd, even Obama, are strongly tied to the implementation of the low quality (sub prime) loans. But Bush and the Repubs knew about them and only shouted in whispers. Of the bankers, only USBank seems to have avoided much traffic in these junk mortgages (remember junk bonds?).

Now, lets all decide its done, its not likely anyone is going to jail, and we have to get this mess cleaned up.

[McHineguy]

Obama isn''''t even President yet and the rabid partisan wingnuts are lining up to blame Bush''''''''s failures on him.

Perhaps they can take their heads out of their backsides long enough to realise we''''''''re all on this sinking ship together.

We''''re all Americans.

Stop ********* and start bailing.










--------------------------------------------------------------------------------

Posted by CaribouBarbi at 01:54 PM : Dec 07, 2008

I agree with one of your sentiments, stop ********* and start bailing. But I find the rest of your post just another ********* session about Bush and the Repubs.

Im a repub that is ready to support the new president but its hard in the midst of all this vitriol.

[solarrays247-2009]

translation:

"i blame bush for all of my credit card debts..how dare he not stop me on making these mistakes and taking the chance on calling him a facist for doing so"
Posted by bleechdahole at 02:12 PM : Dec 07, 2008


Haven''t you forgotten a whole bunch of people? Eh? No one forced Wall Street, nor some of our largest financial institutions to take the risks that they did with investors'' monies!! Credit card debts are but a drop in the bucket compared to the actual denizens of our current financial mess. Or maybe you just awoke from hibernation?

Anyone can portend to be an armchair genius...but do you have the courage to step up to the plate and actually come up with something constructive at this point in time?

I think CaribouBarbi says it best:

"We''''re all Americans.

Stop ******** and start bailing.

If you can''''t help just sit down and shut up!"

[solarrays247-2009]

Dems, repubs, rich wall street, unqualified mortgae holders. There aint no clean skirts on this dance floor.

The Dems did demand mortgages be made "more available" to "under advantaged" homebuyers. FannieMac did lobby hard to extend and promote these bad loans. Wall Street did find a way legal to insure them through AIG (launder their history). The Repubs did fail to cry "foul" in a loud voice that we could near. Many of those mortgage holders knew they could never make the payments but had "plans" to move before it crashed.

No clean skirts. Names like Clinton, Barney Frank, Chris Dodd, even Obama, are strongly tied to the implementation of the low quality (sub prime) loans. But Bush and the Repubs knew about them and only shouted in whispers. Of the bankers, only USBank seems to have avoided much traffic in these junk mortgages (remember junk bonds?).

Now, lets all decide its done, its not likely anyone is going to jail, and we have to get this mess cleaned up.

Posted by machineguy at 02:20 PM : Dec 07, 2008

Good job...very accurate! I like your attitude! Let''s get''er done!!

[debinok1]

Well, Duuh. Tell us something we don''''t know, Messiah. The Gall of this guy.
Posted by WhatChange
*********************
This may not be news to you, but the majority of Americans seem to think there is a quick fix that he will use on Jan 21st to make it all better. They just don''t get that it has taken years of mistakes by EVERYONE to get us into this, and it is going to take years to get us out.

[debinok1]

The blame is to the entire government as a whole

Posted by DJ_IL
*******************
Wrong PART of the blame is on the entire government, part is on wall street, But the BIGGEST part of the blame is on the American Consumer. Everyone who chose to charge a life they couldn''t have afforded otherwise has caused this. When you live beyond your means financed by credit cards instead of living with what you can afford has driven us to this point and it wont get better until everyone gets back to the basics of spending only what you have and saving for everything else.

[debinok1]

But still that does not mean it was all democrats or republicans
Posted by DJ_IL
********************
On that we agree it took both, BUT in all fairness regardless of his political affiliation BUSH has more blame than most. It was HIS policies that sent us into the current tail spin, and Dems and Reps both voted those policies into practice.

[debinok1]

For two years he has threatened to take the money from corporations and rich people to give to the poor.
Posted by BagdadsHere7
********************
False, He wants to undo Bushs unfair tax cuts to the rich, he wants them to pay their FAIR SHARE, instead of trying to run the country on the backs of the working class.

[McHineguy]

For two years he has threatened to take the money from corporations and rich people to give to the poor.
Posted by BagdadsHere7
********************
False, He wants to undo Bushs unfair tax cuts to the rich, he wants them to pay their FAIR SHARE, instead of trying to run the country on the backs of the working class.


--------------------------------------------------------------------------------

Posted by DebinOK1 at 03:55 PM : Dec 07, 2008

FALSE. The higher earners already pay 70% of the tax bill and use less than 5% of the benefits (except for the right to work, which is pretty evenly distributed). But, the small, entitlement minds of our country prefer to claim they "deserve" more instead of working for it.

But tax them enough and they will leave the country entirely, just like the jobs have gone, the rich will follow. we cant refuse to wrok hard, tax anyone making more than us, and insist on all those benefits. Its time to pay the piper. One crash at a time.

[edward1975-2009]

Stop the presses, Obama has stated the obvious, give him the Nobel Prize in Economics for stating what everyone took for granted. This coming from the man who had all the answers before the elections. Change my arse.

[McHineguy]

But still that does not mean it was all democrats or republicans
Posted by DJ_IL
********************
On that we agree it took both, BUT in all fairness regardless of his political affiliation BUSH has more blame than most. It was HIS policies that sent us into the current tail spin, and Dems and Reps both voted those policies into practice.


--------------------------------------------------------------------------------

Posted by DebinOK1 at 03:50 PM : Dec 07, 2008

there aint no clean skirts on this dance floor. The problem began with Clinton, was ignored by Bush, and augmented by Reid, Pelosi, Franks, and Dodd. While fannieMac lobbied, Wall street covered, and unqualified mortgagees pyramided. Nope, no clean skirts. Now lets clean up the mess and quit trying to blame our favorite demon.

[McHineguy]

Your right, it took FDR almost 4 terms to straighten out the mess Hoover caused.


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Posted by demswin08 at 03:09 PM : Dec 07, 2008

Actually, acording to many economists, he made it worse. And he made it last longer. But most Americans dont understand how the economy works so they believe what they hear and FDR managed that very well.

[wardoglrs]

This man is going to further make things worst his thinking is socialism and that will never work so why even go there.

People need to resist the taxes and just end government do away with corrupt politics altogether.
Yoy hold the power i suggest you use it

[Stratmaster7]

I see the inane comments contin ue even after the election. first there''s BRdeckard...Yeah, the guy spent time on the poorer side of one of the larger urban areas in the world helping those less fortunate, and gee... he didn;t single-handedly turn the area into Beverly Hills. What a loser.

Then there is the old "tax the high earners and they will leave post". Hey Machine, those "high earners"... what percentage of the population are you talking about? Repealing the tax breaks for the top 2 or 3% won;t make them leave. they were all here before the breaks. If they spend their investment money elsewhwere it is because they want to take advantage of near slave level wages, not because of the tax break.

then, the usual drivel from Baghdad: "For two years he has threatened to take the money from corporations and rich people to give to the poor."

Just ignore the fact his premise is a complete misstatement of Obama''s position and policy.

Traitors one and all.

[jt_lancer]

The reality is that the GOVERNMENT created the problem - especially the Federal Reserve and its manipulation of the money supply and interest rates.

Yet, the American sheeple are largely economic illiterates and do not realize this.

They will continue to clamor to their new Master to ''create'' happiness and prosperity for them all, with the wave of a magic government wand.

[Stratmaster7]

Posted by JT_Lancer at 06:07 PM

Only your version of reality JT, although I agree that was one piece of the problem. Add in predatory lenders, real estate agents, a percentage of home buyers who wanted to live above their means, arrogant automakers who ignored the global marketplace and tried to ignore the energy situation, an arrogant POTUS who thought he could wage war and cut taxes at the same timeetc. and you start ghetting close to the whole picture.

[jt_lancer]

Curiously, ''predatoy lending'' was ENCOURAGED by BOTH parties. Previously, it was called ''economic opportunity for low income families''.

The government made rules which PUNISHED banks who refused to lend to low income families and minorities, and rewarded banks who did make these loans.

[jt_lancer]

As far as the US automakers ignoring the marketplace, they are largely uncompetitive due to the heavy burden that union labor puts on them. High labor costs and fat pensions and health benefits for retirees add a huge cost to every car they have to sell.

Notice that none of the foreign automakers with plants in the US are seeking a US govt bailout.

[Stratmaster7]

Posted by JT_Lancer at 06:15 PM

You can''t combine two different things and talk about them like they are the same. I agree that the government encouraged lending in ways it should not have.

However, Predatory lenders by the nature of te adjective are something different. thse lenders forged documents, inflated income levels etc. They weren;t doing thata t the governments insistence. If the legislation encouraging lending covered the person they were lending to, there would have been no need for the obfuscations and fraud, correct?

[jt_lancer]

The idea that more legislation would have prevented predatory lending is ludicrous. Why didn''t the existing laws prevent it?

There will always be somepeople in every industry who don''t play by the rules. What is often left out of this argument is that many applicants for subprime loans lied about their income levels. Some estimates said over 50% lied on their applications.

Lenders deserve some blame, but borrowers are hardly innocent. Common sense dictates if you can''t afford a loan, don''t borrow the money.

[bjcone8559]

translation:

"i blame bush for all of my credit card debts..how dare he not stop me on making these mistakes and taking the chance on calling him a facist for doing so"


--------------------------------------------------------------------------------

Posted by bleechdahole


Your translation needs a translator.

[gi_joe_]

Obama is a fraud?

He was not born in America!

[Stratmaster7]

Posted by JT_Lancer at 06:24 PM

yes lenders deserve some, and some realtors.. and some borrowers. We do agree on one thing, there is plenty of blame to go around.

[bjcone8559]

The government made rules which PUNISHED banks who refused to lend to low income families and minorities, and rewarded banks who did make these loans.

Posted by JT_Lancer


That is very interesting. I have been in the banking business for almost twenty years and I have not yet read those ''rules''. Could you please list your source so I can further enlighten myself in this matter?

Also, I am currently working with hundreds of unfortunate families who have lost, or are losing their family homes. An overwhelming majority of those folks are suffering, not because they ''bought more home than they deserved'', (as many here have stated) but because their incomes have gone away or have been greatly deminished. These people bought homes that they COULD afford based on their circumstances at the time of the purchase, sometimes with terms that fit perfectly with their optomistic expectations of the future.

Yes, the financial tailspin we are experiencing now is a direct result of deregulation, but not necessarily deregulation of individual home mortgage loans. The bulk of the problem stems from the lack of oversight which led to corrupt bank-to-business and bank-to-bank loans. Look back for just a moment and remember the ''Silverado Savings And Loan'' debacle. Remember now? That was the child of another Bush brother... Neil Bush, and it had nothing to do with individual homoe mortgage loans. Remember also that it was a cost of several Billion dollars to taxpayers.

[Stratmaster7]

Posted by nowaymcgoo at 07:01 PM :

great post from someone with first hand knowledge. Thanks for the clarity.

[mr12258]

YES, The economy will get worse before it get better.It will get worse the day Obama takes office and it will get better the day we replace him with a republican...

[papabc]

Hmmmmmmm! If we stop pouring Trillions of Dollars into to that mess it will get sooner faster that you think.

Let the failing businesses fail and those on solid ground no fail.

Greed has cause this problem:
1. Government
2. Banking (Starting in the late 90''s)
3. Invertor
4. House buying to make a quick dollar at interent only.(Maybe it goes with 2 ans 3)

No we need to bail out those that should be loosing their shirts but NOOOOOOOOOOOOOOOOOOOOOOO, Lets bail them out.. Make them rich again.. Now let them fail on our tax dollars.

Who is going to jail? Who caused this?? Where is the investigation prior to handing out the trillions???

[mr12258]

DJ...I see your still around. I guess you still think Obama is going to save the day...

[tincup356]

If there were an investigation into all this it would be just like the 911 investigation. Criminals investigating themselves will never lead to the truth, only the story and blame they want to give you, that will halfway fit their story, even if it does surpass hollywood script writing in believability.We can no longer trust anything congress or the white house says, or does,from any administration.Both parties form a very powerful, corrupt partnership, working together to break this country and bring down the middle class.They are all guilty of treason.

[tincup356]

i cant wait till the health care people try to get on the bandwagon for money saying they can ''t make a living...they don''t make enough.People complain about car prices but what about Dr.''s care and drug costs? They are playing God just to take everything you have or you can die. I see now why they take what i call a hypocrites oath, so they can be equal liars to politicians, who by the way are akin to the FDA who make it possible for that industry to rape the public on drugs with 1000% markup, and to legalize poisons like Aspartame to be used on the people as they have for 20 years now.Drink a diet coke and enjoy...you''ve been poisoned.