In contrast to their criticism of rosy assessments of the state of the economy during the presidential campaign, top economic aides on Sunday gave what media reports see as an "optimistic" reading of the economy. The AP notes that during the 2008 campaign, Barack Obama "relentlessly criticized his Republican opponent, Sen. John McCain, for declaring, 'The fundamentals of our economy are strong.' Obama's team painted the veteran senator as out of touch and failing to grasp the challenges facing the country." But on Sunday, "that optimistic message came from economic adviser Christina Romer." On NBC's Meet The Press, Romer said, "Of course the fundamentals are sound in the sense that the American workers are sound, we have a good capital stock, we have good technology."
The Wall Street Journal reports top White House aides "again urged patience on government measures aimed at bolstering the economy and unclogging credit markets, and noted that the economy was showing a few hopeful signs." On ABC's This Week, Obama aide Lawrence Summers said, "Clearly, the fact that consumer spending was like a ball falling off a table through the holiday season, and that there does seem to be some sign of stability in January and February is better than if that were not the case. But we've got an economy that's losing 600,000 jobs a month. That's probably not going to stop imminently."
The Hill reports Obama's economic advisers "fanned out to Sunday's talk shows to warn it is premature to think the recession has hit its low point." The New York Times says the Obama advisers "walked a careful line Sunday, saying that despite a few hopeful indicators and President Obama's call to investors to consider returning to the share markets, that it would 'take some time' to turn a corner." AFP reports President Obama's "economic advisors denied Sunday they were moving too slowly to fix the stricken US banking industry, and insisted victory would come in the 'economic war.'"
Obama's Handling Of The Economy Criticized Media sources this week note the growing level of criticism of President Obama's economic policies. Time reports that Obama's "honeymoon in the corridors of power has come to an abrupt end. ... The problem for Obama, and perhaps for us all, is that some of the hand-wringing came" from Warren Buffett, who "was - and is - an Obama supporter, but...took to the airwaves on March 9 to try to seize the young President's attention away from health care and education and energy and refocus it back onto the economy. Warning that Obama's agenda has become too sprawling and provocative. ... The oracle's verdict was quickly endorsed by Jack Welch and Andrew Grove, retired CEOs of General Electric and Intel, respectively."
US News Weekly's Kenneth T. Walsh says, "Criticism is rising that Obama and Democrats in Congress are overreaching and diverting attention from the economy to less urgent matters." James Poniewozik, in Time, writes, "To watch CNBC today is to enter an alternative universe, where élites are populists, Wall Street is Main Street and bank executives are the oppressed. It's not surprising that a voice of opposition to the new Administration would emerge. But who would have thought it would be on a channel not owned by Rupert Murdoch?"
Newt Gingrich, in an essay for Time, writes, "In this environment, the only two relevant objectives are creating jobs and restoring financial institutions to functional stability. Yet the Obama budget has the potential to do exactly the opposite."
Newsweek's Jonathan Alter writes, "There are basically four options to address the banking crisis, two of which are nonstarters. The first is to celebrate the recent uptick in banks' stocks...and do nothing -- let the market exercise its healing powers. We tried that once before, under Herbert Hoover." The "second option is to nationalize the banks." Option three, which has the momentum right now, goes by the name Public-Private Investment Funds (PPIFs). Sheila Bair, the chairman of the FDIC, calls this the 'Aggregator Bank' plan, because the government would lend to these partnerships. Geithner let slip recently that the price tag for taxpayers is $1 trillion. Option four is informally called the Good BanksBad Banks approach, and it was endorsed in broad outline early this year by Federal Reserve chairman Ben Bernanke."
Thrift Seen As Impediment To Recovery Daniel Gross, in a cover story for Newsweek titled "Stop Saving Now!" writes, "As consumers hibernate and investors hoard cash, the economy is withering. This new age of thrift is understandable. But for a recovery to take hold, Americans will need to start taking risks again."
The Wall Street Journal reports President Obama is "set to release a plan Monday raising the federal guarantee on small-business loans up to 90%, but a study by Congress's watchdog agency contends that insufficient oversight is in place for that program." Government watchdogs "fear the potential for another debacle, similar to what happened in the mortgage crisis, in which poorly documented loans were granted by mortgage brokers, then shuffled off to banks and hedge funds as securities."
The Politico reports President Obama is "looking for some sector of the economy to lead the nation out of recession, and he's putting down a $730 million dollar bet Monday on small businesses." Obama and Treasury Secretary Timothy Geithner "will announce a plan Monday to make it easier for these entrepreneurs to tap into billions of dollars in federal lending aid to fight a credit crunch that has brought business borrowing to a standstill." The AP reports new initiatives "come as Republicans have sought to build on some bipartisan misgivings over Obama's ambitious spending blueprint."
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On the weekend talk shows, top Obama economic aides downplayed the suggestion that the President would consider the taxation of healthcare benefits, but media reports note they did not rule out the possibility. Some media outlets noted that the Obama presidential campaign harshly criticized Republican opponent John McCain for backing the concept. The AP reports one of President Obama's "leading economic advisers says the White House is opposed to taxing health insurance," but Christine Romer, chairwoman of the White House Council of Economic Advisors, "is not ruling it out." As a candidate, Obama "opposed such taxes and called them 'a multi-trillion dollar tax hike.'"
Romer, on NBC's Meet The Press, was asked about recent reports that "the Administration signaling that the President is now open to taxing employer health benefits for employees." Romer said Obama "is still opposed to it. He certainly was very critical and very skeptical of it. It is certainly not in our proposal. And we have proposed other ways to, to deal with health care and to fund it. And so no, it is not something that he supports." Asked if that means such a proposal is "off the table," Romer replied, "I'm not going to say one way or the other," but again added, "He is absolutely opposed to it and skeptical."
On CBS's Face The Nation, Lawrence Summers, the director of the National Economic Council, said that "taxing health care benefits" is "not in the President's proposal," but also declined to rule out such a proposal. Austan Goolsbee, a member of the White House Council of Economic Advisors, said on Fox News Sunday, "There are some people in Congress who are pushing this, but that is not the president's idea. ... He is open to all ideas. He said, 'Let's put all ideas on the table.' That is not the President's idea. It's not in his health plan. It's not in his budget." Goolsbee added, "I'm not leaving the door open."
Sen. Bob Corker, also appearing on Fox News Sunday, said, "Talking about health care -- there is a $600 billion gap that the Administration has pointed out. No doubt they're very open to taxing benefits of Americans on health care because that's how they're going to fill the gap."
Asked on Fox News Sunday if he supports taxing health benefits, House Financial Services Committee chair Rep. Barney Frank responded, "No, I don't. I'm for a single payer health care system like Medicare."
The Washington Times reports, "During the presidential campaign, Mr. Obama took a much harsher tack, running a spate of ads denouncing Republican opponent John McCain's health care plan on precisely those grounds - that it was partially financed by taxes from counting the value of medical insurance as taxable income."
Former Vice President Cheney's interview on CNN's State of the Union program on Sunday is generating coverage in today's major newspapers, with much of it focusing on his criticism of President Obama's anti-terror policies. Under the headline "Cheney Asserts Obama Has Raised Security Risks," the New York Times reports that Cheney charged that "the new administration's changes to detention and interrogation programs for terrorism suspects would hamper intelligence gathering." The AP notes Cheney said on the Bush team's anti-terror efforts, "I think that's a great success story. It was done legally. It was done in accordance with our constitutional practices and principles."
The Los Angeles Times reports Cheney also "said the Obama administration is returning to the Clinton administration's approach of treating terrorism as a law enforcement matter, rather than a 'war.' He warned that such an approach represented a de-escalation of the effort." Said Cheney, "They're very much giving up that center of attention and focused that's required."
The Washington Post focused its report on Cheney's reaction to "President Bush's decision not to pardon I. Lewis 'Scooter' Libby." Cheney said "he strongly disagreed" with Bush on that account, adding Libby "had been left 'hanging in the wind.'" Cheney "said he still speaks to Bush after having 'traveled a long way together in eight years and two presidential campaigns. That built a very solid, lasting relationship.'"
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Bloomberg News reports President Obama will headline his first fundraiser as President on March 25, but it "may be difficult" to keep up the record-smashing pace of donations that marked the presidential campaign, both because of the state of the economy and because of "donor fatigue."
The Hill reports this morning that General David Petraeus, "who has repeatedly been mentioned as a possible presidential candidate, will make a high-profile speech in Iowa about a year and a half before the state's first-in-the-nation caucuses," a move that is "sure to set tongues wagging in the battle for the Republican presidential nomination in 2012." Petraeus will be the commencement speaker at the University of Iowa next year.
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The Minneapolis Star Tribune reports that both sides made their closing arguments in the Minnesota Senate trial on Friday, and that "the choice is up to the judges," but The Hill reports Senate Minority Leader Mitch McConnell said Friday that he would urge Norm Coleman (R) "to take his legal battle with Al Franken to federal court, potentially dragging out the Minnesota Senate race for several more months."
The Washington Times reports, "Angling for a critical Senate swing vote to pass the 'card check' bill that would make it easier to form unions, Pennsylvania labor leaders promised" Sen. Arlen Specter (R) "that they will switch union members from" the Democratic Party to the GOP "to help him win a tough 2010 primary election."
The Hartford Courant reports this morning that former CT2 Rep. Rob Simmons (R), "buoyed by a poll showing that he is in a dead heat in a possible matchup against" Connecticut Sen. Chris Dodd (D), announced yesterday that he would enter the race.
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The Hill reported over the weekend that Family Research Council President Tony Perkins announced on Friday that he would not challenge Louisiana Sen. David Vitter (R) in the 2010 GOP primary.
The Oklahoman reports that in addition to Rep. Mary Fallin (R), "three other possible GOP primary candidates are testing the waters" in the Oklahoma gubernatorial race former Rep. JC Watts, state sen. Randy Brogdon, and attorney Gary Richardson, who drew about 150,000 votes in 2002 as an independent.
The New York Times reported over the weekend that New York Mayor Michael Bloomberg (I) has spend $2.9 million so far on his reelection campaign, "compared with $5.1 million in spending during the same period in 2005," and the New York Daily News adds Bloomberg ultimately "ended up spending nearly $84.5 million" in his 2005 campaign.
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Jay Leno: "Good news, the stock market was up for the fourth day in a row. See, I don't know what makes me happier, seeing the stock market go up or Bernard Madoff going down."
David Letterman: "Top Ten Ways The GOP Can Become More Hip. 10. Change mascot from an elephant to a can of Mountain Dew. 9. Buy one of them computers all the kids are using. 8. Appoint Michael Phelps chairman in charge of chillaxing. 7. They should totally start a band. 6. Change Rush Limbaugh's name to Spongerush Fatpants. 5. Add highlights to combovers and hairpieces. 4. Four words: Lil Wayne for Senator. 3. Bring back this guy (George W. Bush dancing with African dancers). 2 How 'bout stealing and ordering hits like when Nixon ran things. 1. Fewer reactionary old white guys."
Jimmy Fallon: "Hey, Obama is being criticized for trying to solve too many problems at the same time. I'll tell you one thing. This never would have happened if Bush were still president."
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