Obama's Recovery Address‏

February 25, 2009

by Faiz Shakir, Amanda Terkel, Satyam Khanna, Matt Corley, Benjamin Armbruster, Ali Frick, and Ryan Powers Contact Us | Tell-a-Friend | Archives | Permalink | Subscribe to Feed

ADMINISTRATION

Obama's Recovery Address

Thirty-five days after being inaugurated as America's 44th president, Barack Obama discussed his economic agenda before a joint session of Congress last night. He focused on three priorities -- health care, energy, and education -- that will form the backbone of his long-term vision for economic growth and development. Those three core policy areas also received significant attention in the American Recovery and Reinvestment Act, which Obama signed into law earlier this month. "Now is the time to act boldly and wisely -- to not only revive this economy, but to build a new foundation for lasting prosperity," Obama said last night. Although the President came into the House chamber with sky-high approval ratings, Americans remain deeply worried about the recession. He offered them not just a budget plan but what he called "a vision for America -- as a blueprint for our future." He declared, "We will rebuild, we will recover, and the United States of America will emerge stronger than before."

MOVING IMMEDIATELY ON HEALTH CARE: Obama emphasized health care reform as the key to both restoring economic health and ensuring that the American dream lives on, and he made it clear he would not wait to move on a bold plan. "So let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year," he said. Congress is already acting. In November, Sen. Max Baucus (D-MT), the powerful chairman of the Senate Finance Committee, released his own principles for health reform and has since held numerous meetings on restructuring the system. And under the direction of Sen. Ted Kennedy (D-MA), "many of the leading figures in the nation's long-running health care debate have been meeting secretly in a Senate hearing room" and "appear to be inching towards" a consensus that real reform will require every American to have health insurance and find ways to make it affordable. The Wonk Room's Igor Volsky notes that Obama left the details of reform up to Congress -- and "the devil will certainly lie in the details." Still, as Obama pointed out, he and Congress have already "done more to advance the cause of health care reform in the last thirty days than we have in the last decade," including passing landmark health IT innovation, new incentives for disease research, and unprecedented funding for preventive care, all in the American Recovery and Reinvestment Act. He also signed a law providing health insurance to 11 million children, a bill Bush vetoed twice.

'IT BEGINS WITH ENERGY': Obama's vision for restoring robust economic growth and reclaiming new opportunity for all "begins with energy," he said. The recovery plan has already taken big steps to advance the goal of clean energy: It made huge investments in renewable energy, efficiency, and building a new, clean electrical grid. But Obama went further last night, challenging Congress to pass a broad cap-and-trade program that places a price on dirty fuel and invests in renewables -- and will allow the U.S. to "to truly transform our economy, to protect our security and save our planet from the ravages of climate change." The Obama administration is serious about implementing cap and trade; its budget factors in revenues from carbon pricing starting in 2012. Transforming how America gets its energy will go a long way toward rebuilding the American economy as well. A Center for American Progress study found that a $100 billion investment in green energy and technology creates two million jobs within two years. This week, the Center for American Progress Action Fund hosted the National Clean Energy Summit, where political leaders from across the ideological spectrum joined business, labor, and environmental leaders to discuss the urgent need to shift to a clean energy economy. They identified a national clean energy smart grid as a top priority in transforming America's energy economy -- and CAP is leading the way, with a report explaining how such a grid would work, enumerating the jobs it would create, and recommending the policies needed to implement it.

EDUCATION IS 'A PRE-REQUISITE': The recovery plan Obama signed into law this month enacted "the largest increase in federal aid since Washington began to spend significantly on education after World War II," spending $150 billion on school districts, child care centers and universities. Education Secretary Arne Duncan praised the bill, saying it would "avert literally hundreds of thousands of teacher layoffs." The bill also included $13.9 billion in added funding for Pell Grants. Rebuilding crumbling schools and injecting needed funds into university scientific research, however, is not enough. "In a global economy, where the most valuable skill you can sell is your knowledge, a good education is no longer just a pathway to opportunity. It is a pre-requisite," Obama said, announcing a goal "to ensure that every child has access to a complete and competitive education." He earned a prolonged standing ovation when he declared that dropping out of high school "is no longer an option. It's not just quitting on yourself; it's quitting on your country." Obama asked Americans to commit to at least one year of higher education or career training -- a goal that will require more flexible university programs as well as a renewed focus on secondary education to prepare students for higher learning.

IRAQ -- OBAMA CALLS FOR MOST U.S. TROOPS TO BE WITHDRAWN FROM IRAQ BY AUGUST 2010: President Obama is expected to announce this week that he will withdraw most U.S. troops from Iraq by August 2010, which is 19 months after his inauguration. Obama's plan will initially leave a "residual force" of 30,000 to 50,000 troops, and a further withdrawal will take place before December 2011 -- the period in which the U.S. agreed with Iraq to remove all American troops under the Status of Forces Agreement. Obama was also considering 16-month and 23-month withdrawal timetables. But Gens. Petraeus and Odierno, according to military officials, "were uncomfortable with the 16-month plan that Mr. Obama backed during the campaign," and the 19-month time frame was reportedly a "compromise." While Obama's 19-month timetable is faster than the timeline set by the SOFA, Sadiq Al-Rikabi, a top adviser to Iraqi Prime Minister Nouri al-Maliki, said that al-Maliki welcomed the announcement and expressed "no worry" about U.S. forces moving out quicker than the agreement requires.

ECONOMY -- JINDAL OFFERS RESPONSE TO OBAMA AFTER DENYING 25,000 LOUISIANA RESIDENTS UNEMPLOYMENT INSURANCE: Gov. Bobby Jindal (R-LA) offered the Republican response to President Obama's address last night, in which Jindal "defended the virtues of small government that he said even his own party had abandoned in recent years." Last Friday, Jindal announced that he would reject roughly $100 million in unemployment assistance from the federal recovery package, claiming the temporary unemployment aid would eventually lead to a tax hike on businesses. Jindal's decision ensured that at least 25,000 unemployed Louisiana residents would not be eligible for unemployment insurance. However, in 2005, as a congressman representing Louisiana, he co-sponsored a bill extending temporary unemployment insurance -- similar to the type he now opposes -- to those who found themselves unemployed in the wake of Hurricane Katrina. Further, as the Wonk Room reported yesterday, in Louisiana 430 people lose their jobs every day.

ECONOMY -- WATCHDOGS WARN THAT FINANCIAL RESCUE IS VULNERABLE TO FRAUD: Yesterday, government officials charged with overseeing the $700 billion Troubled Asset Relief Program (TARP) warned lawmakers that the "U.S. government's rescue of the financial system is vulnerable to fraud that could potentially cost taxpayers tens of billions of dollars." In testimony before the House Subcommittee on Oversight and Investigations, Neil Barofsky, the special inspector general for TARP, cited problems with the reconstruction of Iraq, hurricane relief efforts, and the 1990s savings-and-loan bailout as evidence of the potential for fraud. "History teaches us that an outlay of so much money in such a short period of time will inevitably draw those seeking to profit criminally," he said. Acting U.S. Comptroller General Gene Dodaro told the subcommittee that while the Treasury Department has made progress in recent months, the lack of "comprehensive written policies and procedures governing TARP" could "increase the risk of wasted government dollars," adding that there are "high risk issues that still need attention." The warnings come as the Obama administration prepares to begin a series of "stress tests" to determine whether some of the nation's largest banks will need additional aid to survive if economic conditions worsen beyond policymakers' expectations. The Government Accountability Office has previously warned that TARP lacks the necessary oversight to "ensure integrity, accountability, and transparency" in the spending of rescue funds.