He launched into an early defense of his Administration’s plan to rescue the nation’s top banks, including Citi and Bank of America. The troubled banks are rumored to be on the verge of nationalization. The president said it wasn’t a plan to "rescue bankers" but rather to save American businesses and homeowners.
[The State Of The Union]
President Barack Obama made a vigorous defense of his multi-billion dollar spending plan to arrest the nation’s economic decline in his State of the Union address last night.
The Administration pushed through a $787 billions stimulus plan; a $75 billion plan to address the housing crises; and, anywhere from $1.5 to $2 billion to address the banking crises.
The president made it clear that the alternative –to do nothing– would impose dire consequences on the nation.
President Obama said the Bush tax cuts to the wealthiest 2% of Americans will also be rolled back but that any family making less than $250,000 would not pay a dime extra in taxes.
Yet, for the recovery program to be successful, the president said probably billions more in spending will have to come before the decline is reversed. He launched into an early defense of his Administration’s plan to rescue the nation’s top banks, including Citi and Bank of America. The troubled banks are rumored to be on the verge of nationalization. The president said it wasn’t a plan to “rescue bankers” but rather to save American businesses and homeowners.
“It’s not about helping banks,” the President said. “It’s about helping people.” The president said the country’s economy can never recover so long as banks are not yet willing to lend money to businesses so that they can meet their payroll and to consumers to buy homes and to purchase cars. Yet, the president made it clear that any more resources going into the banks will come with firm conditionality. This means that nationalization is not off the table.
The president repeatedly repeated the refrain that the American economy will recover. The president said his budget will focus on three critical categories: energy, healthcare, and education.
The country would invest as much as $15 billion every year into renewable energy research and development; he asked Congress to send him
a plan that will show how renewable energy will eventually replace carbon-based energy.
He said healthcare cost reform could no longer be deferred since high healthcare cost resulted in bankruptcies every 30 second in the United States and that
1.5 million Americans could lose their homes next year.
The president said he wants the United Sates to have the highest proportion of college graduates by 2020. He said education begins at home and urged parents to read to their children. He said dropping out of High School was no longer an option.
“It’s not just quitting on yourself; it’s quitting on your country!” he declared to those who contemplated dropping out of High School.
The president made it clear that in the absence of the private sector being in a position to spend, the government had no choice but to fill the spending gap in order to create employment and so spark aggregate demand. “I reject the view that says our problems will simply take care of themselves,” he declared.
The president also made it clear that the automobile industry will be sustained in some capacity. Yet, he left room for a possible demise of at least one or more of the so-called Big Three.
The president enjoys record popularity in the polls and Republicans who had been opposing his economic recovery program are now in disarray.
[MORE TO COME]
