When President Barack Obama came into office in January, the economies in the U.S. and much of the rest of the world were in shambles. At the end of 100 days in office the President had instituted a huge corporate bailout program and pumped funds into the U.S. economy. He has started to answer that old riddle, "How do you eat an elephant?"
President Obama began work on the beast. Now, almost four months later the economy feels different. It may not BE significantly different, but there are signs that the financial plunge is bottoming out. Don't take my word for it. The Financial Times' in depth feature, Global Economy, headlined "Downturn bottomed out," and that the "World discovers it is still breathing."
While candidate Barack Obama was campaigning for office the Bush administration continued to run up the federal budget deficits. President Obama promised to trim out wasteful, unneeded and ineffective fat from his budget. Although this administration's initial efforts results are modest, according to a recent Washington Post story, "Obama's budget knife yields modest trims," it is at least started. Summarizing Lori Montgomery and Amy Goldstein's conclusion:
President Obama has said for weeks that his staff is scouring the federal budget, "line by line," for savings. Today, they will release the results: a plan to trim 121 programs by $17 billion, a tiny fraction of next year's $3.4 trillion budget.
President Obama's budget deficit problem remains as an easy target for Republican criticism. But there is another budget balancing effort that recently emerged. The President wants the business community's most lucrative tax breaks to be closed. Congressional Quarterly carried an excellent story recently that explained: "Tax plan calls for corporate hikes." Author Joseph Schatz begins,
The more the business community sees of the Obama administration’s tax plans, the less it likes.
As the White House completed its multipart budget release Monday with fresh details on a plan to scale back tax advantages for businesses operating overseas, a proposed tax hike on the life insurance industry and a bid to eliminate an unintended tax break claimed by paper companies, industry groups pushed back with forceful rhetoric, trying to convince lawmakers that President Obama’s tax agenda is bad for business.
President Obama introduced the idea of a "new economic foundation" (since been modified into "the five pillars") for the country at a speech at Georgetown University in mid April. That same day he discussed with the New York Times Magazine writer David Leonhardt, how his policies on schools, energy and health care might change daily life in America. Leonhardt's great 6-page, well-footnoted story, "After the Great Recession," is described by the author:
This was our third interview about the economy, the first two occurring during last year’s campaign. And while the setting was decidedly more formal this time — the Oval Office — the interview felt as conversational as those earlier ones. We sat at the far end of the office from his desk and spoke for 50 minutes. None of his economic advisers were there. As the conversation progressed, Obama spoke in increasingly personal terms. What follows is a lightly edited transcript of that interview.
At the end of our conversation, when I asked him if he was reading anything good, he said he had become sick enough of briefing books to begin reading a novel in the evenings — “Netherland,” by Joseph O’Neill.
President Obama knew the first day he was in office that his main focus had to be on the economic problems that looked so completely huge and insurmountable. Wall Street was undone. Main street was hurting in profound ways. So the Obama administration started to work. Congress went to work also. What has emerged is a somewhat different fiscal situation than when they started. Wall Street thinks it has been saved, but credit remains largely frozen and Main Street is seen as the way for banks to make a profit. To remedy that the President wants to be able to sign legislation instituting tighter credit card regulations by Memorial Day. Thus President Obama is still at work "eating the elephant, one bite at a time."
Reference: ProPublica's "Eye on the Bailout," a dynamic chart that follows the $1.1 Trillion Taxpayer-Funded Bailout
[Post date - May 15, 2009]See also Behind the Links, for further info on this subject.
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