President Bush acknowledges weakness in US economy
Photo 
President Bush gives a thumbs up as he emerges from Air Force One at J.F.K. Airport in New York, Friday.
NEW YORK — Trying to calm jitters about the economy, President Bush conceded on Friday that the country “obviously is going through a tough time” but expressed confidence that it will rebound. He cautioned against overreacting to fix the problems.
In a speech to The Economic Club of New York, Bush said this was not the first time the economy has been rattled and that he is certain that it will ride out its troubles. “These are uncertain times,” he said.
The president spoke as evidence of an ailing economy piled up. The dollar fell, oil and gold hit record highs, the economy is shedding jobs, retail sales saw a big drop and the effects of a severe credit squeeze linger. Economic worries have replaced the Iraq war as the No. 1 concern of voters in this presidential election year.
Bush acknowledged that prices are up at the gas pump and grocery stores and housing values are down – leading to worries among everyday “hardworking Americans.” But he said low unemployment and strong productivity are proof of the economy’s fundamental strength and resilience.
“Every time, this economy has bounced back better and stronger than before,” Bush said.
The president also praised the work of the Federal Reserve. After cutting interest rates several times, the Fed said Friday it has voted to endorse an arrangement to bolster troubled Bear Stearns Cos. and stands ready to provide add liquidity to a combat a serious credit crisis.
“It was strong action by the Fed and they did so because some financial institutions that borrowed money to buy securities in the housing industry must now repair their balance sheets before they can make further loans,” the president said.
“Today’s events are fast moving, but the chairman of the Federal Reserve and the secretary of the treasury are on top of them and will take the appropriate steps to promote stability in our markets,” Bush assured his audience.
The president chose American’s financial center as the backdrop – and the titans of finance and commerce as the audience – for his attempts to calm nerves from Wall Street to Main Street.
The Economic Club of New York is an exclusive, wealthy, largely homogenous group of top executives. Speaking before the gathering had Bush somewhat literally preaching to the choir – the 101-year-old group’s new chairman is Glen Hubbard, the first head of the White House Council of Economic Advisers for Bush.
He even drew a laugh when he opened his remarks with a not-so-veiled reference to the economy’s ills. “It seems like I showed up in an interesting moment, a very interesting time,” Bush said.
His main message, aside from optimism, stuck to Republican economic orthodoxy: warning repeatedly against too much government intervention.
For instance, while insisting his administration has an “active plan” to deal with the problems, Bush said he opposed several measures pending on Capitol Hill. They included proposals to allocate $400 billion to purchase abandoned and foreclosed homes, to change the bankruptcy code to allow judges to adjust mortgage rates, and to artificially prop up home prices.
“It’s important not to overcorrect, because when you overcorrect, you end up in a ditch,” Bush said. “It’s important to be steady.”
He said his administration would address the crisis “in a way that respects the ingenuity of the American people, that bolsters the entrepreneurial spirit and ensures that when we make it through this rough patch, that the driving will be smooth.”
Bush took a veiled shot at Democratic presidential candidates Hillary Rodham Clinton and Barack Obama for their criticism of trade agreements that they say put American workers at a disadvantage.
“When times are tough, it’s much easier to find somebody else to blame,” the president said, without mentioning either candidate by name. “Sometimes that somebody else to blame is somebody in a distant land. It’s easy politics. It’s easy to go around and hammer on trade.”
In a brief question-and-answer session, a member of the audience, noting that consumer prices are rising and the dollar is weak around the world, asked Bush whether the United States has an inflation problem.
“I agree that the Fed needs to be independent and make considered judgments and balance growth versus inflation,” Bush said without answering the question directly.
“We believe in a strong dollar and I recognize that economies go up and down, but it’s important for us to put policy in place that sends the signal that our economy is going to be strong and open for business.”
He said the United States should not do “something foolish” during this economic period that will make it harder to grow, such as blocking capital from coming into the nation or failing to extend the tax cuts.
He said he had cautioned Saudi King Abdullah that he “better be careful about affecting markets” with high oil prices and that soaring fuel costs would prompt more investment in alternative sources of energy.
But, Bush said, “Our energy policy hasn’t been very wise up to now.” He avoided further discussion of prices, saying, “I’m going to dodge the rest of your question.”
Mar 15, 2008 at 10:50 p.m.
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I have never voted along party lines, as I always try to pick the one I believe is best. When Clinton pushed NAFTA I was vocal about that. When Bush pushed the war I was vocal about that. When I make negative statements about Bush, it is not as a Democrat, it is as an extremely frustrated American.
This country is the greatest in the world by far. Civil war did not bring this country down.
Two world wars did not bring this country down.
The cold war did not stop us.
Interior fighting about Vietnam did not do it.
This country is headed for destruction simply because of our lack of financial responsiblity as individuals, and as a nation. We are doing it to ourselves and I personnally believe that we are aware of it, but are afraid to talk about it and address it because it is really going to hurt when we finally do address it.
Mar 15, 2008 at 10:17 p.m.
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I agree that the current problems with sub prime mortgages are not the presidents fault. Too much credit or blame is given to any sitting president for the state of the economy and sometimes if there is any deserved, the problems started with policies enacted during the previous administration and the results do not become apparent until later. I am concerned about the current administration's lack of concern about the national debt and the spending policies of republicans in congress. I always thought that conservatism included fiscal conservatism and have been disappointed by the apparent lack of it in recent times. It seems to me that the bottom line is that we cannot simply keep borrowing money to run the government. I understand that there is both good and bad debt, but is all of this debt good?
Mar 15, 2008 at 7:58 p.m.
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benthinkin,
One more thing... Whether that recession started when Clinton was in office or whether it started after Bush took office, I don't blame either one for it.
Congress controls the purse strings (maybe they have a lack of control), The Fed controls the rates, and we as consumers control how much we spend indivually and how much we save. All of these affect the economy.
The economy is taking a dive right now because people borrowed way too much money and the banks were stupid enough to actually lend it to them. It's not the President's fault.
Mar 15, 2008 at 7:36 p.m.
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benthinkin,
Apparently there's a debate on when the recession actually began:
http://en.wikipedia.org/wiki/Early_2000s...
"Several members of NBER's business cycle dating committee have said that revised data indicates a recession actually began some time within the final months of 2000."
It may or may not have technically been a recession, but it definitely was a consumer recession. Right now we are not technically in a recession since there hasn't been 2 back-to-back negative quarters, but we are currently in a consumer recession.
Mar 15, 2008 at 6:36 p.m.
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DrTalk, take a look at this inforation. http://en.wikipedia.org/wiki/List_of_rec...
It does not list a recession in the late Clinton administration...
Mar 15, 2008 at 5:17 p.m.
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RUserious,
I guess I should have have made it a little more clear about who I was addressing. My comments were directed at norseman and happycamper.
I agree with you that the President and others elected need to live up to their responsibilities. But I disagree that they should set aside everything personal. I think politians should just honestly tell us their values and opinions and let the people decide if they are what's right for America. None of the John Kerry stuff like "I'm persaonlly opposed to abortion but I don't think it's right to push my beliefs on others."
Yes, I do feel secure. As far as terroism goes, I wish we did take more effort in securing our borders (I have only heard John McCain support this. I don't know what Hillary or Barack think about it) As far as the economy goes, I still feel secure. I take personal responsibility in saving for the future. I'll make it through the recession just fine.
Mar 15, 2008 at 2:50 p.m.
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DRTalk-I’m not even bashing Bush-I’m saying; any man (or woman) who chooses to place himself into a position of leadership in this country owes us right to feel relatively secure. Not just against terrorism, but that the country will not fall apart any time soon. That goes for the people the president is instrumental in placing in other positions of the hierarchy. No cronyism.
I don’t feel this security; I don’t feel that I can go along with my daily routine without worrying about what’s going to happen next to greatly, and negatively, affect the way you and I live, long term and/or short term.
I know, with human beings in power, it will never be perfect. That should be taken into consideration. And I know there are also lesser and local positions of power-I’m not talking about that. I know that the person in this ultimate office needs to be as perfect in his day to day and long term functions as humanly possible, he needs to almost set aside everything personal (set it on the back burner) to do what’s best for you and me, (dedicate his life, in other words) if he is telling us that he will be the leader that’s best for this country. That’s why he/she goes through such maneuverings to get into office-not just to get there, but to keep those promises. They should ALL live up to those responsibilities. How comfortable do YOU feel?
Mar 15, 2008 at 2:45 p.m.
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Clobber Clinton, Bash Bush.
Mar 15, 2008 at 1:01 p.m.
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Remember when there was a recession during the last year of the Clinton administration? Were you guys bashing President Clinton then? happycamper rebounded from that recession after President Clinton was gone. You guys need to realize that the Fed has more control over the economy than the President does. You guys also need to realize that it's Congress that ultimately determines how much money is spent, not the President.
Mar 15, 2008 at 12:42 p.m.
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I'm not saying that it works every time or even if it's right. Just try it and judge for yourself. Satisfaction guaranteed or your money back (offer does not apply to the federal government).
Mar 15, 2008 at 12:03 p.m.
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Seems to me, this is the second time in two weeks he's acknowledged that. He said on Feb 28 "...no question, we’re in a slowdown." I think he's getting it! On the other hand, his view on the economy “was rosier than that of many economists.”
garyprimer, youve got to let the White House in on your decoding device so they can get it right the first time.
Mar 15, 2008 at 11:12 a.m.
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I doubt if anyone cares what George thinks any more. Although I have a handy little decoding device that makes what the administration says somewhat useful. If the president says that something is going to happen or may happen, it probably won't or something more like the opposite will happen. If the administration says something happened, it probably did not happen. If the president denies something, it probably is true. Apply these principles and see if things make more sense. Just think Bizarro Bush.
Mar 15, 2008 at 9:38 a.m.
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Yes George we will rebound, when your long gone. Thanks!
Mar 15, 2008 at 2:01 a.m.
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idiot
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