Promoted from the diaries by Jeff. Well done, timetolead.
FOX News Sunday Host Chris Wallace launched this week’s round of talk shows, speaking with Obama Senior Advisor David Axelrod who claimed the stimulus package will improve the unemployment situation, or slow its ascent, but also admitted that aspects of the stimulus may not have an immediate effect.
Next up for Wallace was Google CEO Eric Schmidt and Moody’s Economist.com Chief Economist Mark Zandi. Both were thankful for the Savior’s Obama’s quick action, though Zandi lamented the relatively small size of the stimulus package. Zandi thinks Obama over-estimates its impact, creating 2 or 2.5 million jobs rather than the 3.5 million the administration claims. Finally, Zandi thinks lower mortgage payments through interest rate reductions won’t be enough to bolster the housing market descent and that principal reductions are necessary.
Round Two for Axelrod took place on NBC’s Meet the Press where he repeated many of the same talking points from FNS. Gregory hammered him on the Buy America provisions and Axelrod just repeated, “The language is consistent with our treaties.” Axelrod also affirmed Obama’s desire to maintain a private banking sector.
On CBS’s Face the Nation, White House Press Secretary Robert Gibbs said the President shares the country’s outrage over executive compensation on Wall Street, but when asked whether Obama plans to enforce Congress’s tougher restrictions, Gibbs just replied: Obama is going to sign the bill into law.
Rep. Barney Frank and Sen. Richard Shelby followed Mr. Gibbs on FTN, with Frank offering a meek defense of Geithner’s vague financial rescue plan and Shelby claiming Geithner wasted four hours of the Senate’s time.
Finally, ABC’s This Week consisted of a roundtable of Sens. Charles Schumer and Lindsey Graham and Reps. Peter King and Maxine Waters. The group discussed the stimulus package, with Schumer lauding the bill, Graham and King deriding its partisan taste and lack of tax cuts, and Waters praising the three Republicans who broke ranks to support the stimulus package. Next the group discussed the possibility of bank nationalization, with both Democrats sounding more wary of the idea than the Republicans.
AXELROD ON FNS. FOX News Sunday host Chris Wallace spoke first with Obama strategist and Senior Advisor David Axelrod. Axelrod said to expect the rise of unemployment to be retarded from the stimulus plan.
Still, there remains uncertainty as to what will be retarded more – the unemployment rate or Obama’s bipartisan expectations. Despite garnering just three Republican votes, Axelrod notes a positive effect of just having bipartisan dialogue, something he claims hasn’t happened in DC for the last eight years.
Axelrod expressed the importance of a thriving auto industry and said that all parties involved must agree to significant concessions. When asked about the breakdown of labor union talks, he responded that he wants to speak to the auto industry executives before making a statement.
Despite divulging none of the specific plans on a financial rescue as Obama promised, Axelrod said Geithner is doing a “spectacular job.” Wallace hammers Axelrod on why Geithner still does not have a specific plan after three months in office, but Axelrod takes difference, saying there is a plan in the public-private fund to purchase toxic assets, and promises that “we’ll get this right.”
ERIC SCHMIDT AND MARK ZANDI. Wallace next discussed the effectiveness of the stimulus plan and the banking rescue efforts with Google CEO Eric Schmidt and Moody’s Economy.com Chief Economist Mark Zandi.
Zandi argued that the plan, while useful, is not big enough. He thinks Obama over-estimates the impact of the stimulus package on jobs, estimating 2 or 2.5 million jobs rather than Obama’s estimate of 3.5 million. He also says that the infrastructure spending will take longer than the White House assumes.
Schmidt says that action is needed now and is thankful we passed the stimulus bill because the business community wants something immediate. On the other hand, he favors deliberation over Geithner’s financial market rescue, saying the numbers are so large that he’d rather get the regulation right. Schmidt didn’t elaborate on how the $787 billion of the stimulus package – the largest economic package in US history – is too small to deserve the same level of deliberation as the financial rescue plan.
Zandi said Geithner’s lack of details is disheartening, but the markets will be fine if the White House provides information in the coming weeks.
Finally, Obama plans to announce a $50 billion foreclosure plan in the middle of this week. Zandi said that its not enough to reduce mortgage payments by reducing the interest rate or lengthening the term of the loan, but should focus on writing down the principal of the loan.
AXELROD ON MTP. Round Two for David Axelrod came from David Gregory on Meet the Press. Axelrod repeated his talking points from FOX News Sunday on the next stage of the auto bailout and the stimulus plan.
When asked about the Republican opposition, Axelrod said that Republicans continue to hold to the failed policies of the last eight years that focused on tax cuts. He affirmed his statement on FNS, stating that “Bipartisanship isn’t measured just by votes, but by dialogue.”
Gregory hammered Axelrod on the Buy America provision, particularly on the point that India and China will not be permitted to bid on certain projects. When pressed, Axelrod continued to repeat the same phrase: “The language is consistent with our treaties.”
Gregory asked about bank nationalization, and Axelrod emphasized that while the administration is keeping its options open, their desire is to have a strong private-sector banking system.
Finally, Axelrod said that “to his knowledge,” a disagreement over the politicization of the census was not at the heart of Sen. Gregg’s withdrawal from his Commerce Secretary nomination. Axelrod said that Obama’s third nomination for Commerce Secretary should be coming shortly, though he refused to say if the announcement would come this week, and the administration is still reviewing candidates for the top post at Health and Human Services, a job from which Tom Daschle withdrew his name due to his failure to pay taxes.
Axelrod finished the interview by thanking President Bush, saying he “could not have been more generous in the transition,” though wishing VP Cheney were more accommodating.
ROBERT GIBBS ON FTN. Bob Schieffer, host of CBS’ Face the Nation, spoke first to White House Press Secretary Robert Gibbs.
On why the stimulus bill will be signed in Denver, Gibbs said that its part of an effort to show people across America what is inside the bill and help them focus on the long-term investments in this bill that will help economic growth. He said that the aid given to states and the tax cuts will hit the economy very quickly, while the rest may take longer.
Schieffer asked what sign the administration uses to determine when the economic situation is improving, and Gibbs’ first and only response is jobs. Gibbs notes that we’ve lost 3.5 million jobs during this recession, and he claims this stimulus package will add or save 3.5 million jobs to the economy. He continued Axelrod’s mantra that bipartisanship is more than votes, it’s dialogue, and the administration will continue to reach out to Republicans. Gibbs also repeated Axelrod’s statement on Sen. Judd Gregg’s withdrawal from his nomination for Commerce Secretary, describing the Senator as “independent” and that it may be tough for him to serve in this or any cabinet.
Gibbs said that the President agrees with Congress on the outrage over executive compensation, but when Schieffer asked if Obama will enforce the compensation provisions, Gibbs only responded that he is going to “sign the bill into law.”
REP. FRANK & SEN. SHELBY ON FTN. Schieffer’s next guests were Rep. Barney Frank (D-Mass.) and Sen. Richard Shelby (R-A.L.).
Rep. Frank outlined the importance of making sure the public knows TARP part 2 and the stimulus package are being handled differently than by the Bush administration. On Geithner’s bank rescue plans, Frank said there were two things he didn’t give specifics on – how to deal with toxic assets and foreclosures – and the second will be rolled out this week. Frank insists Geithner was not as opaque as some are charging, and that we should not read into the market decline on Tuesday as an indication of the quality of Geithner’s plan.
Sen. Shelby said Geithner has gotten off to a bad start and wasted four hours of Senate time. He further noted that many banks are like the “walking dead” and they need to be closed now. Shelby concludes by noting his concern over the role of the Fed.
SEN. SCHUMER, SEN. GRAHAM, REP. KING, AND REP. WATERS ON TW. On ABC’s This Week, host George Stephanopoulos held a panel with Sen. Charles Schumer (D-N.Y.), Sen. Lindsey Graham (R-S.C.), Rep. Peter King (R-N.Y.), and Rep. Maxine Waters (D-Cal).
On the fiscal stimulus plan, Schumer says the bill will do three things:
– Keep or create 3.5 million jobs
– Put money in the hands of the middle class
– Build infrastructure
Graham points out that only $3 billion of tax cuts go to small business while 75% of Americans work for small business. King notes that just 18% of the bill is comprised of new tax cuts. Though some, including Sen. Graham, claim 27%, King notes that 9% is from a fix of the Alternative Minimum Tax which would have taken place anyway without the stimulus plan. In addition, he points to a CBO Report that says the stimulus may help in the short term but will hurt the economy more in the long-run than if Obama were to do nothing.
Schumer thinks differently, describing the danger of a deflationary spiral and how the stimulus package helps avoid it.
King expressed outrage that not one Republican in the House could contribute to the bill. Waters and Schumer disagreed, pointing out that the two biggest amendments were Republican amendments ($70 billion for Sen. Grassley’s AMT fix and $30 billion for Sen. Isakson’s tax credit for home purchases, though Isakson’s plan was later gutted).
Sen. Graham came down hard: “If this is going to be bipartisanship, the country’s screwed. There is nothing about this process that has been bipartisan.”
The South Carolina Senator then disagreed with his Governor, who announced he is considering refusing federal bailout money. Graham said that South Carolina should take the money because South Carolina will still have to pay it back. The eight billion dollars that South Carolina is eligible to receive would flow to other states, and South Carolina taxpayers would still foot the bill to pay this money off.
Steph threw out the idea of bank nationalization, and interestingly the Republican Graham seemed more open to nationalization than Waters or Schumer. Waters said that the word nationalization “scares the hell out of people.”
Schumer gave a moderate defense of Geithner’s financial rescue, saying:
– It’s big and bold
– He doesn’t go for the mistake of Paulson – a one-size-fits-all approach that every bank needs bad assets taken which transformed to every bank needs capital injections
– Instead, each bank is inspected and inspectors determine what solution is needed
– TALF: the Fed is using its own capital to bolster lending by going right to the consumer via credit cards, small business loans, etc. This approach seems to work for the commercial paper market and interbank lending, and this approach can be used on a broad basis.
Unfortunately for Schumer, the TALF is not a new concept and was around long before Geithner’s revelations on Tuesday.