By Michael D. Shear
Washington Post Staff Writer
Saturday, September 12, 2009
A top economic adviser to President Obama began a concerted White House effort on Friday to claim credit for the improving economy, declaring that the turnaround is "not, in our judgment, an accident."
Previewing a speech that Obama will give on Wall Street Monday, Lawrence H. Summers compared the government's actions to a successful but evolving response to a natural disaster.
"We are making a clear transition from rescue as the priority of public policy to sustained recovery," he told reporters in a briefing Friday afternoon. "We have moved back from the brink of financial catastrophe."
Summers said the Obama administration can "take real satisfaction" from what he said is movement toward recovery but quickly added that the White House recognizes the depth of economic hardship that remains a legacy of last year's collapse.
"The level of unemployment is unacceptably high," he said. "We will not make the mistake of prematurely declaring victory or prematurely withdrawing public support for the flow of credit. . . . It is a mistake that we must not make today."
Even as Obama ratchets up the fight over health care, administration officials are eager to keep the country's focus on the modest improvements in the economy: The stock market is up more than 15 percent since the beginning of the year, interest rates have fallen and banks are at less risk of default. On Thursday, the White House credited its $787 billion stimulus package with saving or creating more than 1 million jobs since its passage in February.
Republicans have increased their rhetorical attacks on the administration as the unemployment rate has continued to rise and the promise of economic growth has failed to materialize.
House Republican Whip Eric Cantor (R-Va.) issued a statement on Thursday criticizing the president and his aides for offering happy-talk about the economy while many people still suffer.
"The American people don't understand why the Administration continues to praise itself while workers keep losing their jobs," Cantor said. "Since President Obama took office, over 3 million Americans have lost their jobs, including 2.5 million people since the President signed his stimulus bill."
White House officials hope to use the Monday anniversary of the collapse of Lehman Brothers to renew their push for reform of the country's system of financial regulation.
There has been some resistance in Congress to some of the administration's proposals, including a plan to give the Federal Reserve broad authority to serve as the "systemic risk regulator" for a wide swath of financial institutions.
On Friday, Summers indicated a bit of room for negotiations on the specifics of the administration's plan.
"We've seen the Fed as a natural place for systemic regulation," he said. "Just how the Fed will interact with other regulators -- just precisely what the configuration will be -- is obviously going to be a subject for discussion."