Obama to turn attention back to the US economy
WASHINGTON — President Barack Obama is marking the fifth anniversary of the Lehman Brothers collapse by trying to lay claim to an economic turnaround and warning Republicans against moves that he contends would risk a backslide.
His message to the Republicans: don’t oppose raising the nation’s debt limit, don’t threaten to close down the government in a budget fight, and don’t push to delay the health care law or starve it of federal money.
The economic emphasis, after weeks devoted to the Syrian crisis, begins coming into focus in a series of events kicked off by a White House Rose Garden speech Monday. It’s a determined effort to confront public skepticism about his stewardship of the economy and to put down his marker for budget clashes with Congress in the weeks ahead.
The White House argues that a better capitalized and better regulated financial sector is extending more credit, fueling an economy now able to withstand headwinds such as spending cuts and tax increases.
“You can draw this straight line from the health of the financial system to the ways the financial system impacts the economy,” said Jason Furman, the chairman of Obama’s Council of Economic Advisers.
Obama can point to a growing economy, rising housing prices, 35 straight months of hiring, a rebounding stock market and other signs of recovery.
Five years after the federal government stepped in and infused banks with $245 billion in taxpayer money to avert a financial meltdown, the government has been paid back nearly in full.
Sunday is the fifth anniversary of Lehman’s bankruptcy, which was the largest in U.S. history. The firm’s demise marked the beginning of the global financial crisis and was a major catalyst of the financial meltdown.
“We’ve put more people back to work, but we’ve also cleared away the rubble of crisis and laid the foundation for stronger and more durable economic growth,” Obama said during his recent trip to Russia for an economic summit.
Obama intends to highlight that progress to economists and other guests at the White House on Monday, and his National Economic Council is set to release a report detailing the economic advances.
But the public is not convinced that the economy is on the mend. Only onethird say the economic system is more secure now than in 2008, and 52 percent say they disapprove of Obama’s handling of the economy, according to a Pew Research Center poll. There is still plenty of pain to justify their pessimism.
Despite job growth, the unemployment rate remains high at 7.3 percent. Though the rate has fallen, one of the reasons is because some people have dropped out of the labor force and no longer are counted as job seekers. The income gap between the very rich and the rest of the population is the biggest since 1928.
The bank bailout, which started during the closing weeks of President George W. Bush’s term, was highly unpopular but is generally credited with stabilizing the financial system.