President-elect Barack Obama pressed hard for his version of an economic stimulus package in a speech at George Mason University Thursday. The former senator from Illinois warned that without the speedy passage of such a plan "our nation will sink deeper into a crisis that at some point we may not be able to reverse."
Obama stopped short of unveiling the details of his proposal, which his staff and congressional leaders continue to hammer out. But he addressed critics directly, dismissing arguments against more government spending: "If nothing is done, this recession could linger for years. The unemployment rate could reach double digits. Our economy could fall $1 trillion short of its full capacity, which translates into more than $12,000 in lost income for a family of four."
In assigning blame for the nation's predicament, Obama reserved his harshest rebuke for Wall Street executives who "made imprudent and dangerous decisions, seeking profits with too little regard for risk, too little regulatory scrutiny, and too little accountability." But he also pointed out the culpability of politicians, banks, and even irresponsible borrowers, who "took advantage of cheap credit to take on debt they couldn't afford."
Speaking in generalities, Obama stressed the importance of investing in infrastructure, alternative energy, education, and health care. He admitted that the already-passed, high-cost government bailouts have not yet proved successful in resurrecting the economy. But he defended a continuation of that strategy, nonetheless: "It is true that we cannot depend on government alone to create jobs or long-term growth. But at this particular moment, only government can provide the short-term boost necessary to lift us from a recession this deep and severe. Only government can break the cycle that is crippling our economy, where a lack of spending leads to lost jobs, which leads to even less spending, where an inability to lend and borrow stops growth and leads to even less credit."
Many fiscal conservatives from both parties have resigned to accept such need for government involvement, but also stress tax breaks as a means to ignite long-term private sector growth. Obama said that his plan would give $1,000 tax cuts to 95 percent of working families. But he made no mention of cutting business taxes.
In fact, the overall trajectory of the speech mirrored much of Obama's campaign rhetoric, suggesting the president-elect intends to use the current economic crisis to fast-track the imposition of his new vision for America. "It's a plan that represents not just new policy, but a whole new approach to meeting our most urgent challenges," he said. "There is no doubt that the cost of this plan will be considerable."