Pat Dollard

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NY Times:

In a 35-minute conversation with The New York Times aboard Air Force One on Friday, Mr. Obama reviewed the challenges to his young administration. The president said he could not assure Americans the economy would begin growing again this year. But he pledged that he would “get all the pillars in place for recovery this year” and urged Americans not to “stuff money in their mattresses.”

“I don’t think that people should be fearful about our future,” he said. “I don’t think that people should suddenly mistrust all of our financial institutions.”

As he pressed forward with ambitious plans at home to rewrite the tax code, expand health care coverage and curb climate change, Mr. Obama dismissed criticism from conservatives that he was driving the country toward socialism. After the interview, which took place as the president was flying home from Ohio, he called reporters from the Oval Office to assert that his actions have been “entirely consistent with free-market principles” and to point out that large-scale government intervention in the markets and expansion of social welfare programs began under President George W. Bush.

Sitting at the head of a conference table with his suit coat off, Mr. Obama exhibited confidence six weeks into his presidency despite the economic turmoil around the globe and the deteriorating situations in Afghanistan and Pakistan. He struck a reassuring tone, saying Americans should not be frightened of the future, and he said he had no trouble sleeping at night.

“Look, I wish I had the luxury of just dealing with a modest recession or just dealing with health care or just dealing with energy or just dealing with Iraq or just dealing with Afghanistan,” Mr. Obama said. “I don’t have that luxury, and I don’t think the American people do, either.”

Turning to domestic affairs, Mr. Obama indicated that the end was not in sight when it came to the economic crisis and suggested that he expected it could take another $750 billion to address the problem of weak and failing financial institutions beyond the $700 billion already approved. Maintaining support for the additional costs of bailouts is quite likely to be among Mr. Obama’s biggest challenges, given the anger that many Americans feel toward Wall Street executives who they believe are being unduly rewarded with bailout money.

The budget plan he released last month included a placeholder estimate of $250 billion for additional bank bailouts — an amount that represents the projected long-term cost to taxpayers of a $750 billion infusion into the financial sector — and in the interview Mr. Obama indicated that those figures were what he was likely to seek from Congress.

“We have no reason to revise that estimate,” he said.

Addressing the fear and uncertainty among Americans as job losses mount and stock markets sink, Mr. Obama urged Americans to “be prudent” in their personal financial decisions, but not to hunker down so much that it would further slow the recovery.

“What I don’t think people should do is suddenly stuff money in their mattresses and pull back completely from spending,” he said.

Still, he avoided guessing when the situation might begin to turn around. “Our belief and expectation is that we will get all the pillars in place for recovery this year,” he said. “How long it will take before recovery actually translates into stronger job markets and so forth is going to depend on a whole range of factors.”

He added that “part of what you’re seeing now is weaknesses in Europe that are actually greater than some weaknesses here, bouncing back and having an impact on our markets.”

Mr. Obama’s uncertain forecast about when the economy will begin to rebound contrasted with the projections embedded in the budget he recently released.

That plan rested on the assumption that the economy would shrink by 1.2 percent this year, a projection that many economists, including some in his administration, consider overly optimistic because it implies the economy would bounce back in the second half of this year.

As he settles into his new job, Mr. Obama said he spent much of his time reading briefing books, but still tried to stay in touch by perusing newspapers and thumbing through weekly newsmagazines. But he said he did not watch much television, except basketball games.

Mr. Obama rode to the White House partly on his savvy use of new technology, and he has a staff-written blog on his presidential Web site. Even so, he said he did not find blogs to be reliable, citing the economy as one example.

“Part of the reason we don’t spend a lot of time looking at blogs,” he said, “is because if you haven’t looked at it very carefully, then you may be under the impression that somehow there’s a clean answer one way or another — well, you just nationalize all the banks, or you just leave them alone and they’ll be fine.”