Can Obama Fix The Ailing Economy?
SCOTT SIMON, host:
When Barack Obama takes the oath of office in just over three weeks, he will be confronted with the worst economic crisis since the Depression. What will he try to do to improve the economy? And how can that be measured anyway?
President-elect BARACK OBAMA: Whenever I've been asked how I measure the strength of the American economy, my answer is simple, jobs and wages. I know we will be headed in the right direction again when we are creating jobs instead of losing them, and when Americans are gaining ground in terms of their incomes instead of treading water or falling behind.
SIMON: NPR's news analyst Juan Williams joins us. Juan, thanks so much for being with us.
JUAN WILLIAMS: Good to be with you, as always, Scott.
SIMON: And the - reportedly, it's going to be an 800 or more than $850 billion stimulus plan. What have you been able to learn of what some of the details of it might be?
WILLIAMS: Well, this is over a two-year period. But here's the problem. You've already got in place the $750 billion stimulus plan that President Bush authorized, and it's gone back and forth as to how that money is going to be spent. Then, you have additional money now that's been allocated for the Big Three automakers. And on top of that, here comes Barack Obama with a plan that could reach a trillion dollars, Scott. And you know, a billion here, a billion there, pretty soon you're talking a trillion.
And what you've got is a feeding frenzy because it's everybody from the U.S. Chamber of Commerce to the YWCA that wants a piece of the pie. Joe Biden, the vice president-elect, said this week that this stimulus package can't be a Christmas tree, but there's no keeping the kids from clamoring around this tree and saying, wait a second, what about me? So the U.S. Chamber of Commerce wants corporate tax breaks to allow the corporations to survive during a recessionary period.
You've got people who are talking about, and these are the retailers, let's have a tax - federal tax holiday, and a series of them, not just one but several because that will get consumers back in the stores. Then, you've got people saying, wait a second. What about making this a green bill? So we'll do more in terms of new programs, new policies, innovations in terms of green America.
Then you've got people who are doing some really strange things. The zoo and aquarium group who wants some tax breaks for zoos and aquariums, Scott. I don't know if you, Scott Simon, need a tax break, but this could be the time to ask.
(Soundbite of laughter)
SIMON: I could - yes, absolutely. And our cat can use one too.
WILLIAMS: And don't forget, Barack Obama wants to increase the military presence in Afghanistan. That's going to mean more spending in Afghanistan. So he is coming in with a deficit. The deficit's going to grow larger. But at this point, he's got the American people behind him with the idea being we cannot stand deep recession that verges on depression. So the government really has an important role to play here.
SIMON: There are some voices that are questioning the logic of spending a lot of federal money on infrastructure, repair, and restoration. They say that Japan tried that in the 1990s. And whatever it did, it didn't stimulate the economy.
WILLIAMS: No. In fact, what it did was, in the case of the Japanese, led to deflation, where things that were at a certain price one day were actually cheaper the next, and it didn't help. But the key here, and this is an interesting point that you raise, from President Bush's perspective, you've got to have spending that immediately goes into the bloodstream of the U.S. economy. And if it's spending that's on infrastructure, how can President-elect Obama guarantee that the money gets spent quickly, and that it actually is on programs that will lead to quick employment, lower the unemployment rate, and get people back into the stores by boosting consumer confidence?
President-elect Obama's retort to this is he's got the governors on board to say they're going to put the money into programs right away. In specific, think about this, the transit in the country. The trains, the buses, the airports - they're all saying if you give us the money, we can put it to work right away. So that's one area. Secondly, Barack Obama has talked about the schools. And the school systems are saying, yeah. If you give us money, we can improve the quality of schools, and we'll get it going within the calendar year.
SIMON: Before we let you go this week, Caroline Kennedy is reportedly meeting some resistance in her apparent desire to be appointed to succeed Hillary Clinton when she becomes secretary of state. Published reports are that Governor Paterson, David Paterson of New York, is getting just a little annoyed about the public campaign. Was this a done deal that's coming undone?
WILLIAMS: I don't know if I would call it a done deal. That's old Lee Atwater term, Atwater, the old Republican political activist. But you know, what you've got here is a situation where Caroline Kennedy has so many high-powered people in her camp. And she recently got her uncle Ted Kennedy to start getting active in this camp, and she's got Mayor Bloomberg of New York to start getting active in this camp, and pushing on David Paterson.
David Paterson all of a sudden says, wait a second. I was interested. I took the calls. She said she's interested, but she's got to demonstrate her qualifications. She's got to make a case with the Democrats throughout the state. It can't be that it's just a matter of noblesse oblige, and I simply crown her senator from New York. That has rankled Paterson, but it's also rankled rank and file Democrats throughout the state. That's created another problem for Paterson. So it does look like it's unraveling to a certain extent, but not - I wouldn't say it's at the point of being irrevocable, Scott. I would say it's the point where she's got to change the tone of her approach, and she's got time to do it.
SIMON: NPR's Juan Williams. Thanks so much.
WILLIAMS: You're welcome, Scott. Happy new year.
SIMON: And happy new year to you.