From Jake Tapper and Sunlen Miller
Before the Business Roundtable Thursday afternoon, President Obama told the assembled CEOs that the nation "cannot go back to endless cycles of bubble and bust. We can’t continue to base our economy on reckless speculation and spending beyond our means; on bad credit and inflated home prices and overleveraged banks. This crisis teaches us that such activity is not the creation of lasting wealth. It is the illusion of prosperity, and it hurts us all in the end."
President Obama's remarks were made in defense of the hundreds of billions of dollars to be spent on infrastructure, education, energy and health care from the $787 stimulus bill, as well as his $3.6 trillion budget proposal.
The "problems in the financial markets, as acute and urgent as they are, are only a part of what threatens our economy," Mr. Obama said. "We must not use the need to confront them as an excuse to keep ignoring the long-term threats to our prosperity: the cost of our health care and our oil addiction; our education deficit and our fiscal deficit."
The president said he wasn't "choosing to address these additional challenges just because I feel like it, or because I’m a glutton for punishment. I am doing so because they are fundamental to our economic growth, and to ensuring that we don’t have more crises like this in the future....I didn’t come here to pass our problems on to the next president or the next generation – I’m here to solve them."
Obama mentioned what he called the "spirited debate" that has emerged in Washington, "a debate over what it will take to ultimately break the back of this recession and strengthen our economy for the long run. It's a debate that centers on one key question: Does the greatest economic crisis in our lifetime warrant extraordinary action to deal with the array of challenges we face? Or should we limit our efforts and try to deal with them incrementally or one at a time? "
Obama spent much of his time before the CEO’s defending the choice to move ahead with the "extraordinary action" that he outlined.
Speaking to 67 of the top CEO’s in the country – President Obama defended the tax portion of his budget - fully well knowing that many of the wealthy CEO’s would not be in the range to benefit from his tax cut. Obama reminded them that their businesses will be boosted by middle class American having more to spend into their businesses.
"At the end of 2010, 97 percent of all taxpayers and 97 percent of all small businesses will still not see a tax increase, 97 percent. In fact, 95 percent of all working families will receive a tax cut so they can buy some of the wonderful products that you make."
And for the top 3 percent of taxpayers, which Obama joked includes some of the people in the room, "the top tax rate across the board will still be lower than they were during the prosperity of the 1990s, still be lower than they were during the Clinton era."
Obama expressed time and time again – as he spoke with the CEO’s - that he believes in the ability of the market.
"Government has to intervene in a crisis, but the goal should always be to right the ship and let private enterprise do its magic."
Obama said he is confident in the nation's long term prospects but expressed a little humorous frustration in the day-to-day attention spans of a "rapid-fire information-rich environment" where every move he makes as President can change outlook.
"That makes for volatility in confidence, right? Smidgen of good news, and suddenly everything's doing great. Little bit of bad news, ‘oooh, we're -- we're down in the dumps’. And I am obviously an object of this constantly varying assessment. I'm the object-in-chief ---- of this varying assessment," he said laughing.
The self described Object-in-Chief was also said to be the "Confidence-Builder-in Chief" by a participants in the room. His response about his confidence also revealed that he does not think things are as bad as people think with the economy.
"People ask me sometimes, 'Well, you seem like a pretty calm guy. How do you do that?' I say, 'Well, look. I don't think things are ever as good as we say, and they're never as bad as they say.' And things two years ago were not as good as we thought, because there were a lot of underlying weaknesses in the economy. And they're not as bad as we think they are now. We're going to restore confidence by, in a very systematic way, getting this financial system fixed."
Obama brought up the fact that his administration has undergone criticism for tackling problems like energy and education instead of paying more attention to the economy. He used his recently submitted budget proposal for example.
"I think there's some people, when we issued the budget, they said, ‘Boy, these Obama people, they're really ambitious. They're taking on health care; they're taking on energy; they're taking on education. Don't they know that there's this bank crisis right now? We've got to do one thing at a time.’
Relating his budget to the long-term business models of the CEOs in the room, Obama defended himself his budget’s approach, "Look, the budget document that we put forward is a 10-year document. We are like any organization. Just like all of yours, we have to do long-term planning even as we're addressing short-term issues. If we don't do the long-term planning, then we end up having more short-term issues again and again and again and again."
Obama said that they don’t anticipate that every piece of healthcare or energy reform will get done this year – but the structure will be laid out to be implemented over time.
"You know, under the cap proposal that we have, it wouldn't even start until 2012, where we're going to be out of this recession or you'll have somebody else speaking to you in 2013," Obama joked to a healthy dose of laughter from the room.
- Jake Tapper and Sunlen Miller