Obama's Fireside Chat with Leno Gives Reason for Renewed Economic Hope

A BUZZFLASH NEWS ANALYSIS
by Christine Bowman


President Obama struck a breezy tone Thursday night on Jay Leno, as one would expect in a conversation with a late night king of comedy. Even so, there was plenty of substance to take away from the President's remarks, encouraging to a public whose fears and anger have been enflamed by other politicians pushing their own save-my-skin, rather than a save-the-country, agenda.

Obama on Leno

Between the jokes and personal anecdotes, which the public clearly eats up and appreciates, the President spoke many a truth about what's happened in this country economically. He touched on some fixes that he expects to bring the country back, and he conveyed through his demeanor that America's president is not in "deer-in-the-headlights" mode or ready to be Raptured away from the messy here and now. He's on it. The problems can be solved.

In brief, what did President Obama actually say? He directly acknowledged the moral and ethical aspects of the A.I.G. bonuses and Wall Street excesses in general, showing he gets the emotional side of this. The President showed he gets the big picture, too, saying that people took excess risks with other people's money; the economic "growth" of recent years was only "paper money" and thus easily wiped out; there was no oversight; and now America needs to create real growth through new initiatives. He also fleshed out Treasury Secretary Tim Geithner, who has been under attack, saying he's calm, steady, and taking the right steps.

In sum, the President's Leno visit should serve to diffuse some of the "pitchfork" rage and free-floating anxiety that has dominated the airwaves as well as the halls of Congress all week long. If the President's aim is to refocus on the budget bill, then get to work rebuilding, his foray to Burbank will have been all for the good.

Highlights from the transcript:

But there's a moral and an ethical aspect to this, as well. And I think that's what has gotten everybody so fired up. ... the most important thing that we can do is make sure that we put in a bunch of financial regulatory mechanisms to prevent companies like an AIG holding the rest of us hostage. Because that's –- that's the real problem.

The problem is not just what's happened over the last six months. The problem is what was happening for years, where people were able to take huge, excessive risks with other people's money, putting the entire financial system at risk –- and there were no checks, there were no balances, there was nobody overseeing the process.

... The change I'd like to see in terms of tax policy is that we have a system, going back to where we were back in the 1990s, where you and I who are doing pretty well pay a little bit more to pay for health care, to pay for energy, to make sure that kids can go to college who aren't as fortunate as our -- as my kids might be. Those are the kinds of measured steps that we can take. But the important thing over the next several months is making sure that we don't lurch from thing to thing, but we try to make steady progress, build a foundation for long-term economic growth. That's what I think the American people expect.

Here's the dirty little secret, though. Most of the stuff that got us into trouble was perfectly legal. And that is a sign of how much we've got to change our laws -- right? We were talking earlier about credit cards, and it's legal to charge somebody 30 percent on their credit card, and charge fees and so forth that people don't always know what they're getting into. So the answer is to deal with those laws in a way that gives the average consumer a break.

When you buy a toaster, if it explodes in your face there's a law that says your toasters need to be safe. But when you get a credit card, or you get a mortgage, there's no law on the books that says if that explodes in your face financially, somehow you're going to be protected.

So this is -- the need for getting back to some common sense regulations ...

... part of what happened over the last 15, 20 years is that so much money was made in finance that about 40 percent, I think, of our overall growth, our overall economic growth was in the financial sector. Well, now what we're finding out is a lot of that growth wasn't real. It was paper money, paper profits on the books, but it could be easily wiped out.

[Re Geithner] He is a smart guy and he's a calm and steady guy. I don't think people fully appreciate the plate that was handed him. This guy has not just a banking crisis; he's got the worst recession since the Great Depression, he's got an auto industry on -- that has been on the verge of collapse. We've got to figure out how to coordinate with other countries internationally. He's got to deal with me; he's got to deal with Congress. And he's doing it with grace and good humor. And he understands that he's on the hot seat, but I actually think that he is taking the right steps, and we're going to have our economy back on the move.

... In the meantime, we're taking a lot of steps to, for example, opening up -- open up separate credit lines outside of banks for small businesses so that they can get credit -- because there are a lot of small businesses out here who are just barely hanging on. Their credit lines are starting to be cut. We're trying to set up a securitized market for student loans and auto loans outside of the banking system. So there are other ways of getting credit flowing again.

Video link here (25 minutes long).

Comments

oreydc said…
He made a mistake, and admitted to it... I've done that many times... he's a human, not perfect... we need to focus on the economy... don't let this media hype distract us fro mthe real issues...