President Obama told the American people last night that the country is in trouble, but he vowed that the United States would recover and emerge stronger than before. In his first address to a joint session of Congress (don't call it a State of the Union), Obama gave a "sobering speech" but also "sought to spark optimism and confidence in his plan for recovery," notes USA Today. The Wall Street Journal declares that Obama "straddled the divide between fear and hope" throughout his speech, and the New York Timesdescribes it as a mixture of acknowledging the seriousness of the economic problems "with a Reaganesque exhortation to American resilience." The Washington Postpoints out that Obama's optimistic tone had "been absent from his speeches in recent weeks," a fact that many, including former President Bill Clinton, had criticized. In what the Los Angeles Timescalls "a significant departure from the George W. Bush years," Obama barely mentioned foreign policy and focused squarely on the economy and other domestic priorities.
In his 52-minute speech, Obama declared that the "day of reckoning has arrived" and called on Americans to "take responsibility for our future once more." He said it was time to bring an end to the era where people inside and outside Washington avoided making tough decisions in order to maximize short-term gains. He never implicated his predecessor by name, but the message was clear enough when he declared that his budget would reflect "the stark reality of what we've inherited." Obama pointedly noted that everyone in Washington, "and that includes me," will have to sacrifice some "worthy priorities" in order to deal with the burgeoning deficit. But he insisted that getting out of the current mess won't be possible unless the country starts to deal with some long-term issues, such as health care and energy policy.
Obama acknowledged the anger that many people feel over the costly bailouts of banks and automakers but warned that the "cost of inaction will be far greater." He also warned that more money would probably be needed but said that the U.S. economy won't recover until the country's financial system has stabilized. "It's not about helping banks," he said, "it's about helping people." Obama once again repeated that he plans to cut the deficit in half by the end of his first term but made it clear that won't stop him from pursuing an ambitious agenda that was at the centerpiece of his campaign, and yesterday he spent lots of time talking about energy, education, and health care. But he mostly stuck to broad strokes and didn't reveal any significant details about his policy initiatives or how he plans to cut the deficit beyond repeating the tired mantra about how his administration is going "line by line" through the federal budget to find wasteful and ineffective programs.
Inside, the WSJ's Gerald Seib notes that Obama's address was directed more at regular Americans than at the lawmakers who were sitting in front of him. Ultimately, the president "faced a choice between making his big speech a Bill Clinton-like policy manifesto or a Franklin Roosevelt-like fireside chat," writes Seib. "He chose the latter." The LAT declares that Obama "tried to strike a balance that escaped" former Presidents Herbert Hoover, who was criticized for being too optimistic, and Jimmy Carter, who was panned for being too negative, "while also capturing some of the inspirational oratory typical of Ronald Reagan."
Some have warned that Obama runs the risk of not getting anything done by trying to do too much, but the president made it clear last night that he intends "to use the urgency of the moment and his considerable political capital to ... transform the way politics is done," says the WP in its front-page analysis. USAT notes that an already-difficult challenge "is all the greater because he's presiding over an incomplete government." Plus, it seems unlikely he'll get much support from the other side of the aisle. The NYT points out that "the vision he articulated was in some ways anything but unifying." Obama proposed "a more activist government than any other since Lyndon B. Johnson," and some of his most important ideas "represent a philosophical agenda that strikes at the heart of the other party's core beliefs."
Obama wasn't alone in dishing out hope yesterday. Earlier in the day, Federal Reserve Chairman Ben Bernanke told a Senate panel that the economy could end its contraction by the end of the year, and 2010 could be a "year of recovery." Of course, his "carefully hedged comments," as the WP puts it, made it clear that it all depends on whether the government succeeds in stabilizing the financial system. But that sliver of optimism was enough for investors. Markets soared even as new figures indicated that consumer confidence reached its lowest level in more than 41 years. Bernanke also helped the markets by playing down the prospect that the government is about to nationalize major banks, saying he doesn't see a particular need for that extreme course of action just yet. "We can work with them now to get them to do whatever is necessary to restructure," he said. "We don't have to take them over to do that."
The WSJ points out that the low consumer confidence is just one sign of how "the recession and financial crisis are feeding on each other in ways that worsen both." In what is being called an "adverse feedback loop," the recession is causing more companies and individuals to default on their loans, which is hurting banks in ways that are unrelated to the mortgage-related programs that began this national nightmare.
In a front-page piece, the WSJ takes a look at the anything-but-sunny relations between Citigroup and the government. At a time when the government is considering taking a larger stake in Citigroup, it seems clear that their relationship "is off to a very rocky start," declares the WSJ. Executives complain that they're trying to help Citigroup come back from the brink while also pleasing federal officials, but they're getting mixed messages. At times it seems the government wants to micromanage Citigroup's operations, but then ignores it for long periods. "In trying to be neither an active nor a passive investor, the U.S. is directing the business without a firm strategy or particular expertise," declares the WSJ. Privately, federal officials describe the banking giant as "unmanageable," while executives complain there's no one person or federal entity that is in charge of overseeing Citigroup that they can go to with questions or concerns. In a particularly poignant image, one "person close to the company compared the government's role to the sword of Damocles, an ever-present evil hanging over their heads," reports the WSJ.
The NYT fronts, and the LAT goes inside with, word that Obama will soon announce a 19-month withdrawal plan of American combat forces from Iraq. The plan would order combat forces out of Iraq by August 2010, which represents a three-month extension of the 16-month withdrawal timetable that Obama outlined during his campaign. The shift is being billed as a compromise between Obama and military leaders who wanted a 23-month time frame for withdrawal. Obama still plans on keeping a "residual force" in Iraq that the LAT says could consist of up to 50,000 soldiers, but the number is far from clear.
The WP fronts, and the LAT goes inside with, a new study that suggests women should reconsider the idea that one drink a day is good for their health. The study, conducted on more than 1 million middle-aged British women, found that just one alcoholic drink a day increases the risk of several types of cancer by 13 percent. While previous studies have shown members of both sexes can cut the risk of heart disease with one drink a day, the new findings suggest that, at least for women, "the risk of cancer outweighs that potential benefit," notes the LAT.
Showing that the entrepreneurial spirit can trump any recession, the LAT takes a look at a 29-year-old who decided to bottle New York City tap water and sell it under the brand name Tap'd NY. The idea isn't as crazy as it sounds, considering that New York has one of the nation's healthiest water supplies, and it seems like the company is taking off. Promoting it as the "anti-bottled-water bottled water," the product appears to have hit a nerve with New Yorkers who are guilty about buying bottled water from far-away places. The fact that it's a bit cheaper doesn't hurt either.