Spring Break
President Obama urges spending curbs, hands out $15 billion
Liz Sidoti - Associated Press
Issue date: 2/24/09 Section: News
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"If we confront this crisis without also confronting the deficits that helped cause it we risk sinking into another crisis down the road," the president warned. "We cannot simply spend as we please and defer the consequences to the next budget, the next administration or the next generation."
Obama summoned allies, adversaries and outside experts to a special White House meeting on the nation's future financial health one week after triumphantly putting his signature on the gargantuan spending-and-tax-cut measure designed to stop the country's economic free fall and, ultimately, reverse the recession now months into its second year.
At the same time, federal regulators announced a revamped program to shore up the nation's banks that could give the government increasing ownership. It was the administration's latest attempt to bolster the severely weakened banking system without nationalizing any institutions, which the White House has said it does not intend to do.
Wall Street showed it was unimpressed by all the activity. The Dow Jones industrials were down more than 200 points just before the close of trading.
Obama goes before Congress and the nation Tuesday night to make the case for his budget plans, which the White House is to release in more detail on Thursday.
By the president's account, the administration inherited a $1.3 trillion deficit for the current fiscal year from the Bush administration - that's the figure Obama says he'll cut in half - and the stimulus law, coupled with rescue efforts for ailing automakers, the financial industry and beleaguered homeowners will raise this year's red ink to $1.5 trillion.
The administration hopes to trim the deficit by scaling back Iraq war spending, raising taxes on the wealthiest and streamlining government.
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