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Obama calls for prompt action

President Barack Obama seized on grim economic news to push his economic stimulus bill, urging lawmakers to act boldly and overcome partisan divisions to counter a 'continuing disaster' for Americans.

business Updated: Jan 31, 2009 09:38 IST

President Barack Obama seized on grim economic news Friday to push his economic stimulus bill, urging lawmakers to act boldly and overcome partisan divisions to counter a "continuing disaster" for Americans.

The House of Representatives approved the massive spending bill this week without any votes from opposition Republicans. It now goes to the Senate, where Obama was hoping for some Republican support for the plan he says is crucial to reviving a teetering U.S. economy.

"The recession is deepening, and the urgency of our economic crisis is growing," Obama said Friday. "So this is a difficult moment, but I believe, if we act boldly and swiftly, it can be an American moment when we work through our differences together and overcome our divisions to face this crisis."

The government reported Friday that the US economy shrank at a 3.8 percent pace at the end of 2008, the worst showing in a quarter-century. Obama used the new data to speak of meeting people on the campaign trail and hearing about lost jobs, homes foreclosed, hours cut and benefits slashed.

"It's like the American dream in reverse. These are the families who have, by no fault of their own, been hit hardest as the economy has worsened," Obama said. "They need action now." The Democratic president doesn't need Republicans for his economic plan and other initiatives to clear the

Democratic-controlled Congress, but he has said he wants to get away from politics as usual and introduce a new era of bipartisanship at a time when the country faces two wars and its worst recession in 70 years.

In an unusual move for a president, Obama met separately Tuesday with House and Senate Republicans in a visit to the Capitol's two wings, and agreed to drop two items that had been aggravating Republicans: money to re-sod the National Mall in Washington and to expand family planning programs.

"What we can't do is drag our feet or delay much longer," Obama said.

At the same time, the administration also is looking at how to best use the last $350 billion from the financial industry bailout program approved under President George W. Bush.

Bush administration spending of the first $350 of the bailout package drew heavy bipartisan and public criticism because it went overwhelming to bankers who have not put much of the money into the credit system. Obama only gained access to the second $350 billion with written assurances to Congress that the funds would reach Americans facing home mortgage foreclosures and in need of credit for autos and other big ticket items.

Treasury Secretary Timothy Geithner met Friday with Federal Reserve Chairman Ben Bernanke and other top government officials to develop a plan and improve regulation of the financial system. Obama also used the occasion at the White House to sign three executive orders to favor labor unions, and to formally announce a new White House task force on the problems of middle-class Americans, installing Vice President Joe Biden as its chairman. Separately, Obama spoke with Chinese President Hu Jintao on Friday, promising cooperation in a phone call that broadly covered sensitive trade issues, the global financial crisis and the North Korean nuclear threat.

The U.S. trade deficit with China is the largest ever recorded by the United States with a single country, and it recently has been setting new monthly highs. U.S. manufacturers contend China has slowed the pace of currency reform to cope with a global economic downturn that threatens to harm its export-driven economy. In the phone call, Obama stressed the need to "correct global trade imbalances," said White House press secretary Robert Gibbs. China is the U.S. government's largest creditor. China holds roughly $2 trillion in foreign exchange reserves and surpassed Japan in September as the biggest foreign holder of U.S. Treasury securities. The U.S. trade deficit with China totaled $246.5 billion in 2008 through November.

Among other topics, Hu and Obama discussed Iran, Afghanistan and Pakistan, counterterror activities, nuclear proliferation and climate change.

Among the Bush-era executive orders that Obama reversed was one that allowed unionized companies to post signs informing workers that they are allowed to decertify their union. Critics claimed it was unfair because nonunion businesses are not required to post signs letting workers know they are legally allowed to vote for a union.

The orders Obama signed also will require federal contractors to offer jobs to current workers when contracts change, and prevent federal contractors from being reimbursed for expenses meant to influence workers deciding whether to form a union and engage in collective bargaining.

Obama said the White House Task Force on Middle Class Working Families also would work to raise living standards and create opportunities for the poor, "because they, too, share our American dream."

A Republican senator, meanwhile, came forward Friday and said he was one of the White House's top candidates for the job of Commerce Secretary. Obama's first choice to run the Commerce Department, New Mexico Gov. Bill Richardson, dropped out of consideration amid a grand jury investigation over how state contracts were issued to political donors.

Choosing Republican Sen. Judd Gregg could put Democrats within reach of a 60-person majority in the Senate, which would allow them to override voting delay tactics by Republicans. Gregg would have to resign his seat and his replacement would be appointed by the governor of his home state of New Hampshire, a Democrat who would likely pick someone from his own party.