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February 17th, 2009
09:50 AM ET

Obama Faces Growing Economic Storms

Program Note: Tune in to hear more from David Gergen tonight on the AC360° at 10 p.m. ET. And watch him on the CNN Money Summit on Friday at 11 p.m. ET.

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David Gergen | Bio
AC360° Contributor
CNN Senior Political Analyst

This is a good moment to look ahead at the extraordinary challenges facing President Obama and how he and his team will try to solve them. Based on what has appeared in the public press as well as personal conversations in Washington, here is my best take:

In winning passage of the stimulus package, the President managed his way successfully through his first storm but he and his team recognize there are darker, more treacherous ones ahead. The economy has been deteriorating at such an accelerating rate in recent months that the administration had to expand the size of the stimulus package far beyond what they originally envisioned. If the economy continues to sink – and signs around the globe point in that direction – even this package will not be big enough. And economists of almost every stripe complain that its impact was weakened during the political wrangling.

For now, administration insiders believe that the package will begin to help quickly in saving jobs that might have been lost (e.g., with infusions of fresh money, state governments will not have to fire as many people). But insiders are not really expecting the stimulus to start creating many new jobs - or at least those that will show up in statistics – until early next year. Moreover, they recognize that they may have to come back for additional installments of stimulus in the months ahead. No future package should be as large, but there is likely to be a clear need to expand unemployment benefits again. So, look for more stimulus down the road – we just don't know how much.

Here, in a nutshell, is a take on other issues rushing at the administration:

The auto crisis – As General Motors and Chrysler send their reports to Washington, scheduled today, there is a sense in the administration that no good choices lie ahead. The options are likely to boil down to a big, new infusion of money from the feds or a structured bankruptcy of the companies. Either way, there will be pain for auto workers, creditors, shareholders and others. In contrast to a few weeks ago, when the Obama team seemed extremely reluctant to allow a structured bankruptcy, I sense that they may be more open to the idea today. The fact that the President did not appoint a "car czar" suggests that they are not looking to have the tough medicine administered by the administration – as Democrats, do they really want to slice wages and close plants? – but rather, they might prefer to have it done by the courts or some other independent force.

The housing crisis – The President is scheduled to announce a relief plan this Wednesday in hard-hit Phoenix. The first question will be whether it has enough details to judge what it will do – something sadly lacking in the bank bailout "plan" announced by Treasury Secretary Geithner a few days ago. (He got badly hurt in that episode but can still rehabilitate the policy and himself.) The other issue is how the administration will provide mortgage relief to homeowners – if it is through cash infusions, that will be expensive, but if it is through judicial interventions, that could send up interest rates. My bet: more money. One good thing about a housing solution: it adds to stimulus.

The banking crisis – This is the lollapalooza. The cost of a banking bailout will be at least three times as big as the stimulus package. In the estimate of many experts, much of the banking industry (not all) is insolvent – its liabilities now exceed the value of its marked-down assets. So far, the government is ducking the question of how to get those toxic assets off the books of the banks. There is a growing sense in Washington and on Wall Street that we are moving toward nationalization of some major banks. That's not what the administration wants, but experts believe that is where we are heading – and overseas, there is a growing chorus that the sooner the better. This is a very, very tough problem for the administration.

Federal deficits – Toward the end of February, the administration will announce its budget forecasts. My bet is that the predicted deficits will be eye-popping in size and longevity. That is partly because the Obama team will introduce more truth in budgeting, showing – unlike the Bush administration – what the real costs will be of Iraq and Afghanistan as well as other looming domestic initiatives. The White House clearly wants to move full steam ahead on health care reform and reform of energy policies this year – both costly. The hard political question in the country will soon be: how much more can we really afford? Is bailout fatigue going to set in, too?

Nobody knows the answers to all the questions just over the horizon. What insiders do recognize is that President Obama will need the political skills of an FDR and the tenacity of a Lincoln to help the country navigate through the storms that are coming.


Filed under: CNN Money Summit • David Gergen • Economy
soundoff (225 Responses)
  1. Floridavoter

    Marty R, financing stimulus through gas taxes would be a great idea except the tax would counteract the stimulus. Government spending is what the doctor ordered, alas, and although many people don't like the medicine we'll have to put off getting serious about the deficit until after we've cleaned up the current mess (but then we'll really have to do it). Higher gas prices would indeed be useful, not just for the competitiveness of the auto industry but also for making headway on global warming and energy independence. The way to do it would be to have an offsetting tax break so it would be revenue neutral, otherwise it would be self-defeating. Think lower payroll taxes by an amount equivalent to the increased cost of driving for the average person.

    February 18, 2009 at 10:36 am |
  2. Als

    The governor of California-Rep this state is a disaster. California elected a actor to run their state. This will continue to happen when you do not get people who are qualified for the job. In my state the recovery bill will create 70,000 new jobs. Rep are the ones who should want to keep education because under their leadership disaster happens. Americans need to be able to compete in the 21st century. My nephew speaks Chinese and travels over seas. He is a honor student. Rep are out of touch.

    February 18, 2009 at 10:28 am |
  3. Gene Penszynski from Vermont

    P.S. BTW whatever happened to the release all that great 'American Entrepenurial innovation' that the Bush tax cuts were to supposed to provide to close all our trade imbalances with the COMMUNIST Chinese and SOLCIALIST Indians ???? Seems to me that all that forgone tax money went DIRECTLY to the COMMUNIST Chinese and SOCIALIST Indians to put their SLAVE LABORERS to work for SLAVE WAGES while outsourcing good High Paying American jobs and American Infrastructure to them putting MILLIONS of American either out of work or working for McDonalds and Wal-Mart in DEAD END jobs at Poverty wages.

    February 18, 2009 at 10:20 am |
  4. Gene Penszynski from Vermont

    Well Ab. If we still MADE things here we just might have something to to export other than raw materials !

    February 18, 2009 at 10:13 am |
  5. Gene Penszynski from Vermont

    For the life of me I don't know why you won't post this. Could it be that I've hit a nerve here ?

    Just remember that what put the final nail in the last Hooverian/Republican DEPRESSION was the Mother of All ‘Stimulous Packages’ none other than the Astronomical Government Spending and the Massive Tax Increases of World War II. It’s going to take spending and selected tax increases of that magnitude to get us out of the newest Hooverian/Bush/Republican DEPRESSION as well.

    February 18, 2009 at 10:11 am |
  6. JJ McCanna

    Copies to The White House, Sen Reid, MSNBC, CNN

    One of my ideas for job creation:

    I want the US to run 3 to 4 lines of 30” diameter steel pipe from the Pacific Ocean to the Nevada Nuclear Test site where a desaltation plant, a nuclear power plant, and 6 to 12 each multi story hydroponic garden and fish life tank skyscrapers will be constructed. My plan is funish all of Southwestern US with electricity, water and food.

    This plan will require engineering piping design, environmental planning, thousands of tons of steel, Nuclear Power Plant engineering and design, desaltation plant design, and hydroponic skyscraper design.

    The fish life serves two purposes, fertilizer for the plant life and food for the population. These skyscapers can be researched in Popular Science magazine archieves since the idea is many years old.

    I won’t elaborate here, but this idea will create hundreds of thousands of new jobs and could be duplicated in 3 to 4 other sections of the country as well as in Africa and other areas of the world where populations are suffering from drought and starvation.

    If you carefully analyze this idea you will realize that jobs from just about every field of endeavor will be created, skilled as well as unskilled labor, light construction as well as heavy construction, engineering, science, physics, trucking, as well as manual labor. You name it opportunity for all is involved.

    JJ in NV

    February 18, 2009 at 9:54 am |
  7. Ab

    I am in export business since last 15 years. There are always ups and downs, but now it is down and more down. Business has fallen by 80%. somehow managing so far. But now it is going to be the THE END. What a sorry state of affairs. Could not have imagined this even in dreams. I think the root cause of all this is too much imports. If our imports of manufactured products is less even by 25%, all our problems will get diminished greatly.

    February 18, 2009 at 9:21 am |
  8. Black Saint

    We are now seeing that the Illegal Aliens can not only impact this Nation but the global economy as well. Many of the Sub-Prime loans & defaults were to Illegal Aliens that started the unraveling of the Global Economy! Just like our Declining standard of living, Bankrupt Hospitals, Failing Schools, Welfare costs, Identity fraud, Welfare fraud, Voter fraud, Gangs, Crime, Crowded prisons, Destroyed communities, Exploding population, Congested roads, Pollution, Insurance costs, Balance of payments, (Imported oil etc. to support the illegal alien population) Trashed Constitution and the Rule of Law, they have now spread their negative impact & misery across the Globe.

    It looks like with American heading into a very bad recession or more likely an depression, The 100,s of billions the Illegal Aliens are costing American tax payers for free medical, schooling, welfare etc. needs to be spend on American citizens, not invading criminals from third world counties, plus the 40 to 50 billions remittance by Illegal aliens needs to stay in the country to simulate this economy and force Mexico & Latin American to address their problems!

    Last but not least, all Nations immigration policies are by design & intent suppose to enhance the Nation and its Citizens that immigrated legally, obeyed the laws, paid the taxes, fought the wars and built the nation! Clearly for the reasons numerated above Amnesty for the invading horde of uneducated peons and criminals does not meet this criteria.

    They certainly must not be used to further the political careers and lust for power of Corrupt/Pandering Politicians that refuse to abide by Article IV, Section IV of our Constitution against Invasion, Enforce our Immigration Laws, or Honor their Oath of Office!

    February 18, 2009 at 9:06 am |
  9. Michael C. McHugh

    I really think the government urgently needs to consider having the Federal Reserve transfer funds directly to cities and states facing bankruptcy. We do not need budget cutbacks in this crisis, but expansionary, Keynesian policies at every level–including the global level once the IMF is reformed.

    I also think that the best way to save Social Security and expand Medicare to cover those with no jobs or no private health insurance will be to have the Federal Reserve directly subsidize the Social Security Trust Fund.

    To create jobs, the Fed could also fiance a National Development Bank or in infrastructure fund that could be shared out to the states based on population. It could also finance national projects like a high speed rail network that would keep this public works spending going for as long as we need–and it’s going to be years.

    We might also consider setting up some kind of National Housing Bank, where the federal government can just write down or write off millions or mortgages and give homeowners new ones on much more liberal terms.

    Now, if we have trillions of of Federal Reserve money going to big banks and corporations, so all I’m suggesting is that we use the Fed more creatively to help working class and middle class Americans in this crisis, help them with pensions, housing and medical care, and also prevent the states from going broke.

    If the big business interests are getting a blank check here from the Federal Reserve, then it’s only just that the common people get something out of it, too.

    February 18, 2009 at 8:33 am |
  10. Edward Holman

    The Scorpion and the Frog is a fable about a scorpion asking a frog to carry him across a river. The frog is afraid of being stung, but the scorpion reassures him that if it stung the frog, the frog would sink and the scorpion would drown as well. The frog then agrees; nevertheless, in mid-river, the scorpion stings him, dooming the two of them. When asked why, the scorpion explains, "I'm a scorpion; it's my nature."

    Congress saw their chance and passed the Mother of all spending bills, even if it eclipses the taxpayers’ collective ability to repay it.

    I believe that it is a very real possibility that Joe and Jane will quickly come to the conclusion that they must, out of self-preservation, nullify the bail-outs, stimuli and the intent of Congress thus, collapsing the middle class. Productive Americans are disinclined to pay into a stupefying taxation scheme that is required to support this mind-numbing spending spree.

    We cannot pay it back.

    February 18, 2009 at 8:07 am |
  11. john b

    What is really wrong with this country is that so many Republicans submitting there comments seem to be blaming Obama and the Liberals for this mess we are in. Will they ever admit they were wrong about Bush and their own party?

    February 18, 2009 at 7:54 am |
  12. jeff

    who is this clown that keeps saying give every american one million dollars to save money? that does not equal three hundred million dollars, that equals three trillion dollars 3,000,000,000,000.
    seriously...

    February 17, 2009 at 9:16 pm |
  13. Ray

    What a Joke
    The people who voted for this person are idiots, two years of the demorcats in the house and senate wow we never saw this coming!!!!!!! Oh well the great one will save us, going to be alot of crow to eat by the idiots that support this mess. Give it all to welfare lazy people and illegial's as Nancy said they deserve an American life. One day you young people will have to grow up and pay for this mess, the joke is on you. HA I know the truth will come out, get ready to eat that crow!!!!!!!!!!!!!!!

    February 17, 2009 at 9:06 pm |
  14. Rachel Johnson

    I have not yet heard anyone on CNN address the fact that the bail out that Congressman Eric Cantor signed, his wife's company received a great deal of money. Is it me or is this a conflict of interest? The fact that Eric Cantor is being so vocal about the Obama administration bailouts is crazy.

    February 17, 2009 at 9:06 pm |
  15. Eric

    The main problem with the stimulus is that it isn't big enough. Also, too many useless tax cuts. Those can wait.

    Although, politically it's great that Obama just signed the biggest tax cut ever.

    February 17, 2009 at 8:41 pm |
  16. Joe from PA

    Xtina

    Mr. Obama is another story.
    We needed to spend some money to keep the country out of bankruptcy, but looks to me that he pushed through all of the pet projects that he would have had trouble pushing through later.
    Since we are using a trillion dollars now that we don't have and at least another trillion this year for the banks and car companies and hundreds of billions more for Bush's Iraq war and Obama's Afghanistan war.

    Deeper and deeper we go into the sink hole.

    Hoping that millions of Americans will stand up and force the right programs.

    February 17, 2009 at 8:38 pm |
  17. danielle

    The government can continue to throw money into the banking system, car industry and anything else that may come to mind. Until Americans can pay back our school loans, morgage payments, and everyday bills the United States will never get back on its feet. These are common rules of supply and demand. Americans will continue to hold back on buying, until we feel secure. As we have all seen the American consumers run this country. Some of that stimulas package should have come back to the Americans immediately, it will not help us next year, most of us will have already lost the shirt s off our backs by then. Not good enough for those in need of help now. 787 billion dollars, and not a penny to help U.S citizens now.

    February 17, 2009 at 8:38 pm |
  18. wayne

    Stimulus Plan? – It is a package of special interest pork. Primariy designated to make whole the bankers who managed to loot their vaults and now require a cash infusions. Fear not – This is not the end of Capitalism. It is the end game of Socialism. Capitalism was derailed in 1913 when the Private "Federal" Reserve was created by bankers and then Capitalism was completely shut down when FDR created his New Deal which was a raw deal. By 2016 we will have the begginings of Capitalism once again once this nonsense going on is purged like venom. Now you folks will find out what Socialism on seroids is really like. You won't like it.

    February 17, 2009 at 8:35 pm |
  19. KP

    Unbelievable workload indeed...

    Mr. Gergen, I really wanted your opinion on this specific things.
    In House, the stimulus bill passed with 246 Yea and 183 No (57.3% Yea to 42.7% No)
    In Senate, the stimulus bill passed with 60 Yea and 38 No (61.2% Yea to 38.8% No)

    This means that the bill has MORE SUPPORT in the senate than the House floor. Can someone please tell me why all media is talking about how the bill sneaked by in Congress when the NO votes were 43% and 39% approximately – meaning way less than the YEA votes.

    Seriously – I understand the filibuster proof majority, but that is not a standard by any means. We focus on 50% + 1 as the majority. 60-40 split is a blow out. I really hope that Media starts addressing it that way.

    February 17, 2009 at 8:22 pm |
  20. xtina, chicago IL

    sory Joe from PA. If trillion dollar deficit is the wrong way to go, why did Obama add to the deficit with his spending bill? Isn't he doing the same thing the "liberal " George Bush did?

    February 17, 2009 at 8:14 pm |
  21. Patrick Manley

    Why is it so hard for the Aministration to simply temporarily acquire the toxic assets of each and every bank so each can get back to doing what they do best: Loan money to fund growth and investment.

    As long as the President continues to procrastinate, the financial institutions, and the economy, will continue to deteriorate.

    Let's face it, the bad loans are going to be there regardless of who owns them. We need to insure that not one more bank fails and that every bank can conduct business without fear of failure. This needs to be done now, today, tonight or first thing in the morning.

    This country needs bold actions, not cautious plans.

    February 17, 2009 at 8:11 pm |
  22. sam, tn

    I don’t understand why the republicans are spending all their time talking about whats wrong with the presidents stimulus bill. And they don’t have any better ideals to stimulate this economy, but they have better ideals to stimulate their pockets. The president told congress in so many words if anyone had any better ideals to stimulate the economy then lets hear it……silence. And while citizens are still loosen their jobs and homes, republicans are fighting with a president that they clearly don’t like for whatever reason. And remember the quick jolt that president talked about a few months ago, hellooooo. STIMULATE, STIMULATE, not fix, stimulate. In others words get the ball rolling, duhhhhhhh. The republicans where also silent when the previous administration give the first half of the bailout money to wall street. Now congress wants to fight with the our currant administration, o please. I want to take all the republicans by the hand and say, “come on little boys and girls lets play nice because this is clearly bigger than you all”.

    February 17, 2009 at 8:10 pm |
  23. Anquisha Cologne

    Oh thank you lord Jesus for President Obama. He is our Hope and prayers will be answered. This Stimulation is going to work because We as Americans need it to work and Obama said, "We are the rocks of this nation" and we will not be broken by this Financial mess that George Bush and them Triflen Republicans put on us. I already went on the Whitehouse.gov website and there plain as day you can see exactly what our taxpayer dollars is going to help create on jobs and tax reliefs. You can even apply for some stimulation money too and give feedback on your stories of how the stimulation helped you to recover and can we recover? As one famous President is fond of saying, YES WE CAN and thanks to the best President that this country has ever known, YES WE WILL.

    February 17, 2009 at 8:04 pm |
  24. Joe from PA

    Tammy
    Understand your comments, but can not agree.

    I have worked and paid taxes for 40 years. For most of that time, 35% of my income went to federal, state, local, and sales taxes.

    In spite of this, managed to buy a home, have a nice car, and a couple of laptops.

    Worked 50 to 60 hours a week for most of my working life.

    Did what I was advised to do...Maxed out 401Ks, fed IRAs, managed some personal savings.

    Then George Bush and his Congress let us all down.
    $11 trillion national debt that our great grand children will still be paying for in the 22nd and 23rd centuries.

    SEC, FDIC and other institutions that did not follow the law and let crime in the financial industry run wild.

    Like many Americans lost about 30% of my retirement savings, and will now live like some people feel we should, "third world"

    We have been screwed.

    February 17, 2009 at 7:51 pm |
  25. jarrod Newark, Ohio

    these auto maker's need to hit the highway with there overpriced junk and stop spending taxpayers dollars to keep the lights on and their wallet and purses full... if those people really truly want to keep thier job get rid of the union and thier fees lower thier wages and stop the big corporate bonuses and when the company does good they all do good..

    February 17, 2009 at 7:51 pm |
  26. Rina Owen

    CNN- you guys rock!!

    February 17, 2009 at 7:50 pm |
  27. Rina Owen

    My husband and I are both unemployed, actively looking for work, it's hard to find anything. Public assistance is not for everyone to qualify. However, I have a lot of faith in our new president. Personally, I think the U.S. government should just "forgo" peoples problems during this crisis. Just this once. The government is bailing everyone else out so the people should be forgiven for their mistake--basically, start over. These are trying times and it's getting difficult creating worry, health problems, future, etc. However, I have a lot of faith in our new president. As far as president Obama, I think we need to give him a chance. He is trying and he is human. He's got a world to deal with next to God!

    February 17, 2009 at 7:44 pm |
  28. Annie Kate

    I'm not sure anyone will go for more stimulus packages before this one shows any sign that its worked or not. You stated this one may save jobs that would have been lost – how do you prove that? Anyone can say it but how do you know that a job would have been lost? Sounds like smoke and mirrors to me.

    Some of the features in the stimulus package (like lengthening unemployment pay) may work and I'm willing to wait and see what does work and what doesn't but I'm not willing to support another stimulus bill until we have some sort of indication that we are going in the right direction. To me, that is foolish and wasteful and no, I'm not a Republican.

    February 17, 2009 at 7:35 pm |
  29. Anthony Long

    How can we track our state's use of the money from the Stimulous Package? I live in the state of Alabama and I'm very interested to see what Bob Riley will do with the money.

    February 17, 2009 at 7:33 pm |
  30. Jesse

    I truly wish the media would quit admiring Obama and start asking some tough questions. Obama has been sheltered to this point and I realize what truley historic deal this is, but he is the President of the United States and it is the american peoples' responsibilty to hold him accountable. Snap out of it media!!!!!!!!!!!! quit talking about basketball, blackberrys, dog, kids first day at school and all that BS. Quit being afraid to ask the tough questions, you sure were not afraid to ask Bush. I am afraid CNN, ABC, CBS, MSNBC and all the major news papers have become nothing more than GLORIFIED TABLOIDS!!!!!!

    February 17, 2009 at 7:24 pm |
  31. Joey

    President Obama signed the stimulus package 700 billion dollars, don't you think $40,000 in every Americans hands will get this economy back on track? Everyone who wants a new car, home, or whatever it may be, it will be better than $13.00 a week. Wondering?

    February 17, 2009 at 7:13 pm |
  32. EVELYN

    Anderson, please remind people when given a chance that no one is stopping the banks from giving bonuses from another source, just don't use tax payer money for it. They will still get their bonuses.

    February 17, 2009 at 7:08 pm |
  33. jarrod Newark, Ohio

    i don't know about anywhere else but in ohio they are planning to raise just about everything we can't vote on such as taxes on cigaretts,license fees, registration fees, and so-on so i hope the $13 extra a week holds out long enough to give it back THANKS STIMULAS PLAN

    February 17, 2009 at 7:05 pm |
  34. Tammy, Berwick, LA

    My grandmother just made an interesting point a while ago in a conversation I had with her. She said quite simply that she and my grandfather worked to feed and clothe their kids, that her parents worked to feed and clothe their kids during the Great Depression, and that families helped each other through crises. They didn't have fancy houses, cell phones, laptops, or TV's. They didn't drive luxury SUV's. But they made it. No one died from not drinking Starbucks every day. No one died wearing a homemade dress or hand-me downs. The world didn't end because they didn't have an iPod or live in a McMansion. Her point is simple. No one helped her generation or her parents to survive. They did it on their own. They did it quite well. But yet we whine when the government nanny can't wipe our butts, give us a six-figure paying job and food, and let us keep our over the top lifestyles. Wake up America before our own selfishness does us all in. It's amazing how Obama the community worker forgot what community work really means. It's not the hand out but the hand up. This stimulus surely isn't the hand up.

    February 17, 2009 at 6:58 pm |
  35. Jesse

    mike from toronto,

    Thanks a lot for the comments. You are so right!!!!!!!!!!!! I love my country but we have become prisoners of instant gratification. We are almost as much at fault as our government. It's always nice to hear from someone on the outside looking in and see the same thing I see and as a lot of the above bloggers.

    February 17, 2009 at 6:40 pm |
  36. Gene Penszynski from Vermont

    OK xtina. Somone once mentioned to me that political beliefs encompass a giant circle. The extremes at each end eventually wrap around to meet in some ambiguous nether region of Subversion.

    I failed to mention that I can see the motivation of the left for such action.( I don't know of likes of any any Air America sponsors out here on the upstate New York border for example.) but remember in spite of this Vermont is still an overwhelming liberal state. My issue here is with the Constitutional concept of free speech. In that regard I am with you 100%. It's the rest of your neo-con agenfda that I abhor. Sorry xtina but I've been around the block several hundred times on this and I always side with those that are removed from or act to counter balance the extremes.

    February 17, 2009 at 6:33 pm |
  37. Ricardo

    David

    Just tell me that we will balance the budget by the end of the administration, inflation will be at 2%, we no longer need oil from the Middle East, we have a surplus on our trade agreements, Social Security now can paid for all its beneficiaries, yadda yadda yadda. Lie to me, that's what I'm used to. These transparency business is getting me dizzy and I will need an USA made prescription glasses if it does not stop anytime soon.

    Ricardo
    Miami

    February 17, 2009 at 6:32 pm |
  38. mike

    Pardon, but do any of the persistent Bush haters on this site undertand that the Dems have controlled the house and Senate since 2006? There is plenty of blame to go around.

    I hope that Obama succeeds in turning the economy, truth is thought that he and the Dems own it now, as they own the war on terror.

    By the way, Obama is maiming and killing innocent citizens and babies in Afghanistan as we speak. He lies, people die. Hey, that's fun,
    I'm going to enjoy life on the outside, no responsibility for anything that happens, just Monday morning quarterbacking. Alright!

    February 17, 2009 at 6:31 pm |
  39. Barbara in Boston

    How much of this banking crisis is a direct consequence of the bill signed by Bill Clinton (and promoted by Republicans) that undid a lot of the safety regulations put on banks after the Great Depression?

    February 17, 2009 at 6:31 pm |
  40. Dave

    CNN's latest headline 2/17/09 – "Stocks slump despite stimulus"

    Did you consider that the headline should be "Stocks slump because of stimulus"?

    Anderson, when will you consider that this stimulus maybe was too much too soon and poorly developed? Just because President Obama said it was needed? Based on what experience? Where is your critical review?

    February 17, 2009 at 6:26 pm |
  41. Luis

    Can the Securities and Exchange Commission please end Naked Short Selling and bring the uptick rule back.

    What is the S.E.C. doing. If they don't stop this madness going on, their ain't going to be an exchange to look after.

    February 17, 2009 at 6:20 pm |
  42. Joanne

    Thank you to Susan Desg....
    That is the first true comparison I've seen between now and the Great Depression. I, too, would hope that our President would stop creating more fear amongst us by making his incorrect comparison.

    Having said this, I still believe that we must support our President as he 'tries' to offer some help; however, congress has added so much pork to 'his' bill that he probably wouldn't recognize it.

    How about a measely $25,000 per working family, then sit back and watch the economy explode. People will spend, spend and spend some more. They will also save to put their kids thru college, they will be able to stay in their homes.

    Giving billions to car manufacturers won't help us, we can't afford to buy a car.

    February 17, 2009 at 6:13 pm |
  43. xtina, chicago IL

    aww "Gene" from Vermont, we're gonna get you back to the conservative side eventually! You're absolutely right to think that it's WRONG for the grossly misnamed Fairness Doctrine to be reinstated in America. If liberals were so great, why doesn't Air America garner the success in ratings and ad revenue that the conservative stations do? It's not because someone is coming to Vermont, holding a gun to your head, forcing you to listen to Sean Hannity on the radio; it's because we have free choice here in America, and tons more people choose Sean over Air America.

    SO most libraries are overstocked with Al Franken books; does the Fairness Doctrine put more Ann Coulter on their shelves? Somehow I don't picture Chuck Schumer writing that into the bill!

    February 17, 2009 at 6:03 pm |
  44. matt from Toronto

    Hey Jesse, totally agree with asinine policies crafted by politicians, get a lot of that in my Country. The point I was trying to communicate was that when a downturn occurs in America, an external conflict is generated to supply manufacturers an oppourtunity to inject their wares. Wether that be tanks, guns and ammo or plasma, Imbedded CNN reporters (nudge, nudge...wink wink) and tent makers. Its been a constant for the last 100 years that I know of. America has lost its way. It used to be a counrty based on diigence and hard work and now everyone thinks there owed something. Something for nothing, directly learned from the plethora of cable channels and the drivel they serve to a tired, unsuspecting brainwashed public....

    February 17, 2009 at 5:54 pm |
  45. Abel Tsegga

    The Borgen Project has some good info on the cost of addressing global poverty.

    $30 billion: Annual shortfall to end world hunger.
    $550 billion: U.S. Defense budget

    February 17, 2009 at 5:49 pm |
  46. Bob Dale

    This past weekend, I had my 2006 GM car in for some repair work at the dealership where the car was originally purchased and whom has provided all the necessary services. The car is in good shape and I was looking for an upgrade to a 2009 larger vehicle. To my amazement, the dealership offered me over $4,000 less than the current loan value and virtually gave no discounts on the new car we were looking at. We were going to purchase one off the lot. My credit rating is in the high 700’s. Interestingly the dealership was not willing to deal one least little bit. I was totally insulted at the offer and walked out of the dealership. If the car industry is in such dire straits then why are the dealerships not willing to move vehicles off the lot? It is apparent their bailout is not necessary since they really don't want to sell vehicles at REASONABLE prices.....

    It is about time to just let the BIG 3 sink. I can go down the street to the Hyundai dealership (which I have never shopped at) and purchase almost two cars for the price at one of the BIG 3 automakers…. What is wrong with this picture? I pride myself in buying American vehicles, but at what price. I am not going to purchase a vehicle then pay GM to take my current vehicle off my hands. If this 2006 GM car lasts as long as my 1996 GMC, it could get 10 more years of life out of the vehicle. Why or why is it worth less now than my loan value? There is something wrong with this picture with the U.S. automakers. I still own my 1996 GMC Suburban with 376K miles, no problems with the engine, oil changes every 6,000 miles and it still gets 20+ MPG. You can’t get a new vehicle that gets that same MPG today in the same product class. HOW COME?????

    Should U.S. autoworkers keep their jobs with the BIG 3 automakers if consumers can’t get decent deals for the vehicles? Consumers have to go where they get the best deal for the hard earned money they are shelling out. I consider myself a loyal American buyer. But, I am seriously rethinking about buying American. And to those hardworking individuals at the BIG 3 automakers, I am sorry but something is drastically wrong with the BIG 3 leadership and the cost structure of the BIG 3. Maybe it is time to let them fail…

    It is about time to just let them sink. I can go down the street to the Hundai

    February 17, 2009 at 5:47 pm |
  47. Ratna, New York, NY

    Dear David Gergen,

    I honestly don't care about the lack of support of bipartisanship for Obama. He is not expected to sit still and do nothing! I think regardless of the outcome of this stimulus package, at least somethng was done about this. It al has to do with re-configuring the stimulus package with ending the US Army support in Iraq.

    February 17, 2009 at 5:45 pm |
  48. Jim

    I always appreciate David Gergen's analysis. I think he is a true patriot for not joining into the political wars that seem to be going on in our country.

    February 17, 2009 at 5:38 pm |
  49. sharon L

    ahhh~~~~ If only the republicans would simply fade away~ here we are at the end of 8 years of republican freedom...8 years of deregulation, 8 years of tax cuts for the fabulously weatthy, 8 years of the bafoonery an lies of bush and his lackies..It's interesting, iif you look back through history, the country's always been in its most trouble at the end of a republican reign... when will they finally go away? you know like the whigs... If only that ship of greedy sanctomonious fools would sink...

    Unfortunately now, like the spoiled children they act like they lock step to do their best to undermine and make difficult the mess they left the rest of us to try and figure out a way to save...

    they won't be happy until they're one of us "regular type folk":and if they keep on with their whining and greed and if most of the country doesn't choose to simply ignore them, they will all soon be poor too... and to that I say...get to teh back of the bread line morons...

    Tax cuts for the filthy don't work, deregulation doesn't work, never has, I hate that there is a need for this stimulus, but there is a real need and sersiously, who's gonna jump start this economy...the banks most of these republican idiots run...no, they were the first in line for a handout...just like these self righteous goofs will be when the recession stops at their door...

    I'm am lucky, I earn a good living and haven't felt any of the financial strain but most of the country has...

    February 17, 2009 at 5:38 pm |
  50. DJ

    David Gergen is a partisan hack with no credibility. Recessions are a natural part of economic cycles & this one may last an incredibly long 2 years (which would mean ending in late 2009/early 2010) before this spendulus program even can have much impact. But the inflation, deficits, & permanently bloated government it spurs will last a lifetime. Priceless. He's no ordinary lawyer when it comes to speech giving, but a pretty typical lawyer with regards to management/leadership skills....but with this liberal MSM he may make it to Mt Rushmore before he's even out of office. There will be little joy watching BHO fail unlike the joy the partisian Dems enjoyed watching Bush fail though. Maybe the people will take their frustration out on this Contress w/the lowest approval rating in HISTORY.

    February 17, 2009 at 5:35 pm |
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