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Informal Exchange with Reporters on the Economy and Budget

January 06, 2009

THE PRESIDENT-ELECT: When the American people spoke last November, they were demanding change, change in policies that helped deliver the worst economic crisis that we've seen since the Great Depression, but they're also looking for a change in the way that Washington does business. They were demanding that we restore a sense of responsibility and prudence to how we'd run our government.

One of the measures of irresponsibility that we've seen is the enormous federal debt that has accumulated, a number that has doubled in recent years. As we just discussed, my budget team filled me in on - Peter Orszag now forecasts that, at the current course and speed, a trillion-dollar deficit will be here before we even start the next budget, that we've already looked - we're already looking at a trillion-dollar budget deficit or close to a trillion-dollar budget deficit, and that potentially we've got trillion-dollar deficits for years to come, even with the economic recovery that we are working on at this point.

So the reason I raise this is that we're going to have to stop talking about budget reform. We're going to have to totally embrace it. It's an absolute necessity.

And it has to begin with the economic recovery and reinvestment plan that Congress will soon be considering, that we're going to be investing an extraordinary amount of money to jump-start our economy, save or create 3 million new jobs, mostly in the private sector, and lay a solid foundation for future growth.

But we're not going to be able to expect the American people to support this critical effort unless we take extraordinary steps to ensure that the investments are made wisely and managed well. And that's why my recovery and reinvestment plan will have - will set a new higher standard of accountability, transparency, and oversight.

We are going to ban all earmarks, the process by which individual members insert pet projects without review. We will create an economic recovery oversight board made up of key administration officials and independent advisers to identify problems early and make sure we're doing all that we can to solve it. We will put information about where money is being spent online so that the American people know exactly where their precious tax dollars are going and whether we are hitting our marks.

But we're not going to be able to stop there. We're going to have to bring significant reform not just to our recovery and reinvestment plan, but to the overall budget process, to address both the deficit of dollars and the deficit of trust. We'll have to make tough choices, and we're going to have to break old habits. We're going to have to eliminate outmoded programs and make the ones that we do need work better.

That's the challenge that I've handed to Peter, and Rob Nabors, and the rest of my budget team. That's the challenge that the American people have handed me. They know that we're at a perilous crossroad and that tinkering in the margins will not do.

I'm going to have more to say about this subject tomorrow, but today I wanted to lay out an early marker with those that I've entrusted to help bring the changes that the American people voted for. We are going to bring a long-overdue sense of responsibility and accountability to Washington. We are going to stop talking about government reform, and we're actually going to start executing.

That's the charge that I've given the members of the administration. That's the charge that was given to me by the American people. And we are ready for the challenge.

So with that, I'm going to take some questions. And let's start with you.

Q: Thank you, Mr. President-elect. Do you think that you'll be submitting a budget larger than the $3.1 trillion that President Bush submitted for fiscal '09? And, also, what are you doing to address concerns from other Democrats about deficit spending and increasing the deficit with the stimulus package?

THE PRESIDENT-ELECT: Well, you know, I don't want to get into particular budget numbers, because we're obviously still in the process of reviewing what the existing budget looks like, where we can obtain some savings, what programs we can potentially eliminate. We will be submitting that budget later, after we've submitted the recovery and reinvestment plan.

I can give you a set of general principles, though. We know that we're going to have to spend money to jump-start the economy. I spoke about that yesterday.

We know that even if we did nothing that we have close to a trillion-dollar deficit, even if we were on the current path that we're on. And we know that we have to then implement a set of fiscal measures that deal with the medium and long term so that we have a sustainable path of economic growth.

So what I've assigned Peter to do is - and Rob and others - is to work with my economic team. They are part of the team that is putting together the accountability and oversight measures into the recovery act, but they also have this broader charge, which is, how do we get a fix on this budget so that, as the economy recovers, we start stabilizing the economy and - and getting our budget under control?

It's not just Democrat or Republican colleagues on the Hill that are concerned about this. I'm concerned about this. And so what I've said is, I'm going to be willing to make some very difficult choices in how we get a handle on this deficit. That's what the American people are looking for.

And, you know, what we intend to do this year, next year, and all the years that I'm in office is to demonstrate our seriousness, not by gimmicks, not by punting to future administrations the tough choices, but by making some of those tough choices while I'm in office.

Q: ... Earmarks, you said there will be none that get in there without review. Some people would argue even the so-called bridge to nowhere got review, some level of review ...

THE PRESIDENT-ELECT: No, no, no. What I'm saying is - let me repeat what I said about that ... We will ban all earmarks in the recovery package. And I describe earmarks as the process by which individual members insert pet projects without review. So what I'm saying is, we're not having earmarks in the recovery package, period. I was describing what earmarks are.

Q: So there's - you're not suggesting there's some level of review that might ...

THE PRESIDENT-ELECT: I'm saying there are no earmarks in the recovery package. That, that is the position that I'm taking.

Q: Well, if I may, I was just wondering if $200,000 sounds like about the right level at which the tax credits would be phased out. I know that's been thrown out there ...

THE PRESIDENT-ELECT: You know, look, I think you can get some guidance from what I said during the campaign, but I don't want to be locked in to a particular number, Chuck, just because we're still formulating the details of the plan. OK ...

Q: Some are - some are questioning Leon Panetta's lack of intelligence - lack of experience on intelligence matters. Sorry about that. I know this is tricky for you since you haven't announced it yet, but what does he bring to the table for you?

THE PRESIDENT-ELECT: Well, as you noted, I haven't made - haven't made a formal announcement about my intelligence team.

[cell phone rings]

THE PRESIDENT-ELECT: That may be him calling now... finding out where it's at.

I have the utmost respect for Leon Panetta. I think that he is one of the finest public servants that we have. He brings extraordinary management skills, great political savvy, an impeccable record of integrity.

As chief of staff, he is somebody who - to the president - he's somebody who obviously was fully versed in international affairs, crisis management, and had to evaluate intelligence consistently on a day-to-day basis.

Having said all that, I have not made an announcement. When we make the announcement, I think what people will see is, is that we are putting together a top-notch intelligence team that is not only going to assure that I get the best possible intelligence unvarnished, that the intelligence community is no longer geared towards telling the president what they think the president wants to hear, but instead are going to be delivering the information that the president needs to make critical decisions to keep the American people safe.

I think what you're also going to see is a team that is committed to breaking with some of the past practices and concerns that have, I think, tarnished the image of the agencies, the intelligence agencies, as well as U.S. foreign policy.

Last point I will make, though, on this is that there are outstanding intelligence professionals in the CIA, in DNI, and others, and I have the utmost regard for the work that they've done, and we are committed to making sure that this is a team effort that's not looking backwards, but is looking forward to figure out how we're going to serve the American people best, OK?

Q: Thank you, Mr. President-elect. You're being put under a lot of pressure internationally to get more involved in the situation in Gaza. I understand you think there should only be one president at a time, but what do you have to say to the Israelis and the Palestinians who are fighting and dying in Gaza?

THE PRESIDENT-ELECT: As I've said before, when it comes to foreign policy, I think the need to adhere to one president at a time is particularly important. In domestic policy, Democrats, Republicans, we can have arguments back and forth about what tax policies are going to be. When it comes to international affairs, other countries are looking to see who speaks for America. Right now, President George Bush, as president of the United States, speaks on behalf of the U.S. government and the American people when it comes to international affairs.

Obviously, I am deeply concerned about the conflict that's taking place there. I'm being fully briefed and monitored - monitoring the situation on a day-to-day basis. The loss of civilian life in Gaza and in Israel is a source of deep concern for me.

And after January 20th, I am going to have plenty to say about the issue. And I am not backing away at all from what I said during the campaign, that I - starting at the beginning of our administration, we are going to engage effectively and consistently in trying to resolve the conflicts that exist in the Middle East.

That's something that I'm committed to. I think it's not only right for the people in that region; most importantly, it's right for the national security of the American people and the stability that is so important to this country. So on January 20th, you will be hearing directly from me and my opinions on this issue. Until then, my job is to monitor the situation and put together the best possible national security team so that we hit the ground running once we are responsible for national security issues.

Barack Obama, Informal Exchange with Reporters on the Economy and Budget Online by Gerhard Peters and John T. Woolley, The American Presidency Project

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