His Economic Outlook:
“We begin this year and this Administration in the midst of an unprecedented crisis that calls for unprecedented action. Just this week, we saw more people file for unemployment than at any time in the last twenty-six years, and experts agree that if nothing is done, the unemployment rate could reach double digits. Our economy could fall $1 trillion short of its full capacity, which translates into more than $12,000 in lost income for a family of four. And we could lose a generation of potential, as more young Americans are forced to forgo college dreams or the chance to train for the jobs of the future. In short, if we do not act boldly and swiftly, a bad situation could become dramatically worse.”
Military and Terrorism
Two remote U.S. missile strikes that killed at least 20 people at suspected terrorist hideouts in northwestern Pakistan yesterday offered the first tangible sign of President Obama’s commitment to sustained military pressure on the terrorist groups there, even though Pakistanis broadly oppose such unilateral U.S. actions.
Issued executive orders to shutter the Guantánamo Bay, Cuba, detention camp within a year, close the CIA’s network of secret overseas prisons and end the agency’s use of interrogation techniques that critics describe as torture.
Aside from roads and weatherizing homes, build a smart electrical grid.
“One of, I [Obama] think, the most important infrastructure projects that we need is a whole new electricity grid. Because if we’re going to be serious about renewable energy, I want to be able to get wind power from North Dakota to population centers, like Chicago. And we’re going to have to have a smart grid if we want to use plug-in hybrids then we want to be able to have ordinary consumers sell back the electricity that’s generated from those car batteries, back into the grid. That can create 5 million new jobs, just in new energy.
But, it’s huge projects that generally speaking, you’re not going to have private enterprise would want to take all those risks. And we’re going to have to be involved in that process.”
Fuel and emission standards:
Obama “will direct federal regulators on Monday to move swiftly on an application by California and 13 other states to set strict automobile emission and fuel efficiency standards, two administration officials said Sunday“
Banking system: Nationalization?
“I’m not talking about total ownership,” she [Pelosi] quickly cautioned — stopping herself by posing a question: “Would we have ever thought we would see the day when we’d be using that terminology? ‘Nationalization of the banks?’ ”
So far, President Obama’s top aides have steered clear of the word entirely, and they are still actively discussing other alternatives, including creating a “bad bank” that would nationalize the worst nonperforming loans by taking them off the hands of financial institutions without actually taking ownership of the banks. Others talk of de facto nationalization, in which the government owns a sizeable chunk of the banks but not a majority, with all that connotes.
That has already happened; taxpayers are now the biggest shareholders in Bank of America, with about 6 percent of the stock, and in Citigroup, with 7.8 percent. But the government’s influence is far larger than those numbers suggest, because it has guaranteed to absorb the losses of some of the two banks’ most toxic assets, a figure that could run into the hundreds of billions of dollars.
Many believe this form of hybrid ownership — part government, part private, with the responsibilities of ownership unclear — will not prove workable.
“The case for full nationalization is far stronger now than it was a few months ago,” said Adam S. Posen, the deputy director of the Peterson Institute for International Economics. “If you don’t own the majority, you don’t get to fire the management, to wipe out the shareholders, to declare that you are just going to take the losses and start over. It’s the mistake the Japanese made in the ’90s.”
The stimulus package:
For a more complete outline of the package see here.
Of all the stimulus proposals so far, the “smart electrical grid” may be the most far-reaching, changing the very landscape of America. How far we will go in health care and banking remains to be seen.