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Obama's Economic Plan; Quake Shakes Capital of Costa Rica
Aired January 08, 2009 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
RICK SANCHEZ, CNN ANCHOR (voice-over): Making news right now: saving the U.S. economy. The plan starts to come together.
SEN. BARACK OBAMA (D-IL), PRESIDENT-ELECT: We can restore opportunity and prosperity.
SANCHEZ: What will be cut? How much debt can we incur to save your jobs?
Which jobs will be lost? Your questions answered by our panel, Harvard economist Jeffrey Miron, author and CNN money specialist Ali Velshi, political analyst Patricia Murphy, and watching how Wall Street reacts from the New York Stock Exchange, Susan Lisovicz.
Also, a panel of working Americans like you, what they say about Obama's plan.
It's lunchtime in San Francisco and 3:00 p.m. in Miami, as this special national conversation begins right now.
(END VIDEOTAPE)
SANCHEZ: And hello again, everybody. I'm Rick Sanchez here at the world headquarters of CNN.
First, catching up with some of the breaking news that you were hearing Kyra talk about just moments ago. This is the scene as it looks right now in an area not far from San Jose, the capital of Costa Rica. You will see one shot coming up here where you can actually see the shaking.
We understand the magnitude of this is about a 6.2 of this earthquake. However, as you probably know, it may take awhile to find out exactly how much damage has been done. There's that shot coming in from the capital, where you can see the camera actually shaking as it's trying to get pictures of what's going on. These things are always alarming. There is a fault line that goes through there.
Any one of you who have traveled knows that in parts of Costa Rica and Guatemala, there are plenty of active volcanoes as well that tourists often go to visit. So, that's the situation as we set the scene for you.
Here's what we're going to do. We're going to be monitoring it with CNN Espanol, with Glenda, obviously, and obviously the folks over at CNN International as well. And as we get more information, we will be sharing it with you throughout this newscast. Depend on CNN to bring you those pictures.
In the meantime, probably the most important story taking place here in the United States is a piece of legislation that will likely be one of the most important pieces of legislation ever passed in the United States. At least that's the way Barack Obama wants you to see it.
And he may be not so far from the truth, at least if you talk to most of the economists. It's called the American Recovery and Reinvestment Plan to save the United States economy, and thereby perhaps save much of the world's economy as well.
Here's what we're going to do. We want you to watch this. Every American should watch this. It's Barack Obama as the next president of the United States coming in and saying, this is what we have to do, and this is why we have to do it. We're going to divide this into four parts.
Here now, the very first part of his speech. This is where he's going to be talking about actually making a difference in people's lives and making sure that it's done right now. He also talks in his speech about why we have to do this. And he breaks it down into four categories, how he has to act extremely bold, and also how the American people need to do something about this, this time, making references to the fact that perhaps, over the last eight years, we weren't.
We ready with that tape now? Here we go. This is the first part of Barack Obama's speech. If you missed it today, this is themed act and act now.
(BEGIN VIDEO CLIP)
OBAMA: Thank you, everybody. Thank you. Please be seated. Thank you so much.
(APPLAUSE)
OBAMA: Let me begin by thanking George Mason University for their extraordinary hospitality and to thank all the great friends, the governors, the mayors who are in attendance here today.
Throughout America's history, there have been some years that simply rolled into the next without much notice or fanfare. And then there are the years that come along once in a generation, the kind that mark a clean break from a troubled past and set a new course for our nation. This is one of those years.
We start 2009 in the midst of a crisis unlike any we have seen in our lifetime, a crisis that has only deepened over the last few weeks.
Nearly 2 million jobs have been now lost. And on Friday, we're likely to learn that we lost more jobs last year than at any time since World War II. Just in the past year, another 2. 8 million Americans who want and need full-time work have had to settle for part-time jobs.
Manufacturing has hit a 28-year low. Many businesses cannot borrow or make payroll. Many families cannot pay their bills or their mortgage. Many workers are watching their life savings disappear. And many, many Americans are both anxious and uncertain of what the future will hold.
Now, I don't believe it's too late to change course, but it will be if we don't take dramatic action as soon as possible. If nothing is done, this recession could linger for years.
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.
We could lose a generation of potential and promise as more young Americans are forced to forego dreams of college or the chance to train for the jobs of the future. And our nation could lose the competitive edge that has served as a foundation for our strength and our standing in the world.
In short, a bad situation could become dramatically worse.
This crisis did not happen solely by some accident of history or normal turn of the business cycle. And we won't get out of it by simply waiting for a better day to come or relying on the worn-out dogmas of the past.
We arrived at this point due to an era of profound irresponsibility that stretched from corporate board rooms to the halls of power in Washington, D.C.
For years, too many Wall Street executives made imprudent and dangerous decisions, seeking profits with too little regard for risk, too little regulatory scrutiny, and too little accountability. Banks made loans without concern for whether borrowers could repay them, and some borrowers took advantage of cheap credit to take on debt they couldn't afford.
Politicians spent taxpayer money without wisdom or discipline and too often focused on scoring political points instead of problems they were sent here to solve.
The result has been a devastating loss of trust and confidence in our economy, our financial markets, and our government.
Now, the very fact that this crisis is largely of our own making means that it's not beyond our ability to solve. Our problems are rooted in past mistakes, not our capacity for future greatness.
It will take time -- perhaps many years -- but we can rebuild that lost trust and confidence. We can restore opportunity and prosperity.
(END VIDEO CLIP) SANCHEZ: Let me tell you who's going to be joining us to go along with this speech. That's the first part of Barack Obama's very important speech today. There are three others. But let's stop right here.
Let's have a conversation with some of our guests.
Jeffrey Miron is a Harvard University professor of economics. Mark Preston, who you have become familiar with, is from "Preston on Politics," CNN political editor. Patricia Murphy is with CitizenJanePolitics.com. And Susan Lisovicz is watching things for us there at the New York Stock Exchange.
Also joining us today are Juanita Dvorsky -- let's get that citizen panel that we have put together as well -- Troy Fluker and Rebecca Burnos, all three American workers, just like you. We want to see how they assess the future president's speech.
Professor Miron, I want to start with you. He says this is a crisis like no other. Is he right and how so?
Professor Miron, are you there?
All right. We lost Professor Miron.
Same question to Mark Preston.
Take it up, if you can.
MARK PRESTON, CNN POLITICAL EDITOR: Rick, I think he's absolutely right. This is a crisis that we certainly haven't seen in our generation. He painted a very bleak picture today.
And just in that snippet, Rick, we saw Barack Obama spread the blame around. Not only was it Wall Street. Not only was it politicians here in Washington or regulators here in Washington. It was also people who overextended themselves. So, he was basically saying today we need to come together as a nation. We need to get back on track. And we can only do it if we all get together.
That is what he's trying to sell to the American people. That is what he's trying to sell to Congress.
SANCHEZ: But I guess let's be fair and try and judge this on his terms. And he's played out a pretty nasty scenario as far as how things are right now.
I understand we have got the professor back.
Professor, are things as bad as he described them?
JEFFREY MIRON, ECONOMICS PROFESSOR, HARVARD UNIVERSITY: I don't think so.
They're certainly not good, but I think president-elect Obama was painting kind of a worst-case scenario. The typical forecasts that are out there from forecasters would suggest that we're going to be growing again by the third or fourth quarter of this year. And so that's a typical recession, and maybe a little bit worse than average recession. But it's not Armageddon. It's not the gloom and doom that we heard from president-elect Obama.
SANCHEZ: Patricia, why would he do that, though? Isn't that a political move? Why would a politician do something like that?
PATRICIA MURPHY, EDITOR, CITIZENJANEPOLITICS.COM: Well, it's a political move because he's going to need cover from Democrats, from Republicans to create this sense of urgency that there's action. And he also wants to create a sense of urgency among the American people.
There is bailout fatigue out there right now. Americans need to know why they need to spend even more of their own money to start throwing money at these problems. They need to know why it's so serious and what they're going to be asked to do to help. It's their money. They need to hear that.
SANCHEZ: Manufacturing, he says, you can't borrow, then you can't build.
Susan Lisovicz, going to you before we go to the break. Is he right?
SUSAN LISOVICZ, CNN FINANCIAL CORRESPONDENT: Well, I mean, manufacturing has been one of the hardest-hit industries. Unfortunately, now the recession is so deep and so broad, that it's not the only area, not by a long shot.
Corporate earnings come out in about two weeks. We're expecting the sixth straight quarter of declines. And that is a, you know, broad-based decline. It's not just the financial industry that is suffering. And we got an example of that today with December retail sales, the most important month of the year for retailers. And even Wal-Mart is bringing down its numbers for the quarter as a result of poor sales -- Rick.
SANCHEZ: We're going to ask you about jobs in just a little built, because Barack Obama is going to be talking about that. The next theme he picks up as soon as we come back from break has to do with how we act. I guess the term or the theme here would be boldly, as he describes it. We will let you listen to it yourself. It is important.
We will be right back.
(COMMERCIAL BREAK)
SANCHEZ: As Barack Obama explained the situation in the United States, it did seem pretty dismal.
We do have some average American workers, just like you, in our studio.
Raise your hands, guys, if you agree with Barack Obama. Yes, we will get the question in. Raise your hand if you agree with Barack Obama that things in the United States are pretty darn bad right now. You agree? Do you feel it personally?
Yes?
UNIDENTIFIED FEMALE: Yes.
TROY FLUKER, BUSINESS COORDINATOR: Yes, I feel like things could be a lot worse.
SANCHEZ: Could be a lot worse?
FLUKER: Yes, for us as individuals, yes.
SANCHEZ: Well, let me hold you, and come back to you guys in just a minute, because we do want to get your sense of this. Let's finish this out now with Barack Obama with the second part of his speech today, where he talks about not only the fact that we have got to act now, but that we have to act boldly.
(BEGIN VIDEO CLIP)
OBAMA: We should never forget that our workers are still more productive than any on Earth. Our universities are still the envy of the world. We are still home to the most brilliant minds, the most creative entrepreneurs, and the most advanced technology and innovation that history has ever known. And we are still the nation that has overcome great fears and improbable odds.
If we act with the urgency and seriousness that this moment requires, I know that we can do it again.
That is why I have moved quickly to work with my economic team and leaders of both parties on an American Recovery and Reinvestment Plan that will immediately jump-start job creation and long-term growth. It's a plan that represents not just new policy, but a whole new approach to meeting our most urgent challenges.
For if we hope to end this crisis, we must end the culture of "anything goes" that helped create it, and this change must begin in Washington.
It's time to trade old habits for a new spirit of responsibility. It's time to finally change the ways of Washington so that we can set a new and better course for America.
There is no doubt that the cost of this plan will be considerable. It will certainly add to the budget deficit in the short term.
But equally certain are the consequences of doing too little or nothing at all, for that will lead to an even greater deficit of jobs, incomes, and confidence in our economy.
It is true that we cannot depend on government alone to create jobs or long-term growth. But at this particular moment, only government can provide the short-term boost necessary to lift us from a recession this deep and severe. Only government can break the cycle that are crippling our economy, where a lack of spending leads to lost jobs, which leads to even less spending, where an inability to lend and borrow stops growth and leads to even less credit.
That's why we need to act boldly and act now to reverse these cycles. That's why we need to put money in the pockets of the American people, create new jobs, and invest in our future. That's why we need to restart the flow of credit and restore the rules of the road that will ensure a crisis like this never happens again.
(END VIDEO CLIP)
SANCHEZ: The president-elect says the job losses can get so bad that we could, during his term, hit double-digit unemployment. Been awhile since we have been there.
Professor, let me bring you back into the equation. Why is that important? What would it mean?
MIRON: What would which mean, to try to get the jobs going again?
SANCHEZ: No, the idea that we could, during his administration, hit double-digit unemployment?
MIRON: Well, if we hit double-digit unemployment, it's because the economy has failed to grow for a significant number of quarters ahead.
SANCHEZ: Is he saying, expect this to happen? I mean, is that what he's saying?
MIRON: He's trying to say expect this to happen, unless the government does something dramatic, because he wants to justify this big expansion of government.
But that doesn't make it the necessarily case that the economy will falter even more without the stimulus package. And there's also the crucial question of what form the stimulus package takes. The administration, the incoming administration, seems to be firmly on the spending side and only grudgingly on the tax cut side.
But the Keynesian theory that they rely on is just as open to tax cuts as an effective method as it is to spending increases.
SANCHEZ: He says he wants to create three million jobs. How is he going to create three million jobs? By the way, jobs doing what, one would wonder, Mark Preston?
PRESTON: Well, he has several different proposals out there right now, Rick. He's talking about building infrastructure, spending money for the long run, pointing money into making medical records, for instance accessible all across the country.
He's also talking about bringing broadband into every school. He's talking about rebuilding schools. So, what they're trying to say is that, if we spend this money now, there will be -- short term, we will get hit in the pocket. Long term, they think it will pay off.
But, Rick, there are trip wires right now on both sides of the equation. First off, we have just heard in the last couple hours from Democrats on Capitol Hill that they don't like the tax breaks that Barack Obama is talking about giving the companies. On the other side, we have long heard from Republicans on Capitol Hill, fiscal conservatives, they don't like the idea of the expansion of government.
So, this is going to be a tough haul for him.
SANCHEZ: You mean it can't get done in a couple of weeks, as some had expected?
PRESTON: Not a couple of weeks. Look by mid-February. But it's not going to be sailing easily through Congress.
SANCHEZ: What is the biggest problem, guys over here? Average workers, you're looking at me. Give me one word to describe what you think is the most difficult thing facing our country right now that this president-elect has to deal with.
Juanita, I will start with you.
JUANITA DVORSKY: Well, I think that one of the big things -- I have a son-in-law who lost his job because...
(CROSSTALK)
SANCHEZ: So, jobs? You would say jobs?
UNIDENTIFIED FEMALE: Jobs.
(CROSSTALK)
SANCHEZ: All right. We have got to hit a break here.
But, when I come back, Troy and Rebecca, I want your responses to that as well. Take some time to think about it.
The next part of Barack Obama's speech has to do with doing something this time, leaving the impression that perhaps we haven't in the last administration. We will let you hear it for yourself, not sound bites, the entire speech, when we come back.
(COMMERCIAL BREAK)
SANCHEZ: Once again, we're letting you know that these pictures have been coming into us from Costa Rica, about 20 miles from the capital of San Jose, where apparently the epicenter of this earthquake is. It's about 6.5-magnitude. We're following it. No reports yet of significant damage and/or casualties. Obviously, as soon as we get that, we will be turning it around and sharing it with you.
We do welcome you back here to the world headquarters of CNN in Atlanta. I'm Rick Sanchez.
The big story here obviously is Barack Obama giving his first and probably most important policy speech to date. He hasn't yet become the president, but you know this will be the area that he is going to be concentrating on, saving the United States economy.
What did you want to say? What did you want to do here?
Oh, let's take a break right here, and we will be right back.
(COMMERCIAL BREAK)
SANCHEZ: As you can see, many of you have been responding to the speech that we're showing you. We're not trying to show you just little sound bites of what he said. We want you to see what the president-elect said in its entirety. The entire speech is what we're letting you hear.
And we have got a system of -- or we have got a panel that's been set up to respond to what the president-elect is saying. And we have just been joined by Ali Velshi as well, as a matter of fact.
So, we have got -- let me take you through this. We have got Ali Velshi. We have got Harvard professor Jeffrey Miron, Mark Preston, CNN political editor, Patricia Murphy, CitizenJanePolitics, Susan Lisovicz at the Wall Street -- on Wall Street.
And then we have got our own panel that is standing by over here of workers, average American workers.
Troy, let me ask you a question. One-word answer, what's the most important thing you think this president has to deal with?
FLUKER: Unemployment.
SANCHEZ: Unemployment?
Rebecca, same question to you?
UNIDENTIFIED FEMALE: Definitely unemployment.
SANCHEZ: Unemployment? And what would you like to see him do? Again, keep it to a couple of words.
UNIDENTIFIED FEMALE: I guess I think hopefully through some sort of energy, green energy plan. Maybe create research jobs, or possibly building new plants, facilities, that sort of thing.
SANCHEZ: That's interesting, because that is what he is about to talk about.
This is the part of the speech where the president-elect says that, this time, we need to not just talk about doing something; we need to do something for the American people.
Hear him out. And we will have more conversation on the other side.
(BEGIN VIDEO CLIP)
OBAMA: This plan begins with -- this plan must begin today, a plan I'm confident will save or create at least 3 million jobs over the next few years.
It's not just another public works program. It's a plan that recognizes both the paradox and promise of this moment: the fact that there are millions of Americans trying to find work, even as all around the country there's so much work to be done.
And that's why we'll invest in priorities like energy and education, health care and a new infrastructure that are necessary to keep us strong and competitive in the 21st century.
That's why the overwhelming majority of the jobs created will be in the private sector, while our plan will save the public sector jobs of teachers, police officers, firefighters, and others who provide vital services.
To finally spark the creation of a clean energy economy, we will double the production of alternative energy in the next three years. We will modernize more than 75 percent of federal buildings and improve the energy efficiency of 2 million American homes, saving consumers and taxpayers billions on our energy bills.
In the process, we will put Americans to work in new jobs that pay well and can't be outsourced, jobs building solar panels and wind turbines, constructing fuel-efficient cars and buildings, and developing the new energy technologies that will lead to even more jobs, more savings, and a cleaner, safer planet in the bargain.
To improve the quality of our health care while lowering its cost, we will make the immediate investments necessary to ensure that, within five years, all of America's medical records are computerized. This will cut waste, eliminate red tape, and reduce the need to repeat expensive medical tests.
But it just won't save billions of dollars and thousands of jobs; it will save lives by reducing the deadly but preventable medical errors that pervade our health care system.
To give our children the chance to live out their dreams in a world that's never been more competitive, we will equip tens of thousands of schools, community colleges, and public universities with 21st-century classrooms, labs, and libraries. We'll provide new computers, new technology, and new training for teachers so that students in Chicago and Boston can compete with children in Beijing for the high-tech, high-wage jobs of the future.
To build an economy that can lead this future, we will begin to rebuild America. Yes, we'll put people to work repairing crumbling roads, bridges and schools, by eliminating the backlog of well- planned, worthy, and needed infrastructure projects, but we'll also do more to retrofit America for a global economy. That means updating the way we get our electricity, by starting to build a new smart grid that will save us money, protect our power sources from blackout or attack, and deliver clean, alternative forms of energy to every corner of our nation.
It means expanding broadband lines across America so that a small business in a rural town can connect and compete with their counterparts anywhere in the world.
It means investing in the science, research, and technology that will lead to new medical breakthroughs, new discoveries, and entire new industries.
And, finally, this Recovery and Reinvestment Plan will provide immediate relief to states, workers, and families who are bearing the brunt of this recession. To get people spending again, 95 percent of working families will receive a $1,000 tax cut, the first stage of a middle-class tax cut that I promised during the campaign and will include in our next budget.
To help Americans who have lost their jobs and can't find new ones, we'll continue the bipartisan extension of unemployment insurance and health care coverage to help them through this crisis.
Government at every level will have to tighten its belt, but we'll help struggling states avoid harmful budget cuts, as long as they take responsibility and use the money to maintain essential services, like police, fire, education, and health care.
Now, I understand that some might be skeptical of this plan. Our government has already spent a good deal of money, but we haven't yet seen that translate into more jobs, or higher incomes, or renewed confidence in our economy.
And that's why the American Recovery and Reinvestment Plan won't just throw money at our problems. We'll invest in what works.
(END VIDEO CLIP)
SANCHEZ: Invest in what works. Will clean energy production work?
He says, Ali Velshi, that he is going to double it in the next 10 years. Pretty lofty.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Yes. And it will work. It is one of the few things we can do. He mentioned something about infrastructure that is needed. There are things in the country that are needed. Well, a better energy infrastructure is needed. And in good times, you know, most people expect their light switches to go on and their electricity be there. And energy infrastructure is hard to maintain at the best of times. And most people don't want to spend billions of dollars doing it.
Now we have tough times and we need work. And as one of your panelists in the studio with you said, hopefully this energy alternative -- energy infrastructure will create research jobs and high level, high paying jobs, as well as manufacturing construction- type of jobs, which we've been losing in disproportionate numbers in this country.
So he's got to deal with the jobs issue and that is a -- is a good way to deal with it. I think it will work.
SANCHEZ: How does -- any one of you who wants to tackle this -- how does a government create jobs other than government jobs?
I mean doesn't -- isn't this supposed to come from the private sector?
How do you -- professor, you -- how do you do this?
JEFFREY MIRON, ECONOMIST, HARVARD UNIVERSITY: I don't think that the government does really create jobs, except for government jobs, as you suggested. What government can do is to eliminate policies which inefficiently deter the private sector from wanting to create jobs.
SANCHEZ: Do you see that...
MIRON: And that means...
SANCHEZ: Do you see that strategy being undertaken here?
MIRON: No, not at all.
SANCHEZ: No?
MIRON: Not at all. Just the opposite. I think there's going to be a lot more government decision-making about what types of energies are used, what types of investment projects are undertaken for all sorts of things. And that is not good for efficiency going forward.
(CROSSTALK)
MIRON: The real question is...
VELSHI: But it's good for getting us out of a recession. There's no recession that we've ever been able to come out of in the United States or anywhere else without massive government intervention. And there are very few people -- Professor, you're one of very few people -- who could probably hold a convention in a phone booth right now -- who think massive government intervention is not required.
MIRON: First of all, there's two kinds of government intervention. There's spending increases and there's tax cuts. In the standard Keynesian theory says just as strongly that tax cuts will work. And every economist would agree that lower taxes improves incentives over the long run -- and therefore, over the long run, would be much more beneficial for the economy.
The existing empirical evidence on which is more effective at stimulating -- evidence due, in fact, to Christina Romer, the head of President-Elect Obama's council of the economic advisers... SANCHEZ: Says what?
MIRON: Says that the tax cuts are more effective at stimulating the economy than the spending increases.
SANCHEZ: All right. We're going to have to keep it there, guys.
We'll come back in just a little bit.
We thank you.
By the way, Ali Velshi has a brand new book out. I stayed up and read it last night. It's fabulous and it explains things quite clearly.
Thanks a lot for that, Ali.
We'll be talking to you more about that in a bit.
Let's take a break now.
The next part of Barack Obama's speech has to do with tough choices and the ones that need to be made. Thematically speaking, that's it -- his words -- in its entirety, when we come back -- and our panel.
(COMMERCIAL BREAK)
SANCHEZ: Welcome back.
Now, Barack Obama on tough choices. This is the longest of all the cuts.
From those -- for those of you who are just now getting home from work, let me tell you what we're doing. Barack Obama gave a policy speech today, just days before coming becoming the next president of the United States. We have chosen to let you hear the entire thing.
So here's how he closes this speech today on restimulating or recovering our economy.
(BEGIN AUDIO CLIP)
OBAMA: The true tests of policies we'll pursue won't be whether they're Democratic or Republican ideas, whether they're conservative or liberal ideas, but whether they create jobs, grow our economy and put the American dream within the reach of the American people.
Instead of politicians doling out money behind a veil of secrecy, decisions about where we invest will be made transparently and informed by independent experts wherever possible. Every American will be able to hold Washington accountable for these decisions by going online to see how and where their taxpayer dollars are spent.
And as I announced yesterday, we will launch an unprecedented effort to eliminate unwise and unnecessary spending that has never been more unaffordable for our nation and our children's future than it is right now.
We have to make tough choices and smart investments today, so that as the economy recovers, the deficits start coming down. We cannot have a solid recovery if our people and our businesses don't have confidence that we're getting our fiscal house in order. And that's why our goal is not to create a slew of new government programs, but a foundation for long-term economic growth.
That also means an economic recovery plan that is free from earmarks and pet projects. I understand that every member of Congress has ideas about how to spend money. Many of these projects are worthy. They benefit local communities. But this emergency legislation must not be the vehicle for those aspirations.
This must be a time when leaders in both parties put the urgent needs of our nation above our own narrow interests.
Now, this recovery plan alone will not solve all the problems that led us into this crisis. We must also work, with the same sense of urgency, to stabilize and repair the financial system we all depend on. That means using our full arsenal of tools to get credit flowing again to families and businesses, while restoring confidence in our markets.
It means launching a sweeping effort to address the foreclosure crisis so that we can keep responsible families in their homes.
It means preventing the catastrophic failure of financial institutions, whose collapse could endanger the entire economy, but only with maximum protections for taxpayers and a clear understanding that government support for any company is an extraordinary action that must come with significant restrictions on the firms that receive support.
And it means reforming a weak and outdated regulatory system so that we can better withstand financial shocks and better protect consumers, investors and businesses from the reckless greed and risk- taking that must never endanger our prosperity again.
No longer can we allow Wall Street wrongdoers to slip through regulatory cracks. No longer can we allow special interests to put their thumbs on the economic scales. No longer can we allow the unscrupulous lending and borrowing that leads only to destructive cycles of bubble and bust. It is time to set a new course for this economy and that change must begin now.
We should have an open and honest discussion about this recovery plan in the days ahead. But I urge Congress to move as quickly as possible on behalf of the American people. For every day we wait or point fingers or drag our feet, more Americans will lose their jobs, more families will lose their savings, more dreams will be deferred and denied. And our nation will sink deeper into a crisis that, at some point, we may not be able to reverse.
That is not the country I know. It is not a future I accept as president of the United States. A world that depends on the strength of our economy is now watching and waiting for America to lead once more and that is what we will do. It will not come easy or happen overnight. And it is altogether likely that things may get worse before they get better.
But that all the more reason for Congress to act without delay. I know the scale of this plan is unprecedented, but so is the severity of our situation. We have already tried the wait and see approach to our problems and it is the same approach that helped lead us to this day of reckoning.
And that is why the time has come to build a 21st century economy, in which hard work and responsibility are once again rewarded. That's why I'm asking Congress to work with me and my team day and night -- on weekends if necessary -- to get the plan passed in the next few weeks. That's why I'm calling on all Americans -- Democrats and Republicans and Independents -- to put good ideas ahead of the old ideological battles, a sense of common purpose above the same narrow partisanship and insist that the first question each of us asks isn't what's good for me, but what's good for the country my children will inherit.
More than any program or policy, it is spirit that will enable us to confront these challenges with the same spirit that has led previous generations to face down war and depression and fear itself. And if we do, if we are able to summon that spirit again, if we are able to look out for one another and listen to one another and do our part for our nation and for posterity, then I have no doubt that years from now, we will look back on 2009 as one of those years that marked another new and hopeful beginning for the United States of America.
Thank you. God bless you. And may God bless the United States of America.
(END AUDIO CLIP)
SANCHEZ: And we understand that Barack Obama will now be speaking shortly. This time it will be live.
Let's check in with Candy Crowley.
A passing of the baton, so to speak -- out with Howard Dean, in with Tim Kaine as the new DNC chair.
CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Absolutely.
SANCHEZ: What are we hearing about this?
How is it going to go?
CROWLEY: Well, this is, of course, as you're saying, a passing of the baton. But it's not going all that easily. Howard Dean will not be there, as a matter of fact.
SANCHEZ: Really?
CROWLEY: He is off to America Samoa. He promised that he would visit all 50 states and territories and that was the last one there.
Also, they're going about to -- they're about to inaugurate a governor.
However, a lot of supporters of Howard Dean say he was not invited to this event. And they, at least, find it kind of odd, as one put it to me -- sort of baffling, as another said -- that he would not be there. They think that he has done a lot for the Democratic Party. They have not -- they were not intimately involved in the strategy of the presidential campaign, the DNC.
Nonetheless, certainly a lot of the state chairmen, who are huge supporters of Dean and see him as a real catalyst toward making the DNC better. So, you have that little kerfuffle there.
Dean has not made anything of it publicly, certainly. But it is -- it will be notable for who will not be there.
But Tim Kaine, the governor of Virginia, a very good friend of Barack Obama. They credit Kaine with helping deliver Virginia, which had been Republican forever and a day. It turned Democratic.
So they definitely -- this is the man that they want to put in there. And he will wear two hats -- be governor and the DNC chairman (INAUDIBLE).
SANCHEZ: We've got to hit a break.
But I have to ask you, wasn't Dean the one who came up with the 50-state strategy and isn't that the strategy that eventually worked?
CROWLEY: Well, it is the strategy that eventually works. But I think that the Obama people would tell you that it was the man and not the infrastructure.
But, nonetheless, they both added to it.
SANCHEZ: Wow! That's interesting that he wouldn't be there. And one does begin to suddenly ask a lot of questions. And I imagine you'll be getting to those, as well.
Candy Crowley, thanks so much for bringing us up to date on that.
Now, let's take a break here real quick, because when we come back, we expect we might have Barack Obama live, speaking about this transition. And we'll also have our guests talking about his speech earlier today. A lot going on, including the earthquake in Costa Rica.
We'll be right back.
(COMMERCIAL BREAK)
OBAMA: ...that we would build a movement for change. With the support of ordinary men and women who gave whatever time and money they could spare, we did just that. And that's why we can truly call our success on November 4th not just a Democratic victory, but an American victory.
On the other hand, it would be a mistake to take our success in the campaign as a sign that our work is somehow complete. At a time when the challenges we face in this country are so vast, we cannot afford to abandon the movement we built. We have to strengthen it. We must build a movement for change that can endure beyond a single election. And that will require redoubling our efforts to reach out to Americans throughout our 50 states, north and south, east and west. It will require finding candidates for elective office whose policies and plans are rooted not in ideology, but in what works. And it will require shedding our ingrained habits of taking money from federal lobbyists and special interests and relying instead on small donations from ordinary Americans.
We're in a strong position to rebuild a Democratic Party committed to these principles because of the outstanding work of its current, Chairman Howard Dean. For nearly four years, Howard has served our party and our nation as a visionary and effective leader. He launched a 50-state strategy that made Democrats competitive in places they had not been in years -- working with my chief of staff, Rahm Emanuel, to give the Democrats a majority in the House for the first time in over a decade.
Having steered the Democratic Party through two successful elections, Howard deserves enormous credit for helping usher in a new era in Washington. And now is the time not only to build on Howard's record of achievement, but to remake the Democratic Party to meet the challenges of the 21st century.
And no one is better suited to help lead this effort than the new chairman of the DNC, my good friend, Governor Tim Kaine of Virginia.
Tim comes from Virginia, a state that reflects America, where people of all backgrounds and walks of life, big cities and small towns, and a growing population come together -- but in a state so diverse, Tim has been a successful candidate and a successful governor not by appealing to our divisions, but by appealing to our common hopes; not by pursuing policies that advance any dogma, but by pursuing policies that work for the people of Virginia.
Tim and I share a philosophy. It's a pragmatic, progressive philosophy that was at the heart of my campaign and will be at the heart of this administration. It's a philosophy that measures the strength of an idea not by whether it's Republican or Democrat, but whether it can actually solve a problem and make a difference in people's lives.
Tim knows that breaking free of the old orthodoxies and reaching across party lines isn't just a way to build a Democratic Party that's more open and inclusive, it's a way to achieve progress for all Americans. He understands that while politics is tough and we need to fight hard for our ideals and our values, we also need to work together to solve our common problems. That's how he built what has become a model of good and responsible government in the Commonwealth of Virginia. As governor, Tim's promoted smart growth reforms to help traffic move better and improve the quality of life in our communities; ramped up the number of children getting health care and a pre-K education; and invested in schools while holding them more accountable.
Under his watch, Virginia has become one of America's leading centers of innovation -- creating new jobs, building new industries and seizing the opportunities of a 21st century economy.
In the end, what will make Tim such an outstanding DNC chairman is not just his ability to win campaigns by bringing people together or his recognition that we need new, more pragmatic approaches to meet the challenges of our time. It's his belief that politics is about something more than what all too often it's become in Washington. That it's not about enriching corporate friends or feeding partisan disputes or getting your name in the papers, but about the dignity of service. That's the kind of leadership he will bring to the Democratic Party. That's the kind of leadership the Democratic Party will bring to America.
So, with that, let me just introduce very briefly the new chairman of the Democratic National Committee, Governor Tim Kaine.
GOV. TIM KAINE (D), VIRGINIA, INCOMING DEMOCRATIC PARTY CHAIRMAN: Well, thank you President-Elect Obama.
It is such a treat to be here today and accept this honor. I will say about you that you've proved to me in this discussion what you proved to Americans on November 4th -- that you are a very persuasive individual. And I am -- I'm thrilled to accept the opportunity and humbled, as well.
I signed onto Barack Obama's campaign for presidency in February of 2007, early, with a great deal of confidence in him as the person who should be the leader of what I believe will be a very challenging time for our nation, that we are now in. And I'm so proud of the campaign that he ran, the policies that he advocated. And I'm proud of my native state of Virginia, which supported him in a very unusual way, after not having supported a Democratic candidate for 44 years.
I want to thank the president-elect for his confidence in me. Io have been honored to serve 15 years in elective office, entering my last year as governor of Virginia. And I pledge to do my very best to continue to keep his trust in this very important job.
I hope to do three things as DNC chair. I want to promote this president's agenda. I want to carry the proud banner of a proud party. And I want to work to creatively engage citizens in and new ways, through this party, to be active in civic life.
In promoting the president's agenda, we're at a crossroads time for this nation. It is truly a time of momentous import, as we confront challenging economic circumstances and a troubled international environment.
All Americans, however they voted on November 4th, have a huge stake in this presidency being successful. And so I will be a passionate and positive promoter of President Obama's agenda. And that will be my first goal as DNC chair.
My second goal is to carry a proud banner for a proud party. The Democratic Party has a long pedigree. And the basic values -- the best of what being a Democrat is about -- belief in the equality of all; the lifting and leveling power of education; the dignity of work; the power of innovation in America; our responsibilities to each other, especially to the least of these. And internationally, that we're strong when we're strong militarily and economically, but that we also have to be strong diplomatically and in our moral example.
Those are the basic values of the Democratic Party that I cherish and that Americans of all parties cherish those values, as well.
In Virginia, we've managed to do some good as Democrats. When I started as a statewide candidate in state politics in 2000, our party was moribund. But we, beginning with a great leader, Mark Warner, Jim Webb, so many other great Democrats -- we've won a lot of seats. But we haven't done it because of the letter after our name. We've done it because we have made the party in Virginia working everyday a party of problem solvers and unifiers.
We're not the ideologues, the instructionist, the gridlock folks. We're the problem solvers.
And we're not the dividers. In Virginia, we've rejected the politics of negativity -- the politics that, you know, often energizes the 51 percent by beating up on the 49 percent and instead tried to unify people. And so that will be the same model that I will try to carry here as DNC chair, as I carry the banner for this great party.
And, finally, the thing I'm most excited about -- being able to engage Americans in new ways in politics. Chairman Dean, with the 50- state strategy here at the DNC, has just done a remarkable job, as the president-elect said, in recognizing that we can't be a regional party or a party of a few states that might get us to 270 electoral votes, but that we've got to be a party that plays everywhere.
And what a remarkable job he did in his four year tenure. I've got huge shoes to fill.
And then Senator Obama, in his campaign, they campaigned in truly a different way. I remember early in the campaign, a friend of mine in Virginia said, well, he's good on the inspiration. But I thought, you know, you just don't see it. Because at the end of the day, the story of this campaign was less about the inspiration than about the organization -- and organization around what I think is a pretty basic principle -- the principle that everybody matters.
You don't have to be a big donor for your donation to matter. You don't have to be a Ph.D. or a foreign policy expert for your idea to matter. And you don't have to be a full-time campaign worker for your effort to matter.
And so if we can engage people, as we did in this campaign in remarkable ways -- many coming into politics for their first time -- many without a party affiliation, who just felt excited that a candidate was offering them a chance to engage, we can do the same thing in politics not just around election cycles, but also around making change -- the changes that this president wants in our economy, in our health care system, in our need to find a brighter and cleaner energy future.
And so in those three areas, I'm going to do my best for my friend. I consider Barack a great friend. I can -- I'll call him Barack until January 18th and then thereafter, there will be a different title.
But I am -- I'm very, very humbled at this opportunity and excited to take it on and we'll do great work together.
Thank you so much.
OBAMA: Thanks to you.
Appreciate it.
Thank you, guys.
SANCHEZ: And there you go.
Mark Preston, Patricia Murphy -- Tim Kaine, moderate, left of center, right of center -- where does he fall and how does he match up with the rest of the folks that we've seen the president-elect introduce us to in the last couple of weeks?
MARK PRESTON, CNN POLITICAL EDITOR: Well, certainly, he is considered a moderate. He was somebody who was with Barack Obama very early on. This is not a surprising appointment. He did say right after the election he was not interested in this, Rick.
But, of course, he said Barack Obama was very encouraging. And, of course, he did -- one thing he did say there, though, he said he had three goals. His first goal was to really push Barack Obama's agenda, which really ties into what we've been talking about for the past hour, and that, of course, is to get this economic bill right through Congress. So you will see the DNC certainly start shifting gears and working on that, I think, the in the next couple of weeks.
SANCHEZ: You know, I want to get -- I've got -- I want to get a sense of what average Americans are thinking -- the average working American. We've got three of them here -- Juanita, Troy and Rebecca.
From what you've seen so far, whether you voted for him or not, of Barack Obama -- does he seem presidential?
Does he seem like the guy who's going to be able to get this job done?
Juniata?
JUANITA DVORSKY, RETIRED TEACHER: I think he's going to be a won -- do a wonderful, wonderful job. And I'm just hoping that he will also be helping we retirees and, also, our children, our grandchildren -- because of the education. Our education system here in the United States has been going down. And I feel bad about that because as...
SANCHEZ: Education is the big issue for you. You and I were talking about that during the break. It's interesting, depending on how you talk to, Troy, for example, Rebecca -- different perspectives on this. But, again, that question -- Barack Obama so far, his composure, his comportment, the way he's handled himself, the way he's spoken, the people he's chosen, please you, Troy?
TROY FLUKER, BUSINESS COORDINATOR: Yes, definitely. I really like the ex -- excuse me -- the subtitle you had on the except before that said "do something." He's actually doing something. And a lot of -- I know he has a lot of naysayers and critics on his plans, but actually has a plan. And I've yet to hear someone come up with anything better.
SANCHEZ: Matt Sargent is watching us. He's joining us on Facebook now. He says: "It's going to be far more interesting to watch Obama as he's doing things rather than this pre-game show of what he wants to do about things."
Is that a fair criticism -- it's easier to talk about what you plan to do than what are actually going to do when you get into office?
Rebecca?
REBECCA BURNOS, ADVERTISER: I think that has a tendency of happening throughout history. You know, you hear all these great plans and then you don't really see them executed as you would expect, maybe because of some of the political red tape he's been talking about through some of these speeches.
But...
SANCHEZ: Patricia Murphy, let me bring you into this.
He said a couple of things during his speech on the economy. One of them was: "We come to this point after a period of irresponsibility."
He also said: "Politically, we must move transparently."
Is he taking a shot at the...
PATRICIA MURPHY, EDITOR, CITIZENJANEPOLITICS.COM:
PRESTON: Yes. In Washington...
SANCHEZ: Is he taking a shot at the other administration here, this past administration?
MURPHY: Well, it may be a shot at the other administration. It's also, right now, certainly, a message to Congress that for him, sunlight is the best disinfectant -- the only way to keep objectionable projects out of this is going to have them online and to have people who are able to look through those, have taxpayers look through there and see how their tax dollars are being spent.
But that's going to be very difficult for him, I think, to keep pork out of that. This is being called a lobbyist free-for-all here in Washington. And members are not going to be able to vote for this bill if they can't tell their constituents how it's going to help them back home.
SANCHEZ: That's interesting.
MURPHY: And there are going to be tough hurdles to come.
SANCHEZ: That's interesting that you'd raise that. I mean, the whole lobbying issue -- it's like a pressure that's undeniable -- Mark Preston, you live in Washington. You know the town.
Can this guy buck up and resist that, as so many others before him have not been able to?
PRESTON: You know, I think he's going to have to buck up and resist it. That's all he's talked about, Rick, his whole campaign -- he's a Washington outsider, he's going to come here and change things. We heard that in his speech today.
But look, everything we heard today, we've heard bits and pieces before. He's a salesman right now. He is trying to sell this plan. And he is also trying to sell that he's going to bring change to Washington. And the only thing that we'll ever know if that happens is time. So we've got to give him some time to see if he can pull it off.
SANCHEZ: How about his demeanor?
By the way, let me show you a MySpace comment that just came in right now. Go ahead, Robert, twist that thing around there and you'll see: "The more I heard this speech, the more I know that he will try his darndest to fix our economy -- to fix our country."
You know, one thing is to try, the other one is to execute. As another -- as an old football coach of mine used to say -- and certainly we're going to be watching, along with the rest of America, here at CNN.
Juanita, Troy and Rebecca, thanks so much for coming in.
UNIDENTIFIED FEMALE: You're welcome.
SANCHEZ: Thanks for taking your time. I know we interrupted you, Juanita. So we were able to get you tickets to go over to the Georgia Aquarium, all right?
We've got you taken care of.
DVORSKY: Thank you.
SANCHEZ: And, of course, we want to say thanks, as well, to Patricia Murphy and Mark Preston for taking us through this.
And to those at home, we'll continue to stay on the story. Now Wolf Blitzer is standing by.
He's got "THE SITUATION ROOM".
BLITZER: Thanks very much, Rick.
