Highlight 7 Positive Statements economic report of the president To the Congress

Question

Highlight 7 Positive Statements

economic report of the president

To the Congress of the United States:

As we begin a new year, the American people are still experiencing

the effects of a recession as deep and painful as any we have known in

generations. Traveling across this country, I have met countless men and

women who have lost jobs these past two years. I have met small business

owners struggling to pay for health care for their workers; seniors unable

to afford prescriptions; parents worried about paying the bills and saving

for their children’s future and their own retirement. And the effects of this

recession come in the aftermath of a decade of declining economic security

for the middle class and those who aspire to it.

At the same time, over the past two years, we have also seen reason

for hope: the resilience of the American people who have held fast—

even in the face of hardship—to an unrelenting faith in the promise of

our country.

It is that determination that has helped the American people

overcome difficult periods in our Nation’s history. And it is this perseverance

that remains our great strength today. After all, our workers are as

productive as ever. American businesses are still leaders in innovation.

Our potential is still unrivaled. Our task as a Nation—and our mission

as an Administration—is to harness that innovative spirit, that productive

energy, and that potential in order to create jobs, raise incomes, and foster

economic growth that is sustained and broadly shared. It’s not enough

to move the economy from recession to recovery. We must rebuild the

economy on a new and stronger foundation.

I can report that over the past year, this work has begun. In the

coming year, this work continues. But to understand where we must go

in the next year and beyond, it is important to remember where we began

one year ago.

Last January, years of irresponsible risk-taking and debt-fueled

speculation—unchecked by sound oversight—led to the near-collapse

of our financial system. We were losing an average of 700,000 jobs each

month. Over the course of one year, $13 trillion of Americans’ household

wealth had evaporated as stocks, pensions, and home values plummeted.

Our gross domestic product was falling at the fastest rate in a quarter

century. The flow of credit, vital to the functioning of businesses large and

small, had ground to a halt. The fear among economists, from across the

political spectrum, was that we could sink into a second Great Depression.

Immediately, we took a series of difficult steps to prevent that

catastrophe for American families and businesses. We acted to get lending

flowing again so ordinary Americans could get financing to buy homes

and cars, to go to college, and to start businesses of their own; and so

businesses, large and small, could access loans to make payroll, buy equipment,

hire workers, and expand. We enacted measures to stem the tide of

foreclosures in our housing market, helping responsible homeowners stay

in their homes and helping to stop the broader decline in home values.

To achieve this, and to prevent an economic collapse, we were forced

to use authority enacted under the previous Administration to extend

assistance to some of the very banks and financial institutions whose

actions had helped precipitate the turmoil. We also took steps to prevent

the collapse of the American auto industry, which faced a crisis partly

of its own making, to prevent another round of widespread job losses in

an already fragile time. These decisions were not popular, but they were

necessary. Indeed, the decision to stabilize the financial system helped to

avert a larger catastrophe, and thanks to the efficient management of the

rescue—with added transparency and accountability—we have recovered

most of the money provided to banks.

In addition, even as we worked to address the crises in our banking

sector, in our housing market, and in our auto industry, we also began

attacking our economic crisis on a broader front. Less than one month

after taking office, we enacted the most sweeping economic recovery

package in history: the American Recovery and Reinvestment Act of

2009. The Recovery Act not only provided tax cuts to small businesses and

95 percent of working families and provided emergency relief to those out

of work or without health insurance; it also began to lay a new foundation

for long-term growth. With investments in health care, education, infrastructure,

and clean energy, the Recovery Act has saved or created roughly

two million jobs so far, and it has begun the hard work of transforming our

economy to thrive in the modern, global era.

Because of these and other steps, we can safely say that we’ve avoided

the depression many feared. Our economy is growing again, and the

growth over the last three months was the strongest in six years. But while

economic growth is important, it means nothing to somebody who has

lost a job and can’t find another. For Americans looking for work, a good

job is the only good news that matters. And that’s why our work is far

from complete.

It is true that the steps we have taken have slowed the flood of job

losses from 691,000 per month in the first quarter of 2009 to 69,000 in the

last quarter. But stemming the tide of job loss isn’t enough. More than

7 million jobs have been lost since the recession began two years ago. This

represents not only a terrible human tragedy, but also a very deep hole

from which we’ll have to climb out. Until jobs are being created to replace

those we’ve lost—until America is back at work—my Administration will

not rest and this recovery will not be finished.

That’s why I am continuing to call on the Congress to pass a jobs bill.

I’ve proposed a package that includes tax relief for small businesses to spur

hiring, that accelerates construction on roads, bridges, and waterways,

and that creates incentives for homeowners to invest in energy efficiency,

because this will create jobs, save families money, and reduce pollution

that harms our environment.

It is also essential that as we promote private sector hiring, we

continue to take steps to prevent layoffs of critical public servants like

teachers, firefighters, and police officers, whose jobs are threatened by

State and local budget shortfalls. To do otherwise would not only worsen

unemployment and hamper our recovery; it would also undermine our

communities. And we cannot forget the millions of people who have lost

their jobs. The Recovery Act provided support for these families hardesthit

by this recession, and that support must continue.

At the same time, long before this crisis hit, middle-class families

were under growing strain. For decades, Washington failed to address

fundamental weaknesses in the economy: rising health care costs, growing

dependence on foreign oil, an education system unable to prepare all of

our children for the jobs of the future. In recent years, spending bills and

tax cuts for the very wealthiest were approved without paying for any of

it, leaving behind a mountain of debt. And while Wall Street gambled

without regard for the consequences, Washington looked the other way.

As a result, the economy may have been working for some at the

very top, but it was not working for all American families. Year after year,

folks were forced to work longer hours, spend more time away from their

loved ones, all while their incomes flat-lined and their sense of economic

security evaporated. Growth in our country was neither sustained nor

broadly shared. Instead of a prosperity powered by smart ideas and sound

investments, growth was fueled in large part by a rapid rise in consumer

borrowing and consumer spending.

Beneath the statistics are the stories of hardship I’ve heard all

across America—hardships that began long before this recession hit two

years ago. For too many, there has long been a sense that the American

dream—a chance to make your own way, to work hard and support your

family, save for college and retirement, own a home—was slipping away.

And this sense of anxiety has been combined with a deep frustration that

Washington either didn’t notice, or didn’t care enough to act.

These weaknesses have not only made our economy more

susceptible to the kind of crisis we have been through. They have also

meant that even in good times the economy did not produce nearly enough

gains for middle-class families. Typical American families saw their standards

of living stagnate, rather than rise as they had for generations. That

is why, in the aftermath of this crisis, and after years of inaction, what is

clear is that we cannot go back to business as usual.

That is why, as we strive to meet the crisis of the moment, we are

continuing to lay a new foundation for prosperity: a foundation on which

the middle class can prosper and grow, where if you are willing to work

hard, you can find a good job, afford a home, send your children to worldclass

schools, afford high-quality health care, and enjoy retirement security

in your later years. This is the heart of the American Dream, and it is at

the core of our efforts to not only rebuild this economy—but to rebuild it

stronger than before. And this work has already begun.

Already, we have made historic strides to reform and improve our

education system. We have launched a Race to the Top in which schools

are competing to create the most innovative programs, especially in math

and science. We have already made college more affordable, even as we

seek to increase student aid by ending a wasteful subsidy that serves only

to line the pockets of lenders with tens of billions of taxpayer dollars. And

I’ve proposed a new American Graduation Initiative and set this goal: by

2020, America will once again have the highest proportion of college graduates

in the world. For we know that in this new century, growth will be

powered not by what consumers can borrow and spend, but what talented,

skilled workers can create and export.

Already, we have made historic strides to improve our health care

system, essential to our economic prosperity. The burdens this system

places on workers, businesses, and governments is simply unsustainable.

And beyond the economic cost—which is vast—there is also a terrible

human toll. That’s why we’ve extended health insurance to millions more

children; invested in health information technology through the Recovery

Act to improve care and reduce costly errors; and provided the largest

boost to medical research in our history. And I continue to fight to pass

real, meaningful health insurance reforms that will get costs under control

for families, businesses, and governments, protect people from the worst

practices of insurance companies, and make coverage more affordable and

secure for people with insurance, as well as those without it.

Already, we have begun to build a new clean energy economy. The

Recovery Act included the largest investment in clean energy in history,

investments that are today creating jobs across America in the industries

that will power our future: developing wind energy, solar technology, and

clean energy vehicles. But this work has only just begun. Other countries

around the world understand that the nation that leads the clean energy

economy will be the nation that leads the global economy. I want America

to be that nation. That is why we are working toward legislation that will

create new incentives to finally make renewable energy the profitable

kind of energy in America. It’s not only essential for our planet and our

security, it’s essential for our economy.

But this is not all we must do. For growth to be truly sustainable—

for our prosperity to be truly shared and our living standards to actually

rise—we need to move beyond an economy that is fueled by budget deficits

and consumer demand. In other words, in order to create jobs and raise

incomes for the middle class over the long run, we need to export more

and borrow less from around the world, and we need to save more money

and take on less debt here at home. As we rebuild, we must also rebalance.

In order to achieve this, we’ll need to grow this economy by growing our

capacity to innovate in burgeoning industries, while putting a stop to irresponsible

budget policies and financial dealings that have led us into such

a deep fiscal and economic hole.

That begins with policies that will promote innovation throughout

our economy. To spur the discoveries that will power new jobs, new businesses—

and perhaps new industries—I have challenged both the public

sector and the private sector to devote more resources to research and

development. And to achieve this, my budget puts us on a path to double

investment in key research agencies and makes the research and experimentation

tax credit permanent. We are also pursuing policies that will

help us export more of our goods around the world, especially by small

8 | E conomic Report of the President

businesses and farmers. And by harnessing the growth potential of international

trade—while ensuring that other countries play by the rules and

that all Americans share in the benefits—we will support millions of good,

high-paying jobs.

But hand in hand with increasing our reliance on the Nation’s

ingenuity is decreasing our reliance on the Nation’s credit card, as well as

reining in the excess and abuse in our financial sector that led large firms

to take on extraordinary risks and extraordinary liabilities.

When my Administration took office, the surpluses our Nation

had enjoyed at the start of the last decade had disappeared as a result of

the failure to pay for two large tax cuts, two wars, and a new entitlement

program. And decades of neglect of rising health care costs had put our

budget on an unsustainable path.

In the long term, we cannot have sustainable and durable economic

growth without getting our fiscal house in order. That is why even as we

increased our short-term deficit to rescue the economy, we have refused

to go along with business as usual, taking responsibility for every dollar we

spend. Last year, we combed the budget, cutting waste and excess wherever

we could, a process that will continue in the coming years. We are

pursuing health insurance reforms that are essential to reining in deficits.

I’ve called for a fee to be paid by the largest financial firms so that the

American people are fully repaid for bailing out the financial sector. And

I’ve proposed a freeze on nonsecurity discretionary spending for three

years, a bipartisan commission to address the long-term structural imbalance

between expenditures and revenues, and the enactment of “pay-go”

rules so that Congress has to account for every dollar it spends.

In addition, I’ve proposed a set of common sense reforms to prevent

future financial crises. For while the financial system is far stronger today

than it was one year ago, it is still operating under the same rules that led

to its near-collapse. These are rules that allowed firms to act contrary to

the interests of customers; to hide their exposure to debt through complex

financial dealings that few understood; to benefit from taxpayer-insured

deposits while making speculative investments to increase their own

profits; and to take on risks so vast that they posed a threat to the entire

economy and the jobs of tens of millions of Americans.

That is why we are seeking reforms to empower consumers with

the benefit of a new consumer watchdog charged with making sure that

financial information is clear and transparent; to close loopholes that

allowed big financial firms to trade risky financial products like credit

defaults swaps and other derivatives without any oversight; to identify

system-wide risks that could cause a financial meltdown; to strengthen

capital and liquidity requirements to make the system more stable; and to

ensure that the failure of any large firm does not take the economy down

with it. Never again will the American taxpayer be held hostage by a bank

that is “too big to fail.”

Through these reforms, we seek not to undermine our markets but

to make them stronger: to promote a vibrant, fair, and transparent financial

system that is far more resistant to the reckless, irresponsible activities

that might lead to another meltdown. And these kinds of reforms are in

the shared interest of firms on Wall Street and families on Main Street.

These have been a very tough two years. American families and

businesses have paid a heavy price for failures of responsibility from Wall

Street to Washington. Our task now is to move beyond these failures, to

take responsibility for our future once more. That is how we will create

new jobs in new industries, harnessing the incredible generative and

creative capacity of our people. That is how we’ll achieve greater economic

security and opportunity for middle-class families in this country. That

is how in this new century we will rebuild our economy stronger than

ever before.

the white house

february 2010

Explanation / Answer

In economics ,positive approach means looking at things the way it is. It is fact based and can be verified.

From this view point 7 positive statements in the above report are,

1.American people are still experiencing the effects of a recession as deep and painful as any we have known in generations

2.With investments in health care, education, infrastructure, and clean energy, the Recovery Act has saved or created roughly two million jobs so far.

3.Our economy is growing again, and the growth over the last three months was the strongest in six years.

4.We also took steps to prevent the collapse of the American auto industry, which faced a crisis partly of its own making, to prevent another round of widespread job losses in an already fragile time.

5.By 2020, America will once again have the highest proportion of college graduates in the world.

6. Growth in our country was neither sustained nor broadly shared.

7.We have launched a Race to the Top in which schools are competing to create the most innovative programs, especially in math and science.

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