Obama to speak on financial crisis

US president Barack Obama will make his first comments on the economy and the financial crisis today as the White House makes the issue its top post-election priority.

Obama to speak on financial crisis

US president Barack Obama will make his first comments on the economy and the financial crisis today as the White House makes the issue its top post-election priority.

The move underscored the vital importance of averting severe year-end tax increases and spending cuts as Mr Obama heads towards a second term.

The newly re-elected president is also considering replacements for high-profile team members expected to leave his cabinet and the White House soon.

Treasury secretary Timothy Geithner and secretary of state Hillary Clinton want to step down, but have indicated a willingness to delay their departures into next year, or at least until successors are confirmed. Defence secretary Leon Panetta also wants to retire next year.

The president privately delved into both issues yesterday, on his first full day back in Washington following his re-election. He and his team were also assessing how congressional Republicans were positioning themselves following the election before saying much publicly about his second term.

In his victory speech, Mr Obama offered a call for reconciliation after a divisive campaign. But he made clear he had an agenda in mind, citing a need for changes in the tax code as well as immigration reform and climate change.

Obama aides want to avoid what they believe was an over-reach by President George Bush, who declared after narrowly winning re-election that he had “political capital” and intended to spend it.

One of Mr Bush’s first moves was to push to privatise government Social Security pensions – a plan roundly rejected by Congress and the public.

The White House believes Mr Obama has a clear mandate on one key issue: raising taxes on families earning more than 250,000 dollars (£157,000) a year. His senior adviser David Plouffe said voters “clearly chose the president’s view of making sure the wealthiest Americans are asked to do a little bit more” to help shrink the federal deficit.

The president has long advocated allowing tax cuts first passed by Mr Bush to expire for upper-income earners. But he gave in to Republican demands in 2010 and allowed the cuts to continue, angering many Democrats.

Both parties agree that the combination of tax increases and spending cuts from January 1, the so-called fiscal cliff, could plunge the economy back into recession.

Republican House of Representatives speaker John Boehner said on Wednesday that he wanted to compromise with the re-elected president. He said the chamber would be willing to accept higher tax revenue under the right conditions as part of a more sweeping attempt to reduce deficits.

The White House wants consistency in its fiscal cliff negotiating team, meaning Mr Geithner is likely to put off his departure from Treasury until Mr Obama and politicians can reach some agreement.

White House chief of staff Jack Lew is seen as a leading candidate to replace Mr Geithner. He is well respected in Washington by both parties and served as budget director under both Mr Obama and former president Bill Clinton.

Another person often mentioned as a possible successor to Mr Geithner is Erskine Bowles, a White House chief of staff under Mr Clinton and the co-chief of the White House’s 2010 deficit reduction commission.

Both men would bring an intimate knowledge of the intricacies of the national budget and could be expected to take a leading role in trying to negotiate a broad budget agreement with Congress.

The selection of either would signal that the administration intends to make resolution of the government’s deficit problems a priority.

At the State Department, the leading candidates to take over as the top US diplomat are Democratic senator John Kerry and Susan Rice, the US ambassador to the United Nations.

But Ms Rice has faced criticism from Republicans for providing initial accounts about the deaths of Americans in Benghazi, Libya, that later proved false. The White House has vigorously defended her, but the prospect of starting a second term with a contentious confirmation hearing may be unappealing.

Mr Kerry, an early Obama backer, has long coveted the State Department job. He has travelled overseas on Mr Obama’s behalf and even played the role of Republican challenger Mitt Romney during campaign debate preparations this year.

Other cabinet secretaries who have talked about leaving are attorney general Eric Holder and transportation secretary Ray LaHood, the only Republican in the cabinet. Both have said they would speak to the president before making a final decision.

more courts articles

Gary Glitter victim seeking six-figure sum in damages, court told Gary Glitter victim seeking six-figure sum in damages, court told
Stephen Bear ordered to pay back profits from sharing private sex tape Stephen Bear ordered to pay back profits from sharing private sex tape
Man (25) in court charged with murdering his father and attempted murder of mother Man (25) in court charged with murdering his father and attempted murder of mother

More in this section

FILE PHOTO The Competition and Consumer Protection Commission has cleared the purchase of Goodbody Stockbrokers by AIB END Goodbody Stockbrokers fined over €1.2m by Central Bank over rules breaches
Nottingham City Centre Stock Irish staff at the Body Shop wait for wages as retailer shuts stores in the Republic
Ryanair comments on Norwegian Ryanair boss O'Leary's spat with Transport Minister over Dublin Airport escalates
IE logo
Devices


UNLIMITED ACCESS TO THE IRISH EXAMINER FOR TEAMS AND ORGANISATIONS
FIND OUT MORE

The Business Hub
Newsletter

News and analysis on business, money and jobs from Munster and beyond by our expert team of business writers.

Sign up
ie logo
Puzzles Logo

Play digital puzzles like crosswords, sudoku and a variety of word games including the popular Word Wheel

Lunchtime News
Newsletter

Keep up with the stories of the day with our lunchtime news wrap.

Sign up
Cookie Policy Privacy Policy Brand Safety FAQ Help Contact Us Terms and Conditions

© Examiner Echo Group Limited