Obama Faces Growing Economic Storms
Program Note: Tune in to hear more from David Gergen tonight on the AC360° at 10 p.m. ET. And watch him on the CNN Money Summit on Friday at 11 p.m. ET.
David Gergen
AC360° Contributor
CNN Senior Political Analyst
This is a good moment to look ahead at the extraordinary challenges facing President Obama and how he and his team will try to solve them. Based on what has appeared in the public press as well as personal conversations in Washington, here is my best take:
In winning passage of the stimulus package, the President managed his way successfully through his first storm but he and his team recognize there are darker, more treacherous ones ahead. The economy has been deteriorating at such an accelerating rate in recent months that the administration had to expand the size of the stimulus package far beyond what they originally envisioned. If the economy continues to sink - and signs around the globe point in that direction - even this package will not be big enough. And economists of almost every stripe complain that its impact was weakened during the political wrangling.
For now, administration insiders believe that the package will begin to help quickly in saving jobs that might have been lost (e.g., with infusions of fresh money, state governments will not have to fire as many people). But insiders are not really expecting the stimulus to start creating many new jobs — or at least those that will show up in statistics - until early next year. Moreover, they recognize that they may have to come back for additional installments of stimulus in the months ahead. No future package should be as large, but there is likely to be a clear need to expand unemployment benefits again. So, look for more stimulus down the road - we just don’t know how much.
(More here.)
David Gergen
AC360° Contributor
CNN Senior Political Analyst
This is a good moment to look ahead at the extraordinary challenges facing President Obama and how he and his team will try to solve them. Based on what has appeared in the public press as well as personal conversations in Washington, here is my best take:
In winning passage of the stimulus package, the President managed his way successfully through his first storm but he and his team recognize there are darker, more treacherous ones ahead. The economy has been deteriorating at such an accelerating rate in recent months that the administration had to expand the size of the stimulus package far beyond what they originally envisioned. If the economy continues to sink - and signs around the globe point in that direction - even this package will not be big enough. And economists of almost every stripe complain that its impact was weakened during the political wrangling.
For now, administration insiders believe that the package will begin to help quickly in saving jobs that might have been lost (e.g., with infusions of fresh money, state governments will not have to fire as many people). But insiders are not really expecting the stimulus to start creating many new jobs — or at least those that will show up in statistics - until early next year. Moreover, they recognize that they may have to come back for additional installments of stimulus in the months ahead. No future package should be as large, but there is likely to be a clear need to expand unemployment benefits again. So, look for more stimulus down the road - we just don’t know how much.
(More here.)
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