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Barack Obama on Budget & Economy

Democratic incumbent President; IL Senator (2004-2008)


FactCheck: Deficits cut in half, but still higher than 2008

Obama said, "Our deficits--cut by more than half."

Fact Check: The federal budget deficit has declined in half since 2009, from $1.3 trillion to about $600 billion, but that's not much to brag about. The 2009 figure was not just a deficit Obama inherited from his predecessor, since it also reflected the impact of decisions, such as the $800 billion stimulus bill, enacted early in the president's term.

Moreover, the deficit soared in the first place because of the recession, so as the economy has improved, the deficit naturally decreased. The United States still has a deficit higher than it was in nominal terms and as a percentage of gross domestic product than it was in 2008 and a debt much greater as a percentage of the overall economy than it was prior to the recession.

Source: Washington Post FactCheck on 2014 State of the Union , Jan 28, 2014

FactCheck: $2.5T deficit reduction is a debatable estimate

Obama said the administration and Congress "have worked together to reduce the deficit by more than $2.5 trillion." A bipartisan group called the estimate "very reasonable." But it is only an estimate--and a debatable one at that--for deficit reduction from budgets through fiscal year 2022. Exactly how much will be cut will be up to future Congresses. And, even if Congress meets those deficit-reduction goals, deficit spending will continue and the federal debt will grow larger--unless much more is done

Obama has cited the $2.5 trillion figure on numerous occasions. It is based largely on two pieces of legislation: the Budget Control Act, which placed caps on discretionary spending, and the American Taxpayer Relief Act, which prevented tax hikes on most Americans but allowed rates to go up on the top 1% of taxpayers.

Republicans challenge the $2.5 trillion figure with some justification, because the amount of savings depends heavily on the baseline--that is, the starting point of comparison.

Source: FactCheck.org on 2013 State of the Union Address , Feb 13, 2013

$4T in deficit reduction: tax the top 1%

Our work must begin by making some basic decisions about our budget--decisions that will have a huge impact on the strength of our recovery.

Over the last few years, both parties have worked together to reduce the deficit by more than $2.5 trillion-- mostly through spending cuts, but also by raising tax rates on the wealthiest 1 percent of Americans. As a result, we are more than halfway towards the goal of $4 trillion in deficit reduction that economists say we need to stabilize our finances.

Source: 2013 State of the Union Address , Feb 12, 2013

Uphold full faith & credit of US; keep government open

I realize that tax reform and entitlement reform won't be easy. The politics will be hard for both sides. None of us will get 100 percent of what we want. But the alternative will cost us jobs, hurt our economy, and visit hardship on millions of hardworking Americans. So let's set party interests aside, and work to pass a budget that replaces reckless cuts with smart savings and wise investments in our future. And let's do it without the brinksmanship that stresses consumers and scares off investors. The greatest nation on Earth cannot keep conducting its business by drifting from one manufactured crisis to the next. Let's agree, right here, right now, to keep the people's government open, pay our bills on time, and always uphold the full faith and credit of the United States of America. The American people have worked too hard, for too long, rebuilding from one crisis to see their elected officials cause another.
Source: 2013 State of the Union Address , Feb 12, 2013

Home mortgage problems are holding back our economy

Even with mortgage rates near a 50-year low, too many families with solid credit who want to buy a home are being rejected. Too many families who have never missed a payment and want to refinance are being told no. That's holding our entire economy back, and we need to fix it. Right now, there's a bill in this Congress that would give every responsible homeowner in America the chance to save $3,000 a year by refinancing at today's rates. Democrats and Republicans have supported it before. What are we waiting for? Take a vote, and send me that bill. Right now, overlapping regulations keep responsible young families from buying their first home. What's holding us back? Let's streamline the process, and help our economy grow.
Source: 2013 State of the Union Address , Feb 12, 2013

After 10 years of war, it's time for nation-building at home

After a decade of war, it's time to do some nation-building here at home. And what we can now do is free up some resources to, for example, put Americans back to work, especially our veterans, rebuilding our roads, our bridges, our schools, making sure that, you know, our veterans are getting the care that they need when it comes to post-traumatic stress disorder and traumatic brain injury, making sure that the certifications that they need for good jobs of the future are in place.

The first lady has done great work with an organization called Joining Forces putting our veterans back to work. And as a consequence, veterans' unemployment is actually now lower than general population, it was higher when I came into office. So those are the kinds of thtwings that we can now do because we're making that transition in Afghanistan.

Source: Third Obama-Romney 2012 Presidential debate , Oct 22, 2012

Romney's plan will blow up the deficit or raise your taxes

The fact that Romney only has to pay 14% on his taxes when a lot of you are paying much higher--he's already taken that off the board, capital gains are going to continue to be at a low rate so we're not going to get money that way. Romney was a very successful investor. If somebody came to him with a plan to spend $7 to 8 trillion, then we're going to pay for it, but we can't tell you until maybe after the election how we're going to do it, you wouldn't take such a sketchy deal and neither should you, the American people, because the math doesn't add up. Either this blows up the deficit just to pay for the additional spending that he's talking about, $7 to 8 trillion before we even get to the deficit we already have. Or, alternatively, it's got to be paid for, not only by closing deductions for wealthy individuals that will pay for about 4% reduction in tax rates. You're going to be paying for it. You're going to lose some deductions. Nobody who's looked at it that's serious actually b
Source: Second Obama-Romney 2012 debate , Oct 16, 2012

Economic patriotism instead of top-down policies

I think we've got to invest in education and training. I think it's important for us to develop new sources of energy here in America, that we change our tax code to make sure that we're helping small businesses and companies that are investing here in the United States, that we take some of the money that we're saving as we wind down two wars to rebuild America and that we reduce our deficit in a balanced way that allows us to make these critical investments.

Now, it ultimately is going to be up to the voters, to you, which path we should take. Are we going to double-down on the top-down economic policies that helped to get us into this mess? Or do we embrace a new economic patriotism that says America does best when the middle class does best? And I'm looking forward to having that debate.

Source: First Obama-Romney 2012 Presidential debate , Oct 3, 2012

$5T in tax cuts & $2T on defense is failed recipe from 2003

OBAMA: Gov. Romney's proposal calls for a $5 trillion tax cut, that he is going to pay for it by closing loopholes and deductions. When you add up all the loopholes and deductions that upper-income individuals are currently taking advantage of, you don't come close to paying for $5 trillion.

ROMNEY: If the tax plan he described were a tax plan I was asked to support, I'd say absolutely not. What I've said is I won't put in place a tax cut that adds to the deficit. So there's no economist that can say Mitt Romney's tax plan adds $5 trillion if I say I will not add to the deficit with my tax plan.

OBAMA: Well, for 18 months he's been running on this tax plan. It is not possible to come up with enough deductions and loopholes to avoid either raising the deficit or burdening the middle class. It's math. It's arithmetic. Look, we've tried this. Gov. Romney's approach is the same sales pitch that was made in 2001 and 2003, and it all culminated in the worst financial crisis since the Great Depression.

Source: First Obama-Romney 2012 Presidential debate , Oct 3, 2012

Deficit came from two wars paid for on a credit card

OBAMA: When I walked into the Oval Office, I had more than a trillion-dollar deficit greeting me. And we know where it came from: two wars that were paid for on a credit card; two tax cuts that were not paid for; and a whole bunch of programs that were not paid for; and then a massive economic crisis. We had to take some initial emergency measures to make sure we didn't slip into a Great Depression, but what we've also said is, let's make sure that we are cutting out those things that are not helping us grow. And we cut a trillion dollars out of our discretionary domestic budget. That's the largest cut in the discretionary domestic budget since Dwight Eisenhower. Now, we all know that we've got to do more. And so I've put forward a specific $4 trillion deficit reduction plan. It's on a website. You can look at all the numbers, what cuts we make and what revenue we raise.

ROMNEY: You've been president four years. You said you'd cut the deficit in half. We still have trillion-dollar deficits.

Source: First Obama-Romney 2012 Presidential debate , Oct 3, 2012

You elected me to tell the truth: The path ahead is hard

I won't pretend the path I'm offering is quick or easy. I never have. You didn't elect me to tell you what you wanted to hear. You elected me to tell you the truth.

And the truth is, it will take more than a few years for us to solve challenges that have built up over decades. It'll require common effort, shared responsibility, and the kind of bold, persistent experimentation that Franklin Roosevelt pursued during the only crisis worse than this one.

But know this, America: Our problems can be solved. Our challenges can be met. The path we offer may be harder, but it leads to a better place. And I'm asking you to choose that future. I'm asking you to rally around a set of goals for your country, goals in manufacturing, energy, education, and the deficit; real, achievable plans that will lead to new jobs, more opportunity, and rebuild this economy on a stronger foundation.

That's what we can do in the next 4 years, and that's why I'm running for a second term as President.

Source: 2012 Democratic National Convention speech , Sep 6, 2012

House of cards collapsed in 2008; new rules now in place

Long before the recession, jobs and manufacturing began leaving our shores. Folks at the top saw their incomes rise like never before, but most hardworking Americans struggled.

In 2008, the house of cards collapsed. We learned that mortgages had been sold to people who couldn't afford or understand them. Banks had made huge bets and bonuses with other people's money. Regulators didn't have the authority to stop the bad behavior. It was wrong. It was irresponsible. And it plunged our economy into a crisis that put millions out of work, and saddled us with more debt. In the 6 months before I took office, we lost nearly 4 million jobs. And we lost another 4 million before our policies were in full effect.

Those are the facts. But so are these. In the last 22 months, businesses have created more than three million jobs. Together, we've agreed to cut the deficit by more than $2 trillion. And we've put in place new rules to hold Wall Street accountable, so a crisis like that never happens again.

Source: 2012 State of the Union speech , Jan 24, 2012

We don't need a Constitutional amendment to balance budget

Senate Majority Leader Harry Reid called Cut, Cap, and Balance the worse legislation in history, and the President condemned a balanced budget amendment to the Constitution as extreme. Obama arrogantly said, "We don't need a constitutional amendment to do our job." Well, Mr. President, yes, in fact, we do need an amendment. How has Congress "doing its job" of spending taxpayer dollars wisely worked out for America? The truth is, Washington hasn't been doing its job for a very long time.

Hundreds of conservative organizations and Tea Party groups got behind the responsible Cut, Cap, and Balance plan. After the House passed it with a large majority (including 5 Blue Dog Democrats) Senator Reid promised a full debate in the Senate.

Many polls showed increased public support for the bill and a balanced budget amendment. Over 70% of Americans supported a balanced budget amendment to the Constitution, and a CNN poll found 66% of Americans supported the Cut, Cap, and Balance bill.

Source: Now Or Never, by Sen. Jim DeMint, p.127 , Jan 10, 2012

Obama economic stances compared to Romney

Do Obama and Romney disagree on school vouchers? (Yes). Do they both like "No Child Left Behind"? (No). We cite details from Romney's books and speeches, and Obama's, so you can compare them, side-by-side, on issues like these:

Romney vs. Obama on Economic Issues

Source: Paperback: Romney vs. Obama On The Issues , Jan 8, 2012

Appoint bipartisan fiscal commission and re-establish PAYGO

We know that we've got a major fiscal challenge in reining in deficits that have been growing for a decade, and threaten our future. That's why I've proposed a three-year freeze in discretionary spending other than what we need for national security.

At this point, we know that the budget surpluses of the '90s occurred in part because of the pay-as-you-go law, which said that, well, you should pay as you go and live within our means, just like families do every day. 24 Republicans voted for that, and I appreciate it. And we were able to pass it in the Senate yesterday.

But the idea of a bipartisan fiscal commission to confront the deficits in the long term died in the Senate the other day. So I'm going to establish such a commission by executive order and I hope that you participate, fully and genuinely, in that effort, because if we're going to actually deal with our deficit and debt.

Source: Obama Q&A at 2010 House Republican retreat in Baltimore , Jan 29, 2010

Some earmarks are defensible, if done in full light of day

Rep. CHAFFETZ: When you said in the House of Representatives that you were going to tackle earmarks--in fact, you didn't want to have any earmarks in any of your bills--I jumped up out of my seat and applauded you. But it didn't happen.

Pres. OBAMA: We didn't have earmarks in the Recovery Act. We didn't get a lot of credit for it, but there were no earmarks in that. I was confronted at the beginning of my term with an omnibus package that did have a lot of earmarks from Republicans and Democrats when we had to make a whole bunch of emergency decisions about the economy. So what I said was let's keep them to a minimum, but I couldn't excise them all. I think all of us are willing to acknowledge that some earmarks are perfectly defensible, good projects; it's just they haven't gone through the regular appropriations process in the full light of day. So one place to start is to make sure that they are at least transparent, that everybody knows what's there before we move forward.

Source: Obama Q&A at 2010 House Republican retreat in Baltimore , Jan 29, 2010

Some wealth of the last economic boom was illusory

The Fed has one power that is unique to it alone: it enables the creation of money out of thin air. We are talking about an awesome power. It is the power to weave illusions that appear real as long as they last. That is the very core of the Fed's power.

As Pres. Obama said of the economic boom that went bust: "I think it's important to understand that some of that wealth was illusory in the first place."

Exactly. But let's also understand the source of the illusion and what to do about it. Of course not everyone is instinctively against this illusion-weaving power, and many even welcome it. They just want to get back to the times when "everything was good" even though it was all just a mirage--a creation of the appearance of wealth by the Fed.

Tragically, the innocent who understand little about the complexity of the monetary system suffer the most, while those who are in the know reap great profit whether the market is going up or down.

Source: End the Fed, by Rep. Ron Paul, p. 2-3 , Sep 16, 2009

Bottom-up economics instead of trickle-down economics

Obama explained that a healthy economy is a bottom-up economy, not a top-down economy dependent on trickle-down economics. In a bottom-up economy, the rules of business and government are fair and apply to all. There is a level playing field. In such an environment, people's enthusiasm and motivations are maximized. They feel that their personal success will be determined by their hard work and effort, not by who they know or who they are related to. Obama believes that they key to a growing and prosperous economy is a motivated workforce that is engaged and constantly thinking about how it can improve itself, its company's products and services, and its country.

Obama believes that all will benefit from the system he envisions, that Wall Street & Main Street are intertwined, that you can't have successful securities investing without successful companies to invest in, and you can't have successful companies without motivated engaged workers

Source: Obamanomics, by John R. Talbott, p. 18-19 , Jul 1, 2008

Focus on economic justice instead of macroeconomic policy

"The true genius of America, a faith--a faith in simple dreams, an insistence on small miracles; that we can tuck in our children at night and know that they are fed and clothed and safe from harm; that we can say what we think, write what we think, without hearing a sudden knock on the door; that we can have an idea and start our own business without paying a bribe; that we can participate in the political process without fear of retribution, and that our votes will be counted--at least most of the time."

These words are from Barack Obama's major economic policy speech on Feb. 13, 2008. It had a completely different focus than the macroeconomic issues we are used to hearing discussed in Washington. Rather, he focused his remarks on what, for him, is the most pressing need today in America, the need for economic justice. To a great degree, much of Barack Obama's platform for America is about a singular issue, economic justice.

Source: Obamanomics, by John R. Talbott, p. 29-31 , Jul 1, 2008

OpEd: "Hope" translates into economic opportunity

"I'm not talking about blind optimism here--the almost willing ignorance that thinks unemployment will go away if we just don't think about it, or the health care crisis will solve itself if we just ignore it. That's not what I'm talking about. I'm talking about something more substantial, It's the hope of slaves sitting around a fire singing freedom songs; the hope of immigrants setting out for distant shores; the hope of a skinny kid with a funny name who believes that America has a place for him, too. Hope--Hope in the face of difficulty. Hope in the face of uncertainty. The audacity of hope."

Many of us remember these striking words as the keynote speaker at the 2004 Democratic Nominating Convention. If there is one word associated with Barack Obama, from all of his campaigns, speeches and books, it would have to be hope. From an economic perspective, the word hope easily translates into economic opportunity. Without economic opportunity, there is no hope.

Source: Obamanomics, by John R. Talbott, p. 51 , Jul 1, 2008

Take China “to the mat” about currency manipulation

Q: You had said that if China is actually manipulating their currency, the US needs to “take them to the mat.” What exactly did you mean by that?

A: We have legislation that says that if, in fact, they are manipulating their currency--and I think there’s no dispute that they are--that we need to take strong action. It’s in the Banking Committee. I will say that it’s actually a blunt tool. I’d prefer not doing this legislatively. The problem is we’ve had a president that has shown no leadership on it. So when I am in the White House, I will meet directly with the Chinese leadership and indicate we have to restore balance. And, by the way, we have to mobilize our allies, such as the European Union, to have that conversation with us. This is an imbalance that is not good for any economy over time. It’s not sustainable, the trade imbalances that we have.

Source: 2007 Democratic radio debate on NPR , Dec 4, 2007

Supports federal programs to protect rural economy

Our rural communities are the backbone of Illinois. Yet, factories have closed, jobs have disappeared, and homes and farms have been foreclosed upon. Effective federal programs are necessary to protect the rural economy.
Source: 2004 Senate campaign website, ObamaForIllinois.com , May 2, 2004

Freeze annual domestic spending for next five years

Now that the worst of the recession is over, we have to confront the fact that our government spends more than it takes in. That is not sustainable. Every day, families sacrifice to live within their means. They deserve a government that does the same.

This freeze will require painful cuts. Already, we've frozen the salaries of hardworking federal employees for the next two years. I've proposed cuts to things I care deeply about, like community action programs. The Secretary of Defense has also agreed to cut tens of billions of dollars in spending that he and his generals believe our military can do without.

Source: 2011 State of the Union speech , Jan 26, 2011

The worst has passed, but the devastation remains

One year ago, I took office amid two wars, an economy rocked by a severe recession, a financial system on the verge of collapse, and a government deeply in debt. Experts from across the political spectrum warned that if we did not act, we might face a second depression. So we acted--immediately and aggressively. And one year later, the worst of the storm has passed.

But the devastation remains. One in 10 Americans still cannot find work. Many businesses have shuttered. Home values have declined. Small towns and rural communities have been hit especially hard. And for those who'd already known poverty, life has become that much harder.

This recession has also compounded the burdens that America's families have been dealing with for decades--the burden of working harder and longer for less; of being unable to save enough to retire or help kids with college.

So I know the anxieties that are out there right now. They're not new. These struggles are the reason I ran for President.

Source: 2010 State of the Union Address , Jan 27, 2010


Barack Obama on Financial Bailout

OpEd: Each bailout revealed more of Washington's inside game

TARP opened the floodgates for a wave of unaccountable spending that flowed out of Washington. Soon afterward, President Obama bailed out the auto industry to rescue big labor. His allies in Congress passed the $787 billion stimulus bill, most of them without having read it. And he forced through a trillion-dollar heath care takeover. With each bailout, more and more of us felt we were getting further and further from what America was meant to be: a free and striving people with a limited and accountable government. Instead, Washington was revealing itself to be an inside game, with the rules fixed to benefit the establishment. The rules favor the well connected, while the rest of us in flyover country pay the bills.
Source: Can't Is Not an Option, by Gov. Nikki Haley, p.115 , Apr 3, 2012

Push mortgage refinancing; banks repay deficit of trust

Millions of innocent Americans have seen their home values decline. And while Government can't fix the problem on its own, responsible homeowners shouldn't have to sit and wait for the housing market to hit bottom to get some relief.

That's why I'm sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low interest rates. No more red tape. No more runaround from the banks. A small fee on the largest financial institutions will ensure that it won't add to the deficit, and will give banks that were rescued by taxpayers a chance to repay a deficit of trust.

Let's never forget: Millions of Americans who work hard and play by the rules every day deserve a Government and a financial system that do the same. It's time to apply the same rules from top to bottom: No bailouts, no handouts, and no copouts. An America built to last insists on responsibility from everybody.

Source: 2012 State of the Union speech , Jan 24, 2012

Establish a Financial Crimes unit; end era of recklessness

I will not go back to the days when Wall Street was allowed to play by its own set of rules. If you're a big bank or financial institution, you are no longer allowed to make risky bets with your customers' deposits. You're required to write out a "living will" that details exactly how you'll pay the bills if you fail--because the rest of us aren't bailing you out ever again. And if you're a mortgage lender or a payday lender or a credit card company, the days of signing people up for products they can't afford with confusing forms and deceptive practices are over.

We will also establish a Financial Crimes Unit of highly trained investigators to crack down on large-scale fraud and protect people's investments. Some financial firms violate major anti-fraud laws because there's no real penalty for being a repeat offender. That's bad for consumers, and it's bad for the vast majority of bankers and financial service professionals who do the right thing.

Source: 2012 State of the Union speech , Jan 24, 2012

Recession because Wall St. and Washington failed us

Obama hoped to connect with the unemployed despite holding the country's most prestigious job; to disparage Washington politics despite being a product of them; to have a self-described "direct conversation with the folks of New Hampshire."

"We've gone through the deepest recession since the Great Depression, and folks here have had their lives uprooted by lost jobs and foreclosed homes, shuttered businesses, vanished savings," he said. "Many good, hardworking people who met their responsibilities are now struggling, in part because folks on Wall Street and people in Washington didn't meet their responsibilities. Now, these are the things that I hear about every day in the letters I get--from families going bankrupt; from small businesses crushed by their health-care costs. I am not going to walk away from these efforts. I am not going to walk away from these people."

Source: Ten Letters, by Eli Saslow, p. 19-20 , Oct 11, 2011

2008 financial collapse: final verdict on failed philosophy

"What we've seen the last few days," Obama asserted [during the financial crisis in late summer 2008], "is nothing less than the final verdict on this philosophy, a philosophy that has completely failed. And I am running for president because the dreams of the American people must not be endangered anymore. It's time to put an end to a broken system in Washington that is breaking the American economy. It's time for change that makes a real difference in your lives."

[Federal Reserve chair Bernanke addressed Congressional leaders]: "I am a student of the Great Depression," he began. "Let me state this clearly. If we do not act in the next few days, this will be worse than the Great Depression." He let the statement sink in, just long enough for Senator Chris Dodd to gasp audibly, before he continued: "Investors have lost confidence in our capital markets. It is a matter of days before we will witness a series of catastrophic failures."

Source: Confidence Men, by Ron Suskind, p.114 , Sep 20, 2011

OpEd: Undermined message of restraint with new "investments"

Pres. Obama spoke boldly of the need for spending restraint in his 2011 State of the Union Address. "Every day, families sacrifice to live within their means," he declared. "They deserve a government that does the same." However, in the very same speech Obama undermined this message by advocating a host of new federal spending measures--using the euphemism "investments"--to speed up our economic recovery.

This was the same argument Obama used to justify his exorbitant $800 billion "stimulus" program. Although that spending binge failed to improve the economy, with unemployment rising from 7.6% when the stimulus passed to roughly 9% today, it looks like Obama's prescription is more of the same. A few weeks after his State of the Union speech, Obama proposed a budget with yet another record deficit--one exceeding $1.65 trillion. Unsurprisingly, as I write these words, the federal government hit its debt ceiling, sparking demands from the Obama administration to raise the ceiling even higher.

Source: The Freedom Agenda, by Sen. Mike Lee, p. 2-3 , Jul 18, 2011

OpEd: Economy recovering, but not feeling it on the street

Printing, borrowing and spending money is one thing. But bashing the prior President and doing the same thing is another. Obama has blamed the state of the economy on Bush, but there is only so much blaming before people demand that the economy improves. Obama has declared that the economy is recovering and improving, but the feeling on the street is that the economy does not seem to be getting much better. There is still high unemployment and the housing sector continues to get worse. Gas prices and many other commodity prices are near their highs, and wages are not keeping up. The economy will be the biggest factor in the general election. If the economy improves, then there will be a competitive race.
Source: Why She Will Win, by Ron Paul Jones, p. 25-26 , Jun 8, 2011

OpEd: Crisis means Obama won, but world's falling apart

With the 2008 economic crisis, the candidate chuckled to his senior staff, "The good news is we're gonna win. The bad news is the world's falling apart."

The crisis was good news for him in another way. Suddenly there was a clear and historic purpose to the first year of an Obama presidency: to stop the bleeding and place the nation on a sharply different course. Instead of letting go of his big campaign promises on energy, health care, and education, he now sought to connect them to the recession.

Source: The Promise: Obama Year One, by Jonathan Alter, p. 5 , May 18, 2010

Worked on TARP & bank bailouts during 2008 transition

Obama had inherited a nightmare in 2008. He would need to act boldly to keep the country from being swamped by its problems. Never before in American history did a president-elect make so many presidential-level decisions before being sworn in. Obama signed off on the largest public investment since WWII and lobbied a huge bank rescue bill through Congress while he was still technically a private citizen. (He had resigned from the Senate shortly after the election.)

During the 1932-33 transition, FDR's strategy was to spurn efforts to cooperate with Hoover. Obama consciously chose a different course, at least on the banks. "I explicitly rejected FDR's strategy of not taking any ownership of what needed to be done during the transition and I think that was the right decision," he said later. "If I had refused to weigh in on TARP prior to my being sworn in--we would not have hit the ground running. And I think the situation could have spiraled out of control much more severely."

Source: The Promise: Obama Year One, by Jonathan Alter, p. 77-78 , May 18, 2010

We all hated the bank bailout; but it was necessary

Our most urgent task upon taking office was to shore up the same banks that helped cause this crisis. It was not easy to do. And if there's one thing that has unified Democrats and Republicans, and everybody in between, it's that we all hated the bank bailout. I hated it. You hated it. It was about as popular as a root canal.

But when I ran for President, I promised I wouldn't just do what was popular--I would do what was necessary. And if we had allowed the meltdown of the financial system, unemployment might be double what it is today.

So I supported the last administration's efforts to create the financial rescue program. And when we took that program over, we made it more transparent and more accountable. And as a result, the markets are now stabilized, and we've recovered most of the money we spent on the banks. Most but not all.

To recover the rest, I've proposed a fee on the biggest banks. I am not interested in punishing banks. I'm interested in protecting our economy.

Source: 2010 State of the Union Address , Jan 27, 2010

$1T avoided Depression; but I took office with $8T debt

Let me start the discussion of government spending by setting the record straight. At the beginning of the last decade, the year 2000, America had a budget surplus of over $200 billion. By the time I took office, we had a one-year deficit of over $1 trillion and projected deficits of $8 trillion over the next decade. Most of this was the result of not paying for two wars, two tax cuts, and an expensive prescription drug program. On top of that, the effects of the recession put a $3 trillion hole in our budget. All this was before I walked in the door.

Just stating the facts. Now, if we had taken office in ordinary times, I would have liked nothing more than to start bringing down the deficit. But we took office amid a crisis. And our efforts to prevent a second depression have added another $1 trillion to our national debt. That, too, is a fact. I'm absolutely convinced that was the right thing to do.

Source: 2010 State of the Union Address , Jan 27, 2010

FactCheck: Obama's estimate of $8T deficit is closer to $3T

Republicans laughed when Obama described the huge deficits he had inherited when he took office. Despite the Republican scoffing, Obama's claims are backed up by the historical record--mostly. [Looking at each fact that Obama cited]:

Obama: "In 2000, America had a budget surplus of over $200 billion."

FactCheck: Fiscal year 2000 ended with a total budget surplus of $237 billion.

Obama: [By 2009] "a one-year deficit of over $1 trillion."

FactCheck: Deficit when Obama took office: CBO projected the deficit would total $1.2 trillion.

Obama: [By 2009, we had] "projected deficits of $8 trillion over the next decade."

FactCheck: CBO projected only a $3.1 trillion deficit over 10 years.

So the president actually understated matters regarding annual surpluses and deficits for years past, but he may have strained the facts when he spoke of what was being predicted for future years. His figure is based on a "baseline" projection by Obama's own OMB projecting a 10-year deficit of $8.9 trillion.

Source: FactCheck.org on 2010 State of the Union speech , Jan 27, 2010

G-20 produced "collective document" on global economy

After the G-20 Summit concluded, the US president declared that unemployment has reached its highest level in 26 years in his country. "Faced with similar global challenges in the past, the world was slow to act," he said.

"Today we've learned the lessons of history. We are committed to growth and job creation.... The US [will] clean out the troubled assets... to ensure that our action leads directly to loans to businesses large and small. And our G-20 partners are pursuing similarly comprehensive programs."

"We've got a global economy, and if we're taking actions in isolation in the US, but those actions are contradicted overseas, then we're only going to be halfway effective... [We have had] a drastic reduction in US exports... and the contagion from the financial markets debilitating the economies elsewhere" is affecting other US companies. Obama explained, "this is a collective document."

Source: Obama and the Empire, by Fidel Castro, p. 30-1 , Apr 3, 2009

US will emerge from this recession, stronger than before

For many Americans, the state of our economy is a concern that rises above all others. And rightly so. If you haven't been personally affected by this recession, you probably know someone who has. You don't need to hear another list of statistics to know that our economy is in crisis, because you live it every day. The impact of this recession is real, and it is everywhere.

But while our economy may be weakened and our confidence shaken, though we are living through difficult and uncertain times, tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before.

The answers to our problems don't lie beyond our reach. They exist in our laboratories and our universities; in our fields and our factories; in the imaginations of our entrepreneurs. What is required now is for this country to pull together, confront boldly the challenges we face, and take responsibility for our future once more.

Source: 2009 State of the Union address , Feb 24, 2009

Not enough to help those at the top: it doesn’t trickle down

Q: What’s the fastest solution to bail people out of economic ruin?

OBAMA: It’s not enough just to help those at the top. Prosperity is not just going to trickle down. We’ve got to help the middle class. Part of the problem is that for many of you, wages and incomes have flat-lined. For many of you, it is getting harder and harder to save, harder and harder to retire. Sen. McCain is right that we’ve got to stabilize housing prices. But underlying that is loss of jobs and loss of income. That’s something that the next treasury secretary is going to have to work on.

McCAIN: We obviously have to stop this spending spree that’s going on in Washington. Do you know that we’ve laid a $10 trillion debt on young Americans, $500 billion of it we owe to China? We’ve got to have a package of reforms and it has got to lead to reform prosperity and peace in the world. And I think that this problem has become so severe, that we’re going to have to do something about home values.

Source: 2008 second presidential debate against John McCain , Oct 7, 2008

Pay attention to Main Street, not just Wall Street

OBAMA: Ten days ago McCain said the fundamentals of the economy are sound. Unless we are holding ourselves accountable day-in, day-out, not just when there’s a crisis for folks who have power and influence and can hire lobbyists but for the nurse, the teacher, the police officer who frankly at the end of each month, they’ve got a little financial crisis going on. They’re having to take out extra debt just to make their mortgage payments. We haven’t been paying attention to them.

McCAIN: We’ve got fundamental problems in the system. And Main Street is paying a penalty for the excesses and greed in Washington, DC, and in the Wall Street. There’s no doubt that we have a long way to go, and obviously stricter interpretation and consolidation of the various regulatory agencies that weren’t doing their job that has brought on this crisis. But I have a fundamental belief in the goodness and strength of the American worker. And the American worker is the most productive, the most innovative.

Source: 2008 first presidential debate, Obama vs. McCain , Sep 26, 2008

Regulate institutions for what they do, not what they are

Deregulated financial markets create a needless Hobson's choice: Either let banks suffer the folly of their own mistakes; or keep bailing out banks & invite more speculative bubbles. But there is a third alternative: Complement necessary rescues with more stringent supervision and regulation, so speculative bubbles stop occurring. As Obama put it last March: "Our history should give us confidence that we don't have to choose between an oppressive government-run economy and a chaotic and unforgiving capitalism. We need to regulate institutions for what they do, not what they are. Over the last few years, commercial banks and thrift institutions were subject to guidelines on subprime mortgages that did not apply to mortgage brokers and companies. It makes no sense for the Fed to tighten mortgage guidelines for banks when 2/3 of subprime mortgages don't originate from banks. This regulatory framework has failed to protect homeowners, and it is now clear that it made no sense for our financial system.
Source: Obama`s Challenge, by Robert Kuttner, p. 31-32 , Aug 25, 2008

Free market needs proper government oversight

"It's useful to remind ourselves that our free market system is the result neither of natural law nor of Divine Providence. Rather, it emerged through a painful process of trial and error. And although the benefits of our free market system are mostly derived from the individual efforts of generations of men and women pursuing their own vision of happiness, in each and every period of great economic upheaval and transition we depended on government action to open up opportunity, encourage competition, and make the market work better."

Obama's overall economic philosophy: He understands the power of the free market to create jobs and encourage creativity, but he also understands that, left to its own devices, without proper government oversight, it has a way of bouncing wildly between booms and busts. Individual participants in a market economy can do little to influence the overall stability of the system, but government can, and must, act to assure our financial markets remain strong and stable.

Source: Obamanomics, by John R. Talbott, p. 69 , Jul 1, 2008

Prosecute mortgager fraud; require full mortgage disclosure

Proposals Obama has made to address predatory lending and fraudulent activity in the mortgage and credit card business:
Source: Obamanomics, by John R. Talbott, p. 77-78 , Jul 1, 2008

Latinos & blacks are hardest hit by housing & gas crises

For eight long years, Washington hasn’t been working for ordinary Americans. And few have been hit harder than Latinos and African Americans. You know what I’m talking about. Like a couple I met in Las Vegas who were tricked into buying a home they couldn’t afford. You know about the families all across this country who are out of work, or uninsured, or struggling to pay rising costs for everything from a tank of gas to a bag of groceries. And that’s why you know that we need change in this country
Source: Obama & McCain back-to-back speeches at NALEO , Jun 28, 2008

More accountability in subprime mortgages

Source: Campaign booklet, “Blueprint for Change”, p. 10-15 , Feb 2, 2008

Help the homeowners actually living in their homes

It is important to make sure that we’re not helping out the speculators, but instead are helping out the homeowners who are actually living in their homes, who have the capacity to make the payments if they’re not seeing a huge increase in their mortgage payments. But understand this, this is not new. We have a history in this country of preying on low-income peoples because they don’t have access to banks. The Community Reinvestment Act is oftentimes not enforced as it should be. We’ve got to open up bank branches. We’ve got to give people access to financing so that they’re not going to a payday loan operation. I two years ago introduced a provision that would eliminate predatory lending, something that I had already helped to get passed at the state level. We’ve got to give ordinary working people access to financing. Part of the reason that they are borrowing on their homes, they’re borrowing on credit cards, is that the banks and financial institutions have dominated policy in Washington.
Source: 2008 Congressional Black Caucus Democratic debate , Jan 21, 2008

Accountability and oversight over the financial markets

The sub-prime lending mess, part of the reason it happened was because we had an administration that does not believe in any kind of oversight. You’ve got to disclose if you’ve got a teaser rate and suddenly their mortgage payments are going to jack up & they can’t pay for them. I intend to restore a sense of accountability and regulatory oversight over the financial markets. We have the best financial markets in the world, but only if they are transparent and accountable and people trust them.
Source: 2008 Democratic debate in Las Vegas , Jan 15, 2008

Modify some of the fraudulent & predatory lending practices

We’ve got to modify some fraudulent & predatory lending practices. I put in a bill to make that happen because it does affect communities. Unless we are able to rid the influence of special interest lobbies, we’re going to continue to see bad legislation like that. I’ve put forward a $10 billion housing fund that can help bridge people who have been responsible in making their payments. We’ve got to make sure they can get the kinds of help they need to stay in their homes & make the payments.
Source: 2008 Democratic debate in Las Vegas , Jan 15, 2008

Government regulation needed for when markets fail

In the era of George Bush’s running up huge federal deficits, Obama advocated fiscal restraints, calling for pay-as-you-go government. He waxed on about the power of the free market to create wealth and change lives. But he also had an afterthought on a market-based economy straight from liberal economist Paul Krugman: “Sometimes markets fail, and that’s when labor laws and government regulation are necessary correctives.” In other words, he was saying that capitalism is magnificent, but it does have its drawbacks. It would be hard for anyone to argue with such a balanced statement. “Obama figures out ways to present himself like a conservative to conservatives.” Said [one advisor]. “He has the whole venture capital industry here in Chicago, nothing but Republicans, thinking he is their champion. He has supported entrepreneurship. It is a pro-growth message.”
Source: From Promise to Power, by David Mendell, p.248-249 , Aug 14, 2007


Barack Obama on Stimulus Package

We neglect nation-building here when we nation-build abroad

OBAMA: We have to do is recognize that we can't continue to do nation building. Part of American leadership is making sure that we're doing nation building here at home. That will help us maintain the kind of American leadership that we need.

ROMNEY: For us to be able to promote peace requires us to be strong, and that begins with a strong economy here at home.

OBAMA: [When considering Mideast policy], what is also important for us to understand, is that for America to be successful in this region, there are some things that we're going to have to do here at home as well. You know, one of the challenges over the last decade is we've done experiments in nation building in places like Iraq and Afghanistan. And we've neglected, for example, developing our own economy, our own energy sectors, our own education system. And it's very hard for us to project leadership around the world when we're not doing what we need to do here.

Source: Third Obama-Romney 2012 Presidential debate , Oct 22, 2012

OpEd: Stimulus bill derisively called "porkulus"

With the election of President Barack Obama, things only seemed to get worse. Promising "hope and change," the new president seemed to want to go farther down the road to economic ruin than even President Bush. The long arc of U.S. history toward a bloated and unsustainable federal government continued and actually accelerated at a blistering pace. Government involvement in the economy gained speed and size and began consuming everything in its path.

Then, on February 17, 2009, President Obama signed the American Recovery and Reinvestment Act, commonly referred to as the "stimulus" bill. A young woman called it by its real name: pork. So did about a hundred other people who showed up at a "Porkulus" protest.

Source: Tea Party Patriots, by M.Meckler & J.B.Martin, p. 7-8 , Feb 14, 2012

OpEd: Stimulus vote turned GOP into "party of No"

President Obama and his spokespeople would describe our opposition to the stimulus bill as our coming out as the party of "no." He accused us Republicans of making a calculated, political decision to oppose him on the stimulus bill instead of doing what was right for the country. He charged then (incorrectly), as he later would repeatedly, that we had already made the decision to oppose the stimulus bill before we even heard his proposals.

But sometimes saying "No" is what's right for this country--an all 178 Republican members said just that to President Obama, Speaker Pelosi, and Leader Reed's pork-laden stimulus package.

In a sense, President Obama had been correct when he identified the stimulus vote as a turning point--he was just wrong about what message it sent to the American people. Far from revealing us as the party of "no," our solidarity in the face of the majority party's bullying tactics revealed us to be an awakening movement of responsible leaders.

Source: Young Guns, by Reps. Ryan, Cantor & McCarthy, p. 52-56 , Sep 14, 2010

Recovery Act averted a second Great Depression

Let's start with our efforts to jumpstart the economy last winter, when we were losing 700,000 jobs a month. Our financial system teetered on the brink of collapse and the threat of a second Great Depression loomed large. I didn't understand then, and I still don't understand, why we got opposition in the Republican caucus for almost $300 billion in badly needed tax cuts for the American people, or COBRA coverage to help Americans who've lost jobs in this recession to keep the health insurance that they desperately needed, or opposition to putting Americans to work laying broadband and rebuilding roads and bridges and breaking ground on new construction projects.

Well, that's what the Recovery Act was. Now, I am happy to report this morning that we saw another sign that our economy is moving in the right direction. The latest GDP numbers show that our economy is growing by almost 6%--that's the most since 2003.

Source: Obama Q&A at 2010 House Republican retreat in Baltimore , Jan 29, 2010

Across-the-board tax cuts wouldn't stimulate economy

Rep. PENCE: The so-called stimulus bill was a piecemeal list of projects and boutique tax cuts. Now, Republicans offered a stimulus bill at the same time. It cost half as much as the Democratic proposal, and it would have created twice the jobs. It essentially was across-the-board tax relief.

Pres. OBAMA: This notion that this was a radical package is just not true. A third of them were tax cuts, and they weren't--when you say they were "boutique" tax cuts--95% of working Americans got tax cuts, small businesses got tax cuts, large businesses got help in terms of their depreciation schedules. I mean, it was a pretty conventional list of tax cuts. And the notion that I would somehow resist doing something that cost half as much but would produce twice as many jobs--why would I resist that? I wouldn't. I am not an ideologue. The problem is, I couldn't find credible economists who would back up the claims that you just made.

Source: Obama Q&A at 2010 House Republican retreat in Baltimore , Jan 29, 2010

Increased spending comes from Bush's automatic stabilizers

Rep. RYAN: The spending bills that you've signed into law, the domestic discretionary spending has been increased by 84%. You now want to freeze spending at this elevated beginning next year.

Pres. OBAMA: I want to just push back a little bit on the underlying premise about us increasing spending by 84%. The fact of the matter is, is that most of the increases in this year's budget, this past year's budget, were not as a consequence of policies that we initiated but instead were built in as a consequence of the automatic stabilizers that kick in because of this enormous recession. So the increase in the budget for this past year was actually predicted before I was even sworn into office and had initiated any policies.

Rep. RYAN: I would simply say that automatic stabilizer spending is mandatory spending. The discretionary spending, the bills that Congress signs that you sign into law, that has increased 84%.

Source: Obama Q&A at 2010 House Republican retreat in Baltimore , Jan 29, 2010

Spending freeze now would be destimulative; later is better

Rep. RYAN: Total spending in your budget would grow at 0.03% less than otherwise. I would simply submit that we could do more and start now. Why not start freezing spending now?

Pres. OBAMA: The reason that I'm not proposing the discretionary freeze take into effect this year is, I am just listening to the consensus among people who know the economy best. And what they will say is that if you either increase taxes or significantly lowered spending when the economy remains somewhat fragile, that that would have a destimulative effect and potentially you'd see a lot of folks losing business, more folks potentially losing jobs. We'll have a longer debate on the budget numbers, all right?

Source: Obama Q&A at 2010 House Republican retreat in Baltimore , Jan 29, 2010

Restore Pay-As-You-Go law

The Senate should restore the pay-as-you-go law that was a big reason for why we had record surpluses in the 1990s.

Now, I know that some in my own party will argue that we can't address the deficit or freeze government spending when so many are still hurting. And I agree--which is why [the proposed 3-year spending] freeze won't take effect until next year--when the economy is stronger. That's how budgeting works.

But understand, if we don't take meaningful steps to rein in our debt, it could damage our markets, increase the cost of borrowing, and jeopardize our recovery--all of which would have an even worse effect on our job growth and family incomes.

Rather than fight the same tired battles that have dominated Washington for decades, it's time to try something new. Let's invest in our people without leaving them a mountain of debt. Let's meet our responsibility to the citizens who sent us here. Let's try common sense. A novel concept.

Source: 2010 State of the Union Address , Jan 27, 2010

OpEd: Stimulus trillions must be borrowed, printed, or taxed

Within six months of taking office, Pres. Obama put the US on track to double its already staggering national deficit. The new debt, which will burden future generations, is immoral. And all of it in the name of fixing an economy broken by too much debt in the first place.

Servicing the $11.5 trillion debt is a huge annual expenditure in the federal budget. Those who hold our debt, including foreign countries like China and Saudi Arabia, must be paid first. Last year we spent more than $400 billion to service our debt. Is that what the president meant by "change"?

Where is all of this money going to come from? It can come from only three places. Government borrows it, government prints it, or government taxes the people for it. So far the administration has done the first two. We've borrowed massive sums from foreign countries & we've also simply printed money. Economists call this practice "monetizing the debt," and it's not something we hear much about. Higher taxes won't be far behind.

Source: Going Rogue, by Sarah Palin, p.388-389 , Nov 17, 2009

We’re in the worst financial crisis since Great Depression

Q: Where do you stand on the financial recovery plan?

A: We are going through the worst financial crisis since the Great Depression. As we engage in this important rescue effort, we’ve got to make sure that we’ve got oversight over this whole process. $700 billion, potentially, is a lot of money. We’ve got to make sure that taxpayers have the possibility of getting that money back--and gains--if & when the market returns. We’ve got to make sure none of that money is going to pad CEO bank accounts or t promote golden parachutes. We’ve got to make sure we’re helping homeowners, because the root problem has to do with the foreclosures taking place all across the country. This is a final verdict on 8 years of failed economic policies--a theory that says w can shred regulations & consumer protections and give more to the most, and somehow prosperity will trickle down. It hasn’t worked. The fundamentals of the economy have to be measured by whether or not the middle class is getting a fair shake.

Source: 2008 first presidential debate, Obama vs. McCain , Sep 26, 2008

Spending freeze is like a hatchet where you need a scalpel

Q: In the middle of a huge financial crisis that is yet to be resolved, how this is going to affect you not in small ways, but in major ways, and the approach you would take to the presidency.

McCAIN: How about a spending freeze on everything but Defense, Veterans Affairs and entitlement programs? We ought to seriously consider, with the exceptions of caring for our veterans, national defense and several other vital issues.

OBAMA: The problem with a spending freeze is you’re using a hatchet where you need a scalpel. There are some programs that are very important that are currently underfunded. I want to increase early childhood education. We’re currently spending $10 billion a month in Iraq when they have a $79 billion surplus. It seems to me that if we’re going to be strong at home as well as strong abroad, that we’ve got to look at bringing that war to a close.

Source: 2008 first presidential debate, Obama vs. McCain , Sep 26, 2008


Barack Obama on Voting Record

Voted against limiting credit to 30%, because 30% too high

Clinton and Obama battled over their votes on bankruptcy bills and an amendment to cap interest charged on credit, at 30%. Obama claimed, “I thought 30% potentially was too high of a ceiling.”

Obama did vote against--and Clinton voted for--an amendment that would have placed a 30% cap on the interest rate that could be charged on any extension of credit. The amendment failed by a vote of 74 to 24 in 2005. When the amendment came up for a vote, Obama was standing next to Sen. Paul Sarbanes, D-MD, the senior Democrat on the banking committee and the leader of those opposing the landmark bill, which would make it harder for Americans to get rid of debt.

As for whether the 30% cap was too high, that’s certainly a matter of opinion. Sen. Mark Dayton of Minnesota, sponsor of the amendment, said on the Senate floor that such a cap “is still consumer abuse” but is much better than rates of more than 300%, which he said were being charged by some loan operations in the country.

Source: FactCheck.org on 2008 Congressional Black Caucus Dem. Debate , Jan 21, 2008

I opposed both the 2001 and 2005 bankruptcy bills

I opposed both the 2001 and 2005 bankruptcy bills. They were bad ideas, because they were pushed by the credit card companies, they were pushed by the mortgage companies, and they put the interests of those banks and financial institutions ahead of the interests of the American people.
Source: 2008 Democratic debate in Las Vegas , Jan 15, 2008

Voted NO on paying down federal debt by rating programs' effectiveness.

Amendment intends to pay down the Federal debt and eliminate government waste by reducing spending on programs rated ineffective by the Program Assessment Rating Tool (PART).

Proponents recommend voting YES because:

My amendment says we are going to take about $18 billion as a strong signal from the Congress that we want to support effective programs and we want the taxpayer dollars spent in a responsible way. My amendment doesn't take all of the $88 billion for the programs found by PART, realizing there may be points in time when another program is not meeting its goals and needs more money. So that flexibility is allowed in this particular amendment. It doesn't target any specific program. Almost worse than being rated ineffective, we have programs out there that have made absolutely no effort at all to measure their results. I believe these are the worst offenders. In the following years, I hope Congress will look at those programs to create accountability.

Opponents recommend voting NO because:

The effect of this amendment will simply be to cut domestic discretionary spending $18 billion. Understand the programs that have been identified in the PART program are results not proven. Here are programs affected: Border Patrol, Coast Guard search and rescue, high-intensity drug trafficking areas, LIHEAP, rural education, child abuse prevention, and treatment. If there is a problem in those programs, they ought to be fixed. We ought not to be cutting Border Patrol, Coast Guard search and rescue, high-intensity drug trafficking areas, LIHEAP, rural education, and the rest. I urge a "no" vote.

Reference: Allard Amendment; Bill S.Amdt.491 on S.Con.Res.21 ; vote number 2007-090 on Mar 22, 2007

Voted NO on $40B in reduced federal overall spending.

Vote to pass a bill that reduces federal spending by $40 billion over five years by decreasing the amount of funds spent on Medicaid, Medicare, agriculture, employee pensions, conservation, and student loans. The bill also provides a down-payment toward hurricane recovery and reconstruction costs.
Reference: Work, Marriage, and Family Promotion Reconciliation Act; Bill S. 1932 ; vote number 2005-363 on Dec 21, 2005

Get minorities into home ownership & global marketplace.

Obama adopted the CBC principles:

Source: Congressional Black Caucus press release 01-CBC10 on Jan 6, 2001

Require full disclosure about subprime mortgages.

Obama co-sponsored requiring full disclosure about subprime mortgages

Sen. DODD: Today we are facing a crisis in the mortgage markets on a scale that has not been seen since the Great Depression: over 2 million homeowners face foreclosure at a loss of over $160 billion in hard-earned home equity; over one out of every 5 subprime loans is currently delinquent. These high default rates have frozen the subprime and jumbo mortgage markets and infected the capital markets to the point where central banks around the world have had to inject liquidity into the system to avoid the crisis from spreading to other segments of the market.

One of the fundamental causes of this serious crisis is abusive and predatory subprime mortgage lending. The Homeownership Preservation and Protection Act of 2007 is designed to protect American homeowners from these practices, and prevent this disaster from happening again. The legislation will:

It is important to keep in mind that only about 10% of subprime mortgages have been made to first time home buyers. This market has not been primarily about creating a new set of homeowners; a majority of subprime loans have been refinances. While maintaining access to subprime credit on fair terms is important, too much of the subprime market has actually put the homes and home equity of American families at risk.

In the coming months, the housing crisis is going to get worse. We will need to continue to press lenders and servicers to provide real relief for homeowners threatened with foreclosure.

Source: Homeownership Preservation and Protection Act (S.2452 ) 2007-S2452 on Dec 12, 2007

Reform mortgage rules to prevent foreclosure & bankruptcy.

Obama co-sponsored reforming mortgage rules to prevent foreclosure & bankruptcy

Source: Foreclosure Prevention Act (S.2636) 2008-S2636 on Feb 13, 2008

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