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Meet the Press, January 25, 2009TranscriptMSNBC
MR. DAVID GREGORY: Our issues this Sunday: the nation's 44thpresident takes office and lays out the challenges ahead.(Videotape)PRES. BARACK OBAMA: Starting today we must pick ourselvesup, dust ourselves off and begin again the work of remakingAmerica.
(End videotape)MR. GREGORY: At the top of the agenda, the dire economic crisis and how tocreate jobs, restore confidence and get the nation's economy moving again.Our exclusive guests, two men at the center of the debate: the president's topeconomic adviser, director of the National Economic Council, Lawrence Summers;and the leader of the Republicans in the House, an outspoken critic of the stimulus plan, Congressman John Boehner.Then, President Obama's first week on the job: trying to make a clean break fromthe Bush years, ordering the closure of the detention center at Guantanamo Bay,Cuba, and signaling a new diplomatic push in the Middle East. Insights andanalysis on the new Obama administration from New York Times columnist TomFriedman; senior writer for The Weekly Standard, Stephen Hayes; and host of  NPR's "All Things Considered," Michele Norris.
 
But first, the president's point man on the economy, Dr. Larry Summers. Welcome back to MEET THE PRESS.DR. LAWRENCE SUMMERS: Good to be with you.MR. GREGORY: President Obama's elected to get a daily economic briefingsimilar to the national security briefing. Can you tell us what you're telling him,succinctly, about the state of this economy?DR. SUMMERS: I'm telling him he's inherited an extraordinarily difficultsituation: the worst economy since the second World War, a financial system that'sgot very serious problems, government budget deficits he's inheriting of a trilliondollars, an entitlement situation that's three times the burden that it was in the year 2000. He's inheriting an extraordinarily difficult situation in the domesticeconomy, in the global economy; the kind of situation that requires the types of decisive action he's been working with Congress to produce.MR. GREGORY: So let's talk about that, and that is the stimulus or the recovery plan that the president has proposed. In December, this is what you wrote: "In thiscrisis, doing too little poses a greater threat than doing too much." That was an op-ed piece you did. In that same piece, you said at that time that the economy washeaded to a position where it was underperforming, where it was falling short of capacity to the tune of a trillion dollars. Now, there are other economists that I'vespoken to say actually that's optimistic, that it's actually falling short to the order of $2 trillion. So why a stimulus plan that's only 825 billion?DR. SUMMERS: David, this is the largest stimulus plan in the country's history.It's the largest investment in the backbone of our economy since the interstate--since the interstate highway system. It's going to double renewable energy. And itis only one phase of the approach that the president is taking. The president hasmade clear that there will be strong action to address the terrible problems in our housing sector, that he will be using additional funds for a substantial financialrecovery plan to get the flow of credit going. This is one component of our strategy to bring about expansion. And the president has also made clear that goingforward we're going to be leaning forward and that he is prepared to do what isnecessary.MR. GREGORY: It is big, even...DR. SUMMERS: And so we believe this--we believe that this is a properly sizedapproach to move the economy forward. You know, economists from several
 
 private firms have now corroborated our incoming CEA chairman ChristinaRomer's estimate that the plan will create...MR. GREGORY: The Economic Advisory Board.DR. SUMMERS: Yeah. The plan will create three to four million jobs more thanthe economy otherwise would've had, and that's before you get to the financialrecovery approach. So we are very determined.But there is one other thing that we are also very mindful of, which is money has to be spent well. And that's why the president's put new emphasis on accountabilityin designing this proposal: no earmarks, oversight of all projects, transparency ona Web site that everybody can see on the status of each project. And we also haveto do things in a way where the government can control them right.MR. GREGORY: I, I--and I want to go through all that. But I just want to go back to your central point, which is that one of the biggest mistakes you can make isdoing too little. Yes, this is the largest stimulus in our history, but the problem, asyou said, is something we've never seen in our history. So if you have a hole in theeconomy that's at least a trillion, maybe 2 trillion, don't you need a stimulus package that fills that hole?DR. SUMMERS: Well, no, David. We have what economists call the multiplier. Afact--when the government--when the government spends...MR. GREGORY: Right, which is if you create a job, it creates another job.DR. SUMMERS: ...when the government spends a dollar creating a job, that person has higher income; because they have higher income, they're able to spendmore, that creates other jobs down the road. That's why we surveyed a range of economists. We talk--and this is something the president insists on--to a lot of experts, both Democrat and Republican. And you know, frankly, some of themthink the stimulus should be larger, some of them think the stimulus should be,should be smaller. President balanced the different views and I think came to theapproach that we've taken, and came to an approach that's balanced in another way. It's balanced between very substantial new investments that are referred to between very important protections to prevent teachers and cops from being laidoff, and also--and this is a substantial part of the package--tax cuts, because werecognize that we've got to help households to be able to spend, and businesses.
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