Obama Challenges Critics of Stimulus Bill

WASHINGTON -- President Barack Obama fought back against Republicans on Thursday, charging that critics of his nearly $1 trillion plan to stimulate the collapsing U.S. economy were promoting failed theories and ignoring the depth of the crisis.

In an impassioned opinion piece in the Washington Post, Obama demanded that Congress act swiftly to provide the massive infusion of federal spending -- pressing his case on an emergency package for which he has struggled to win bipartisan backing.

Despite strong support in the polls and a convincing White House victory, the president has hit unexpectedly heavy political headwinds in his first month in office, one that has seen key nominees withdraw under a cloud of tax troubles and a deepening economic downturn -- the worst since the Great Depression of the 1930s.

Obama's nearly unprecedented courting of Republicans in Congress to match his campaign promises of bipartishanship failed to gain one opposition vote in the House of Representatives when it passed an $819 billion version of the measure last week. Senate Republicans and some Democrats are proving equally balky in debate on their version of the plan, which has climbed to above $900 billion but still not come to a vote.

"What Americans expect from Washington is action that matches the urgency they feel in their daily lives -- action that's swift, bold and wise enough for us to climb out of this crisis," a clearly frustrated Obama wrote.

Republicans charge the stimulus plan is loaded down with pet Democratic spending and ignores the curative powers of tax cuts.

Obama hotly disagreed, saying Republicans were promoting a failed theory, "the notion that tax cuts alone will solve all our problems; that we can meet our enormous tests with half-steps and piecemeal measures; that we can ignore fundamental challenges such as energy independence and the high cost of health care and still expect our economy and our country to thrive."

Even Obama's attendance at Thursday's National Prayer Breakfast, accompanied by his wife, Michelle, was tinged with politics, since he was to return to the executive mansion to sign an executive order forming the White House Office of Faith-based and Neighborhood Partnerships.

During his presidential campaign, Obama said he wanted to expand White House faith-based efforts begun in the Bush administration. While he endorsed Bush's initiative to give religious groups more access to federal funding, he also promised to make some changes to the office.

Obama will ask for a legal review of whether to allow such groups to hire only co-religionists.
The Bush initiative came under criticism from those who viewed it as a violation of America's traditional separation of church and state.

On Wednesday, Obama ordered $500,000 pay caps for executives of firms that take federal bailout money, the first in a set of far-reaching and tough standards in the government struggle to stabilize the teetering U.S. banking and financial sector.

The president's move to limit executive salaries came after reports last week that Wall Street firms shoveled out more than $18 billion in 2008 year-end bonuses even as the industry took billions in government rescue money to prevent a feared collapse of the U.S. financial system.

"We all need to take responsibility. And this includes executives at major financial firms who turned to the American people, hat in hand, when they were in trouble, even as they paid themselves their customary lavish bonuses," a stern Obama said in the White House foyer.

The pay cap measure would apply to institutions that negotiate agreements with the Treasury Department for "exceptional assistance" in the future. The restriction would not apply retroactively to such firms as American International Group Inc., Bank of America Corp., Citigroup Inc., and the three major auto makers that already have received such help.

Obama said that massive severance packages for executives who leave failing firms are also going to be eliminated. "We're taking the air out of golden parachutes," he said.

The pay caps were ordered as part of the government's $700 billion effort to keep the financial system afloat. Half of that money was spent in the final two months of the Bush administration, widely criticized for poor oversight and too little focus on helping Americans facing home mortgage foreclosure.

The pay caps presage more strict measures as the administration begins doling out the remaining $350 billion. And Obama has said, without specifics, that far more will be needed to turn the financial system around.

Obama enjoyed a legislative victory Wednesday as he signed a bill extending health coverage to 4 million uninsured children, ending a two-year effort by Democrats. He called it a first step toward fulfilling a campaign pledge to provide insurance for all Americans. Unlike other developed countries, the United States does not have universal health care.

"The way I see it, providing coverage to 11 million children through (the children's program) is a down payment on my commitment to cover every single American," Obama said at a White House bill-signing ceremony.

The measure was similar to two bills vetoed by former President George W. Bush.
Obama acknowledged the difficulties of reforming health care. "It won't be easy; it won't happen all at once," the president said. "But this bill that I'm about to sign, that wasn't easy either."

Click here to read Obama's editorial in the Washington Post.