BIRMINGHAM, Ala. – "Confidence" was the catchword of the day Monday as President Bush discussed ways to restore a sound economy, which has seen marked improvements in productivity and retail sales but still is bound by nearly 6 percent unemployment and a crashing stock market.
"Our economy is fundamentally strong," Bush told an audience at the Alys Stephens Performing Arts Center at the University of Alabama at Birmingham. "But I understand this, that the American economy is constructed on confidence. Confidence to invest and build. Confidence for our small-business owners to take risk. Confidence that the job base will expand. Confidence to produce and hire."
Calling the 1990s "the land of the endless profit," Bush said the country now "must get rid of the hangover that we now have as a result of the binge — the economic binge — we just went through."
Bush said he wants to rebuild confidence during an era when inflation is low, interest rates are "reasonable," productivity is increasing, and manufacturing and retail sales are up. He urged Congress to help the country expand those numbers by making last year's tax cuts permanent, giving him authority to create trade agreements, passing a terrorism insurance bill, and limiting frivolous lawsuits.
Whether those measures will be enough to boost confidence in the stock market remains to be seen. In the past week, the stock market fell by triple digits on four of the five business days.
White House press secretary Ari Fleischer downplayed the slide, saying markets take care of themselves, but the Dow was on another downslide Monday, slipping more than 300 points following the president's speech.
A new Time/CNN poll indicates a huge majority, 72 percent of respondents, believe the accounting scandals at energy giant Enron and telecom leader WorldCom were not isolated incidents but "may indicate a pattern of deception."
Vice President Dick Cheney, however, touted the continued resilience of the American economic system during a luncheon to raise money for Republican Rep. Nancy Johnson of Connecticut, saying he doesn't think corporate America in general should be tarred by the actions of a few rogue companies.
"Government will clearly investigate and pursue the wrongdoers," Cheney said without reference to his own company, Halliburton Corp., an oilfield services firm that Cheney headed from 1995-2000 that is currently under investigation by the Securities and Exchange Commission for questionable accounting practices.
CEOs who are found to be cooking the books "must be held to account," he added.
Bush said he wants new laws toughening penalties for corporate fraud, but has not pressed for as many changes as those enumerated in a Senate corporate accountability measure that is expected to be approved on a bipartisan basis Monday.
"We can't pass a law that says you'll love your neighbor like yourself and we can't pass a law that says you will be honest. We can pass laws that say if you're not honest we'll get you. Corporate America must make the decision, each as an individual, that you're going to uphold high standards," Bush said.
The Senate bill, sponsored by Banking Committee Chairman Paul Sarbanes, D-Md., toughens penalties and adds to the list of securities crimes punishable by jail time, including a ban on corporate officers from accepting company loans, a practice Bush has criticized despite benefiting from it while a corporate officer at Harken Energy Corp. in the late 1980s.
Bush said he wants the House and Senate to resolve their differences over those new laws and get a bill for him to sign before they recess in August.
While in Birmingham, the president was to attend a fund-raiser luncheon for Rep. Bob Riley who is running for governor against incumbent Democrat Don Siegelman. The lunch was an effort to close the financial gap between Riley, who has earned $561,661, and Siegelman, who has collected $4.2 million according to their last campaign finance reports.
Fox News' Wendell Goler and the Associated Press contributed to this report.