WASHINGTON – President Bush on Saturday sought to reassure Americans about the cost and scope of the U.S. financial bailout plan and said that in the long run "our economy will bounce back."
Bush, in his weekly radio address, acknowledged that people are concerned about their finances and, while he offered assurances about an eventual recovery, he did not say when that would happen.
Since Oct. 9, 2007, when the Dow topped 14,000, investors have lost $8.3 trillion from pension funds, college savings plans, 401(k) self-funded retirement plans and other investments.
"The federal government has responded to this crisis with systematic and aggressive measures to protect the financial security of the American people," Bush said. "These actions will take more time to have their full impact. But they are big enough and bold enough to work." Congress gave Bush a $700 billion plan to buy bad assets from banks and other institutions to shore up the financial industry.
Bush was to meet later Saturday at the presidential retreat in Camp David, Maryland, for talks on the economy with French President Nicolas Sarkozy and European Commission President Jose Manual Barroso, who were to stop in the United States on their way home from a summit in Canada.
In the Democrats' weekly radio address, Rep. Rahm Emanuel used the occasion for campaign criticism against John McCain, the Republican presidential nominee.
"On weekends like this, maybe you're like me and my neighbors, working around the house, trying to save a few bucks," said Emanuel, the chairman of the House Democratic Caucus. "My neighbors and yours are struggling in this economy. They're working as hard as they know how, but the economic policies that George Bush proposed and John McCain supports have left them working harder, paying more and making less."
White House press secretary Dana Perino said the Camp David meeting was not expected to produce any new policy decisions or the date or place for a planned meeting of leaders of major economic powers, the so-called G8. Instead, she said it would focus on efforts extending as far back as April on coordination for financial stability through measures such as bank disclosures, accounting rules at credit rating agencies, capital standards and asset valuation.
The bailout plan runs counter to Bush's oft-stated commitment to free enterprise and the president said he knew many Americans have reservations about the government's approach, particularly the Treasury's planned injection of up to $250 billion in U.S. banks in return for partial ownership stakes, something that hasn't been done since the Great Depression of the 1930s.
"As a strong believer in free markets, I would oppose such measures under ordinary circumstances," the president said. "But these are no ordinary circumstances. Had the government not acted, the hole in our financial system would have grown larger, families and businesses would have had an even tougher time getting loans and ultimately the government would have been forced to respond with even more drastic and costly measures later on."
Bush said the government's involvement was limited in scope and Washington will not exercise control over any private firm and federal officials will not have a seat on bank boards. He also said he believed that the final cost to taxpayers would be significantly less than the initial investment as the housing market recovers.