Obama Team Heads to 'War' Over Economic Agenda

Billionaire investor Warren Buffett said last week that the country is in an "economic war," likening the crisis to the Pearl Harbor attacks.

It's a war all right. President Obama adviser Christina Romer said as much on Sunday.

But there are two sets of battle lines. One is between the American people and a deepening recession. The other is between the Obama administration and the minority in Congress -- each trying to convince the public it has the economic cure.

A wave of top Obama financial advisers blanketed the airwaves Sunday morning to promote the president's budget proposal and defend his response so far to the crisis, following up on the president's repeated attempts over the past few days to build confidence in an economic turnaround.

The advisers, at the same time, tried to blunt Republican charges that the White House is exploiting the crisis to enact sweeping changes in his budget. They worked to reinforce the theme that Republicans got the country into this mess and are offering scant ideas to reverse course.

"The situation the president inherited of nearly $1 trillion deficits, before he did anything, came at a time when it was a Republican president and a Republican Congress that were making the decisions," said Larry Summers, head of the National Economic Council, on ABC's "This Week." "So I think what the president is proposing is a strategic budget. It is making substantial cuts, but it's also providing support in some important areas ... that will let us have a sound economic expansion."

Asked about Republican criticism of the $3.6 trillion budget plan, Summers said: "We'd love to see (Senate Minority Leader Mitch) McConnell's concrete alternatives that gets closer to a balanced budget."

The subtle dig follows the "Party of No" Web site launched by the Democratic National Committee which accuses the Republican Party of stonewalling the president while refusing to present an alternative budget of its own.

Pushing a pro-active image, Austan Goolsbee, of the White House Council of Economic Advisers, told "FOX News Sunday" the administration is determined to keep the unemployment rate from hitting double digits. The U.S. unemployment rate hit 8.1 percent last month, a 25-year high.

"In the first 51 days of this president, the administration has passed a series of really dramatic moves -- the biggest financial rescue package that we have seen in decades, the largest stimulus probably in the history of the country, the biggest home foreclosure prevention and mortgage assistance program since the Depression," Goolsbee said.

Romer, head of the Council of Economic Advisers, also said Sunday that Obama is offering "incredible medicine for the economy and we fully expect it to work."

She agreed with Buffett's "economic war" description.

"We haven't won yet. We have staged a wonderful battle," she said on NBC's "Meet the Press."
But with the battle over the budget just beginning, Republicans are returning fire.

House Minority Whip Eric Cantor defied the claim that Republicans have no alternatives.

He said the GOP will produce a plan that puts the focus on fixing the banking system to free up credit and helping small businesses create jobs. "Republicans will have a plan," Cantor said, criticizing the administration for a "lack of focus" on the fundamental challenges to the economy.

"They're trying to do entirely too much and not focus on the job at hand."
McConnell, speaking on "This Week," indicated his party would not have a comprehensive budget alternative. Rather, he said Republicans would offer amendments to "reframe" Democratic prescriptions for the country's ailing economic health.

"It taxes too much, it spends too much, it borrows too much," McConnell said. "They're taking advantage of a crisis in order to do things that had nothing to do with getting us into the crisis in the first place. They want to have a massive expansion of health care."

And former Vice President Dick Cheney chastised the administration Sunday for trying to pin the blame on the Bush administration.

"This is a global problem. This isn't something that happened just in the Bush administration or just in the United States," Cheney said on CNN's "State of the Union."

"It doesn't do just to go back and say, 'Well, George Bush was president and that is why everything is screwed up,' because that is simply not true."

With partisan rancor on the rise, Buffett's words last week appear to have fallen on deaf ears.

Buffett, in calling the crisis an "economic war," said Democrats have an obligation to stop exploiting that to push through agenda items and Republicans have an obligation to support those policies that are designed to fight the war.

Buffett, during an interview with CNBC, reaffirmed his support for Obama but said the administration also has to stop blaming the Bush administration. He suggested such finger-pointing would be like blaming the Navy for Pearl Harbor.

Meanwhile, the Obama administration is rolling out another set of proposals in its economic crisis attack plan.

Despite Cantor's comments about the need for small business help, Obama plans to announce a broad package of measures Monday that includes $730 million from the stimulus plan for that sector of the economy. This money will be used to immediately reduce small-business lending fees and increase the government guarantee on some Small Business Administration loans to 90 percent.

The government also will take aggressive steps to boost bank liquidity with more than $10 billion aimed at unfreezing the secondary credit market, according to officials briefed on the plan who demanded anonymity to avoid pre-empting the president's announcement. Small business owners have complained about difficulties obtaining credit from struggling banks.

Obama's economic advisers touted the small business plan in interviews Sunday.

"The market for credit to small businesses is completely frozen in an already terrible credit crisis," Goolsbee said. "And so we're trying to reignite through direct intervention the small business credit market so that they can expand."

The Associated Press contributed to this report.