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Print[Ferro-alloys.com]WASHINGTON-- U.S. President Barack Obama defended on Monday the administration's handling of the 2008 financial crisis on the fifth anniversary of Lehman Brothers' collapse, touting an economic turnaround while warning against self-inflicted wounds from Washington's potential fiscal fight.
Accompanied by a group of Americans who the White House said have benefited from the government's policies, Obama said although the economy is on the mend, it is not yet where it needs to be.
"We've cleared away the rubble from the financial crisis, and we've begun to lay a new foundation for economic growth and prosperity," Obama said at the White House, adding the Americans should take note of how far they have come from where they were five years ago, and they also need to keep in mind the remaining work that needs to be done to strengthen the economy.
"We need to grow faster. We need more good-paying jobs. We need more broad-based prosperity. We need more ladders of opportunity for people who are currently poor, but want to get into the middle class," he added.
Five years ago, the collapse of Lehman Brothers investment bank marked the beginning of the global financial crisis which wreaked havoc on the world economy, and forced the U.S. government to step in and bail out banks with billions of money to avert a financial meltdown and stabilize the economy.
After mentioning signs of progress, including 7.5 million new jobs, better capitalized banks, a turnaround in the housing market and revitalized auto industry, Obama acknowledged that the middle class families have not benefited enough from the recovery, as most of the gains have gone to the top earners.
Monday's speech kicked off a series of economic events planned this week. After weeks of focus on Syria, Obama would try to put an emphasis on the economy. He will address the Business Roundtable on Wednesday and conduct meeting on Thursday with his export council. He is also expected to travel to a Ford assembly plant on Friday to highlight the success of the government auto bailout.
Obama's remarks followed a report released Sunday by the White House economic team, which concluded that the administration's policies have helped support the economy and strengthen the financial system. The economic-rescue measures listed include the Troubled Asset Relief Program, the "stress tests" designed to shore up the banks and the bailout of the auto industry.
Gene Sperling, director of the National Economic Council, told reporters during a Sunday conference call that the "bold" policies taken by Obama administration "have performed better than virtually anyone at the time predicted" and five years later the government bailout money has been paid back nearly in full.
However, critics said the recovery was disappointingly slow and the unemployment rate remained high at 7.3 percent despite job growth. They also expressed concerns over the widening income gap between the very rich and the rest of the population, as well as the stalled Wall Street reform.
As a renewed budget battle with the Republicans looms large, Obama also seized the opportunity to warn the GOP opponents not to threaten the country with a government shutdown or default.
U.S. Treasury Secretary Jacob Lew told Congress last month that the federal government will reach its debt ceiling of 16.7 trillion U.S. dollars by mid-October, urging Congress to raise the government's borrowing authority in a timely manner. Furthermore, Democrats and Republicans have not yet agreed on the government's budget plan for the 2014 fiscal year. Failure to act on a federal funding bill by Oct. 1 would provoke a government shutdown. Failing to increase the debt ceiling would bring the country to a default.
Republican lawmakers insisted that a debt ceiling increase should be in line with spending cuts, and they will not support financing for government operations unless the Affordable Care Act, Obama's signature healthcare law, is delayed or repealed.
"The last time the same screw threatened this course of action back in 2011, even the mere suggestion of default slowed our economic growth," Obama recalled the showdown which rattled the markets in the summer of 2011.
In an interview with ABC news aired Sunday, Obama voiced his willingness to reverse the spending cuts known as sequester, but stressed that he will not negotiate with Republicans over the country's debt ceiling.
He reiterated in his Monday speech that he "will not negotiate over whether or not America keeps its word and meets its obligations" and he "will not negotiate over the full faith and credit of the United States."
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