Obama calls for stimulus package

Wants Congress to act quickly on $100b in aid; Pledges to take economy 'head on' once in office

President-elect Barack Obama and met with Vice President-elect Joe Biden and the members of his economic advisory team yesterday in Chicago. Obama said he wants Congress to pass an economic stimulus package of $100 billion or more. (John Gress/Reuters)

WASHINGTON - President-elect Barack Obama, in his first postelection news conference, said yesterday that he wants Congress to pass a fresh economic stimulus package "sooner rather than later" to help stabilize the staggering American economy - a challenge made more urgent by soaring unemployment that rose last month to its highest level since 1994.

After meeting with the 17 members of his economic brain trust in Chicago, Obama told reporters he hoped the outgoing Congress would approve a new stimulus program of $100 billion or more in a special session before year's end, despite Republican opposition. If this Congress failed to act, Obama said, he would make it his first priority after the Jan. 20 inauguration to get the new Congress to enact legislation that includes an extension of unemployment benefits, tax cuts, and aid to small business.

Obama pledged to take "head on" the na tion's difficult economic challenges when he enters office, including the Wall Street rescue package, the related home foreclosure crisis, and the unemployment rate. And he noted that state and local governments will need federal help to avoid financial disaster, which would add to the nation's economic woes.

In a setting designed to project presidential authority, Obama answered several questions from reporters touching on a wide range of topics: the economy, his Cabinet selections, US-Iran relations, and the breed of puppy he and his wife will get for their daughters.

Though the room was packed with journalists and he stood at a rostrum before a row of flags, Obama repeatedly reminded reporters that "the United States has only one government and one president at a time" and he must wait until after President Bush leaves office before enacting his agenda.

The news conference came hours after the US Department of Labor announced the latest round of grim economic news: Employers shed another 240,000 jobs in October, pushing the unemployment rate from 6.1 percent in September to 6.5 percent last month.

On Thursday, the three major US automakers, weighed down by deep losses and burning through cash reserves, met with House Speaker Nancy Pelosi and Senate majority leader Harry Reid, seeking billions in short-term loans to stay afloat.

Last month, Democratic leaders signaled they would reconvene Congress for a rare lame-duck session after the election to pass a stimulus package of at least $100 billion and get it to the president's desk as soon as possible. But that plan is now sidetracked because Republicans are reluctant to add to a deficit approaching $1 trillion, and Bush is lukewarm to the idea.

In a statement yesterday, Pelosi, a California Democrat, noted that the chamber passed "strong economic recovery and job creation legislation" two months ago, but the legislation stalled in the Senate. She said the economy needs another shot in the arm before it recovers, and that yesterday's unemployment report "should send a clear signal to Republicans in the Senate and to President Bush that they must join us" before the economy falls even further.

Obama was flanked by his economic council, which includes billionaire investor Warren Buffett as well as financial industry leaders such as Anne Mulcahy, chairwoman and CEO of Xerox Corp., and former top government economic officials including Paul Volcker, the former chairman of the Federal Reserve. Obama spoke mostly in general terms and had few specifics, though he acknowledged it will be a long, difficult job to reverse the economic slide.

"We need a rescue plan for the middle class that invests in immediate efforts to create jobs and provide relief to families that are watching their paychecks shrink and their life savings disappear," Obama said. An extension of unemployment insurance, help for small businesses, and a second fiscal stimulus plan, he said, "will jump-start economic growth [and] is long overdue."

Meanwhile, Obama said his team will monitor the Wall Street rescue package. Besides the financial and business sectors, he added, any federal action needs to protect "state and municipal governments facing devastating budget cuts and tax increases."

Obama wouldn't say exactly how he would help struggling automakers, whom he called "the backbone of American manufacturing." He said the Bush administration should do everything it can to help the industry retool, and pledged to make their survival a high priority.

Less than three days after making history by becoming the nation's first black president-elect, Obama appeared confident at a podium with a placard reading, "Office of the President-elect." He said he believes an incoming president "can do an enormous amount" to restore economic confidence, advance an agenda, and help families struggling to weather the economic storm.

"We have a current financial crisis that is spilling out into the rest of the economy, and we have taken some action so far," the president-elect said. "More action is undoubtedly going to be needed. My transition team is going to be monitoring very closely what happens over the course of the next several months."

Asked about his Cabinet, Obama said he will make more appointments "with all deliberate haste, but I want to emphasize deliberate as well as haste." Referring to the choices of Vice President-elect Joe Biden and Rahm Emanuel, his incoming chief of staff, Obama said, "I'm proud of the choice I made of vice president, partly because we did it right. I'm proud of the choice of chief of staff, because we thought it through."

Obama said he read texts from Abraham Lincoln and had spoken with Presidents Carter, George H.W. Bush, and Clinton to prepare himself for the presidency. But his attempt at humor went awry when he said that he was consulting only living presidents, and not following former first lady Nancy Reagan in using seances. Obama later called Reagan to apologize. It was then-first lady Hillary Clinton, not Reagan, who was said to have spoken of seances, but Clinton disputed that notion.

Obama acknowledged receiving a letter of congratulations from Iran's president, Mahmoud Ahmadinejad, but is weighing an appropriate response, he said, given Iran's suspected development of nuclear weapons and what he said is its support of terrorist organizations.

On a lighter note, Obama said the choice of a puppy for daughters Malia and Sasha has become "a major issue. I think it's generated more interest on our website than just about anything."

The family must select a breed that will not aggravate Malia's allergies, Obama said, adding, "Our preference would be to get a shelter dog, but, obviously, a lot of shelter dogs are mutts like me. So . . . so whether we're going to be able to balance those two things I think is a pressing issue on the Obama household."