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Obama's challenge: Be urgent but hopeful

Tone is crucial to stimulus pitch

By Scott Helman
Globe Staff / January 8, 2009
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President-elect Barack Obama faces a delicate task today as he pitches his economic recovery plan in a major address: He must underscore the urgency of the recession without further unsettling the nation's shaky financial system.

Obama's primary goal is to convince skeptical members of Congress and the public that the recovery plan, which he indicated yesterday could cost as much as $775 billion in tax relief and new public spending, is necessary to shore up the weakened economy. Aides say Obama will make the case by again stressing the immediacy of the crisis.

At the same time, consumers, investors, and lenders are carefully following the president-elect's every word. Analysts say that today and through his early days in office he must be mindful of not hitting the sky-is-falling message too hard, and that he needs to offer the American people solutions, reassurance, and, above all, hope that better days lie ahead.

"Not only the president but the president's staff can move markets, can shake or restore confidence, or they can plow new ground that can either be good or troubling - that's the power of the executive branch," said Ari Fleischer, former press secretary for President Bush. "It's a huge honor, but it's a massive burden."

The balancing act between economic realism and optimism is one Obama has faced since winning election in November. But it has come into sharper relief as his inauguration has neared and job losses and other economic indicators have worsened, and it promises to endure well into his presidency.

"Given the sensitivities of the market, I've got to pay some attention to market psychology, because part of what we have right now is such a loss of trust in both the marketplace and in government that restoring that confidence, restoring that trust, is going to be very important," Obama said in an interview broadcast last night on CNBC.

Obama has issued especially stark warnings in recent days, calling the economy "very sick," "badly damaged," and "very dire," and saying it might get "dramatically worse" without bold action. He has said the country is at a "perilous crossroad," and could face annual federal deficits of more than $1 trillion for years.

Vice President-elect Joe Biden, meeting privately with congressional leaders Monday, ominously likened the economic climate to the terrorist attacks of Sept. 11, 2001, declaring, "we're at war," according to Politico.

The dire words are designed largely to get Americans and their representatives in Congress - especially Senate Republicans, whose assent is crucial - behind the economic recovery plan, which Obama wants enacted within his first weeks in the Oval Office. Some analysts say that Obama should err on the side of being overly grim about the economy, because the failure of the recovery package would wreak far more havoc than his gloomy prognostications.

"Better to take that risk than the other risk of not getting the money through, or not getting the public behind the stimulus package," said Peter Hart, a long-time Democratic pollster.

Fleischer said he believes Obama has a fair amount of leeway in publicly discussing the economy, because the damage is already so apparent. "Given how bad the economy is, how well-known and how long-known that's been a fact, he actually has more room to roam than usual," he said.

Still, analysts say Obama would be wise to temper such assessments - in today's speech and beyond - with doses of optimism.

"You want to leave it on an up note - that we can come out of this even stronger," said Richard Semiatin, a political scientist at American University in Washington. "The president not only has to be a leader right now. He also has to be the great empathizer."

Aides say Obama recognizes this, and that in his pitch for the recovery plan he will emphasize rebuilding confidence in the economy and highlight long-term investments to achieve that.

"We are in challenging times, and to say otherwise would not be truthful," said one transition aide, who asked for anonymity to preview the speech. "But this plan is to stabilize the economy so we can get ourselves back on track."

During the presidential campaign, Obama could speak more candidly about how bad things were economically; indeed, it defined his critique of Republican rival John McCain, who Obama argued would lead the country down the same path. Obama regularly skewered McCain for saying, as the Wall Street crisis mushroomed in September, that the fundamentals of the economy were "sound."

Since Election Day, Americans have increasingly looked to Obama, buoyed by record approval ratings, for leadership. The markets have at times swung in response to his economic announcements, but his assessments have hardly softened - his descriptions of the economy this week were among his gravest to date.

The severity of the economic crisis has forced Obama into an unusually active, visible role for a president-elect - both in crafting policy with Congress and repeatedly addressing the public. In contrast, Obama continues to defer to President Bush on foreign policy, even as Israel's ongoing incursion into the Hamas-ruled Gaza Strip increasingly demands world attention.

Roderick Hart, a specialist on political communication at the University of Texas, said Obama, in speaking so candidly about the economic challenges, is showing more respect to the public than many of his predecessors.

"Above almost all, we depend on a president to hearten us, to steel us for the battle, to care for the national psyche," Hart said. "His main challenge is to get people to be aware without being completely discouraged."

But, Hart added, "Awareness and encouragement are a very dicey, hard-to-manage couple."

Scott Helman can be reached at shelman@globe.com.

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