Obama makes strides on economic recovery

President-elect Barack Obama praised the US Senate's vote this afternoon to release the second half of the controversial $700 billion financial bailout.

"Restoring the economy requires that we maintain the flow of credit to families and businesses. So I'm gratified that a majority of the U.S. Senate, both Democrats and Republicans, voted today to give me the authority to implement the rest of the financial rescue plan in a new and responsible way. I know this wasn't an easy vote because of the frustration so many of us share about how the first half of this plan was implemented. There was too little transparency and accountability, and it didn't do enough to get credit where it's needed most -- small businesses and families struggling to keep their jobs and make ends meet. Now my pledge is to change the way this plan is implemented and keep faith with the American tax payer by placing strict conditions on CEO pay and providing more loans to small businesses, more transparency so that taxpayers can see where their money is spent, and more sensible regulations that will protect consumers, investors, and businesses," Obama said in a statement.

Obama also praised House Democrats' version of the economic recovery package he has made his top priority.

The plan, released today, totals $825 billion -- $50 billion more than his original proposal -- and includes about $550 billion in spending and $275 billion in tax cuts over the next two years.

"I am pleased that the House of Representatives has acted with urgency on an American Recovery and Reinvestment Plan that will save or create over three million jobs, provide tax relief to struggling families and businesses that create jobs, and invest in priorities like health care, education, and energy that will make America strong and competitive in the 21st century. This plan is a significant downpayment on our most urgent challenges, and it will contain the kind of strict, independent oversight that will allow the American people to hold Washington accountable for how and where their tax dollars are spent," Obama said in a statement.

Obama has warned against increasing the cost of the package too much, given the record federal deficits, projected to reach $1.2 trillion this year. He told editors at the Washington Post today that he will convene a "fiscal responsibility summit" in February to discuss how to solve long-term financial problems, with a special focus on entitlements such as Social Security.

"We need to send a signal that we are serious," said Obama of the summit.