Obama Picks Economic Team, CBS Gets Reaction...From Obama

On Monday’s CBS Evening News, correspondent Dean Reynolds reported on Barack Obama's announcement of an economic team, but instead of getting reaction from Republicans or financial experts, Reynolds decided to stick with the president-elect himself: "Timothy Geithner, president of the New York Federal Reserve Bank, as Treasury secretary. Obama said Geithner has an 'unparalleled understanding of our current economic crisis.' And Lawrence Summers, a former Treasury secretary himself, to chair the National Economic Council. Obama called him 'one of the great economic minds of our time.'

The only mention of Republicans in the story was about how cooperative they will be if Obama backs off tax increases: "As a candidate, he favored raising taxes on the rich, but as president-elect he now says he's inclined to wait on that, a concession that could bring congressional Republicans to his side."

Following the report by Reynolds, Smith played a clip of an interview with former Clinton Securities and Exchange Commission Chairman, Arthur Levitt. At one point, Smith asked Levitt: "Barack Obama puts his economic team in place today. It's two months until he takes office. Is this audacious or is this good management on his part?" Levitt replied: "This is smart. I mean, we have an administration that is virtually powerless. Certainly a president who nobody listens to. What we've seen now with the new administration is we have a shadow administration in power, in place, acting in a constructive and in a cooperative way...We cannot afford a lost two-month period where public confidence would disappear. We cannot afford that."

Here is the full transcript of the Reynolds report:

6:30PM TEASE:

HARRY SMITH: Tonight, they've just signed on for the toughest job in America.

BARACK OBAMA: I've sought leaders who could offer both sound judgment and fresh thinking.

SMITH: Barack Obama introduces his economic team and puts them right to work.

OBAMA: We do not have a minute to waste.

6:31PM SEGMENT:

HARRY SMITH: The financial crisis is not officially his headache yet, but Barack Obama wants you and the markets to know he's already working on it. Eight weeks before he takes office, the president-elect today introduced the economic team that will deal with the crisis. And earlier he consulted with President Bush about the new bailout of Citigroup. The latest taxpayer rescue of a financial institution was a big relief to Wall Street. The Dow soared nearly 400 points today. That's almost 900 points over the past two sessions, close to 12 percent, the biggest two day gain in 21 years. Dean Reynolds is in Chicago and he begins our coverage of the economy, the presidency in transition.

BARACK OBAMA: Good morning, everybody.

DEAN REYNOLDS: Flanked by a team of economists whose unenviable job will be to find a way to halt the nation's financial slide, the president-elect took pains not to raise expectations.

OBAMA: This will not be easy. There are no short cuts or quick fixes to this crisis, which has been many years in the making. And the economy's likely to get worse before it gets better.

REYNOLDS: Leading the effort to turn things around, Timothy Geithner, president of the New York Federal Reserve Bank, as Treasury secretary. Obama said Geithner has an 'unparalleled understanding of our current economic crisis.' And Lawrence Summers, a former Treasury secretary himself, to chair the National Economic Council. Obama called him 'one of the great economic minds of our time.' Obama put his economic team in place before his national security team for a simple reason.

OBAMA: With our economy in distress, we cannot hesitate and we cannot delay.

REYNOLDS: Obama expects his team to make recommendations over the next two months on a stimulus to jumpstart the economy and create 2.5 million mostly public works jobs by 2011, with infrastructure repairs and energy projects.

OBAMA: It is my hope that the new Congress will begin work on an aggressive economic recovery plan when they convene in early January so that our administration can hit the ground running.

REYNOLDS: For now, though, Obama is working on the fly, altering some campaign ideas to meet changing circumstances.

OBAMA: I'm not going to give tax breaks to the wealthiest among us.

REYNOLDS: As a candidate, he favored raising taxes on the rich, but as president-elect he now says he's inclined to wait on that, a concession that could bring congressional Republicans to his side. And while just three weeks ago he campaigned on a stimulus in the neighborhood of $175 billion, today estimates range hundreds of billions of dollars higher. No wonder he repeatedly resisted putting a price tag on the latest version.

OBAMA: I'm not going to discuss numbers right now...I don't want to get into numbers right now.

REYNOLDS: Obama also addressed the specific problems of the US auto industry, saying he was surprised that the automakers have yet to put forward a plan for recovery and warning them that they cannot expect a blank check from the American taxpayer to help them out. Harry.

SMITH: Dean Reynolds in Chicago tonight. Thanks.

 

Here is the full transcript of the Smith interview with Levitt:

6:36PM SEGMENT:

HARRY SMITH: Earlier today, I spoke about the financial crisis and the government bailouts with former Securities and Exchange Commission Chairman Arthur Levitt. I asked him if Citigroup's need for a second bailout means the crisis is even worse than we thought.

ARTHUR LEVITT: I think it probably is worse than we thought, but I think the government is doing what they should do. They have to help restore public confidence.

SMITH: A lot of people at home are sitting watching this and they're saying 'these folks on Wall Street have been preaching economic Darwinisim for decades, why not let them fail? They made this mess, why not let them fail?'

LEVITT: The implications of failure now are global, they cut across the economy at every level. We're talking about three basic pillars of the economy: Finance, automobile, and housing. If all three of those tank, we have an economy absolutely in the depths of despair. Can't happen.

SMITH: Barack Obama puts his economic team in place today. It's two months until he takes office. Is this audacious or is this good management on his part?

LEVITT: This is smart. I mean, we have an administration that is virtually powerless. Certainly a president who nobody listens to. What we've seen now with the new administration is we have a shadow administration in power, in place, acting in a constructive and in a cooperative way with the Secretary of the Treasury Hank Paulson. We cannot afford a lost two-month period where public confidence would disappear. We cannot afford that.

SMITH: Arthur Levittt, thank you so much for your time this evening.

LEVITT: You're quite welcome.