NBC: Stimulus Started Economic 'Healing,' Auto Bailout Was a 'Gutsy Call' by Obama
Published: 6/3/2011 1:57 PM ET
An otherwise straightforward report on bad economic news on Friday's NBC Today cited economist Diane Swonk, who argued government stimulus prevented things from getting worse: "We basically had a massive coronary during the financial crisis....Financial stimulus and monetary stimulus, you know, got us to the stage where we're healing but we're in still in a lot of rehab."
Correspondent Tom Costello set up the sound bite by declaring: "To get things moving, the government has already cut payroll taxes while the Fed has pumped in $600 billion of stimulus money." He lamented: "But more government spending is unlikely given the political battle over the debt ceiling in Washington."
Moments later, co-host Meredith Vieira spoke with Meet the Press host David Gregory about the political impact of the weak economy on President Obama's reelection chances. Gregory acknowledged that it would "a primary vulnerability for the President" but quickly added: "There will be a rebuttal from President Obama....it'll be focused on the auto industry, which in the White House they maintain could have been a lot worse. This was a gutsy call by the President to launch the auto bailout and that's a sign of some recovery."
On Thursday's Today, prior to Friday's jobs report that showed unemployment jumped to 9.1%, news reader Ann Curry touted "hopeful news" in a rosy government-backed study on jobs: "Despite the Dow's tumble on Wednesday and a persistently high unemployment rate, the government reports today that the U.S. job market may be rallying, seeing its best hiring stretch in five years."
Curry also noted: "The new report says that the boost isn't only helping job seekers, it's also helping state governments close budget gaps with strong tax revenue increases."
Here is a full transcript of Today's June 3 economic coverage:
7:00AM TEASE:- Kyle Drennen is a news analyst at the Media Research Center. Click here to follow Kyle Drennen on Twitter.
MATT LAUER: Where's the recovery? Alarming new signs the economy is still faltering. Unemployment high, stocks down and home prices at their lowest level in years. With the 2012 presidential race already revving up, how concerned should President Obama be?
LAUER: Meanwhile, we have to talk more about signs that the economic recovery is slowing down and there is a fear among a lot of people that this could be much more than a temporary bump in the road. We'll have the latest details on that in a live report coming up straight ahead.
LAUER: Now we turn to the economy and some serious concerns this morning that that fragile recovery that was under way could be in jeopardy. NBC's Tom Costello's in Washington with details on this. Hi, Tom.
[ON-SCREEN HEADLINE: Recession Depression; Growing Concern About Dismal Economic Picture]
TOM COSTELLO: Hi, Matt, good morning. It's all about jobs, housing, retail sales, manufacturing, Europe, Japan. It's an awful lot to worry about. So is this slow-down a bump in the road or something more serious?
UNIDENTIFIED MAN: We don't give up! We do not give up!
COSTELLO: At Shrine Auditorium in Los Angeles, 3,000 homeowners gathered for one-on-one time with a re-fi specialist, desperate to change the terms of their mortgage and save their homes. Jennie Robletto was there hoping to hold onto her home after her husband got laid off.
JENNIE ROBLETTO: Not knowing what the future has in store for us, I think, is the most difficult part.
COSTELLO: The nation's housing crisis remains a huge obstacle to a full economic rebound.
PETER MORICI [ECONOMIST, UNIVERSITY OF MARYLAND]: We simply have too many houses. During the boom, millions of homes were built that we don't need. And until young folks find good paying jobs so they can become homeowners, we're not going to get rid of those millions of homes in foreclosure.
COSTELLO: Whatever economic recovery was under way earlier this year is now very much in question. Home prices at their lowest level since 2002, a decade of home equity wiped out. Manufacturing growth is slowing, jobs growth, slowing, car sales and consumer spending down. Unemployment seems perpetually stuck and something that hits every household and business - gas prices near $4 a gallon. As if that's not enough, there's plenty to worry about overseas, from the Middle East to Europe and Asia.
DAVID FABER [CNBC CORRESPONDENT]: A debt crisis in Greece that is yet to be solved. Frankly we've been dealing with it for a year and a half. That appears to be worsening in some ways and you've still got the ramifications of the terrible earthquake in Japan.
COSTELLO: The pessimism has taken hold on Wall Street. The Dow is down nearly 5% from it's high in May. Meanwhile, bond yields are paying less, that hurts retirees who are on fixed incomes. To get things moving, the government has already cut payroll taxes while the Fed has pumped in $600 billion of stimulus money. But more government spending is unlikely given the political battle over the debt ceiling in Washington.
DIANE SWONK [MESIROW FINANCIAL]: We basically had a massive coronary during the financial crisis. We're lucky we're not dead. Financial stimulus and monetary stimulus, you know, got us to the stage where we're healing but we're in still in a lot of rehab and rehab can take a very long time.
COSTELLO: That's a good analogy, a massive coronary. How long this rehab will take is anyone's guess. Earlier in the year, economists were hoping we'd see the economy grow at about 4% this year. Now most say we'll be lucky if we hit 2%. Meredith.
MEREDITH VIEIRA: Tom Costello, thank you very much. Mitt Romney focused on the struggling economy, Thursday, as he officially launched his bid for the Republican presidential nomination. Just one of the highlights from what has been a wild week in politics. David Gregory is the moderator of Meet the Press. David, good morning to you.
DAVID GREGORY: Good morning, Meredith.
[ON-SCREEN HEADLINE: Recession Depression; How Will Bad Economy Impact Presidential Election?]
VIEIRA: Let's talk a little bit about the politics of this bad economy. No U.S. president since FDR has won a second term in office when the economy - or the unemployment number on election day has topped 7.2%. Right now it's at over 8.5%, not expected to get much lower by the next election. So how concerned should the White House be?
GREGORY: Well, very concerned. This is a primary vulnerability for the President. They understand that in the White House. There will be a rebuttal from President Obama as he ramps up for re-election. And it'll be focused on the auto industry, which in the White House they maintain could have been a lot worse. This was a gutsy call by the President to launch the auto bailout and that's a sign of some recovery. But this is going to be the message war. It's about the economy. Are you better off, deeper into this recession, than you were when President Obama came into office?
VIEIRA: And that's what Mitt Romney latched on to when he announced yesterday in New Hampshire that he is running for president. He blamed President Obama for the current unemployment rate. He said, 'Mr. President, you have had your chance.' Given the economic outlook, that people believe it is dimming, does that make Romney a more attractive candidate this time around because of his business savvy?
GREGORY: Oh, I think it does. Well, because of that business savvy. Now he's going to have to face questions about his own record of job creation as governor of Massachusetts. But this was the debate that Mitt Romney wanted to have back in 2008. And I remember covering him in New Hampshire when the issue was not the economy yet, but back in 2008, it was Iraq and the surge. And he didn't do as well there as he did against Senator McCain, who got the nomination, of course, because he couldn't focus on the economy. Here this is where he'd like that focus to be squarely.
VIEIRA: Yeah, he wasn't the only one in New Hampshire yesterday, Sarah Palin pulled in with her tour bus. She said it was pure coincidence, she wasn't trying to upstage Romney. Romney said he didn't care that she was there. They're saying that publically, behind closed doors what do you think they're saying?
GREGORY: Oh well, look, Sarah Palin is not a real pro-Republican-establishment person. She's going to dance to her own music here. And she was reaching out to conservatives in the state. So it has all the trappings of her at least positioning herself for a run. I don't think that means that she runs. A lot of Republicans I talked to still think that she stays on the sidelines. She can command that media scrutiny, that media attention and that's what she wants right now. Whether to become a candidate or not. Nevertheless, she has a real impact because she can still occupy that political space of social conservatives. That can be more important in a state like Iowa than New Hampshire. It could also help Mitt romney if she's in the race, as well as somebody like Michelle Bachmann.
VIEIRA: And before I let you go, the big story this week actually wasn't Palin or Romney or the economy, it really was the scandal surrounding New York Congressman Anthony Weiner and that lewd picture that was sent through his Twitter site. You know, he has said he is moving on and a lot of Democrats have said that this is a distraction they would like to see end. So what are the political implications, not just for Weiner, but for other Democrats in Congress, if this story continues to have legs.
GREGORY: You know, this is one of those stories where they want to get back to talking about the economy, even if unemployment is high. Look, I think at this stage he may try to move on. There are still some outstanding questions about who sent the picture, was it him? I think, obviously, if something else comes to light it's going to keep that story in the headlines. If not, I think he'll successfully be able to move past it.
VIEIRA: Alright, David Gregory, thank you so much. And I know you're going to enjoy your weekend because you can sleep in late because Meet the Press preempted this Sunday for NBC Sports live coverage of the French Open. So have a great weekend, David.
GREGORY: Thanks, Meredith.