President Obama addresses the nation in prime-time news conference - Spokane, North Idaho News & Weather KHQ.com

President Obama addresses the nation in prime-time news conference

WASHINGTON (AP) -  President Barack Obama says he expects strong support from Americans and Congress for his push for unprecedented regulatory authority over financial institutions.

Addressing a prime-time news conference, the President defended his call for broad new powers to regulate nonbank entities such as troubled insurer American International Group. Treasury Secretary Timothy Geithner and Federal Reserve Chairman Ben Bernanke testified Tuesday about the plan.

President Obama said the absence of such authority contributed to AIG's woes. He likened the authority to the government's regulation of the banks. He also urged Americans not to demonize AIG and other companies receiving federal tax dollars.

He defended his decision to wait a few days before expressing his anger over the bonuses paid out to executives at troubled insurer AIG.

Critics questioned why the President seemed days behind the populist anger over the $165 million that were distributed at the company bailed out with federal tax dollars.

Said Obama : "It took us a couple of days because I like to know what I'm talking about before I speak."

The President was answering questions by a reporter at the press conference.

On Sacrifice:

President Obama said people can do their part during the economic crisis by continuing what they have always done: work hard, look after their families and contribute to their communities.

In the news conference the President was asked about why he hasn't called for more sacrifice from the American public during the crippling economic downturn.

President Obama said he wants people to keep working and caring for each other. He said he wants them to pay attention to the debates happening in Washington about the next budget because he is going to need the support of the American people.

The Budget:

President Obama said he's not ready to comment on a proposal from some Senate Democrats to scrap his middle-class tax cut after 2010. The President said he hasn't yet seen what changes are coming out of the House and Senate.

But he delivered his bottom-line on the budget at the news conference. President Obama said the budget must move toward health care reform and include an energy policy that frees the nation from dependence on foreign oil. He also says he's looking for investment in education and a reduction in the deficit.

President Obama said a middle-class tax cut is already in place through the recovery package for at least two years. And he said he never expected Congress to approve his plan without some changes.

Deficits:

The President says it will be impossible to balance the budget if the government doesn't tackle health care costs and boost economic growth.

President Obama was answering Republican critics, and some congressional analysts, who forecast deficits of $9.3 trillion over the next 10 years based on the President's budget.

He said he inherited a deficit that the Republicans had contributed to, and pointed out that the GOP has failed to come up with an alternative.

He said if he doesn't address reliance on foreign oil, improve the education system and drive down the cost of health care that the economy won't grow at either his rate of 2.6 percent, or the congressional budget analysts' rate of 2.2 percent.

Defense Spending

President Obama said he can save money on defense and veterans programs by targeting the way the military buys its equipment. He said the country can remain safe and make sure veterans have the services they deserve.

President Obama said too often in recent years, returning veterans haven't been given what they need in such areas as treatment for post-traumatic stress and serious brain injuries.

He said he wants to serve those veterans and reduce military spending by keeping close tabs on the way contractors and lobbyists do business. He told reporters at the Tuesday evening news conference that he's already targeted $40 billion in procurement savings, and that he'll continue to look for ways to reduce wasteful spending on multibillion-dollar weapons systems.

Charitable Giving

The President is defending a budget idea that would reduce the tax deduction that wealthier families can take when they make charitable donations.

The President says the plan is "the right thing to do."

The President said the change in tax policy would be realistic and fairer to lower-earning families that make charitable gifts but get a smaller tax deduction. Some lawmakers don't like the idea. They say it could hurt donations to needy groups in a time of need.

He said the provision would affect only about 1 percent of the American people, and they would still get a tax deduction, just not as big as they used to get.

On the Subject of Race:

The President said Americans are judging him by the job he's doing, not the color of his skin.

Questioned about race at the news conference, the President said the American people are assessing his ability as chief executive based on his skills and work. He said that's the way he should be judged.

He said there was justifiable pride in January when he was inaugurated as the first black President. He said that step beyond the nation's searing legacy of racial discrimination lasted about a day.

Stem Cells

The President says lifting a federal ban on embryonic stem cell research with the "right thing to do and the ethical thing to do."

The Democratic President says he wrestled with the ethics of the decision but is hopeful that the science will lead to help for people with debilitating diseases.

He said he has no interest in causing controversy, as the stem cell decision did. He says he is happy to avoid such controversy if that's where the science leads.

But he said he will not make a decision on a matter like stem cells based on what he called a rigid, ideological approach.

President Obama 's decision on stem cells was a reversal of his predecessor, Republican George W. Bush.

The Homeless

At a time when millions of Americans are losing their jobs and their homes, the President said he's "heartbroken" that any children are without a roof over their heads.

He said the "most important thing" that he can do for those children is make sure that their parents have jobs. And he again pointed to his plan to save or create 3.5 million jobs through his economic stimulus package.

He said in the meantime, he wants to work with states to help those who are "falling through the cracks."

And the President told reporters that there needs to be a "change in attitude" in the country, so that it isn't seen as "acceptable" for children and families to be homeless.

On the Mideast

Even as a hard-line Israeli government takes shape, President Obama said he still believes it's possible to achieve peace in the Middle East.

The President was asked about the incoming government led by a prime minister who has said Palestinians are not ready for statehood.  He reaffirmed the U.S. goal of a two-state solution, where he said Israelis and Palestinians can live "side by side" with "peace and security."

He said his choice of George Mitchell as Mideast envoy was a signal that he's serious about trying to move the parties toward that goal. 

The President referred to the St. Patrick's Day White House gathering of former warring parties in Northern Ireland as proof that even when peace seems impossible, differences can eventually be overcome through persistence.

World View

The President said the world's view of U.S. global leadership is rising because of steps taken by his administration.

He defended his economic policies and said he thought the dollar was in an extraordinarily strong position. He said the reason was that investors consider the U.S. to have the strongest economy and the most stable political system in the world.

He said that despite a "rough patch," the prospects for the world economy are extremely strong.

As for the image of the United States, Obama spoke boldly of the world response to his administration and the steps it has taken. He said there has been a restoration of confidence in the ability of the U.S. to "assert global leadership."

(Copyright 2009 by The Associated Press. All Rights Reserved.)

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