Barack Obama's president-elect press conference - 26 November 2008

Good morning, everybody: please have a seat.

It has been increasingly clear in recent months – and we saw some additional reports this morning – that we're facing an economic crisis of historic proportions. And at this defining moment in our nation's history, the old ways of thinking and the old ways of acting just won't do. We're called to seek fresh thinking and bold new ideas from the leading minds across America. And as we chart a course to economic recovery, we must ensure that our government – your government – is held accountable for delivering results.

Today, I'm pleased to announce the formation of a new institution to help our economic team accomplish these goals: the President's Economic Recovery Advisory Board. This board is modeled on the President's Foreign Intelligence Advisory Board created by President Eisenhower to provide rigorous analysis and vigorous oversight to our intelligence community by individuals outside of government – individuals who would be candid and unsparing in their assessment. This new board will perform a similar function for my administration as we formulate our economic policy.

The board will be composed of distinguished individuals from diverse backgrounds outside of government – from business, labor, academia and other areas – who will bring to bear their wisdom and expertise on the formulation, implementation and evaluation of my administration's economic recovery plan. The board will report regularly to me, Vice President-elect Biden and our economic team as we seek to jump-start economic growth, create jobs, raise wages, address our housing crisis, and stabilize our financial markets.

Let me speak to why I think this is necessary. The reality is is that sometimes policymaking in Washington can become a little bit too ingrown, a little bit too insular. The walls of the echo chamber can sometimes keep out fresh voices and new ways of thinking. You start engaging in groupthink. And those who serve in Washington don't always have a ground-level sense of which programs and policies are working for people and businesses, and which aren't.

This board will provide that fresh perspective to me and my administration with an infusion of ideas from across the country and from all sectors of our economy, input that will be informed by members' firsthand observations of how our efforts are impacting the daily lives of our families.

I'm pleased to announce that this board will be chaired by one of the world's foremost economic policy experts, a former chairman of the Federal Reserve and one of my most trusted advisors, Paul Volcker. Paul has been by my side throughout this campaign, providing a deep understanding of financial markets, extensive experience managing economic crises, and keen insight into the global nature of this particular crisis. Paul has served under both Republicans and Democrats, and is held in the highest esteem for his sound and independent judgment. He pulls no punches. He seems to be fairly opinionated – [laughter] – He has a long and distinguished record of service to our nation, and I am pleased that he's answered the call to serve once again.

I'm also happy to announce that Austan Goolsbee, another one of my key economic advisors, has agreed to serve as staff director and chief economist of the Economic Recovery Advisory Board, and act as the primary liaison between the board and the administration. I also plan to nominate Austan to serve as one of the three members of my Council of Economic Advisers.

Austan is one of America's most promising economic minds, known for his pathbreaking work on tax policy and industrial organization. He is one of the economic thinkers who's most shaped my own thinking on economic matters. He's been a stalwart adviser for me since I ran for the United States Senate. I look forward to continuing our close collaboration in the White House.

I plan to announce the remaining members of the Economic Advisory – Economic Recovery Advisory Board in the coming weeks, and I look forward to their contributions to our urgent work to rebuild our economy and restore prosperity across America.

The last point I'd make about the board – I'll announce the particular members in the future – but I just want to be clear that this is going to be designed to make sure that everybody – that businesses across the board, whether it's high-tech or manufacturing, old or new economy, labor, innovative thinkers who may not always subscribe to the conventional wisdom, that they are there to challenge some of our assumptions, to make sure that we are not just doing the same old thing all the time. I can't think of better people than Paul and Austan to help lead that advisory board.

So with that, let me take a couple of questions. I'm going to start with David Shaper from NPR, if he's around. There he is. Good to see you, David.

David Shaper: Good to see you, too. Thank you, sir.

This is the third news conference you've done on the economy this week. And I'm wondering: when you say that there needs to be a new way of thinking and the old way of thinking won't do anymore, does this suggest a bit of a frustration or disappointment with the way the Bush administration and Secretary Paulson is handling the crisis to this point?

Obama: No, I think what it speaks to is the frustration of eight years in which middle-class wages have gone down or, in real terms, their family incomes have been reduced. It speaks to my frustration about all the families that I've met over the last two years who have lost their health insurance or their pensions are in danger, young people who can't afford to go to college.

It expresses frustration about our inability to tackle some of the long-term problems that we've been facing and have been talking about for decades, whether it's health care, energy, an education system that's been slipping behind in critical areas like math or science and, most of all, I think, frustration with the incapacity of Washington to take bold, clear, decisive steps to deal with our economic problems.

So, you know, I was elected with the charge of getting this economy back in shape but also making sure that it's working on behalf of middle class families. In order to do that, I've tried to bring together the best economic minds, people who don't always agree with each other but all share a commitment to making sure that we're growing the pie and that equal opportunity is a reality in our economy, that the American dream remains alive.

And so what I intend to do over the next two months is to forge that team, make sure that it has concrete plans for us to put this economy back on track. And we are going to implement starting day one when I come into office.

Okay? Tom DeFrank, New York Daily News. Sure.

Tom DeFrank: Mr. President-elect, as we all know, we're – as we all know, we're two days away from the biggest shopping day of the year. And a lot of retailers are worrying that this year it could be a disaster that this economy can ill afford. Do you – do you have any shopping advice for nervous consumers? And are you planning to hit the malls yourself on Friday?

Obama: Well, we are going to do some Christmas shopping and Malia and Sasha have already put their lists together. It's mostly for Santa. They send their letter every year. But we may do some extra shopping as well.

I – look, I think families understandably are nervous and concerned about their economic situation. We've seen job loss. We've seen flat-lining wages and incomes. The economic statistics have been bad and people are watching television and understandably are nervous about their future.

There is no doubt that during tough economic times, family budgets are going to be pinched. I think it is important for the American people, though, to have confidence that we've gone through recessions before, we've gone through difficult times before; that my administration intends to get this economy back on track; that we are going to create 2.5 million jobs over the next two years; that our future is bright if we make good decisions.

And what we don't want to do is get caught up in a spiral where people pull back from the economy, businesses then pull back, jobs are reduced, and we get into a downward spiral. What we want to do is to be sober, to be clear, to recognize that we've got some real adjustments that have to be made. That's true with – in individual businesses. It's true in terms of individual family budgets. It's also true for the economy as a whole.

But we continue to have the best workers in the world. We continue to have the most innovation in the world. We continue to be in possession of extraordinary resources that, if we harness properly, will get this economy moving over the next couple of years but also over the next two decades or three decades.

So people should – should understand that help is on the way. And as they think about this Thanksgiving shopping weekend, and as they think about the Christmas season that is coming up, I hope that everybody understands that – that we are going to be able to get through these difficult times, but we're just going to have make some good choices.

All right. I'm going take one more question. Go ahead.

[reporter]: Thank you, Mr. President-elect. In addition to the Santa Claus list, I wanted to get into some specifics on exactly what you plan to do when you say, "Help is on the way."

Obama: Yeah.

[reporter]: First of all, do you support the Bush administration's latest $800 billion bailout? Are you worried about the continuation of printing money? Specifically, what federal programs would you cut?

Obama: How many – how many compound questions is this going to be?

[laughter]

[reporter]: It's three, to be honest with you.

[laughter]

[reporter]: Secondly, what federal – you talked about sacrifice yesterday. What federal programs specifically, one or two, would you cut to actually pay for your stimulus plan?

Obama: Okay.

[question]: And finally, you were talking about changing Washington. Your campaign was that. Paul Volcker has been around a long time. Tom –

Obama: Uh-oh, Paul, I think that's an insult there.

[reporter]: He's very highly respected, I want to add – very highly – very wise man. But –

Paul Volcker: I haven't been in Washington for a while. (Chuckles.)

[reporter]: But sir, you talked about John McCain was going to come back to Washington if he won, and it would just move people into different chairs. You've got Tom Daschle, Hillary Clinton, Bob Gates –

Obama: Wait-wait-wait-wait: hold on, hold on. Hold, hold – wait, wait; hold on, you hear that. So the – first of all, that's not the topic. We're not talking about my Cabinet, because I haven't made those appointments yet. And I'm happy –

[reporter] So can we talk about Paul Volcker? He's been around a long time. So it's – he's somebody who knows the ways of Washington. But what do you say – you know, say to your supporters who were looking for change?

Obama: Actually, Paul Volcker hasn't been Washington for quite some time, and that's part of the reason he can provide a – a fresh perspective. Austan Goolsbee, from my – my understanding, you've never worked in Washington?

Austan Goolsbee: Yeah. I've been on vacation –

Obama: This is about a – this is; this-this-this is about as fresh a face as you can get. Although – well, that's all right.

[laughter]

Look, let me take the questions in turn.

Number one: with respect to the details of the economic plan, as I've said before, we are going to be working over the next several months to put those details together. I've described for you the framework within which we are going to put that – that legislation forward. We're going to have a strong stimulus, a(n) economic recovery plan that is designed to put people back to work. That's priority number one.

It is going to be large enough to jump-start the economy. That is what I talked about on Monday.

On Tuesday, I talked about the fact that we are going to have to pare back on programs that do not work. And I – I think would hardly be expected to provide you a detailed list now; that's why I have Peter Orszag, our budget director, who's going to be going through that budget page by page, line by line. And the expectation is, is that we will identify those programs that are not working, make sure that those are eliminated, and put money into programs that do work, around things like health care modernization, making sure that we've got the first-class schools that our kids need in order to compete in the 21st century, start putting a downpayment on a new energy economy.

When it comes to the people that we've pulled together – because I know this has been sort of conventional wisdom floating around Washington – that, well, you know, there's a recycling of people who were in the Clinton administration, although Paul dates before that, the last Democratic administration that we had was the Clinton administration. And so it would be surprising if I selected a Treasury secretary who had had no connection with the last Democratic administration because that would mean that the person had no experience in Washington whatsoever. And I suspect that you would be troubled and the American people would be troubled if I selected a Treasury secretary or a chairman of the National Economic Council at one of the most critical economic times in our history who had no experience in government whatsoever.

What we are going to do is combine experience with fresh thinking. But understand where the – the vision for change comes from first and foremost. It comes from me. That's my job, is to provide a vision in terms of where we are going and to make sure, then, that my team is implementing it. I think that when you ultimately look at what this advisory board looks like, you'll say this is a cross-section of opinion that in some ways reinforces conventional wisdom, in some ways breaks with orthodoxy in all sorts of ways.

And that's the kind of discussion that we're going to want. We want ideas from everybody. But what I don't want to do is to somehow suggest that because you served in the last Democratic administration that you're somehow barred from serving again, because we need people who are going to be able to hit the ground running.

[reporter]: And, specifically, do you support the 800 (billion dollar) – the latest $800 billion bailout? Because the markets are watching your words very closely, and they're wondering whether you support that, sir.

Obama: Well, the – what I've said is that we have to do whatever's required in order to make sure that our financial system stays effective in being able to get credit to the markets; and it is important for us to make sure that the federal government, whether it's the Fed or the Treasury or any of the other agencies that have been given this authority, use it in a forceful fashion.

The latest attempts by the Treasury to make sure that we have a housing market in which credit is flowing, and that is looking at other areas of consumer credit, like student loans or car loans – I think that is a positive sign. And my hope is – is that over the next couple of months we continue to ensure that credit is flowing, that businesses are able to keep their doors open, that we are able to make sure that people make payroll. If we do those things, then I'm confident that we can get back on track, but we're still going to need the kind of economic recovery plan that I've been talking about and that I intend to get passed as soon as I'm sworn into office.

[reporter]: Thank you, sir.

Obama: All right? Okay, guys. Thank you very much. Happy Thanksgiving.

I want you to know that both Paul and Austan have special turkey-cooking recipes, if everybody – if anybody out here needs some advice on how to make the ideal turkey. They – they seem to have a competition back here.

All right. Thank you, guys.