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April 10, 2009
Biden's Economic Advisor on 'Glimmers of Hope'
The Situation RoomBLITZER: And joining us now from the north lawn of the White House, the chief economist and economic policy adviser to the vice president, Joe Biden, Jared Bernstein.
Jared, thanks very much for coming in.
JARED BERNSTEIN, CHIEF ECONOMIST TO VICE PRESIDENT BIDEN: Nice to see you again, Wolf.
BLITZER: The president says he sees some glimmers of hope that things are moving in the right direction. Be specific. What are some of those glimmers?
BERNSTEIN: Well, some of those glimmers have to do directly with some of the interventions that the president, the economic team and the Treasury have put in place. The president mentioned today, small business loans up 20 percent. That's a really important increase when you think about the difficulties that small businesses have faced in a tough credit market. But you could also talk about mortgage rates, the 30-year fixed rate well below 5 percent, an historic low, and that's since our housing plan was passed, so that's a really important indicator.
Refinancing, way up. That helps too. So those are the kinds of glimmers. But Wolf -- and the president made this point today -- you really have to temper any of this kind of optimism connecting it to some of our plans with a realistic sense of the challenges the economy still faces.
BLITZER: So you're not ready to declare "Mission Accomplished" yet?
BERNSTEIN: Oh, so far from it, Wolf. The point is this -- look, I told you about mortgage rates, I told you about small business lending, I can talk about refinances. The bottom line, jobs and incomes for American working families, for the middle class, for families throughout this country who are still struggling with a tough economy. Until we get that job market and those paychecks back with people's living standards rising with economy, mission nowhere near accomplished.
BLITZER: Because your boss, the vice president, told me earlier in the week that there would continue to be job losses throughout the rest of this calendar year.
BERNSTEIN: The forecast -- it's a good point and an important one, it's one that the vice president has made before. You know, if you talk about the forecast for the overall economy, GDP, gross domestic product, that starts to turn up towards the end of the year, and that's very positive. But, you know, let's face it, you don't exactly take GDP to the grocery market to buy your bag of groceries.
What matters, bottom line, jobs and income. And jobs and wages, that kind of thing, that lags the overall GDP. So we do expect unemployment to continue to rise.
BLITZER: Here's another point that the president made this morning. Listen to this.
(BEGIN VIDEO CLIP)
OBAMA: So we have still got a lot of work to do. And over the next several weeks, you will be seeing additional actions by the administration.
(END VIDEO CLIP)
BLITZER: All right. Explain what he means by additional actions. Is he talk about another economic stimulus package?
BERNSTEIN: No, he's definitely not. What he's talking about are just further steps in programs that are already underway.
So, for example, we know that the Treasury and, I should say, the Fed and the FDIC are engaged in diagnostic testing to determine the health of the banking sector. There are ongoing plans. This PPIP, or the Public/Private Investment Plan, to help get the bad assets off the balance sheets, that's a work that's coming on line.
You know, the Recovery Act, those pieces are still falling into place. Just a week ago or so, the Making Work Pay tax cut began to filter into people's paychecks. That's an important part of the boost too.
BLITZER: One other point the president made. He said things are moving in the right direction, but he added, "If we don't flinch."
What's your biggest concern right now? What does he mean by that, "If we don't flinch"?
BERNSTEIN: I think the idea there is that we have a set of plans that depend, in large part, on continued pressure from our side, from the Congress' side, in terms of implementing these plans, making sure they get into the system in a timely and efficient way. If you talk about shovel-ready infrastructure, that kind of spending from the recovery plan is getting out into the system as we speak.
But we have to monitor that to make sure that those dollars are efficiently and effectively spent so we can create and save 3.5 million jobs between now and the end of next year. Our plans for the financial sector, for the housing sector, we cannot flinch in the implementation of these plans. We have to monitor their actions as they go through the system, make sure that they're up and running the way we expect them to be.
BLITZER: Jared Bernstein, thanks for coming in.
BERNSTEIN: My pleasure, Wolf.
