Here is the speech I’m waiting to hear from President Obama:
“Good evening my fellow Americans.
I want to talk to you directly tonight about our economy. We have faced some perilous times and we are not out of the woods yet. While the financial and banking crisis that took us to the brink has been stabilized we still have major problems in housing, in capital investment and jobs creation. This is not news to you, you feel it.
When I took office I felt called to face the structural problems that faced our nation with bold new direction. I focused on the most difficult problems first in stimulating the economy to stop our economic freefall and tackling the burdensome crisis in health care. I tried to target the new spending used for these purposes to help transform our economy for the future.
We have not faced a crisis this serious since the Great Depression. There is no clear roadmap for such challenges. We must take actions that fit the conditions we face. Some will work. Others will require adjustment. We have and will make mistakes and when we do we will correct them and replace failed efforts with new strategies. This is not long term planning—this is economic triage. We had hoped our economic strengths had vaccinated our economy from such illnesses but we found ourselves first in the emergency room than then the operating room to stop the bleeding.
We are not in this alone. The global markets are feeling the same pain and sometimes worse fundamentals. The EU has been hit particularly hard by the debt crisis in Greece and other countries. China’s blazing economic growth has slowed and it is feeling some of the internal tensions felt around the world, yet it still provides a strong source of growth for the global economy. On our southern border, Mexico is facing a virtual war with drug cartels, crime and violence. In the Middle East, Iraq, and Afghanistan America is engaged in defending against threats to our way of life that are costly but necessary. Looming on the horizon is a menacing threat of nuclear proliferation from Iran and the irrational behavior of North Korea and several other failed states.
After a growing sense of recovery in the first half of 2010, events are conspiring to sap our confidence. We face a new risk today and my purpose tonight is to name it and confront it head-on. Our new threat is a loss of confidence, a griping fear of the uncertainty ahead, and a sense of urgency for constructive action we feel missing today to turn our ship into the wind.
The actions my administration took in stimulus spending, health care reform and other areas to address our problems, while necessary, in my judgment, nonetheless add to our uncertainties. The sum of all our fears is causing the recovery we need to slow and is putting us at risk of stalling or worse falling back into recession as both business and consumers hunker down.
What worked to get our economy into recovery needs now to change to accelerate growth. So tonight I want to outline my strategy for our return to growth:
FROM GOVERNMENT SPENDING TO PRIVATE INVESTMENT. The Government cannot keep spending, we all know that, and now it is time for the private sector to step up to the plate and unleash the cash it has been hoarding to invest in a growing economy. Worries over deficit levels, inflation and taxes to service debt are discouraging private investment when we need it most so here is my plan of action:
- Extend the Tax Cuts Scheduled to Expire this year to 2015. This fear of rising taxes is holding us back and I will ask Congress to extend these tax cuts for an additional five years to take away that uncertainty. I know some would like to make them permanent but debating the merits of that now will take too long. We need action now so let’s postpone that debate until the economy turns around.
- No Capital Gains or Carried Interest Taxes until 2020. To unleash the cash sitting on the sidelines I propose to suspend capital gains taxes and carried interest taxes for 10 years to put the capital of America back to work creating jobs and growing our economy to its maximum potential. History teaches us that reducing capital gains actually raises government revenue and I’m betting that history will repeat itself just when we need it most.
- Use Unspent Stimulus Funds to Pay Down Debt. Not all those shovel ready projects intended by the stimulus program were as shovel ready as we expected. The result is there are still billions in stimulus, TARP and other funding unspent. Left sitting there the temptation will be irresistible to spend it driving up the deficit further. I propose instead to use it—all of it as well as any government loan repayments to reduce the Federal deficit and begin a deliberate process of restoring our Federal family budget to reasonableness.
FROM FEAR OF MARKETS TO GROWTH FROM FREE TRADE. The fear in markets around the world is holding back the growth potential that comes from global commerce. We need to step up and provide the global trade and economic growth leadership the world expects from America. I propose to do the following:
- Approve Free Trade Agreements with Colombia, South Korea and Panama. These agreements have been sitting on the sidelines as we quibbled over details that while important can be worked out in good faith between the parties over time. I plan to ask Congress for action this year to approve these agreements and get our economy’s exports growing faster.
- Middle East Economic Cooperation Agreement. The intractable problems of Middle East peace require changes that align the interests of the parties and give them more reasons to work together than to remain at odds. Water, environmental issues, electricity, job creation, new technology and trade all are essential to each of them. The United States proposes that Turkey, Saudi Arabia, Jordan, Egypt, Israel and Iraq form the nucleus of such a cooperation agreement. The agreement would be open to expansion from other countries in the region who are willing to enter into the agreement and work together cooperatively and peacefully. To encourage such development, the US proposes to enter into a free trade agreement and a mutual security agreement with this new Middle East Economic Cooperation group of nations.
- Mexican-American Security Agreement. The drug violence taking place in Mexico threatens to spill over our borders and is already creating serious problems for our border states of Arizona, Texas, New Mexico and California. Dealing with it is a bilateral challenge that will take action from both countries. The US will take actions to secure our southern border and stop the trafficking in drugs and people. We will work with the Mexican government to provide assistance in confronting drug cartels, and I am forming a working group of Governors, Congressional leaders and the Administration to device a new immigration strategy that works.
FROM FEAR OF THE FUTURE TO CONSUMER CONFIDENCE IN THE FUTURE. The third leg in this new strategy is a focus on restoring consumer confidence. Nothing will help more than job creation and a growing economy and the first two parts of this strategy are designed to achieve that goal. This strategy is focused on controlling costs and creating opportunity for Americans. I propose the following:
- Use the Market to Drive Down Health Care Costs. Our new health care plan lays the foundation to assure expanded coverage but now we must turn our focus to driving down the costs. I propose to do that by eliminating the barriers to interstate competition between health plans enabling America’s to shop for the best deal. My plan would lay out a basic set of policy options and allow providers to offer supplemental coverage on a competitive basis and use the ruthless competition in the market place to bring health care costs under control.
- Overhaul the US Tax System to Create a Simplified Fair Tax. I propose to completely overhaul the complex US tax system to replace it with a flat tax that eliminates most paperwork and creates a level, fair and easy to understand set of tax rates that is revenue neutral. By ending the gaming of our tax system I hope to restore confidence in its fairness and shift America’s focus to growth. Everyone needs to participate in America’s growth and everyone needs to pay a reasonable share of their income to renewing America’s future. Our current system is out of line, unfair and increasingly dysfunctional. We must fix that.
- Improve the Quality and Affordability of Education. To secure our economic future America needs a work force trained to meet our technology, science and social needs. We must reinvest in education and make it accessible to all. I propose to shift the lion’s share of Federal spending on education into a program of scholarships to students who qualify based upon their academic performance and to make tuition a tax deductible expense for students and parents to shift the focus of education from institutions to education consumers. This will allow students to shop for a school that meets their needs and enable competitive market forces to drive down the costs of education and create more choices just as we hope it will in health care costs. Good teachers will command good salaries and good schools will attract more students and America will be better for it.
So that is my strategy for restoring America to growth and driving our country out of the ditch and into a bright future. This will not be easy, but nothing could be harder than the economic near death experience we have just survived. So roll up your sleeves America and let’s all get back to work.”