Bold calls under Barack Obama 'eased financial crisis'
White House marks fifth anniversary of global financial meltdown with a spirited defence of measures by the current administration
The White House marked the fifth anniversary of the global financial crisis with a new bid to claim credit for "bold" emergency economic rescue measures it said worked better than anyone expected.
Officials also used the public relations push - which included a 49-page report on the administration's response to the meltdown - as a political warning to Republicans of the "self-inflicted wound" threatened by a new debt showdown.
US President Barack Obama's top economic adviser, Gene Sperling, argued that the administration's difficult calls across the banking sector, car industry and in housing and finance had stabilised the US economy.
"The president undertook a series of bold, unprecedented and politically difficult measures in 2009 that have performed better than virtually anyone at the time predicted," said Sperling, director of the National Economic Council (NEC).
Ironically, Sperling spoke just before news broke that one of the architects of those policies, Lawrence Summers, a former NEC chief, said he was withdrawing from the race to be the head of the Federal Reserve.
Summers, a polarising figure in Washington, said he feared that his Senate confirmation process would end up becoming too contentious.
The new economic crisis report touted Obama's speedy response to the crisis when he took office in January 2009, at a time when the economy was losing 800,000 jobs a month and the possibility of a depression loomed.
It said measures such as the Troubled Asset Relief Programme, inherited from the Bush administration, had stabilised the financial system while recouping the Treasury's investment and keeping credit and lending open.
The report argued that stress tests established for US banks by the Treasury had saved the banking system and were now a model for the rest of the world.
And the report also touted the US car industry bailout, controversial at the time, which has seen GM and Chrysler emerge from bankruptcy and create 340,000 jobs since 2009, in a new period of prosperity for the iconic American industry.
The report was released as Obama seeks to turn the focus away from foreign policy - specifically Syria and Egypt - to the economy.
The president was due to make a speech at the White House yesterday, address businessmen tomorrow and visit a plant in Kansas City on Friday.
The latest initiative, on the fifth anniversary of the collapse of Lehman Brothers investment bank which triggered the worst crisis since the Great Depression, also coincided with the opening shots in a new fiscal showdown in Washington.
Obama warned that he would not negotiate with Republicans who are seeking concessions in return for lifting the US$16.7 trillion US borrowing limit, without which the government will go into default.
"What I haven't been willing to negotiate, and I will not negotiate, is on the debt ceiling," Obama told ABC News.
Sperling added that it would not be responsible to risk progress made since the recession with a spell on the "high wire" of a threatened default.
"We came back from the brink, we avoided a second Great Depression, but we all agree that we have a lot further to go to get jobs growing, to get unemployment down to where we need it to be," Sperling said.
A confrontation is also looming between Obama and Republicans on the government's operating budget.
If no deals are reached within weeks, the government could be shut down by the beginning of next month, and it could begin defaulting on its debts by the middle of October.
