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Saturday, July 11, 2009

President Urges Public Patience on Economy

WASHINGTON — President Obama is stepping up efforts to maintain public support for his agenda as rising unemployment presents him with the biggest test of his political strength since taking office.

Faced with an economic downturn that has proved deeper than the White House initially projected, Mr. Obama asked Americans on Saturday to remain patient, arguing that his $787 billion stimulus plan had saved the economy from collapse and put it on a gradual course to recovery.

“As a result of the swift and aggressive action we took in the first few months of this year, we’ve been able to pull our financial system and our economy back from the brink,” he said, deflecting calls for a new round of stimulus spending and saying that his plan was intended to work not in a few months but over two years.

Facing an array of challenges on Capitol Hill and concern about the huge budget deficit, he cast his main legislative initiatives, starting with his call for overhauling the health care system, as part of a long-term plan to rebuild the economy on a sounder foundation.

Mr. Obama returns to Washington on Sunday from a weeklong trip abroad at a time when Democrats have grown increasingly jittery about the economy and the political risks of the president’s ambitious agenda on health care, energy and climate change, financial regulation and other issues.

Aides said Mr. Obama’s remarks on Saturday, delivered in his weekly radio and video address, were intended to help regain control of the debate. He will follow up with speeches in Michigan and New York in the coming week, and possibly a prime-time news conference.

Behind the scenes, the White House is working to calm nervous lawmakers. Rahm Emanuel, the White House chief of staff, urged House Democrats in a private meeting earlier in the week to take note of polls showing that Democrats were in much stronger shape than Republicans on the issues of taxes and economy.

Mr. Emanuel assured them, according to those attending, that the White House “has their back” as they are being asked to take tough votes.

“We have to fly through a little turbulence,” said David Axelrod, one of Mr. Obama’s senior advisers. “But the important thing is to keep going, understand where you are headed and not lose heart in the middle of the journey.”

Still, the shifting environment threatens to make it harder for Mr. Obama to rustle up votes from nervous Democrats who, unlike Mr. Obama, have to run for re-election next year. Some polls have found a slight softening in support for Mr. Obama and his economic proposals nationally and, potentially more worrisome for Democrats, erosion in battleground states including Ohio. “It makes everything a little harder,” said Senator Michael Bennet, a Colorado Democrat who will be on the ballot next year.

Representative Jason Altmire, Democrat of Pennsylvania, said: “Everyone is concerned — you want it to be better. I think everyone realizes this was a long-term process. We are digging out of a deep hole.”

And Senator Charles E. Schumer of New York, the No. 3 ranking Democrat, said that the complications from persistent weakness in the economy were “probably the most serious challenge we as Democrats face.”

Republicans said they sensed a new vulnerability in Mr. Obama. They have been visibly energized as they argue that his stimulus plan was costly and ineffective and that his health care plan will mean tax increases and more government bureaucracy.

“While the president’s personal numbers are still good, his policies, particularly the spending and the rising debt, are scaring people,” said Senator John Cornyn of Texas, the chairman of the National Republican Senatorial Committee.

Mr. Cornyn said he believed that any patience the public had with the Obama economic approach was wearing thin and that Democrats would have difficulty continuing to blame the Bush administration for economic troubles.

“Time’s up on that one,” he said.

From the moment he took the presidency, Mr. Obama has warned that it could take years to get the economy back on track, and most polls showed that Americans were prepared to give him time.

The worsening economy could test just how much time Americans are willing to give him, particularly if the unemployment rate, now 9.5 percent, the highest since 1983, breaks 10 percent. Most economists anticipate that the unemployment rate will reach double digits this year.

And some politically critical states have already reported that unemployment has broken 10 percent. Ohio hit 10.8 percent in May. Florida, Indiana and Michigan are already well above that threshold while other states are approaching it. That could make it much more difficult to convince conservative Democrats in those states, already worried about challenges from Republicans next year, to cast votes for legislation like the health care or climate-change bill, particularly if these measures include some form of tax increases.

In one sign of this, three of the five House Democrats from Indiana, which reported an unemployment rate of 10.6 percent in May, voted against the climate-change measure backed by the White House when it passed by a narrow margin on the House floor last month.

House leaders signaled on Friday night that they would seek a vote on raising taxes by $550 billion over 10 years on the wealthiest Americans to help pay for the health care overhaul, a move that could put many Democrats in competitive districts in a difficult position.

A slow economic recovery would mean a further downturn in government revenues, which in turn could increase the size of the deficit as Mr. Obama is pushing for more spending. Historically, the deficit has been a potent issue with independent voters in particular, and it is already projected to remain at record levels for years to come.

In an interview, Mr. Emanuel criticized Republicans for assailing the stimulus package and said voters understood the depth of the problem and how much time it would take to turn around.

“I think the public knows three things: We inherited a total mess; we’re working hard on it; and we’re not going to get out of it overnight,” he said. “Here’s the deal: The key to what this year is about is rescuing the economy from falling off the cliff and trying to put in place the building blocks of recovery.”

Still, Mr. Obama’s aides acknowledged that they had only limited time, and that lawmakers might have less patience than voters. As a rule, voters’ views of the state of the economy tend to become cemented six months before Election Day.

“Nervousness is the natural state of politicians,” Mr. Axelrod said. “But the truth is on all of this stuff, the real risk is doing nothing. “

Democrats said they did not relish the prospect of heading out to face voters if things have not begun turning around.

“People are mad, angry,” said Representative Allen Boyd, a moderate Florida Democrat. “When you have times like that, everybody gets in a foul mood. It is rough for an elected official to run in that kind of environment.”

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