Obama tells news conference that his budget is key to nation’s long-term health

With the major elements of his economic recovery plan now laid out, President Obama warned Tuesday that the climb out of recession will not happen overnight, and he called on Americans to show patience and faith that things will get better.

“We will recover from this recession, but it will take time,” Obama said. “It will take patience. And it will take an understanding that when we all work together, when each of us looks beyond our own short-term interests to the wider set of obligations we have to each other, that’s when we succeed.”

Obama, speaking on the day Congress began dissecting his budget, also offered a spirited defense of his spending plan, and of the future deficits it projects. He said critics in the Republican Party have a “short memory,” noting that his administration inherited a $1.3-trillion deficit from President Bush. He insisted that economic recovery -- plus federal belt-tightening -- would eventually staunch the flow of red ink.

The president asserted that large-scale federal investment in new technologies, energy efficiency and healthcare reform were necessary to assure long-term economic health.

“The budget I submitted to Congress will build our economic recovery on a stronger foundation so that we don’t face another crisis like this 10 or 20 years from now,” he said.

Obama’s primary goal in the second full-dress news conference of his presidency seemed to be persuading voters that he is effectively grappling with the nation’s enormous problems. But his tone was often subdued, almost flat -- a far cry from his vivacious appearance last week on “The Tonight Show With Jay Leno.” With Leno, Obama’s explanations of the economic crisis and its causes were simple and sharply drawn.

There were no particularly memorable moments Tuesday night -- no attempt by the president to capture the sense of drama or anticipation that has surrounded prime-time news conferences by past presidents.

Instead, Obama seemed to use the forum, so familiar as a tool of outreach to mainstream Americans, to present himself as a steady hand at the helm -- a leader who had a bad situation under control and was not making new demands on the public.

Asked if he would call on Americans to sacrifice more, for instance, Obama said no, adding: “I think folks are sacrificing left and right.”

The news conference came one day after his economic team rolled out the details of his financial recovery program, and less than a month after he presented his prescription for helping troubled homeowners avoid foreclosure. The third principle element in Obama’s recovery strategy, the $787-billion stimulus package, was approved in mid-February.

Under the best of circumstances, Obama was tacitly suggesting, the programs are so large and complex that it will take months for some of them to be up and running -- and even more time before results can be seen.

Experts generally agree that the economic slide is showing signs of slowing, but they also predict that recovery will be long in coming.

“The economy was falling off a cliff at the end of last year and early this year,” said economist Mark Zandi of Moody’s Economy.com. “Now it’s just falling.”

Ken Goldstein, an economist at the Conference Board, said there had been a little improvement, but “we’ve got to do a hell of a lot more” to reverse the huge job losses and improve industrial production. He predicted that could take until late this year or early 2010.

It was the political implication of that reality -- the possibility that a lack of quick results could embolden critics and lead voters to conclude his efforts were failing -- that led Obama to return again and again to what he said was a need for patience.

“It took many years and many failures to lead us here. And it will take many months and many different solutions to lead us out,” he said. “There are no quick fixes, and there are no silver bullets.”

At another point, he said, “Looking back four years from now, I think, hopefully, people will judge that body of work and say, ‘This is a big ocean liner; it’s not a speedboat,’ ” he said. “It doesn’t turn around immediately, but we’re in a better place . . . because of the decisions that we made.”

Only once did Obama show a sign of impatience himself, snapping at a reporter who asked why he and Treasury Secretary Timothy F. Geithner had not been quicker to express anger over the bonuses awarded to employees of AIG. Obama said that it took “a couple of days because I like to know what I’m talking about before I speak.”

And he rejected a suggestion that race may play a role in his relations with voters.

“Obviously, at the inauguration I think that there was justifiable pride on the part of the country that we had taken a step to move us beyond some of the searing legacies of racial discrimination in this country, but that lasted about a day,” he said. “And you know, right now the American people are judging me exactly the way I should be judged, and that is, are we taking the steps to improve liquidity in the financial markets, create jobs, get businesses to reopen, keep America safe?”

Obama also defended the administration’s call for expanded financial regulatory authority.

“We should have obtained [that authority] much earlier, so that any institution that poses a systemic risk that could bring down the financial system we can handle, and we can do it in an orderly fashion that quarantines it from other institutions,” Obama said. “We don’t have that power right now.”

The administration’s financial rescue plan calls for spending $1 trillion in public and private funds to soak up toxic mortgage-based assets from banks in order to restore the flow of credit. Obama took note of the uptick Monday in the financial markets after the toxic-asset plan was announced.

“I think when it comes to the banking system, you know, it was just a few days ago or weeks ago where people were certain that Secretary Geithner couldn’t deliver a plan,” the president said. “Today, the headlines all look like, well, all right -- there’s a plan.”

Obama was defending his budget just as the House and Senate budget committees were beginning to write their own versions of the fiscal plan.

Senate Budget Committee Chairman Kent Conrad (D-N.D.) has prepared a blueprint that departs from Obama’s budget in significant respects.

Asked about that, the president said, “We never expected when we printed out our budget that they would simply Xerox it and vote on it.”

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cparsons@tribune.com

peter.wallsten@latimes.com

James Oliphant, Janet Hook, Noam N. Levey, Jim Puzzanghera, Paul Richter and Jim Tankersley in our Washington bureau contributed to this report.