It’s always nice to get out of Washington for a little while and come to places like this — because the climate’s a lot nicer and so is the conversation. So I’m looking forward to taking your questions and hearing about your concerns — and I look forward to telling you about the work my Administration is doing to address them.
But one thing I don’t need to tell you is that these are challenging times. I don’t need to tell you this because you’re living it every day. Between December of last year and January of this year, this state lost more than half a million jobs, and one out of every ten Californians is now out of work. Housing prices here have fallen 20 percent in the past year, and you’ve got one of the highest foreclosure rates in the nation.
So I know times are tough — in Los Angeles, in California, and all across this country. But here’s what I want you to remember: we are going to meet these challenges, and we will come out on the other side a stronger and more prosperous nation. I can’t tell you how long it will take or what obstacles we will face along the way, but I can promise you this — there will be brighter days ahead.
Because of the Recovery Act I signed into law last month — and that your two outstanding senators, Senator Feinstein and Senator Boxer, worked so hard to pass — we’re making major investments to create jobs right here in California: rebuilding infrastructure, weatherizing homes, putting more police on the streets, supporting community health centers, and more. Altogether, we expect to create or save 396,000 jobs in this state over the next two years.
But we also know that we cannot create as many jobs as we want, or rebuild our economy as we hope, without addressing the problem at the heart of this economic crisis — our housing crisis. We know that fixing that crisis — breaking that cycle of falling home values and rising foreclosures — is the key to fixing our economy.
That’s why we’ve launched a housing plan that will help millions of responsible homeowners save money by refinancing or modifying their mortgages. Our plan included important steps to help lower interest rates. And today, millions of Americans —
folks who never thought they’d be able to lower their monthly payments — are now able to take advantage of these rates, which are the lowest they’ve been in decades. Already, we’re seeing a burst of refinancing. Refinancing applications jumped 30 percent last week, to more than double the rate we had last fall, saving the average homeowner hundreds of dollars a month — the equivalent of a generous tax cut. That’s money you can use right now to pay your bills, or pay off your debts, or save up for a rainy day.And today we launched a new website — www.MakingHomeAffordable.gov — to help borrowers determine whether they’re eligible for our plan, and to help them calculate how much money the plan could save them on their monthly payments.
And keep in mind, this is in addition to the $8,000 tax credit for first-time homebuyers that’s in our Recovery Plan. And if you buy your first home any time between now and December 1st, you can claim that credit this year — on your 2008 tax return — and receive that money in as little as ten days. If you haven’t filed your taxes yet, but are buying a home soon, you can request a six-month extension until October 15th, and claim the credit before then. Or if you’ve already filed your taxes — or wish to do so before April 15th — you can just amend your form later this year, after you’ve bought your home, and get your money then.
The idea here is very simple: if you buy a home this year, you should be able to get your tax credit this year. That’s when you need it most, and that’s how we’ll help people start spending again, and how we’ll help raise home values, stabilize our housing market, and create new jobs again.
I’m also pleased to announce that today, California will be receiving $145 million from the Department of Housing and Urban Development to provide additional help to communities hardest-hit by the foreclosure crisis.
These funds will be used to buy up and rehabilitate vacant foreclosed homes and resell those homes with affordable mortgages — and to provide mortgage assistance and rehabilitation loans for low-income and middle-income families. That’s how we’ll help people here in California live their dream of homeownership — and how we’ll start transforming abandoned streets lined with empty houses into thriving neighborhoods.
But we know that it’s not enough to address challenges like housing and infrastructure and job creation in the short term. None of this will make a difference unless we build an economy that offers prosperity for the long-run. We can’t go back to a bubble-and-burst economy based on reckless speculation and spending beyond our means, where a relative few do spectacularly well while the middle class loses ground. We can’t go back to a culture on Wall Street that says it’s OK to bend or break the rules and a culture in Washington that says it’s OK to look the other way.
And we cannot allow what happened at AIG to ever happen again in this country. I know a lot of you are outraged about this. I’m outraged, too. The idea that some of the very people who drove our economy into the ground could accept bonuses with one hand while they were taking taxpayer money with the other goes against our most basic sense of what is fair and what is right. And I am committed to ensuring that we have the tools to prevent the kinds of abuses that sent AIG spiraling so that we never again put our financial system at that kind of risk.
We also want to do this because it serves the most important goal we have today, which is to rebuild our economy in a way that is consistent with our values — an economy that rewards hard work and responsibility, not high-flying finance schemes; an economy that is built on a strong foundation, not one that’s propelled by overheated housing markets and maxed-out credit cards. That’s how we’ll bring about a recovery that endures.
And that is exactly the purpose of the budget I’m submitting to Congress. It’s a budget that makes hard choices about where to save and where to spend. Because of the massive deficit we inherited and the cost of this financial crisis, we are going through our books line by line so that we can cut our deficit in half by the end of my first term and reduce it by $2 trillion over the next decade. But what we will not cut are investments that will lead to real growth and real prosperity — investments that will make a difference in the lives of this generation and future generations.
Because spiraling health care costs are crushing families, dragging down our entire economy, and represent one of the fastest growing parts of our budget, we’ve made an historic commitment to health care reform in this budget — reform that brings us closer to the day when health care is affordable and accessible for every single American.
Because we know that countries that out-educate us today will out-compete us tomorrow, this budget invests in a complete and competitive education for every American — in early childhood education programs that work; in high standards and accountability in our schools; and in finally putting the dream of a college degree or technical training within reach for anyone who wants it.
Because we know that enhancing America’s competitiveness will also require reducing our dependence on foreign oil and building a clean energy economy, this budget will spark the transformation we need to create green jobs and launch renewable energy companies right here in California. It makes clean energy the profitable kind of energy, and it invests in technologies like wind power and solar power and fuel-efficient cars and trucks, powered by batteries like the ones I saw at a facility in Pomona earlier today — all of which will also help combat climate change.
That’s what this budget does. Here’s what it does not do. It does not raise the taxes of any family making less than $250,000 by a single dime. In fact, 95% of all working families will receive a tax cut — a tax cut — as a result of our recovery plan.
Now, there are those who say these plans are too ambitious; that we should be trying to do less, not more. Well, I say our challenges are too large to ignore. The cost of our health care is too high to ignore. Our dependence on oil is too dangerous to ignore. Our education deficit is too wide to ignore. To kick these problems down the road for another four years or eight years would be to continue the same irresponsibility that led us to this point. And I did not run for President to pass on our problems to the next generation — I ran for President to solve them.
So I know some folks in Washington and on Wall Street are saying we should
focus on only one problem at a time. And I understand the thinking behind that. It’d be nice if we could pick and choose what problems to face and when to face them. But that’s just not the way it works. You don’t get to choose between paying your mortgage bills or your medical bills. You don’t get to choose between paying your kids’ tuition and saving enough for retirement. You need to take on all of these problems. And you need a government that will do the same. That’s what leadership is all about.And that’s what this debate on the budget is all about — it’s about whether we are willing to do what needs to be done not only to get our economy moving right now, but to put it on the road to lasting, shared prosperity. It can be easy to lose sight of this. It’s easy for pundits to get on TV, put their ratings ahead of their own sense of responsibility, and oversimplify what’s at stake. It can be difficult to break free from the partisanship that’s held sway in Washington for so many years.
But that is what we have to do. That is what this moment requires. For what all of you know deep down — and what folks in Washington sometimes forget — is that in the end, a budget is not merely numbers on a page or a laundry list of programs. It is about your lives, your families, and your dreams for the future. And you didn’t send us to Washington to stand in the way of your aspirations. You didn’t send us there to say no to change — you sent us there to get things done.
And that is exactly what I intend to do. But I cannot do it without you, the American people. As I’ve said many times, change in this country comes not from the top down, but from the bottom up. That’s why I’m here today — because it will take all of us talking with one another and all of us working together to see our nation through this difficult time and bring about a brighter day. So, thank you for this opportunity to speak with you, and now I’d like to open it up for questions.
(Source: White House)