'A Failure to Communicate'? Administration Tries to Explain Financial Crisis

IMAGE: Explaining recession crisis

With the nation's recession nearing a year-and-a-half in duration, critics from Capitol Hill to Main Street say the Obama administration has not succeeded in helping the general public understand how the financial crisis occurred and what the government is doing to solve it.

"To even help people understand what is going on, they haven't done a good job," said professor George Lakoff a linguistics professor at the University of California-Berkeley. "They haven't been able to explain what the problems are."

"They need to find a way for people to understand it," he said. "That is extremely urgent."

Analysts warn that if the administration, specifically the Treasury Department, cannot better communicate its programs to the general public, then it runs the risk of a lack of understanding fueling public outrage as hundreds of billions of taxpayer dollars get dished out.

"This is a very real concern and I have seen it firsthand," said Scott Talbott, vice president at the Financial Services Roundtable. "What happens is the average person focuses on one concept like 'Treasury bailing out bad banks' and then they stop listening. This incomplete conclusion leads to anger and frustration. These reactions are understandable, but if Treasury increases the public's understanding of its actions, the level of anger and frustration will decrease."

But, said Talbott, there is a way for the Treasury to decipher these complex financial developments for average Americans.

"These are very complicated issues. There are lots of moving parts to each program and they all work in concert. This is Ph.D-level finance work," he said. "However, the issues and programs can be explained in layman's terms."

"It is incumbent on Treasury, Congress, and the industry to deliver these programs in a way that can be understood," Talbott noted.

In a Pew Research Center poll recently conducted, 73 percent of Americans said they understand "the economic situation and the government's economic policies," with only one in four people saying they understand it "very well." One quarter of people also said they understand it "not well" at all.

To increase public comprehension, the administration is clearly trying to explain the myriad of financial crisis measures it has taken in recent months.

The Treasury Department launched a new Web site last week called , "to provide the American people with information about the Obama administration's efforts to stabilize our financial system."

Treasury Department Launches Web site

The Web site features a type of dictionary to help increase people's understanding of common financial terms.

In a statement Tuesday, the Treasury touted its "unique decoder tool that translates frequently used financial language and Financial Stability Plan program names into real terms."

But some people found the decoder just as confusing as the terms themselves.

"This doesn't make any sense at all," said Beth Santos of Washington. "It looks like a high school textbook to me."

For example, the Web site "decodes" the Asset Guarantee Program (AGP) as follows: "Established under section 102 of EESA, allows the department of the Treasury assume a loss position with specified attachment and detachment points on certain assets held by the qualifying financial insitution; the set of insured assets would be selected by the Treasury and its agents in consultation with the financial institution receiving the guarantee."

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