President Obama defended his decision Tuesday to seek government authority to take over troubled financial institutions that aren't banks, a category including insurance giant American International Group and its contentious bonuses.
Obama used the second prime-time news conference of his fledgling presidency to tout progress in opening up the nation's credit markets, including a plan to buy up banks' bad loans and other assets. But he acknowledged more remains to be done. "We will continue to do whatever is necessary in the weeks ahead," he said.
The president described himself "as angry as anybody" about the $165 million in bonuses handed out by AIG, which is eligible for up to $182.5 billion in government assistance. He warned bankers and Wall Street executives against "enriching themselves on the taxpayers' dime."
"At the same time," he said, "the rest of us can't afford to demonize every investor or entrepreneur who seeks to make a profit."
Obama defended his proposed $3.6 trillion budget plan against attacks from both parties that it maintains record deficits. Democrats such as Senate Budget Committee Chairman Kent Conrad of North Dakota are questioning the size and scope of the Obama plan, which calls for major investments in health care, energy and education.
The president blamed long-term deficits on the cost of health care and said they can't be eliminated soon. "We're not going to be able to do it this year or next year or three years from now," he said. He said "critics" have proposed no alternative.
Obama also told reporters earlier in the day that he will soon unveil a "comprehensive" new strategy for the war in Afghanistan, including diplomatic efforts and military operations.
The news conference came after Obama's roughest week in the White House because of the outcry over the AIG bonuses. He defended Treasury Secretary Timothy Geithner, who had come under fire last week from Florida Rep. Connie Mack and other Republicans over the AIG bonuses. New York Attorney General Andrew Cuomo, a Democrat, said this week that AIG employees have returned bonuses totaling about $50 million.
The president himself still enjoys high approval ratings, 63% in the Gallup daily tracking poll released Tuesday. He said Americans "are judging me exactly as I should be judged" — on the basis of his economic actions.
• Touted his administration's plan for more surveillance equipment and federal agents along the U.S.-Mexican border to fight increasing drug violence. Obama said the U.S. should work to ensure "illegal guns and cash" don't flow back across the border to aid Mexican drug cartels. He declined to say whether he would back sending National Guard troops.
• Said his status as the nation's first African-American president has not influenced his decisions in the White House. Obama noted his two months in office have "been dominated by me trying to figure out how we're going to fix the economy, and that affects black, brown and white."
• Said making peace between Israel and the Palestinians won't be helped by the election of prime minister-designate Benjamin Netanyahu, "but I think it's just as necessary."
• Opposed the idea of a new global currency, as floated by China. The subject could come up next week, when Obama attends an economic summit in London of leaders from the "Group of 20" major economies. They will discuss possible stimulus plans to revive the global economy and new regulations on financial markets.