Obama to Order Iraq Withdrawal on Day One, Axelrod Says

David Axelrod, on the economy: "Obama will have a strong message for bankers."

January 18, 2009, 11:25 AM

Jan. 18, 2009 — -- Incoming White House senior adviser David Axelrod said this morning that President-elect Barack Obama will fulfill his campaign promise and begin on Wednesday the process of withdrawing America forces from Iraq within 16 months.

"He believes that that is a reasonable timetable. We've moved a great distance from the time he started talking about that, and now we're in an area where everyone agrees that we should be on a path to withdrawing those troops. And he is going to begin that process, as promised, on that day," Axelrod said in a "This Week" interview with George Stephanopoulos.

On Wednesday, Obama will call in his military commanders and ask them to come back with a plan for withdrawal.

But Axelrod made clear that the economy will be the top priority of the incoming administration, and that Obama will have a strong message for bankers once he takes office: start lending again.

"I think he's going to have a strong message for the bankers. We want to see credit flowing again. We don't want them to sit on any money that they get from taxpayers. And the other things that we have to deal with is transparency. No one can really tell you exactly where the money went, how it was spent. It's not easy to follow, even for people in government. We have to deal with that and we have to begin to address the housing issue in a way it hasn't been addressed yet," Axelrod said.

"And we have to make sure that the money doesn't go to excessive CEO pay and dividends when it should be going to lending," he said.

Axelrod went on to slam the way the Bush administration spent the first $350 billion of the TARP money.

"I think it's clear that it has to be administered in a much different way," Axelrod said. "First of all, the point is to get credit flowing again, to businesses and to families across the country. That hasn't happened with the expenditure of the first $350 billion."

On Obama's recovery plan, Axelrod was clear that "the reason that he came here two weeks early was to begin work on an economic recovery package." But he also tempered high expectations, explaining "any economist will tell you that even if we move rapidly, it takes a little while for this to move through the system and to put the brakes on what is the most serious economic downturn we've had in many, many generations."

Democrats Express Doubts on Obama Plan

But some Democrats have expressed doubts about the job-creating potential of Obama's economic plan. "I have my doubts," Sen. Kent Conrad, D-N.D., said earlier this week. "I don't think, you know, the -- most of the assessment is that this will reduce unemployment from what it would otherwise be by 2 percent. My people's analysis suggests maybe only have of that."

When asked by Stephanopoulos if they Obama team is "over-promising," Axelrod explained, "we have to try. It's not enough to be a doubter. It's not enough to question, not when we're in the situation we're in."

"We believe that this is a well-conceived approach to the problem we face. It's extraordinary and it's painful to have to do in terms of our debt. But it's something we have to do or we run the risk of that scenario that you suggest, double-digit unemployment."

And Republicans are expressing even more doubts and criticism over not being consulted on the preparation of the package. "There have been consultations...And there will continue to be consultations," Axelrod said in response.

"We ought to put all of the politics aside and do what's best for the country. Right now the country is in an economic emergency. And we need to act. And I don't think people are going to have much tolerance for the kind of customary Washington. Now having said that, I think that there are legitimate discussions to have."

Axelrod also defended Obama's choice for Treasury Secretary, Tim Geithner, saying he believes Congress will confirm him after his testimony this week. It was revealed this week that Geithner failed to pay roughly $34,000 in back taxes when he was working at the IMF.

"He has paid those taxes... when it was pointed out that he had made a mistake on his taxes," Axelrod said. "The mistake he made which was when he was overseas serving our country in the IMF, everyone agrees it's a common mistake that people working overseas make. He's corrected it."

"I think when people look at Tim Geithner though, they should look at a guy who has devoted his life to public service, who was an integral part in solving another international financial crisis in the '90s and has vast experience and great insights," Axelrod urged. "He is precisely the kind of person we need in the Treasury right now. And I think when people get to know him, he's going to testify this week, I think he's going to inspire great confidence."

Inauguration Speech to Focus on Responsibility

Finally, Axelrod offered some insight into Obama's highly anticipated inauguration speech on Tuesday, hinting that Obama's address will be themed around the concept of personal responsibility.

"One thing about Barack Obama, his themes have been consistent not just through this campaign, but through his public life," Axelrod said.

"From his convention speech in 2004 through today. So I don't think you're going to be surprised by what you hear. I think he's going to talk about where we are as a country, but also who we are as a people. And what responsibilities accrue to us as a result of that. And what we have to do to move forward. I'm not going to handicap whether it's going to be a great speech, a good speech or -- but I have confidence in the message that he wants to deliver and I don't think you'll be surprised by it."