Stakeout Following the Democratic Steering and Policy Committee Economic Listening Session

Press Conference

STAKEOUT WITH SPEAKER OF THE HOUSE NANCY PELOSI FOLLOWING THE DEMOCRATIC STEERING AND POLICY COMMITTEE ECONOMIC LISTENING SESSION ALSO PARTICIPATING: MARK ZANDI, CHIEF ECONOMIST, MOODY'S ECONOMY.COM; REBECCA BLANK, KERR SENIOR FELLOW, BROOKINGS INSTITUTION; ALLEN SINAI, CHIEF GLOBAL ECONOMIST, DECISION ECONOMICS; REP. ROSA DELAURO (D-CT); REP. CHARLES RANGEL (D-NY); REP. BARNEY FRANK (D-MA); REP. GEORGE MILLER (D-CA)

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SPEAKER PELOSI: This was a session that was put on by our Steering and Policy Committee, chaired by Congressman George Miller and Congresswoman Rosa DeLauro and participated in by the chairmen of our committees and members of the House Democratic Caucus.

The word of the day is a word that is important to our economy every day, and that word is confidence: confidence in the -- in our markets, confidence in lending, confidence in our financial institutions. We were -- we had excellent presentations and piercing questions from our colleagues. It's clear that we have to stabilize our financial institutions. We have to invest in our -- a stimulus plan to grow our economy. We have to regulate our financial institutions. And we have to end the housing crisis.

And the Obama administration has already done just that. In record time, we passed the president's economic recovery plan, and it -- and we are now anticipating very positive outcomes from that. Last week, the president put in motion the housing proposal, and we are -- and we are positive in anticipation of what that will result in. The -- Mr. Frank talked to us about regulatory reform and the course that we are on, and that -- and the big issue of the day here is financial stabilization of our financial institutions, of our markets.

And I have to say that our members left this meeting much better equipped to make important decisions for our country, for our economy; much better informed about the choices that we have; and much more confident about the course of action that President Obama has taken us on.

I will look forward to continuing these meetings, but right now, I want you to hear from our economists, and again express my appreciation to them for being with us today.

We'll begin with Mark Zandi of Moody's, who's probably been at most of the meetings on an ongoing basis, and we have benefit -- from his thinking.

Thank you, Mark Zandi.

MR. ZANDI: Oh, thank you, Madame. Thank you again for the opportunity to be here today.

I thought it was very productive, and I'd like to say that while the economy is clearly struggling, and this is -- we're in the midst of the worst economic downturn since the Great Depression, I think it's important not to lose sight of the fact that the policy response to date has been very good and very aggressive, and we need to give that a chance to work. And I think it will.

I think the stimulus is a good package. It's large. It's well designed. I think it'll make a difference by the summer. We'll see that in the job market. I think the financial stability plan will start to kick in and help the banking system, which desperately needs it. And I think the foreclosure-mitigation plan is a good plan and will help by the end of the year.

So I am increasingly confident that, by this time next year, the economy will stabilize -- not that it will come roaring back in 2010, but that it will stabilize by this time next year.

Now, having said that, I think policymakers need to do more. I don't think we're done. I think we're going to need more efforts to shore up the job market, the financial system and the housing market. And, you know, to do that -- let me say, I think you have to be extraordinarily bold; that the big mistake here would -- to not be aggressive in responding to this crisis.

I think it's fair to say that I've been wrong about the severity of this. And even though I think this is going to be a very difficult year, it could be worse than I'm anticipating. And so given that, I think it's extraordinarily important for policymakers to be very aggressive, and that's going to require more taxpayer money.

And I think to put more taxpayer money at risk, we're going to need help from the Democrats and the Republicans. And hopefully, you can work together and come to terms and respond to this in a very aggressive and effective way. Thank you.

SPEAKER PELOSI: Thank you, Mr. Zandi.

Dr. Blank, Dr. Rebecca Blank.

MS. BLANK: So the bad news out there is just the numbers are bleak, and they are bleak across the board. The -- you know, this is a national recession, not regional. It's hitting every industry. It's hitting people in -- you know, in all walks of life.

The numbers for unemployment for college educated are at some of their highest that we've ever seen. The numbers for high school educated and high school dropouts are, of course, much, much higher. Currently, 12-1/2 million people are unemployed, and that's a lot of pain.

And the bad news is just going to get worse. We're not coming out of this fast. And particularly, labor market numbers on employment and unemployment lag recoveries, so even when an aggregate recovery starts, those numbers are not going to turn around immediately. They'll be four to six months behind.

The good news is that there are a whole series of actions that are being taken, and I have to say, I think they are the right actions. And we're not just talking about the stimulus, but you've got to think about the net effects of the stimulus and the housing market changes and the things the Federal Reserve is doing and the actions that are being taken within the banking sector. And it's the combination of all of those that are going to make a difference.

And as Mark Zandi indicates, whether this is enough, I think, is still unknown, but it is the right set of actions to take. What is absolutely true right now is doing nothing is not an option; that the risks are all on the side of under-reacting, and not on the side of over-reacting. So I'm very pleased to see the level of concern and the level of policy response that we've had.

And by all indications, as we go particularly into the next several months, you're going to start seeing the effects, I think, of both some of the housing market rescue as well as some of the stimulus dollars affecting the labor market and affecting what we're seeing out in terms of mortgage defaults.

SPEAKER PELOSI: Thank you, Dr. Blank.

Dr. Sinai?

MR. SINAI: You know, I think we all know that things are tough out there. It's a tough -- very difficult jobs market. But you have to look beyond that. And all of the polices in a very active Washington policy environment are coming into place bit by bit, piece by piece. And nobody should expect -- you know, Rome was not built in a day. Nobody should expect miracles, quick results, what's going on to change overnight, in a situation where we are facing the most complex interactive, difficult U.S. and global and financial institution problems, along with some major societal problems that we've paid very little attention to in recent years, that have ever happened in American history.

And so I would counsel patience. Hold your fire on judgment and criticism. Let some of these policies -- some won't work, some will work, and time will pass, things will get better. Very tough in this country to be patient. This country, more than any other country, has a very short fuse. And those of us who are connected to financial markets sometimes have a very short attention span.

But be patient. Washington is working very hard, very actively, on the medicine that is absolutely necessary to get the economy, financial markets on its feet and American workers back to work and saving those who are working now from losing their jobs. And I think we all see real progress on these fronts. We're like doctors. Your patient doesn't always look good when you're working on the patient. You have to wait and see how it goes. And it will go better. Six, 12 months from now,it will be significantly better.

SPEAKER PELOSI: Thank you, Dr. Sinai. Now let's hear from the co-chairs of our Steering and Policy Committee.

REP. MILLER: Well, thank you. I think what we heard was that first and foremost, that President Obama was exactly right when he asked us to report the fiscal stimulus bill immediately, and the Congress was right when we responded as quickly as we did. I think in the House it was a week and a day after he made that request in his inaugural speech.

And it appears also that we're about right that this will save or create a couple of million additional jobs, but there will be additional unemployment for some period of time going forward.

We're starting to see the impacts of that, the passage of the stimulus act. Construction money went out last week. Housing money went out last week. Additional money is going to go out this week.

Education money goes out in a couple of weeks, to school districts, that hopefully will prevent the firing and laying off of many, many teachers that was anticipated, without the stimulus program.

It's also pretty clear that the last administration's decision to give the money to the large banks, with no questions asked, caused a lot of delay in putting together a meaningful program, and that the administration is well on track to do that.

And also their decisions to deal with the consumer credit markets of automobiles, student loans and general consumer credit can be helpful. And that's just started this week.

So it's tough for politicians to have patience. But we have to have some patience. And we have to have -- pay due diligence to what is next for us to do, to make sure that we can continue to make an advance on turning around this economic downturn.

It's absolutely vital, to our economy and to our workers and to families all across the country, as was pointed out in our session today. Nobody is immune from this, from this downturn. And we've got to continue to make sure that the government responds in a timely fashion.

As Dr. Blank said, doing nothing is simply an option that we cannot afford. And delaying doing what is necessary is an option we cannot afford. And with that, I recognize Rosa DeLauro, my co-chair.

REP. DELAURO: Thank you very much, Congressman Miller.

I want to thank the speaker and our economist guests who are here today. I want to thank them for today but also for their work with us, over the course of the last year, in taking a look at what this fiscal and economic crisis is about and how we may make the right policy decisions to move forward.

It is a struggling economy. But what's heartening to me today is that helping members of Congress, to build a sense of confidence in which the policy directions that we have been undertaking, along with the Obama administration, are the right course.

Do they need to be adjusted potentially? Yes. We are not frozen in the sand, where we can't turn the guns around and be able to address situations as they move. But we are on a right policy track, looking at an economic recovery program and focusing in on jobs and getting people back to work.

And we should not be timid in these actions. We should not be timid about a housing stabilization program, not be timid in dealing with the financial stabilization. It is what the president said that our action needs to be bold and it needs to be swift.

When we have the confidence to move, to address these problems in a forthright way and not be able to talk about spending dollars, then we will build the confidence in the American public that, in fact, we are doing the jobs that needs to get done, to provide them with the economic security that they need to survive and to take care of their families.

SPEAKER PELOSI: Once again I want to thank the co-chairs of our Steering and Policy Committee for bringing us together, Congressman Miller and Congresswoman DeLauro.

As I also mentioned, we had the interaction of the -- many of our chair -- committee chairs, two of whom are with us now, Congressman Frank and Congressman Rangel.

Congressman Frank, chair of the Financial Services Committee.

REP. FRANK: Thank you.

It's encouraging for us to hear that the consensus of some very good economists -- for people who don't always agree on everything -- that we are moving in the right direction. They have emphasized that an enormous economy like this, with problems that have been years in the making, don't -- I was about to say don't turn on a dime; they don't even turn instantly on a trillion (dollars).

SPEAKER PELOSI: (Laughs.)

REP. FRANK: But we do believe that things are -- we are halting the erosion and laying the foundation for things to get better.

In particular -- and Allen Sinai mentioned this -- we want to be very clear. This is not some effort to supplant the private market. In fact, I believe that what we are doing is very pro-market. We are dealing with some problems that the market faces today, and we are talking about putting in place in the future things that will help the market work better. For example, one of the things the market suffers from today is a lack of investor confidence. Much of what motivates us is to try and put things in place that will restore investor confidence.

And in that regard, I want to mention three things which we discussed today, which we are very much engaged in. And I think it might be -- one of my colleagues said -- you know, pulling together -- we now have, I think, a fairly strong view on our side that there are several things that should be done in the near term to help with the stabilization.

One, the mark-to-market rule has clearly got to be made better in its workings. There has to be more flexibility in its application. There has to be discretion in what the consequences are. We've had a series of conversations. The economists today were helpful. Chairman Bernanke, if you look at his speech today, talked about avoiding procyclicality in accounting, which is that -- so we will be pushing the regulators to make sure that they do not abandon mark-to-market, because it has a core of value, but apply it in a way that does not make things worse and there clearly are improvements.

Secondly, I've spoken to Chair Schapiro of the SEC. I am hopeful that the uptick rule will be restored within a month.

Finally -- and we have spoken to Secretary Geithner -- I think there is this danger that people will look at the mistakes that were made in the administration of the TARP funds in the past administration and impute them to the current administration. Under Secretary Geithner and President Obama, very little money has been made available yet to banks. You cannot blame the problems that we've had on them.

And one of the things that we again have felt strongly -- and we got some reinforcement from our economist advisers today -- was more of that money has got to got to the smaller, to the community banks that are underburdened by bad assets, that are connected to the lending.

So getting more money out to the small banks, through the TARP, getting the uptick rule reinstated and substantially revising the way in which mark-to-market is adopted -- those are three things which have now emerged that we're going to be focusing on in working with the administration.

We hope they can be very soon accomplished, and we think they will add to the positive momentum.

SPEAKER PELOSI: Thank you.

Mr. Rangel, Chairman Rangel.

REP. RANGEL: Thank you, Madame Speaker. While there's no question that the news was disappointing, the good news, of course, is that we are on the right track. It could be a lot worse. We're working with a president that has dynamic ideas. We're working with a Congress that's completely supportive.

I'm glad that Chairman Frank is working on the larger banks to see what we can do to make certain that they are more relaxed in loaning money. And quite frankly, for those people who haven't lost their jobs, their businesses, their health insurance, the Congress has responded by making the middle class at least have more disposable income, to get better health care, education and to move on to a new economy.

Our job is not only to be supportive of the president; it's not a Democratic or Republican problem; it's a national problem. And we have to encourage our colleagues to join with us. And suffice it so say, when we go home we're better equipped as a result of talking with economists that don't speak for us, but speak for the country as professionals and make it more effective for us to explain this problem to our constituents.

So once again, thank you so much, for our co-chairs, in bringing us together periodically. And they promised, I think, that they'll bring us better news at our next meeting -- (chuckles). Thank you.

SPEAKER PELOSI: Thank you very much.

Q Madame Speaker?

SPEAKER PELOSI: Yes?

Q I want to ask you, and perhaps your economists, do you still think, given the recent economic developments, that it's realistic to think we're going to create 3.5 (million) to 4 million jobs with the stimulus package? And do you agree we're going to need to use more taxpayer money, perhaps in another stimulus or something else?

SPEAKER PELOSI: Well, I'd like to defer to our economists.

MR. SINAI: Let me take the speaker off the hook on that one. Our studies show that, over the first two years, about 2-1/2 million jobs saved or created. It's a little less than the administration and perhaps Speaker Pelosi has said. I think, when you stretch it out over three years -- because the program does go further -- you get closer to that number.

Remember, businesses will hire more when times are better. So initially, the jobs created may be a little disappointing, but over time, over a three-year period, I think 3 million new jobs is not unrealistic at all.

REP. FRANK: And if you had the House bill it would have been closer. (Laughter.)

Q And a second --

SPEAKER PELOSI: Mark -- Mark --

MS. : Mark's had (his hand up ?).

MR. ZANDI: Well, I just want to comment on taxpayer money.

SPEAKER PELOSI: (Here's the mic ?).

Q (Are you going to answer ?)?

MR. ZANDI: Yeah. With regard to taxpayer money, the point I'm -- would like to make there is that we are going to need more taxpayer money up front. I think another stimulus package is a reasonable probability, given the way things are going. I think more money for financial stability, to shore up the banking system, is likely. That's very likely. I think more money for foreclosure mitigation may also be necessary at the end of the day.

But having said that, while it's going to cost taxpayers more up front, if we are aggressive in using that money up front it'll cost taxpayers less in the long run, because if we don't stem the crisis quickly, the economy will continue to slide away and cause more problems with respect to our deficits and budgets, and ultimately will cost us more.

So it will cost taxpayers more up front, but hopefully, if we're aggressive enough, it'll mean less for taxpayers in the long run.

Q And you agree with that, Madame Speaker, more -- another stimulus?

SPEAKER PELOSI: I do. I think we talked -- at the beginning of this session here, I talked about confidence, that word. And that was the theme of our conference in the other room.

Another word I would use here is it's about time. It's about the time that was lost in the Bush administration by refusing to do a positive recovery package, a stimulus package, resisting all calls to do so when the indicators in our economy said that we needed to take action.

It's about the time that we took -- one week and one day, as Mr. Miller mentioned -- from the time the president stood on the steps of the Capitol to call for swift, bold action. And Congress acted. The president put it into law. It'll take a little time to get going. Some of it is already in the works. But we must give it time to work.

It's about the lag time -- the lag time that -- we are still having unemployment numbers come out now that are part, still, of the Bush economy. Four to six months, the economists -- some of the economists tell us, is the lag time. So we'll still be having increased job losses springing from poor economic policies of before. And then the time will enable us to create the jobs.

So I believe success breeds success. We start (rolling ?) with 1 million, 2 million, 2-1/2 million jobs, and that will cause an (upward ?) spiral of success and even more jobs created.

But as has been said by the economists to us, in that room, and Mark here, you have to keep the door open to see how this goes.

One more point I want to make on it, in case I don't have another shot at this, is it's very clear that as we implement our recovery package, we must make sure that it works. And again confidence is a big part of that investment that we have made.

And we also must make sure the public understands. This is a very fiscally sound package. The choices that were made in it were to create jobs, jobs, jobs and jobs and jobs as soon as possible and jobs over a period of time, to stabilize the economy.

And it is -- it's very important that the message not be that we have raised the baseline for spending. We have not. We have a stimulus which is targeted and in a time frame to make the difference.

So again it comes back to the question of time. And so I hope that in order to instill confidence, people know the president has taken us in a new direction. He's turning around the ship of state. It takes a little time.

(Cross talk.)

MR. SINAI: If I could just say one word on that, the one thing I come away with is that Washington -- I'm quite -- extremely confident that there is the desire, the energy and the flexibility to do what it takes, to get the economy back on its feet and the financial system back on its feet; absolutely confident in that.

Americans should take that home, bottle it, put it down, keep it with them and understand that Washington is working harder than I've ever seen to deal with these problems. And they should also be patient.

I don't necessarily think we are going to need more stimulus funds. I think we have to see how things go. Remember, a tremendous amount of stimulus is working in the economy.

What everybody forgets is, the private sector, as painful as it is, is cutting back. Consumers are cutting back, saving more. Companies are cutting back on people, cutting their costs down. And it does heal itself to a certain extent.

It needs a lot of help. But it is healing as we speak. Even though you can't see the patient symptoms, looking like it's healed, the processes are working to get us to the next recovery. So I'm not sure we're going to need more money from the taxpayers.

Q Speaker Pelosi, you mentioned, you said that confidence is the key. But isn't there some connection between a lot of these policies you're talking about and the recent plunge? Because they seem to correlate with each other, the recent plunge in the stock market. If confidence is key, it doesn't seem like these policies are inspiring a lot of confidence in the markets.

SPEAKER PELOSI: Who would like to take that one on?

MR. SINAI: Look, the markets are risk-oriented. There is a risk. And Mark and I talked today about the risk of a -- yes, we use the "d" word -- a depression. It's possible, a depression like -- something like the '30s. That's a risk. Market people are paid to price securities on risk. That's not reality. Most -- a lot of times, the risks don't turn to reality.

So understand that when the stock market does what it does, it in part is looking to the future, asking a lot of, frankly, very good questions about the program -- Will it work? What's the uncertainty? -- and in a risk-averse way selling just because of the uncertainty. The minute it looks more certain, guess what? Those stock prices will soar. And that will happen not right away, but that may happen sooner than a lot of people think.

SPEAKER PELOSI: Mark, did you want to speak to --

MR. ZANDI: Yeah, well, you make a good point. I mean, I think the difference between a recession -- a typical recession and a very severe recession or depression is the loss of faith. And I think that characterizes the current environment. There's been a loss of faith.

And I think that will be restored over the next few weeks, months as the policy efforts that have been put in place begin to take effect and people really see that it makes a difference. Right now they just don't believe. And if they get some palpable signs of some improvement, I think things can turn very quickly.

Now, having said that, you know, policy is more than dollars and cents for me. It is about restoring confidence. And that's why it's very important for policymakers to articulate the problem clearly and the solutions and make it clear to everyone how it's going to work. And, you know, to some degree that hasn't been the case. People aren't convinced that this is really going to work. And I think policymakers have to work really hard now to make people convinced that what they've done, what they will do is going to make a difference, because it will. It will make a difference.

(Cross talk.)

SPEAKER PELOSI: On that point, I just want to say two things. If there's any message from the Congress to the markets, it is this is a fiscally sound package, because markets don't like spending, as we know. This is a fiscally sound package meant to be a recovery stimulus package with finite investments, not long-term spending, increasing of the baseline -- more technical than --

Q Well, what about the --

SPEAKER PELOSI: -- and the second part of it is that this is very market-oriented, is very market-oriented in terms of the investments that we have had, market-oriented in terms of energy policy and innovation and the whole building of the grid and the rest to encourage the private sector, in many, many ways.

I just named a few of them.

Mr. Miller?

REP. MILLER: I would just say I don't think you can discount the amount of time that was lost with the previous administration. We tried to pass the stimulus bill before Labor Day, before the election. We couldn't get any cooperation on that legislation.

We've been for almost two years now talking about the housing crises and what could be done, and we had no response out of the previous administration.

The first release of the TARP money really discouraged the public because they saw billions of dollars flow to the money center banks and nothing loosening up. What we now see is a concentrated effort to refine those programs, to make sure that they're accountable, to make sure that in fact there's a response to the actions we're taking. And we're starting to see that with respect to consumer credit, with the actions taken there. We're starting to see jobs starting to be quickly created because of the stimulus.

So this is a new process. This is a very different process. And to suggest that somehow on Election Day everybody decided to make a decision to sell the market is outrageous when you consider the time that was lost in the previous administration to deal with this issue. As hard as we struggled to try to get something from this administration, even dealing with the questions of hunger in American families right around Thanksgiving, no response.

And so now we've had to go to work in a matter of a few weeks to put this together. And I think what you're hearing from the validators, from the economics community, is we're on the right track; this is the right direction.

We're not going to draw any conclusions about the future. We're going to continue to monitor this. One of the things that the speaker has been so good at is calling together the economists and people working in the real economy to continue to inform us about what they see, what we should anticipate.

That's why we were ready to go. We started working on the stimulus package long before the election, so that we would be prepared and understand the components and the ramifications, with the advice of people standing behind me.

So this is a long-term process, and we think that that kind of planning and this continued updating by the economists restores confidence in the caucus, so they can address these issues, in the Congress, and eventually in the public.

REP. DELAURO: Madame Speaker, let me make one point. I think that there may be skeptics about the economic recovery plan in Washington. It's manifested on -- some of the talking heads on TV on a regular basis.

But go to the American people -- overwhelming support for the economic recovery program. And go to the chiefs of police that I did yesterday in my district, and you talk to them about public-safety opportunities and what they're going to be able to do. You talk to people about the opportunity to be able to go to work when they haven't had that opportunity.

The public gets it. There may be some of the chattering class that doesn't get it, but the public is overwhelmingly in support of an economic recovery program that is out there today and that just began. And we've got a housing stabilization program that will get itself under way. And yes, we do have to do something about stabilizing those financial markets. But there is action. And it is bold and it will continue to be.

REP. RANGEL: Madame Speaker?

SPEAKER PELOSI: Please, sir.

REP. RANGEL: May I say this? I think investors are not only looking at the market, but they're looking at the Congress, and they're looking at our nation. And we have not received the positive responses all at once.

I really think that the Republicans have just -- have a program of just saying no. It is -- very hopeful that, as things turn around in our communities and our businesses and the unemployment is capped, that sooner or later they'll come up with a creative idea to work with us.

This is not a partisan issue. It is a -- national issues that -- demands at least the involvement of the Republicans. And when you see a divided Congress, there are people that wonder and worry. But we are confident that we have the economists. They all agree that we are on the right track. We have a president that is there to install confidence. And I'm hoping that soon and very soon, the minority would be working with us. And I think that would help a great deal.

REP. FRANK: Can we add one thing on the market? One day this week there was a big problem because of Eastern Europe. Remember, the American stock market is a globalized entity in its reactions, and part of the problem is it is reacting to problems elsewhere in the world. In fact, I think it's generally agreed we've been ahead of much of the rest of the world in trying to respond to these problems.

But the stock market cannot look only in America. And as I said, the problems in Eastern Europe, which are troubling, that drags down the market. So part of what you see in the market is a pessimism about what's going on in the world. And to the extent that problems elsewhere in the world may be worsening where people haven't responded as quickly as we've done, I think that's part of the explanation. That in no way invalidates that we -- the question about what we're doing being the better thing to do.

SPEAKER PELOSI: Now, remember, a couple -- a few days after the president signed the -- well, I guess I'll put it over here with this one -- (laughter). Thank you, Barney. Tidy fellow that he is. (Laughter.)

(Cross talk.)

SPEAKER PELOSI: A few days after the president -- President Bush signed the TARP bill, we were told over and over by the administration that this was going to instill confidence in the markets and we had to do it, and if we didn't do it, things would get worse. And they probably would have.

But only a few days after the president signed the bill, like the following Tuesday, the market went down 600 points. So I called the secretary and I said, "What's with the confidence? Six hundred points." Well, there are all kinds of reasons why the market reacts. He had a number of them, an array of them. So the markets are what they are: free. And we always want them to be. Our message is, we are fiscally responsible and we have market-oriented solutions.

And I would add to the array that Congresswoman DeLauro mentioned about what she sees at home, outside of the editorials, outside of Washington, the enthusiasm of the people outside of Washington is much more positive. And in just a couple of weekends, I saw the private sector very enthusiastic about the infrastructure initiatives and the rebuilding of America that's going to happen in a green way.

I saw in conferences and town meetings with renewable energy people who want a new green economy what this package, recovery package, meant to them. And I saw in childcare centers parents enthusiastic about what the recovery package did for parents and children, so that children can be learning while parents are earning and creating jobs in that sector as well.

So we hope that it will be sooner rather than later that all of this will catch fire in Washington, D.C., but we're not waiting. We're not waiting -- our message is to the American people. There's a drum beat of optimism in that respect, in regard to this package and this president, that is very positive. And again, we need to do more in terms of financial stabilization. For that reason, we turn again to our economist opinion-leaders on this subject.

I don't know if you have any other -- maybe we could take one more.

Q Well, Madame Speaker, different people, with actually different -- (off mike).

SPEAKER PELOSI: I understand, but I'm not here to have a conversation with you. I want to hear from a number of people, but thank you.

Q Moving forward on the budget, there -- and Chairman Rangel, if you would, address this too. There seems to be some discord among -- in the Democratic Party about items like limiting tax deductions for charitable contributions, farm subsidies. Is the president's budget in trouble?

SPEAKER PELOSI: Well, Mr. Spratt was with us earlier. And he could address that. But I think he referenced it as a brilliant document this morning. Was that the term that he used?

This is about a budget that is not only balanced in terms of being fiscally responsible but balanced in its priorities. It is a statement of our national values as a budget has not been for a while, springing from an administration in the last eight years. And it is one that will always be a subject of debate in the Congress of the United States. So that's the regular Congress working its will. But it isn't a division.

REP. RANGEL: It's the most honest budget that we've seen, with so many things that were just omitted, by the previous administration, that it's put in. And the administration is working very closely with us, the same way they gave us the economic recovery package.

They were willing to work out any minor differences we had. So at the end of the day, we could come up with a budget that at least the majority can support. So we're talking about it every day but not just with ourselves but with the administration as well.

MR. SINAI: The budget's a process. It always is. The priorities in this budget are the priorities that the American people voted for. It's very clear, embodied in the budget, for long-run targets. And it is healthy in the give and take, of what goes on in Washington, for modifications and changes to be made. In no way does that mean, if there's discussion about that, that there is a problem and the budget is in trouble.

The budget is not in trouble. It's a subject and the beginning of some debate. And the items you mentioned are worthwhile taking a look at. And what gives me confidence in Washington is what I see in the flexibility, the willingness to discuss all these issues. And it is a little bit frustrating if the other party is not part of that conversation.

SPEAKER PELOSI: Thank you all very much.

END.

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