Decision Points, by Pres. George W. Bush: on Budget & Economy

Barack Obama: McCain calls 2008 White House meeting; but Obama has package

McCain wanted me to convene a White House meeting on the rescue package. I knew John was in a tough position. He was trailing in the polls to Obama. No question the economic trouble was hurting John. Yet I thought the financial crisis gave John his best chance to mount a comeback. In periods of crisis, voters value experience and judgment over youth and charisma. By handling the challenge in a statesmanlike way, John could make the case that he was the better candidate for the times.

I opened the meeting by stressing the urgency of passing legislation as soon as possible. Obama had a calm demeanor and spoke about the broad outlines of the package. I thought it was smart when he informed the gathering that he was in constant contact with [Administration officials]. His purpose was to show that he was aware, in touch, and prepared to help get a bill passed.

When Obama finished, I turned to John McCain. He passed. I was puzzled. What had started as a drama quickly descended into a farce.

Source: Decision Points, by Pres. George W. Bush, p.460-462 Nov 9, 2010

George W. Bush: Cut growth of spending each year except DoD, DHS, DVA, & SSA

I took my responsibility to be a good fiscal steward seriously. As a wartime president, I had two priorities: protecting the homeland and supporting our troops, both in combat and as veterans. Beyond those areas, we submitted budgets that slowed the growth of discretionary spending every year of my presidency. For the last five years, my budgets held this spending growth below the rate of inflation--in real terms, a cut.

I worked closely with Congress to meet my spending targets--or, as I called it, the overall size of the pie. I didn't always agree with how Congress divvied up the pieces.

It is fair to debate those policy choices, but here are the facts : The combination of tight budgets and the rising tax revenues resulting from economic growth helped drive down the deficit from 3.5% of the GDP in 2004 to 2.6% in 2005, to 1.9% in 2006, to 1.2% in 2007.

Source: Decision Points, by Pres. George W. Bush, p.446-447 Nov 9, 2010

George W. Bush: 2008 TARP bailouts: Bear-Stearns; Fannie Mae; AIG

In March, we learned that Bear-Stearns was overexposed. I was surprised by the sudden crisis. The Fed lent $30 billion against Bear's undesirable mortgage holdings. Many denounced the move as a bailout.
In September, we laid out a plan to place Fannie Mae and Freddie Mac into government conservatorship.
On Sep. 15, we allowed Lehman Brothers to file for bankruptcy. Legislators praised our decision not to intervene. The stock market was not so positive.
The NY Fed lent AIG $85 billion in return for 79% of AIG's shares.

On Sep. 18 we launched a new lending vehicle to restart the commercial paper market--the initiative that would become known as TARP. Source: Decision Points, by Pres. George W. Bush, p.452-458 Nov 9, 2010

George W. Bush: Well-being of Main St. directly linked to fate of Wall St.

Regarding TARP, I sympathized with the critics. The last thing I wanted to do was bail out Wall Street. "My friends back home in Midland are going to ask what happened to the free-market guy they knew. They're going to wonder why we're spending their money to save the firms that created the crisis in the first place."

I wished there were some way to hold individual firms to account while sparing the rest of the country. But every economist I trusted told me that was impossible. The well-being of Main Street was directly linked to the fate of Wall Street.

If credit markets remained frozen, the heaviest burdens would fall on American families: steep drops in the value of retirement accounts, massive job losses, and further falling home values. " I understand the frustration of responsible Americans who pay their mortgages on time, and are reluctant to pay the cost of excesses on Wall Street," I said. "But not passing a bill now would cost these Americans much more later."

Source: Decision Points, by Pres. George W. Bush, p.460 Nov 9, 2010

George W. Bush: To avoid another crisis: faith in free markets & free trade

I'm asked often is how to avoid another financial crisis. Once the economy is on firm footing, Fannie and Freddie should compete in the mortgage market on a level playing field. Banks should be required to meet sensible capital requirements to prevent overleveraging. And end compensation packages that create the wrong incentives and reward executives for failure.

At the same time, we must be careful not to overcorrect. Overregulation slows investment, stifles innovation, and discourages entrepreneurships. The government should unwind its involvement in the banking, auto, and insurance sectors. And the financial crisis should not become an excuse to raise taxes, which would only undermine the economic growth required to regai our strength.

Above all, our country must maintain our faith in free markets, free enterprise, and free trade. Democratic capitalism, while imperfect and in need of rational oversight, is by far the most successful economic model ever devised.

Source: Decision Points, by Pres. George W. Bush, p.471 Nov 9, 2010

John McCain: OpEd: Financial crisis gave best chance for 2008 comeback

John McCain wanted me to convene a White House meeting on the rescue package. He was on TV, suspending his campaign to work full-time on the legislation.

No question the economic trouble was hurting John. Our party controlled the White House, so we were the natural target of the finger-pointing. Yet I thought the financial crisis gave John his best chance to mount a comeback. In periods of crisis, voters value experience and judgment over youth and charisma. By handling the challenge in a statesmanlike way, John could make the case that he was the better candidate for the times.

When Obama finished, I turned to John McCain. He passed. I was puzzled. He had called for this meeting. I assumed he would come prepared to outline a way to get the bill passed. What had started as a drama quickly descended into a farce.

Toward the end of the meeting, John talked in general terms about the difficulty of the vote for Republican members and his hope that we could reach a consensus.

Source: Decision Points, by Pres. George W. Bush, p.460-462 Nov 9, 2010

The above quotations are from Decision Points, by George W. Bush . Click here for definitions & background information on Budget & Economy. Click here for other issues (main summary page). Click here for more quotes by George W. Bush on Budget & Economy. Click here for more quotes by George Bush Sr. on Budget & Economy.
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