Obama promises lower mortgage costs, new loans

– Obama discusses economic plans in weekly address

WASHINGTON – President Barack Obama on Saturday promised to lower mortgage costs, offer job-creating loans for small businesses, get credit flowing and rein in free-spending executives as he readies a new road map for spending billions from the second installment of the financial rescue plan.

The White House is deciding how to structure the remaining half of the $700 billion that Congress approved last year to save financial institutions and lenders. An announcement was possible as early as this coming week on an approach that would use a range of tools to unfreeze credit, helping families and businesses.

At the end of a week that saw hundreds of thousands of people lose their jobs, Obama also used his Saturday radio and Internet address to tell that nation that "no one bill, no matter how comprehensive, can cure what ails our economy."

During the final three months of 2008, the economy recorded its worst downhill slide in a quarter-century, stumbling backward at a 3.8 percent pace, the government reported Friday. It could get worse.

Treasury Secretary Timothy Geithner is trying to finish a plan to overhaul the bailout program begun in the Bush administration. Geithner has said the administration is considering using a government-run "bad bank" to buy up financial institutions' bad assets. But some officials now say that option is gone because of potential costs.

Many ideas under consideration could end up costing hundreds of billions beyond the original price tag. Aides would not rule out the possibility that the administration would seek more than the $350 billion already set aside.

Obama said Geithner soon would announce a new strategy "for reviving our financial system that gets credit flowing to businesses and families. We'll help lower mortgage costs and extend loans to small businesses so they can create jobs. We'll ensure that CEOs are not draining funds that should be advancing our recovery."

His administration "will insist on unprecedented transparency, rigorous oversight and clear accountability so taxpayers know how their money is being spent and whether it is achieving results."

Obama's message, largely repackaged from a week of White House statements, was as much for the country as it was for lawmakers: Pass the separate American Recovery and Reinvestment Plan or things are going to get worse.

"Rarely in history has our country faced economic problems as devastating as this crisis," the president said. "Now is the time for those of us in Washington to live up to our responsibilities."

Obama last week won passage of a separate $825 billion economic stimulus plan in the House without a single Republican vote. It now heads to the Senate, where Vice President Joe Biden predicts the measure will fare better among GOP lawmakers.

Republicans pledged to work with Obama. But they cautioned against treating government spending like a "trillion-dollar Christmas list" and renewed their opposition to much in the bill.

"A problem that started on Wall Street is reaching deeper and deeper into Main Street. And the president is counting on members of Congress to come together in a spirit of bipartisanship to act," Senate Minority Leader Mitch McConnell, R-Ky., said in the GOP radio address. "Unfortunately, the plan that Democrats in Congress put forward this week falls far short of the president's vision for a bill that creates jobs and puts us on a path to long-term economic health."

Obama has signaled his willingness to compromise. His chief spokesman said the president hoped to "strengthen" the bill as it headed toward a Senate vote in the week ahead.

Republicans said they hope the administration takes into account their wishes.

"Every day brings more news of layoffs, home foreclosures and shuttered businesses," McConnell said. "And across the country, employers are cutting to the bone even at businesses that most Americans never thought were vulnerable."

Republicans, however, kept putting forward their own plans. McConnell promoted a mortgage program for creditworthy borrowers, offering fixed-rate 4 percent loans designed to increase housing demands and lending.

Obama reverses Bush abortion-funds policy

Getty ImagesWASHINGTON – President Barack Obama on Friday struck down the Bush administration's ban on giving federal money to international groups that perform abortions or provide abortion information — an inflammatory policy that has bounced in and out of law for the past quarter-century.

Obama's move, the latest in an aggressive first week reversing contentious Bush policies, was warmly welcomed by liberal groups and denounced by abortion rights foes.

The ban has been a political football between Democratic and Republican administrations since GOP President Ronald Reagan first adopted it 1984. Democrat Bill Clinton ended the ban in 1993, but Republican George W. Bush re-instituted it in 2001 as one of his first acts in office.

"For too long, international family planning assistance has been used as a political wedge issue, the subject of a back and forth debate that has served only to divide us," Obama said in a statement released by the White House. "I have no desire to continue this stale and fruitless debate."

He said the ban was unnecessarily broad and undermined family planning in developing countries.

"In the coming weeks, my administration will initiate a fresh conversation on family planning, working to find areas of common ground to best meet the needs of women and families at home and around the world," the president said.

Obama issued the presidential memorandum rescinding the Bush policy without coverage by the media, late Friday afternoon. The abortion measure is a highly emotional one for many people, and the quiet signing was in contrast to the televised coverage of Obama's announcement Wednesday on ethics rules and Thursday's signing of orders on closing the Guantanamo Bay prison camp and banning torture in the questioning of terror suspects.

His action came one day after the 36th anniversary of the landmark Supreme Court ruling in Roe v. Wade that legalized abortion.

The Bush policy had banned U.S. taxpayer money, usually in the form of Agency for International Development funds, from going to international family planning groups that either offer abortions or provide information, counseling or referrals about abortion as a family planning method.

Critics have long held that the rule unfairly discriminates against the world's poor by denying U.S. aid to groups that may be involved in abortion but also work on other aspects of reproductive health care and HIV/AIDS, leading to the closure of free and low-cost rural clinics.

Supporters of the ban say that the United States still provides millions of dollars in family planning assistance around the world and that the rule prevents anti-abortion taxpayers from backing something they believe is morally wrong.

The ban has been known as the "Mexico City policy" for the city a U.S. delegation first announced it at a U.N. International Conference on Population.

Both Obama and Secretary of State Hillary Rodham Clinton, who will oversee foreign aid, had promised to do away with the rule during the presidential campaign.

Clinton said Friday evening that for seven years Bush's policy made it more difficult for women around the world to gain access to essential information and health care services. "Rather than limiting women's ability to receive reproductive health services, we should be supporting programs that help women and their partners make decisions to ensure their health and the health of their families," Clinton said.

In a related move, Obama also said he would restore funding to the U.N. Population Fund (UNFPA). Both he and Clinton had pledged to reverse a Bush administration determination that assistance to the organization violated U.S. law known as the Kemp-Kasten amendment.

Obama, in his statement, said he looked forward to working with Congress to fulfill that promise: "By resuming funding to UNFPA, the U.S. will be joining 180 other donor nations working collaboratively to reduce poverty, improve the health of women and children, prevent HIV/AIDS and provide family planning assistance to women in 154 countries."

Thoraya Ahmed Obaid, executive director of the U.N. Population Fund, said: "The president's actions send a strong message about his leadership and his desire to support causes that will promote peace and dignity, equality for women and girls and economic development in the poorest regions of the world."

"We are confident that under the new president's direction, the U.S. will resume its leadership in promoting and protecting women's reproductive health and rights worldwide," Obaid said in a statement issued at U.N. headquarters in New York.

The Bush administration had barred U.S. money from the fund, contending that its work in China supported a Chinese family planning policy of coercive abortion and involuntary sterilization. UNFPA has vehemently denied that it does.

Congress had appropriated $40 million to the UNFPA in the past budget year, but the administration had withheld the money as it had done every year since 2002.

Organizations and lawmakers that had pressed Obama to rescind the Mexico City policy were jubilant.

House Speaker Nancy Pelosi, D-Calif., said the move "will help save lives and empower the poorest women and families to improve their quality of life and their future."

"Today's announcement is a very powerful signal to our neighbors around the world that the United States is once again back in the business of good public policy and ideology no longer blunts our ability to save lives around the globe," said Sen. John Kerry, D-Mass., chairman of the Senate Foreign Relations Committee.

Population Action International, an advocacy group, said that the policy had "severely impacted" women's health and that the step "will help reduce the number of unintended pregnancies, abortions and women dying from high-risk pregnancies because they don't have access to family planning."

Anti-abortion groups and lawmakers condemned Obama's decision.

"I have long supported the Mexico City Policy and believe this administration's decision to be counter to our nation's interests," said Senate Republican leader Mitch McConnell of Kentucky.

"Coming just one day after the 36th anniversary of the tragic Roe v. Wade decision, this presidential directive forces taxpayers to subsidize abortions overseas — something no American should be required by government to do," said House Minority Leader John Boehner, R-Ohio.

Rep. Mike Pence, R-Ind., called it "morally wrong to take the taxpayer dollars of millions of pro-life Americans to promote abortion around the world."

"President Obama not long ago told the American people that he would support policies to reduce abortions, but today he is effectively guaranteeing more abortions by funding groups that promote abortion as a method of population control," said Douglas Johnson, legislative director of the National Right to Life Committee.

Obama's first day in office

BARACK Obama laid down the law on his first day in the Oval Office yesterday.

The new President snatched just a few hours sleep after his euphoric inauguration celebrations — then faced up to a daunting array of problems.

He had promised “swift action”. And in a series of meetings with advisers and generals, he began to tackle America’s crippled economy, the Iraq war, Guantanamo Bay and the Middle East crisis. He also:

SUSPENDED all orders issued to federal departments and agencies by his predecessor George Bush, pending review.

FROZE the pay of presidential staff earning more than £75,000, and BANNED them from accepting gifts from lobbyists.

For your eyes only ... note from Bush to Obama, President No44

The moves were aimed at making his administration more “transparent”. And Obama declared: “Families are tightening their belts — and so should Washington.”

The President began his first working day at a prayer service in Washington’s National Cathedral.

He sat with First Lady Michelle, Vice President Joe Biden and his wife Jill, and Bill and Hillary Clinton.

Hillary was later rubber-stamped as US Secretary of State by the Senate despite Republican questions over potential conflicts of interest created by foreign payments to her husband’s foundation.

Summit

Once in the Oval Office, Obama had a brief moment of solitude in which he read a note left on his desk by Mr Bush.

It was addressed “to No44 from No43” — a reference to the pair being the 43rd and 44th Presidents. But its contents were not revealed.

Getting down to business ... Obama with Rahm Emanuel

Then it was straight into a summit with advisers, including White House Chief of Staff Rahm Emanuel, to discuss plans to revive the US economy with a £600billion injection.

Turning to Iraq, Obama was due to meet Defence Secretary Robert Gates, Chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, and General David Petraeus, head of the US Central Command.

Joining the discussion via tele-conference from Iraq were America’s ambassador to the strife-torn nation, Ryan Crocker, and General Ray Odierno, the top ranking US soldier in the battlezone.

Obama was expected to command the team to draw up plans to pull all US combat troops out of Iraq within 16 months.

On the Middle East, Obama called leaders including Jordan’s King Abdullah, Israeli PM Ehud Olmert and Palestinian Authority President Mahmoud Abbas.

The President also ordered a suspension of trials at Guantanamo Bay while a four-month probe is carried out into the whole purpose of the detention camp in Cuba. The move even halted the case of 11 men charged in connection with the 9/11 atrocities.

It was applauded by human rights activists. But guards at the camp — holding 250 terror suspects — were unimpressed.

Though elated at Obama’s inauguration, black officer Patrick Thomas, 43, disagreed with the President’s intention to close it down.

He said: “If you let these detainees go from here they will pop up somewhere else.”

Late yesterday Obama was due to host an “Open White House” for friends and relatives. Meanwhile his staff were rushing to set up offices and computers. Press secretary Robert Gibbs said: “I just have to figure out how to log in.”

AN explosion of Obama-related goodies has appeared on web auction site eBay, including a “My Mama is for Obama” babygrow.

Obama visits with troops, honors King on holiday

AP – President-elect Barack Obama, his wife Michelle Obama, arrive at 'We Are One: Opening Inaugural Celebration …

President-elect Barack Obama, his wife Michelle Obama, arrive at AP – President-elect Barack Obama, his wife Michelle Obama, arrive at 'We Are One: Opening Inaugural Celebration …
WASHINGTON – With history intersecting the transfer of power, large crowds thronged to the capital Monday, on the eve of Barack Obama's elevation to the presidency as America honored slain civil rights leader Martin Luther King Jr.

A day away from becoming the nation's 44th president, Obama made an unscheduled visit to Walter Reed Army Medical Center to visit with troops injured in battle. And President George W. Bush made calls from the White House to thank several world leaders for their work with him over the last eight years.

On the streets, live broadcasts by the television networks attracted swarms of onlookers, and behind the scenes people made final preparations for a slew of parties, balls and other celebrations that will follow Obama's oath-taking and the inaugural parade.

Obama and Vice President-elect Joe Biden, fresh off a rollicking concert at the Lincoln Memorial Sunday, planned to spend their final day before the inauguration with activities keyed to the celebration of King's life, cut short by an assassin's bullet in 1968.

The Obama and Biden families were part of a community renovation project in honor of King on the federal holiday established in his memory. Transition aides declined to name the locations or details of the projects.

The run-up to Obama's inauguration, like his election itself, has been defined by enormous public enthusiasm, carefully choreographed events and a lofty spirit of unity. What awaits, as Obama often reminds the nation, is many months, if not years, of tough work.

The weekend celebrations began Saturday with Obama's whistle-stop tour, from Philadelphia to Washington, along the path Abraham Lincoln took in 1861. Then came that roaring celebrity-filled concert where several hundred thousand people flanked the reflecting pool, hearing actors, singers and then Obama himself rally for national renewal.

Obama is asking the nation to honor King's legacy by making a renewed commitment to service. That has long been the goal of the King holiday, even if many see it as a day off.

The Presidential Inaugural Committee has launched a Web site, USAService.org, to help people find volunteer opportunities close to their homes.

"I am asking you to make a lasting commitment to make better the lives of your fellow Americans — a commitment that must endure beyond one day, or even one presidency," Obama said in a YouTube appeal last week. "At this moment of great challenge and great change, I am asking you to play your part; to roll up your sleeves and join in the work of remaking this nation."

The president-elect has a busy Monday evening, too.

He is to attend three private dinners to honor the public service of former Secretary of State Colin Powell; Biden, a longtime senator from Delaware; and Sen. John McCain, the 2008 Republican presidential nominee. Those dinners will be held at the Hilton Washington, National Building Museum and Union Station.

Michelle Obama, the future first lady, is hosting a children's evening concert.

At the Capitol on Monday morning, groups of tourists wandered around the barricades to take pictures of the viewing stands and the monuments and buildings. A few even stood and watched NFL highlights that were being shown on the big-screen TV at the Capitol.

Three teachers from Baltimore said they decided to come out to the Capitol to scope out their routes in and out for the inauguration ceremony.

"Seems like they've planed it out pretty well," said Gary Campbell, 29, of Baltimore as his group looked at the viewing stand from across the Capitol reflecting pool. Their school, Baltimore Freedom Academy, and the Homeland Security Academy planned to send four busloads of children to the National Mall to watch the inauguration ceremony.

Being from Baltimore the three were decked out in cold-weather gear and said they planned on wearing thermal coats, hats and scarves for the long wait on the Mall Tuesday.

"We knew to come prepared," said Maddy Ahearn, 24.

Runner Kim Person stopped in front of the Capitol to snap a few quick pictures of the reviewing stand during a break in her marathon training. Person doesn't have a ticket to the festivities, so she used the early morning lull to get close to the building.

"That's why I'm looking at it today, because I won't be able to see it tomorrow," said Person, 43, who plans to be near the Washington Monument on Tuesday.

Obama takes train ride from Philadelphia to Washington

WILMINGTON: Barack Obama warned on Saturday of the vast challenges ahead for Americans as he rolled by train toward Washington, where he will be US Vice President-elect Joe Biden greets Michelle Obama as President-elect Obama gets off his train car in Wilmington, Deleware. (Reuters Photo) More Pictures inaugurated in three days as the 44th president of the United States. ( Watch ) Obama waved to crowds along the tracks from the back of a vintage train car at spots during the journey from Philadelphia to Washington. He takes office on Tuesday amid the deepest economic crisis in generations and wars in Iraq and Afghanistan. "Only a handful of times in our history has a generation been confronted with challenges so vast," Obama said as he began the trip in Philadelphia, evoking the patriots who launched the American fight for independence in the city in 1776. "While our problems may be new, what is required to overcome them is not," Obama said. "What is required is the same perseverance and idealism that our founders displayed." Obama, a Democrat, has vowed to spend hundreds of billions of dollars to jolt the country out of a deepening recession. He stressed in Philadelphia and at a later stop in Wilmington, Delaware, where he was joined by Vice President-elect Joe Biden, that it will take time and sacrifice to turn the economy around. "This is more than an ordinary train ride, this is a new beginning," Biden told the crowd in his hometown of Wilmington. The 137-mile (220 km) train journey launches three days of parties, concerts and shows to celebrate Obama's swearing-in at the US Capitol on Tuesday afternoon. He also will stop in Baltimore before arriving in Washington on Saturday night. The trip was designed to mimic the 1861 rail journey to the capital by Abraham Lincoln before he entered the White House. Obama frequently evokes Lincoln, the 16th president who steered America through the Civil War and ended slavery in the United States. Obama will become the first black US president when he is sworn into office on Tuesday. Janice Winston, 56, said she was overjoyed at the prospect. "It's finally hitting me, because I'm starting to cry, that this is really happening," Winston, who is black, said at the station in Philadelphia. "Today is a new day." Obama's train slowed to a crawl at a few spots along the route so he could step out onto the back of his carriage and wave to the crowds that lined the tracks in frigid weather. In Claymont, Delaware, several hundred people gathered to cheer and wave to Obama, holding signs reading "Halleluja, we did it," and "Hail to the chief."

Obama set to press for his share of bailout funds

WASHINGTON – A week shy of taking office, President-elect Barack Obama already is putting his persuasion skills to a high-stakes test with Congress as he seeks access to the second half of the $700 billion financial bailout fund.

Obama planned to be in the Capitol on Tuesday to meet with Senate Democrats. And his transition team prepared to dispatch top aides to meet with Senate Republicans this week in anticipation of a possible vote Thursday on whether to release the money from the embattled Troubled Asset Relief Program.

In the House, the Financial Services Committee scheduled a hearing on the program in advance of legislation offered by committee Chairman Barney Frank, D-Mass., that would place tough new restrictions on recipients of the money and require spending to reduce mortgage foreclosures.

The legislation is scheduled to reach the floor of the House on Wednesday, with a vote set for Thursday.

That flurry of activity comes in the wake of President George W. Bush's decision Monday to act on Obama's behalf and ask Congress for access to the remaining $350 billion of the money Congress authorized to rescue the nation's financial sector. The request reached Congress as lawmakers and Obama also were assembling a spending and tax-cutting stimulus package of $800 billion, or possibly more.

"It is clear that the financial system, although improved from where it was in September, is still fragile," Obama said Monday.

Bush's notification set a 15-day deadline for Congress to disapprove of the request. The Bush administration's handling of the money has met bipartisan criticism in the House and Senate. Lawmakers have complained that the Treasury Department's use of the money has been muddled and misleading, that recipients of the funds have faced little accountability and that the program has done nothing to reduce home foreclosures.

If the Senate rejects a motion to disapprove the funds, it would pave the way for Obama to begin dispensing the money about a week after he assumes office Jan. 20.

Congressional Democrats said they hoped Obama's desire to place greater restrictions on the money and broaden its goals to loosen more credit would build support among otherwise skeptical lawmakers. The House tentatively scheduled a vote for next week. If both chambers refuse to release the money, it would be up to Obama to issue a veto — a dramatic first act by a new president — in hopes that Congress would not override him.

The request by the Bush White House made it clear that the money was to be used by the incoming Obama administration. It directed lawmakers to a letter Monday from top Obama economic adviser Larry Summers that vowed to make significant changes in the way the program is administered.

In the Senate, Majority Leader Harry Reid, D-Nev., said he was encouraged by Obama's efforts to add more conditions and to require greater accountability for the use of the money. Senate Minority Leader Mitch McConnell, R-Ky., voiced skepticism but left open the possibility that he could be persuaded.

"I would be hard-pressed to support additional funding for the TARP without sufficient assurances this money will not be wasted, misspent or simply used for more industry-specific bailouts," McConnell said.

Summers' letter, however, was not as detailed as the legislation proposed in the House by Frank. That bill would set new conditions on the institutions that receive the money, requiring limits on executive pay and an end to owning or leasing private jets. It also would require spending at least $40 billion from the fund on foreclosure mitigation.

Financial services industry lobbyists said they opposed a provision in Frank's bill that would allow the Treasury Department to apply executive pay restrictions to banks that already have received government money.

Scott Talbott, senior vice president at the Financial Services Roundtable, said the group would like to see Congress' concerns addressed without the retroactive provision. The Roundtable represents 100 of the largest banks and insurance companies, including such government fund recipients as Citigroup Inc., Bank of America Corp. and JPMorgan Chase & Co.

Some lobbyists hoped Summers' letter would reassure lawmakers and make legislation such as Frank's less likely to pass. Summers' letter doesn't address the question of retroactive limits on executive pay.

At the same time, the Federal Deposit Insurance Corp. issued a directive Monday asking banks and other financial institutions to track how the federal money or guarantees they received helped them boost "prudent lending" and efforts to help at-risk borrowers avoid foreclosures.

Mumbai-type attacks can be replicated: Obama

WASHINGTON: President-elect Barack Obama on Sunday voiced fear that Mumbai-type attacks can be replicated by terrorists in other parts of world,including the US and said his administration will focus on putting more pressure on "our major target" al-Qaida.

Asked about 26/11 terror strikes in an interview to ABC News, Obama said the "danger is always there" to have a Mumbai-type attack in an American city.

"When you see what happened in Mumbai, that potentially points to a new strategy, not simply suicide bombings but you have commandos taking over...," he said.

"I think you have to anticipate that having seen the mayhem that was created in Mumbai, that there are going to be potential copycats or other terrorist organisations that think this is something that they can replicate," Obama said.

At a Congressional hearing on Mumbai attack this week, top US intelligence and police officials had expressed similar fear and said that this makes all the more necessary to ensure that those responsible for such an attack are brought to justice, given that US cities are always on top of the hit list of al-Qaida and other terrorist groups.

"So we're going to have to be vigilant in terms of our intelligence, we're going to have to make sure that we are more effective in terms of anticipating some of these issues, and we've got to continue to put pressure on al-Qaida, which is our major target — that's something that I talked about extensively during the campaign," Obama said.

"That has to be one of our primary areas of focus when it comes to our international security."

Obama provides internal analysis of economic plan

WASHINGTON – Facing growing criticism of his economic recovery plan, President-elect Barack Obama made public Saturday a detailed analysis by his economic advisers that estimates the $775 billion plan of tax cuts and new spending would create 3.5 million jobs over the next two years.

But the president-elect's advisers concede in the 14-page report Obama posted on the Internet that their estimates are "subject to significant margins of error," both because of the assumptions that went into their economic models and because no one knows the final outlines of the package that will emerge from Congress.

"These numbers are a stark reminder that we simply cannot continue on our current path," Obama said Saturday in his weekly radio and YouTube broadcast address.

"If nothing is done, economists from across the spectrum tell us that this recession could linger for years and the unemployment rate could reach double digits — and they warn that our nation could lose the competitive edge that has served as a foundation for our strength and standing in the world," he said.

Obama, who previously has provided few details of the massive spending and tax cut plan, released the report one day after the unemployment rate jumped to 7.2 percent, the highest in 16 years. The nation lost 524,000 jobs in December, bringing the total job loss for last year to 2.6 million, the largest since World War II.

If Congress fails to enact a big economic stimulus plan, Obama's advisers estimated that another 3 million to 4 million jobs will disappear before the recession ends.

As lawmaker criticisms of parts of his plan grew during the week, Obama agreed Friday to modest changes in his proposed tax cuts. Democratic congressional officials said his aides came under pressure in closed-door talks to jettison or significantly alter a proposed tax credit for creating jobs, and to include relief for upper middle-class families hit by the alternative minimum tax.

The new report is likely to intensify debate over the economic recovery plan even more, as economists outside the Obama team begin delving into the analysis. The report, for example, estimates that the unemployment rate at the end of 2010 would be 1.8 percentage points lower if the plan is enacted.

Top Democrats on Capitol Hill say there is far more agreement than disagreement on the major parts of the recovery plan: aid to cash-strapped state governments, $500-$1,000 tax cuts for most workers and working couples, and a huge spending package blending old fashioned public works projects with aid to the poor and unemployed and a variety of other initiatives.

The new report provides detailed breakdowns of how many jobs each part of the plan would create, even going so far as to provide estimates that more than 40 percent of the new jobs would go to women and that 90 percent of them would be created in the private sector. It also provides estimates of how many new jobs would be created in each different sector of the economy.

"It's not too late to change course — but only if we take immediate and dramatic action," Obama said. "Our first job is to put people back to work and get our economy working again."

Economic crisis, Obama response face new Congress

AP – Senate Minority leader Mitch McConnell, left, listens to House Minority leader John Boehner, right, during …

WASHINGTON – The Democratic-dominated Congress convenes Tuesday to confront perhaps the worst economic crisis since the Great Depression and to grapple with a hugely ambitious agenda set by President-elect Barack Obama.

The opening day of a two-year session is typically more ceremony than substance, and Congress often recesses until the new president takes office or after the State of the Union address at the end of January.

This year, however, with the economy in a worsening recession, Democrats are promising swift action on an as-yet-unveiled $775 billion economy recovery program that is the first order of business for the Obama administration.

"We will hit the ground running ... to address the pain being felt by the American people," House Speaker Nancy Pelosi, D-Calif., promised Monday as she welcomed Obama to her office.

For the first time in 16 years, Democrats control both houses of Congress and welcome one of their own to the White House. That foreshadows a productive session, particularly if Obama can muster Republican support for his initiatives, as he is seeking.

Pelosi had earlier promised to try to get the economic recovery bill ready for Obama's signature by Inauguration Day, an optimistic timeline that has now slipped by several weeks.

With their numbers bolstered by last fall's elections, congressional Democrats are well-positioned to dominate the session.

Democrat Al Franken on Monday became the apparent victor in a hard-fought Minnesota Senate race. That means Democrats' numbers in the chamber could reach 59 — tantalizingly close to the magic 60 votes needed to overcome a GOP filibuster. Incumbent Republican Norm Coleman promises to contest the result.

But first, Senate Democratic leaders need to work out a looming confrontation with Roland Burris, the Illinois Democrat named by scandal-plagued Gov. Rod Blagojevich, who faces charges of having attempted to sell the seat.

Burris, who is black, came to Washington on Monday to claim the seat, though Democratic officials promise he won't be admitted to the Senate carrying the taint of Blagojevich.

In the House, Pelosi finds her own position strengthened by a gain of more than 20 seats. Her status as the top Democrat in Washington, however, has been supplanted by Obama.

For Republicans, the next two years promise to be difficult. They vow to work with Obama but at the same time have installed a more conservative leadership team in the House that's eager to draw distinctions with Democrats.

In addition to the economic recovery plan, early items on the agenda include a measure designed to ensure women have the right to sue their employers for pay discrimination. It passed the House but fell prey to a GOP filibuster in the Senate. Now it looks as though it will easily pass.

Despite the sense of optimism, however, troubling realities threaten the Democratic agenda.

Perhaps most dangerous is the spiraling budget deficit. On Wednesday, lawmakers will get some very sobering news: New budget deficit projections from congressional estimators project a flood of red ink — likely to exceed $1 trillion for the current budget year — that could threaten other initiatives like extending health care to millions of the uninsured.

With that in mind, Obama promises "very concrete, serious plans for midterm and long-term fiscal discipline."

Obama's family arrive in Washington

WASHINGTON: Incoming US president Barack Obama and his family arrive in Washington this weekend, in time for him to work on an urgent economic recovery plan and his daughters to start classes at their new school.

After less that 48 hours in their south Chicago home following their luxury Hawaii Christmas vacation, the president-elect's wife Michelle and their daughters Sasha, 10, and Malia, 7, flew to Washington late Saturday, a transition aide confirmed.

Obama, two weeks before the 44th American president will be sworn in on January 20, is to join his family on Sunday. They are moving temporarily into the historic Hay-Adams hotel in downtown Washington, which overlooks their new home at the White House on 1600 Pennsylvania Avenue.

It was unclear why the family was traveling separately. Sasha and Malia are set to begin classes on Monday at the exclusive Sidwell Friends School, as dad Obama heads to meetings on Capitol Hill to hammer out the final points of a recovery package in a bid to turn around the country's crumbling economy.

The private, Quaker-run Sidwell has long been the choice for presidential offspring -- the school counts former president Bill Clinton's daughter Chelsea and president Richard Nixon's daughters among its well-heeled alumni.

Before moving to the president's official guest home, Blair House, on January 15, the Obama family can enjoy their transition to the Beltway in style -- they are expected to stay in one of the hotel's luxury 6,000-dollar-a-night suites.

Built in 1928, the luxury residence is separated from the White House only by Lafayette Square, a grassy square block.

Apart from a November 10 White House meeting with President George W Bush, Obama has largely avoided Washington since his historic election as the first African-American US president on November 4.

Obama considering expanding jobless benefits: report

Reuters – U.S. President-elect Barack Obama waves as he and his wife Michelle board their plane at Honolulu International …

NEW YORK (Reuters) – President-elect Barack Obama and Congressional Democrats are considering a major expansion of government-assisted health care insurance and unemployment benefits as part of a two-year economic recovery program, The New York Times reported in its Sunday editions.

Proposals included extending unemployment compensation to part-time workers, subsidizing employers who must continue health insurance benefits temporarily for laid-off and retired employees and allowing workers who lose jobs that did not include insurance to apply for Medicaid, the Times said.

The proposals would be included with other economic measures like ramping up spending on infrastructure and other public works projects meant to stimulate job growth, the Times said.

Democratic aides said the House of Representatives is not expected to vote until next week at the earliest on any stimulus plan, with final action now unlikely before February, the newspaper reported.

Citing Obama advisers, the newspaper said the package, which could face resistance from Republicans and conservative Democrats, would cost at least $775 billion.

"This has really forced people to think outside the box," the Times quoted a House Appropriations Committee aide as saying, "because this is more money than anybody expected to be spending."

Obama is also likely to propose a tax credit of $500 for eligible individuals and $1,000 for couples, the newspaper said. Those earning too little to pay federal income tax would receive a check meant to

Obama: Country needs economic stimulus plan

AP – Early morning preparations continue for President-elect Barack Obama's Inaugural Reviewing Stand on Pennsylvania …

CHICAGO – President-elect Barack Obama urged congressional leaders Saturday to move quickly on an economic recovery plan, even as some Republicans are saying they want more time to review the details.

Obama said Congress should pass an American Recovery and Reinvestment Plan designed to create 3 million jobs. The Democratic president-elect hasn't announced a final price tag on it, but aides said the cost could be as high as $775 billion.

"For too many families, this new year brings new unease and uncertainty as bills pile up, debts continue to mount and parents worry that their children won't have the same opportunities they had," Obama said in an address taped Friday and distributed on radio and posted on YouTube Saturday morning.

The nation's economy remains the top challenge facing Obama when he takes office on Jan. 20. The Federal Reserve estimated that lenders were on track to initiate 2.25 million foreclosures this year, more than doubling the annual pace before the crisis set in. One in 10 U.S. homeowners is delinquent on mortgage payments or in foreclosure.

House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Harry Reid, D-Nev., are to receive details on Monday. Obama plans meetings next week with other congressional leaders — including Republican members whose support he will need — and made an effort not to blame his predecessor, the unpopular President George W. Bush.

"However we got here, the problems we face today are not Democratic problems or Republican problems," Obama said. "The dreams of putting a child through college, or staying in your home, or retiring with dignity and security know no boundaries of party or ideology. ... I am optimistic that if we come together to seek solutions that advance not the interests of any party, or the agenda of any one group, but the aspirations of all Americans, then we will meet the challenges of our time just as previous generations have met the challenges of theirs."

Obama aides had hoped to have an economic plan approved by the House and Senate before Obama takes office. That timeline, though, appears unlikely as time is running out and Republicans have urged a delay to review the plans. Sen. Mitch McConnell, the Republicans' top official, said the plan needs time so that "every dollar needs to be spent wisely and not wasted in the rush to get it spent."

Congressional aides briefed on the measure say it's likely to blend tax cuts of $500 to $1,000 for middle-class individuals and couples with about $200 billion to help revenue-starved states with their Medicaid programs and other operating costs.

A large portion of the measure will go toward infrastructure projects, blending old-fashioned brick and mortar programs such as road and bridge repairs and water projects with new programs such as research and development on energy efficiency and an expensive rebuilding of the information technology system for health care.

"Economists from across the political spectrum agree that if we don't act swiftly and boldly, we could see a much deeper economic downturn that could lead to double-digit unemployment and the American dream slipping further and further out of reach," Obama said.

Obama: Country needs economic stimulus plan

AP – Early morning preparations continue for President-elect Barack Obama's Inaugural Reviewing Stand on Pennsylvania …

CHICAGO – President-elect Barack Obama urged congressional leaders Saturday to move quickly on an economic recovery plan, even as some Republicans are saying they want more time to review the details.

Obama said Congress should pass an American Recovery and Reinvestment Plan designed to create 3 million jobs. The Democratic president-elect hasn't announced a final price tag on it, but aides said the cost could be as high as $775 billion.

"For too many families, this new year brings new unease and uncertainty as bills pile up, debts continue to mount and parents worry that their children won't have the same opportunities they had," Obama said in an address taped Friday and distributed on radio and posted on YouTube Saturday morning.

The nation's economy remains the top challenge facing Obama when he takes office on Jan. 20. The Federal Reserve estimated that lenders were on track to initiate 2.25 million foreclosures this year, more than doubling the annual pace before the crisis set in. One in 10 U.S. homeowners is delinquent on mortgage payments or in foreclosure.

House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Harry Reid, D-Nev., are to receive details on Monday. Obama plans meetings next week with other congressional leaders — including Republican members whose support he will need — and made an effort not to blame his predecessor, the unpopular President George W. Bush.

"However we got here, the problems we face today are not Democratic problems or Republican problems," Obama said. "The dreams of putting a child through college, or staying in your home, or retiring with dignity and security know no boundaries of party or ideology. ... I am optimistic that if we come together to seek solutions that advance not the interests of any party, or the agenda of any one group, but the aspirations of all Americans, then we will meet the challenges of our time just as previous generations have met the challenges of theirs."

Obama aides had hoped to have an economic plan approved by the House and Senate before Obama takes office. That timeline, though, appears unlikely as time is running out and Republicans have urged a delay to review the plans. Sen. Mitch McConnell, the Republicans' top official, said the plan needs time so that "every dollar needs to be spent wisely and not wasted in the rush to get it spent."

Congressional aides briefed on the measure say it's likely to blend tax cuts of $500 to $1,000 for middle-class individuals and couples with about $200 billion to help revenue-starved states with their Medicaid programs and other operating costs.

A large portion of the measure will go toward infrastructure projects, blending old-fashioned brick and mortar programs such as road and bridge repairs and water projects with new programs such as research and development on energy efficiency and an expensive rebuilding of the information technology system for health care.

"Economists from across the political spectrum agree that if we don't act swiftly and boldly, we could see a much deeper economic downturn that could lead to double-digit unemployment and the American dream slipping further and further out of reach," Obama said.

Obama Moves to Counter China in Space With Pentagon-NASA Link

AP – President-elect Barack Obama greets onlookers after his morning workout at the Semper Fit Center on Marine …

Jan. 2 (Bloomberg) -- President-elect Barack Obama will probably tear down long-standing barriers between the U.S.’s civilian and military space programs to speed up a mission to the moon amid the prospect of a new space race with China.

Obama’s transition team is considering a collaboration between the Defense Department and the National Aeronautics and Space Administration because military rockets may be cheaper and ready sooner than the space agency’s planned launch vehicle, which isn’t slated to fly until 2015, according to people who’ve discussed the idea with the Obama team.

The potential change comes as Pentagon concerns are rising over China’s space ambitions because of what is perceived as an eventual threat to U.S. defense satellites, the lofty battlefield eyes of the military.

“The Obama administration will have all those issues on the table,” said Neal Lane, who served as President Bill Clinton’s science adviser and wrote recently that Obama must make early decisions critical to retaining U.S. space dominance. “The foreign affairs and national security implications have to be considered.”

China, which destroyed one of its aging satellites in a surprise missile test in 2007, is making strides in its spaceflight program. The military-run effort carried out a first spacewalk in September and aims to land a robotic rover on the moon in 2012, with a human mission several years later.

A Level of Proficiency

“If China puts a man on the moon, that in itself isn’t necessarily a threat to the U.S.,” said Dean Cheng, a senior Asia analyst with CNA Corp., an Alexandria, Virginia-based national-security research firm. “But it would suggest that China had reached a level of proficiency in space comparable to that of the United States.”

Obama has said the Pentagon’s space program -- which spent about $22 billion in fiscal year 2008, almost a third more than NASA’s budget -- could be tapped to speed the civilian agency toward its goals as the recession pressures federal spending.

NASA faces a five-year gap between the retirement of the space shuttle in 2010 and the first launch of Orion, the six- person craft that will carry astronauts to the International Space Station and eventually the moon. Obama has said he would like to narrow that gap, during which the U.S. will pay Russia to ferry astronauts to the station.

NASA Resistance

The Obama team has asked NASA officials about the costs and savings of scrapping the agency’s new Ares I rocket, which is being developed by Chicago-based Boeing Co. and Minneapolis-based Alliant Techsystems Inc.

NASA chief Michael Griffin opposes the idea and told Obama’s transition team leader, Lori Garver, that her colleagues lack the engineering background to evaluate rocket options, agency spokesman Chris Shank said. Garver and other advisers declined to comment.

At the Pentagon, there may be support for Obama’s vision. While NASA hasn’t recently approached the Pentagon about using its Delta IV and Atlas V rockets, building them for manned missions could allow for cost sharing, said Steven Huybrechts, the director of space programs and policy in the office of Defense Secretary Robert Gates, who is staying on into the new administration.

The Delta IV and Atlas V are built by United Launch Alliance, a joint venture of Boeing and Bethesda, Maryland-based Lockheed Martin Corp., and typically are used to carry satellites.

Already Developed

“No one really has a firm idea what NASA’s cost savings might be, but the military’s launch vehicles are basically developed,” said John Logsdon, a policy expert at Washington’s National Air and Space Museum who has conferred with Obama’s transition advisers. “You don’t have to build them from scratch.”

Meanwhile, Chinese state-owned companies already are assembling heavy-lift rockets that could reach the moon, with a first launch scheduled for 2013. All that would be left to build for a manned mission is an Apollo-style lunar lander, said Griffin, who visited the Chinese space program in 2006.

Griffin said in July that he believes China will be able to put people on the moon before the U.S. goes back in 2020. The last Apollo mission left the lunar surface in 1972.

“The moon landing is an extremely challenging and sophisticated task, and it is also a strategically important technological field,” Wang Zhaoyao, a spokesman for China’s space program, said in September, according to the state-run Xinhua news agency.

Docking

China plans to dock two spacecraft in orbit in 2010, a skill required for a lunar mission.

“An automated rendezvous does all sorts of things for your missile accuracy and anti-satellite programs,” said John Sheldon, a visiting professor of advanced air and space studies at Maxwell Air Force Base in Alabama. “The manned effort is about prestige, but it’s also a good way of testing technologies that have defense applications.”

China’s investments in anti-satellite warfare and in “cyberwarfare,” ballistic missiles and other weaponry “could threaten the United States’ primary means to project its power and help its allies in the Pacific: bases, air and sea assets, and the networks that support them,” Gates wrote in the current issue of Foreign Affairs magazine.

China is designing satellites that, once launched, could catch up with and destroy U.S. spy and communication satellites, said a Nov. 20 report to Congress from the U.S.-China Economic and Security Review Commission. China’s State Council Information Office declined to comment on the nation’s anti-satellite or manned programs.

To boost cooperation between NASA and the Pentagon, Obama has promised to revive the National Aeronautics and Space Council, which oversaw the entire space arena for four presidents, most actively from 1958 to 1973.

The move would build ties between agencies with different cultures and agendas.

“Whether such cooperation would succeed remains to be seen,” said Scott Pace, a former NASA official who heads the Washington-based Space Policy Institute. “But the questions are exactly the ones the Obama team needs to ask.”