Obama promises quick action to help economy

By The Associated Press

WASHINGTON – Democratic presidential candidate Barack Obama on Monday blamed “irresponsible decisions” by the Bush administration and Wall Street for the country’s economic woes as the White House said the budget deficit would soar to record heights next year.

Turning to domestic problems after a week’s tour of the Middle East and Europe, Obama met with more than a dozen economic advisers, appearing with them briefly before retreating for a two-hour closed meeting. The new deficit numbers were the latest sign of an economy in decline, with foreclosures rising, home prices falling, energy prices soaring and nearly a half-million job losses since January.

“It was not an accident or a normal part of the business cycle that led us to this situation,” Obama said. “There were some irresponsible decisions that were made on Wall Street and in Washington.”

Obama said the economy needs both short- and long-term fixes, including another “stimulus” from Congress, and a longer-term focus on renewable energy to curb high gas prices and on universal health care to trim costs.

“We are also going to have to provide some short-term relief,” Obama said. “People are hurting right now. We need to respond rapidly and vigorously to problems.”

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Present at the meeting were AFL-CIO President John Sweeney, former Treasury secretary Paul O’Neill, former Federal Reserve Chairman Paul Volcker, former New Jersey Sen. Bill Bradley, Google chairman and CEO Eric Schmidt and New Jersey Gov. Jon Corzine, former head of the Wall street investment firm Goldman Sachs. Billionaire investor Warren Buffett joined via speaker phone.

Republican John McCain blamed the deficit on wasteful spending by the Bush administration.

“There is no more striking reminder of the need to reverse the profligate spending that has characterized this administration’s fiscal policy,” McCain said in a statement.

“As president, I have committed to balancing the budget by the end of my first term,” McCain said. “Today’s news makes that job harder but should not change our resolve to make the tough decisions and the genuine effort to reach across the aisle that are needed to ensure a lasting solution to the spending problem that threatens the very stability of our economy.”

Obama didn’t name the Bush administration, but his implication was clear.

“We can’t afford, I believe, to keep on doing the same things we’ve been doing,” he said. “We have to change course, and we have to take immediate action.”

Obama has called for an aggressive course from Washington to stimulate the economy, and while he offered few details about his plans, he said the economy would be the focus of much of his attention in the three months until the election.

“This is an emergency we feel not only when reading The Wall Street Journal, but when we travel across Ohio and Michigan, New Mexico, no matter where you meet people day after day who are one foreclosure, one illness, one pink slip away from economic disaster,” he said.

The states Obama mentioned, as he read from prepared text, are key battleground states in November. He fueled speculation Monday as he headed to a three-hour closed meeting at the building that houses the law offices of Eric Holder, who is leading Obama’s search for a running mate. Campaign aides would not say who would be at the meeting or what would be discussed, but Obama is expected to announce his selection before the Democratic National Convention in Denver late next month.