Obama: Pass stimulus or recession lasts ‘years’

The president-elect cast blame on "an era of profound irresponsibility that stretched from corporate boardrooms to the halls of power in Washington."

Obama shed no new light on the details of his plan that could cost as much as $775 billion over two years. And, he said little about the unprecedented red ink and rising debt confronting the government, even after spending days reassuring the public and Congress that he is committed to tackling long-term deficits once the economy rebounds.

But he laid out goals of doubling the production of alternative energy over three years, making 75 percent of federal buildings and two million homes more energy efficient, computerizing all medical records in five years, expanding broadband networks and updating schools and universities.

"It's a plan that represents not just new policy but a whole new approach to meeting our most urgent challenges," he said at George Mason University in suburban Washington.

Obama's economic team is considering a package, half of which would be devoted to spending ranging from infrastructure to assistance to states. About 40 percent — roughly $300 billion — would be tax cuts for individuals and businesses, and about 10 percent would be spent on assistance to unemployed workers.

Governors of six states and mayors of 14 cities — a bipartisan audience that came from as far away as Minnesota and Utah to be among the few hundred in attendance — listened to the speech that lasted less than a half hour. The group remained silent until light applause at the end.

Elsewhere, there was more grim economic news.

A government report showed that the number of people drawing jobless benefits rose last week to the highest level since 1982, demonstrating the troubles the unemployed are having in finding new jobs.

And broader unemployment figures due out Friday are expected to show that the U.S. lost a net total of 500,000 jobs in December. That would bring 2008's total job losses to 2.4 million, the first annual job loss since 2001 and the highest since 1945, though the number of jobs has more than tripled since then.

Speaking a day after the release of a stunning new deficit estimate — that the federal red ink will reach an unprecedented $1.2 trillion this year, nearly three times last year's record — Obama acknowledged some sympathy with those who "might be skeptical" of the stimulus. Vast sums already have been spent or committed by Washington in an attempt — largely unsuccessful so far — to get credit, the lifeblood of the American economy, flowing freely once again.

Such statements are meant to appeal to both parties' budget hawks, whom Obama wants to win over so that approval of a package draws wide, bipartisan support in the Democratic-led Congress.

Republicans Mitch McConnell of Kentucky and John Boehner of Ohio respectively warned that a trillion dollar price tag is too large and Obama should avoid setting policy with the package, as opposed to remaining focused on short term stimulus. Republicans are known to be wary, for example, on spending for long-term "green" technology programs.

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