Obama: Bank Regulators May Have Gotten Too Tough
President Barack Obama said on Friday that regulatory oversight of the country's banks might now be erring too much on the side of caution, potentially hindering the flow of credit to small businesses.
"The banks feel as if regulators are looking over their shoulder, discouraging them from lending," Obama told a town-hall style meeting in Elyira, Ohio during a trip to promote his jobs and health care policies.
Obama said it was not his intention to interfere with bank supervision. But he had told Treasury Secretary Timothy Geithner to make sure that the country has not "seen the pendulum swing too far", with regulators now being too tough after being too slack in the past.
On other issues, it was a combative Obama that exhorted Congress to pass a new job-creation bill, taking a populist appeal to America's recession-racked Rust Belt in an effort to recapture the excitement of his campaign.
Obama weaved us-against-them rhetoric into his appearances, telling a town hall audience that he "will never stop fighting" for an economy that works for the hard-working, not just those already well off.
He said a jobs bill emerging in Congress must include tax breaks for small business hiring and for people trying to make their homes more energy efficient — two proposals he wasn't able to get into a bill the House passed last month.
And he used the word "fight" or some variation of it over a dozen times. The House-passed $174 billion stimulus package faces a stern test in the Senate, in part because it is financed with deficit spending.
With the town hall meeting as well as tours and impromptu visits the people, Obama's day had the feel of a day from his campaign. He grinned, bantered and joked his way through the day, followed by campaign videographers.
After the upset win by Republican Scott Brown in a special Massachusetts Senate election this week — a victory spurred in large part by an anti-establishment sentiment — the White House was well aware that neither Obama's agenda nor the electoral prospects for fellow Democrats this fall can be taken for granted.
So in his at the town hall meeting at Lorain County Community College near Cleveland, the president assailed Washington and Wall Street alike, hoping to connect with public's frustration and position himself as the solution — not the problem.
He strongly defended unpopular actions he has taken to bail out banks and insurers and to rescue automakers from collapse. Such measures have not gone over well in many quarters, and have been derided as moves that expanded government intervention and swelled the deficit.
The measures were seen as a helping hand for Wall Street while many on Main Street walked the unemployment lines.
Obama said that propping up the financial industry was as much about regular Americans as wealthy bankers. "If the financial system had gone down, it would have taken the entire economy and millions more families and businesses with it," he argued.
Similarly, allowing GM and Chrysler to go under might have satisfied calls to force businesses to reap the consequences of bad decisions.
But he also said, "Hundreds of thousands of Americans would have been hurt, not just at those companies themselves, but at other auto companies and at their suppliers and dealers, here in Ohio, up in Michigan, and all across this country."
Obama made a repeated point of criticizing Washington, too — saying that one can get a "pretty warped view of things" from inside the capital city, blasting special interest power and emphasizing repeatedly that he badly wanted to escape the confining nature of the White House.
He sought to demonstrate understanding for the economic uncertainty that lingers in many American homes and businesses despite some improvements in the economy overall.
"Folks have seen jobs you thought would last forever disappear. You've seen plants close and businesses shut down," Obama said. "I've heard about how the city government here is bare bones. And how you can't get to work or go buy groceries like you used to because of cuts in the county transit system."
He promised to help. "I'll never stop fighting for you," he said. "I'll take my lumps, too."
The choice of Ohio was no accident.
It has unemployment slightly higher than the national average, with the state reporting before Obama landed in Cleveland that its rate had ticked upward in December, to 10.9 percent from 10.6 percent the month before. The national rate was 10 percent in December.
Ohio is also a political must-win — a state Obama won in 2008 and probably must win again if he is to get a second White House term.
In northeast Ohio, where steel mills have given way to rust, Obama toured EMC Precision Machining, based in Elyria, and visited with some of the 44 employees still on the factory floor. A year ago, the family-owned maker of custom-made machine products had 77 employees.
En route to the plant, his motorcade whizzed by scores of building either for lease or sale, a reminder of the economic hard times.
The president also made an unannounced lunch stop at Smitty's, a working-class tavern with wood-paneled walls and Bud Light bottles on the bar. He talked with some patrons and had a $4.35 burger, with lettuce, tomato and mustard, for lunch.
Later, accompanied by Gov. Ted Strickland, Obama toured a classroom at the community college where students were designing wind turbines.
Leaving the room, Obama almost walked into a turbine propeller. "I almost sliced myself in half," he joked. "Secret Service would've been unhappy."
Across the street from the town hall location were groups of anti-Obama protesters.
"He's done a lot, but they are all negative things," said Ray Angell, 65, of Twinsburg, Ohio, a conservative active in the anti-tax Tea Party movement, mentioning the stimulus package and climate change proposals.