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Obama Weighs In on Economy, Looks to Pennsylvania

March 17, 2008 at 6:25 PM EDT
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In an in-depth interview, Sen. Barack Obama weighs in on the current U.S. economic crisis, the war in Iraq, issues of race and gender and his run for the Democratic presidential nomination. Obama also looks ahead to next month's contest in Pennsylvania against Sen. Hillary Clinton.

JIM LEHRER: And now our Newsmaker interview with Senator Barack Obama.

Gwen Ifill talked to the Illinois Democrat this afternoon at Beaver County Community College in Monaca, Pennsylvania.

GWEN IFILL: Senator Obama, welcome.

SEN. BARACK OBAMA (D), Illinois: Thank you.

GWEN IFILL: The president said today we are in challenging times. You said yourself that we are teetering on the edge of a potential crisis.

When you watched what the Fed had to do over the weekend, what do you think as president you would do in reaction to this kind of crisis?

SEN. BARACK OBAMA: Well, obviously, there are some short-term steps that we have to take. And what we have is a crisis of confidence in the credit markets, partly because people don’t know where the bottom is, in terms of bad debt that’s out there, not only from the subprime lending market, but also the credit card markets and the title loan markets. And all those potential bad debts are making people afraid to do ordinary business with companies that are very credible.

The Fed has taken some good steps. I think they have been innovative in trying to pump liquidity into the market. I think assisting JPMorgan Chase to purchase Bear Stearns was a sound decision, given that the alternative was probably Bear Stearns going under, which could have triggered a domino effect in the market.

But what I think we have to do is to get a floor under our housing market. And so I’m working with Chris Dodd, the chairman of the Banking Committee, to make sure that we’ve got a system to shore up the mortgage-lending process and make sure that people aren’t losing their homes.

That will provide some assurance that there’s not going to be just a bottomless pit of bad debt out there. And hopefully, banks, then, and other financial institutions will start having a little more confidence and start doing the normal business that needs to be done.

GWEN IFILL: When does it become a Fed bailout and when is a line when it becomes a taxpayer bailout?

SEN. BARACK OBAMA: Well, I’m not sure there’s a bright line. You know, I think that if Congress is starting to appropriate money, then it’s a taxpayer bailout.

And there are some innovative things that we can do to make sure that we are helping people who need help and deserve help, but recognizing that there are some people in the financial system that took enormous risks and probably need to be punished for having taken some bad decisions.

They were getting a lot of upside. They were getting huge $100 million, $200 million bonuses. And they should take some hits. And we don’t want to bail them out.

On the other hand, the ordinary person who’s in their home, partly because of a deceptive loan or because their wages and incomes haven’t gone up over the last seven years that George Bush was in office, those folks need some relief.

And that’s why I would focus on the short-term problems that we’re having, but also on the long-term structural problems that we’ve had with our economy. We have to start providing more income, more help, more support to middle-class and working-class families. That will actually make the entire economy strong.

Race, gender controversy 'distract'

Sen. Barack Obama
[I]t would have been naive for me to think that I could run and end up with quasi-frontrunner status in a presidential election, as potentially the first African-American president, and that issues of race wouldn't come up.

GWEN IFILL: Anybody watching this campaign for the last week to 10 days would think it was all about gender and race between what Geraldine Ferraro said and what your former pastor, Jeremiah Wright, said. Do you look at this and think that maybe, with a woman and a black man running against each other, that this was going to be an inevitable conversation?

SEN. BARACK OBAMA: You know, I'm not sure if it was inevitable. I think that there's no doubt that race and gender are powerful forces in our society. They always have been.

And I think it would have been naive for me to think that I could run and end up with quasi-frontrunner status in a presidential election, as potentially the first African-American president, and that issues of race wouldn't come up any more than Senator Clinton could expect that gender issues might not come up.

But, ultimately, I don't think it's useful. I think we've got to talk about it, and I think we've got to process it, but we've got to remind ourselves that what we have in common is far more important than what's different and that, if we're going to solve any of these problems, we've got to come together and bridge our differences in ways that we just have not bridged them before.

GWEN IFILL: Is that the speech you'll be giving tomorrow in Philadelphia?

SEN. BARACK OBAMA: That will be a major focus of it.

GWEN IFILL: You have also cast this as a generational distinction, the sorts of things that Reverend Wright said being the baggage of fiercely intelligent African-American men of his generation and Geraldine Ferraro's, as well. When does one person's baggage become another person's memory/history?

SEN. BARACK OBAMA: Well, you know, look, there's a continuum. But I think that, you know, when you look at somebody like a Reverend Wright, who grew up in the '50s or '60s, you know, his experience of race in this country is very different than mine, in the same way that Geraldine's experience being an intelligent, ambitious woman, you know, is very different than a young woman who's coming up today and potentially has a different set of opportunities.

Now, we benefit from that past. We benefit from the difficult battles that were taken place. But I'm not sure that we benefit from continuing to perpetuate the anger and the bitterness that I think at this point serves to divide rather than bring us together.

And that's part of what this campaign has been about, is to say, "Let's acknowledge a difficult history, but let's move forward in a practical way to get things done."

GWEN IFILL: Has this been damaging to your campaign?

SEN. BARACK OBAMA: Oh, you know, I would say that it has been a distraction from the core message of our campaign. I think that part of what has always been the essence of my politics -- not just this campaign, but my life -- is the idea that we've got to bring people together.

Now, part of that is biographical, as somebody who comes from a diverse background, with a white mother and an African-American father, growing up in Hawaii and Asia. You know, it's in my DNA to believe that all of us have something fundamental in common, and that's part of what makes America so special.

And so to the extent that, you know, the conversation over the last couple of days has been dominated by some stupid statements that were made by Reverend Wright, but also caricatures of Reverend Wright and the Trinity United Church of Christ -- which, by the way, is part of a denomination that is overwhelmingly white -- you know, I think that that has distracted us from the possibilities of moving beyond some of these arguments.

GWEN IFILL: When Senator Clinton sat down with my colleague, Judy Woodruff, for a conversation like this, she said that her election would be shattering the highest and hardest glass ceiling. Would yours be doing the same?

SEN. BARACK OBAMA: Oh, you know, I would say it would be pretty significant if we had an African-American president. I don't want to get into a contest in terms of which would be more significant; I think that either one would be significant.

So, ultimately, the question for the American people is: Who do they think is best equipped to actually solve the problems that we face right now?

And if you as a voter, regardless of your race or gender, decide that it's Senator Clinton, then you should vote for Senator Clinton. If it's me, you should vote for me. And if it's John McCain, you should vote for John McCain.

GWEN IFILL: But you don't think so?

SEN. BARACK OBAMA: I don't think what?

GWEN IFILL: John McCain.

SEN. BARACK OBAMA: Well, no, John McCain and I have some very real differences. He's somebody I admire greatly. He is somebody who is obviously an American hero.

But he essentially wants to perpetuate George Bush's policies, both on the economy and continuing tax cuts for the wealthy, and on Iraq, where he's stated he's willing to stay for as long as 100 years.

Judgment versus experience

Sen. Barack Obama
[A]ll of us have people in our lives who we meet, we get to know, and in some cases form friendships with who end up getting themselves into trouble or say things that we don't agree with.

GWEN IFILL: The distinction between you and Senator Clinton that's been drawn by both of you over the last several weeks has been judgment versus experience, so let me ask you about your judgment on some issues, not only Reverend Wright and your association with him over the years, but also Tony Rezko, who you've talked a lot about recently, the Chicago developer who is now on trial on federal charges.

Do you think that your association with those two people or people we don't know about would raise questions about your judgment?

SEN. BARACK OBAMA: Well, no. Look, all of us have people in our lives who we meet, we get to know, and in some cases form friendships with who end up getting themselves into trouble or say things that we don't agree with.

And, you know, probably what's true is, because I haven't been in Washington as long as Senator Clinton or others, that, you know, I have not distanced myself from these people for as long of a period of time as somebody, you know, more steeped in Washington politics might have.

But keep in mind, on all these issues, there's no allegations that I've done anything wrong. Just as in the situation with Reverend Wright, there's no allegation that I said something that was inappropriate.

And so I think the American people recognize that all of us have friends or associates or people who we meet along the way who are not ideal or perfect, but that's part of -- you know, part of what life is about.

GWEN IFILL: Let's talk about political judgment. Neither of these are new issues. Are these things you could have laid to rest some months ago?

SEN. BARACK OBAMA: Well, no. I mean, part of the reason that I went in to talk to the Chicago papers about the Rezko matter was there was the suggestion that we hadn't laid it to rest.

And, in fact, I was before the editorial board of the Chicago Tribune and the Chicago Sun-Times for a combined three hours. And, in fact, we had answered almost every question that they had raised previously.

And the Chicago Tribune issued a very lengthy editorial afterwards indicating the fact that, "Well, you know what? He has actually disclosed exhaustively what this relationship was." And it was one in which I had nothing to do with the wrongdoing that Mr. Rezko is accused of.

I understand, though, that I'm now a presidential candidate. So having done this, you know, six or nine months ago, it was probably important for us to do it again. And I suspect when I'm the nominee of the Democratic Party, you know, the same crop of questions will come up. We'll have to do it again three months from now.

War decision provides a contrast

Sen. Barack Obama
[I]f I had had my way, we would not be in this war. And so I think Senator Clinton has a lot of chutzpah, as they say, to in some ways suggest that I'm the person who has not been clear about my positions on Iraq.

GWEN IFILL: On Iraq, Senator Clinton gave a speech today in which she accused you of being all about words and not about substance in Iraq. Five years, the anniversary is upon us.

Do you think it's likely that we're going to be there longer or shorter? Will either Democrat be able to fulfill the promises of phased withdrawal in a timely fashion?

SEN. BARACK OBAMA: Well, first of all, I think it's important to address directly what Senator Clinton said. I mean, this is somebody who authorized the war, who continues not to want to claim that vote that sent us into war.

If we had -- if I had had my way, we would not be in this war. And so I think Senator Clinton has a lot of chutzpah, as they say, to in some ways suggest that I'm the person who has not been clear about my positions on Iraq. I have been opposed to this war from the start.

What I do believe is we've got to be as careful getting out as we were careless getting in. And that means, I believe, a phased redeployment, with a timetable, with a pace of about one to two brigades per month, pulling our combat troops out, but also redoubling our diplomatic strategy inside Iraq, as well as with the regional players, including Iran and Syria.

It means dealing with the humanitarian issues involved. And, by the way, I'm the only person who's issued a detailed plan to deal with the potential fallout as we are withdrawing. So I've talked about not only increases in humanitarian aid, but also getting the international community to set up a commission to monitor potential war crimes, to ensure that those who engage in them are prosecuted.

You know, those are the kinds of concrete steps and planning that should have been done, have not yet been done. And, unfortunately, neither Senator McCain nor Senator Clinton seems to recognize what an enormous strain this has placed on our efforts in Afghanistan, as well as our efforts around the world.

Looking to Pennsylvania

Sen. Barack Obama
[I]n terms of Pennsylvania, I think that there's no doubt that Senator Clinton is favored. Like Ohio, she's got a very popular Democratic governor who is rallying a lot of institutional support for her.

GWEN IFILL: We sit here today in Pennsylvania. Senator Clinton has said that you are not capable of winning the big states that you need to win in order to triumph against a Republican nominee in November. What are your chances here in Pennsylvania?

SEN. BARACK OBAMA: Well, let's first of all talk about this notion of winning big states. I won my home state of Illinois. That's a big state. I won Virginia. Last I checked, pretty big state. Georgia, big state, Minnesota, Missouri, Colorado, you know, these are all big states.

What Senator Clinton really means is, is that she's won certain states and those are the states she's decided are important is the ones that she's won.

So in terms of Pennsylvania, I think that there's no doubt that Senator Clinton is favored. Like Ohio, she's got a very popular Democratic governor who is rallying a lot of institutional support for her. And we've got our challenges.

But we've had our challenges throughout this campaign. We always have to start from the grassroots and the bottom up, getting people involved, getting people engaged.

And ultimately, I think the people of Pennsylvania who are concerned about who can deliver on health care, who are concerned about making sure that we make college more affordable, that want to see infrastructure invested in and want to see an energy policy that actually works, not only to reduce our dependence on foreign oil, but can generate jobs and a green economy, people who are looking for those changes here in Pennsylvania I think can take a look at my track record and say, "Here's a guy who doesn't take PAC money, doesn't take federal lobbyist money, has been about change, knows how to bring people together, and is less likely to polarize the electorate."

And so I think we've got a very good chance.

GWEN IFILL: You talk about polarizing the electorate. I wonder if you worry that the debate that we're in now, including the standoffs over what's going to happen to the delegates and what's going to happen to you and to Senator Clinton and all these other issues, I wonder if you worry that's going to alienate a lot of these new, energized voters who have been brought to the campaign for both of you.

SEN. BARACK OBAMA: No, because I think I can bring them in afterwards, after this, you know, contest is over, based on what was the starting premise of campaign and the reason we've done so well, which is that I think the American people have a lot more in common than our politics reflect.

And they are weary of the same arguments and the same debates that we've been having for years and years now. They want to move forward.

And, look, you know, there's no doubt that it would be great if we had already wrapped up this nomination, that we could have a nice, clean, clear debate with John McCain at this stage.

But as we travel all across the country, we've seen huge surges in Democratic turnout. We've seen independents and Republicans who are disenchanted in some cases opting for a Democratic ballot.

I'm confident that going into the general election there's going to be a clear choice between the future, represented by our campaign, and the past that John McCain has embraced when he embraced George Bush.

GWEN IFILL: What's going to happen in Michigan and Florida?

SEN. BARACK OBAMA: I am sure that we're going to get it resolved. Now, how it's going to get resolved, I'm going to leave it up to the DNC. We've made our suggestions in some cases.

But the key idea is that the delegates in Michigan and Florida should be seated. They should be seated, but they should be seated in a way that is fair for both the campaigns.

GWEN IFILL: Senator Barack Obama, thank you so much for joining us.

SEN. BARACK OBAMA: I had a great time. Thank you, Gwen. Good to see you.

JIM LEHRER: Late this afternoon, the Associated Press reported that Florida Democrats have abandoned plans to re-do the primary with a mail-in vote.

In our online Insider Forum, Leon Panetta and Reverend Jesse Jackson are taking your questions on the road ahead for the Democratic candidates. To participate, just go to