Biden on the Record: Progressive Governance Conference

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As Madam President has pointed out, we — 25 percent of the world’s GDP is the United States. So that if we do not prime the pump, if we do not get our engine running again, we all have a problem, particularly — particularly less-developed countries.

And so we are aggressively pursuing a domestic policy agenda that I will elaborate on in a second, but we’re thinking globally, as well. An important part of the G20 agenda is beginning the discussion about coordinated policies to reduce the systematic risk that we now all understand exists in global markets. A global market in the year 2009 is fundamentally different than what a global market was in the year 1980, or 1990, or even 1995.

And so I’d like to share with you our administration’s economic agenda. And we’re addressing this crisis in four parts: First, a recovery package. Now, I might add, we talk about politics — we all understand we’re all politicians around this table. I think that’s a good thing, not a bad thing. I’m proud of it. But we’re all politicians. And we understand how difficult it is to take what are very complicated notions and explain them to even very well-educated portions of our public.

Who ever talked about derivatives before? How are we explaining to people how complicated the international financial system is, and international monetary policy? It’s a complicated thing to communicate to well-educated constituents.

And so this recovery package was difficult for us to start with, because we inherited a deficit of $1.2 trillion. Even in America, that’s a lot of money — $1.2 trillion. So this recovery package, already approved by Congress, was to restore economic demand. And in the face of this deficit, we went out and said, by the way, we want the Congress to appropriate and we want to spend over the next 18 months another $787 billion, adding initially to the deficit.

In the face of this deep recession, we passed the largest stimulus — fiscal stimulus package in the history of our country — I’d suggest maybe in the history of the world. And since the Great Depression of the ’30s, our country has widely accepted the practice of temporarily pacing the missing private sector demand with public sector demand.

And we are — it’s projected that for at least the next two years in our country that public sector demand will be off by at least a trillion dollars per year. And so there’s nothing ideological about this; it’s just a practical approach, that when a trillion-dollar demand is taken out of the economy, it need be replaced, at least in large part in order to stimulate the economy. And that’s what we did with this $787 billion package for this year.

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