President Bush on Thursday cited “some unsettling times” in the U.S. housing and credit markets as he sought to assure jittery Americans that the economy basically is in good shape despite worries about a recession.
“I say that the fundamentals of our nation’s economy are strong,” Bush told a White House news conference.
He denounced as “a sorry deal” and “disgusting” a newspaper ad by MoveOn.com that mocked Gen. David Petraeus, the top U.S. commander in Iraq. It accused Petreus of “cooking the books” on Iraq and asked: “General Petraeus or General Betray Us?”
Asked about lack of political progress in Iraq, he said, “Part of the reason why there’s not this instant democracy in Iraq is because people are still recovering from Saddam Hussein’s brutal rule. Sort of an interesting comment, I heard somebody say, `Where’s Mandela?’ Well, Mandela’s dead because Saddam Hussein killed all the Mandelas.”
It was a reference to the charismatic former leader of South Africa who helped reconcile his country after decades of racial division. Mandela is still alive.
Bush said that inflation is down, markets are steady, unemployment is relatively low, exports are up and corporate profits “seem to be strong.”
“There is no question there are some unsettling times in the housing markets and credits associated with the housing market,” the president told reporters at a White House news conference. But he said he didn’t see that spreading to the broader economy.
Some economists suggest the housing slump could lead to a recession even in spite of action earlier this week by the Federal Reserve to cut short-term interest rates by a half-percentage point.
Bush said he was optimistic about the economy. “I would be pessimistic if I thought Congress was going to get their way and raise taxes,” he added.
Pressed on whether he was concerned that the nation was nearing a recession, Bush said, “You need to talk to an economist.”
On the subject of Iraq, Bush said there was progress in local communities in Iraq but that people are disatisfied with the central government.
Bush opened the news conference with a statement challenging Democrats on their proposal for a $35 billion increase in a children’s health insurance program. Bush has threatened to veto the bill.
The $35 billion increase for the State Children’s Health Insurance Program, called SCHIP, would bring total spending to about $60 billion, or twice the level sought by the administration.
The president urged lawmakers to send him a simple extension of the current program – which expires at the end of this month – if both sides cannot agree on terms of a new measure.
“Members of Congress are putting poor children at risk so they can score political points in Washington,” Bush said. He said that “more than a million children could lose health coverage” if the program is allowed to expire.
Bush said it was important to take seriously threats being made by Iranian President Mahmoud Ahmadinejad, but that he was committed to working with other nations to convince the Iranian regime to peacefully give up any ambitions it has in developing a weapons program.
“The reason why is because it’s very important for us to take the threats coming out of the mouth of the president of Iran very seriously,” he said. “This is a person that consistently talks about the use of force on Israel, for example, and Israel is our very firm and strong ally.”
He was asked about a recent statement by France’s foreign minister that the international community should prepare for the possibility of war in the event Iran obtains atomic weapons – although he later stressed the focus is still on diplomatic pressures.
“I have consistently stated I am hopeful we can convince the Iranian regime to give up” any nuclear ambitions it has, Bush said.
He also defended the local New York officials’ decision to deny permission to Ahmadinejad to lay a wreath at Ground Zero next week. “I can understand why they would not want somebody that’s running a country that’s a state sponsor of terror down there at the site,” the president said.
Bush spoke out for the first time about the case in Jena, La. He said the FBI is monitoring the situation, adding: “All of us in America want there to be, you know, fairness when it comes to justice.”
Asked later how he responded to those who criticized him for not speaking out on the emotional case, Bush said it is an ongoing trial. “I feel strongly that there ought to be fair justice,” he said. “I just spoke out on it.”
Bush repeatedly refused to comment on reports that Israeli planes guided by ground forces attacked an installation – believed to be the beginnings of a nuclear project – in northern Syria on Sept. 6.
Asked about whether North Korea was providing nuclear assistance to Syria, Bush said, “We expect them not to.”
On other topics, Bush:
-Said his “feelings are not hurt” by criticism leveled at him in a new book by former Fed Chairman Alan Greenspan. “I respectfully disagree with Alan Greenspan when he says this administration didn’t handle the fiscal issues we faced in good fashion,” Bush said. Greenspan accused Bush of runaway spending and putting politics ahead of sound economics.