The Obama administration is hailing recent improvements in U.S. economic indicators, but says more must be done to put the United States on solid economic footing. Treasury Secretary Timothy Geithner proclaimed the risk of financial collapse to be over, but said the United States must shrink its massive national debt.
Last week saw positive U.S. economic news, with increases in home sales and housing prices, a jump in manufacturing activity, a drop in new jobless claims, and a new growth figure showing the economy shrinking far less than had been anticipated.
Treasury Secretary Geithner welcomed the news.
"There are signs the recession is easing," Geithner said. "And, if you think about where we were at the end of last year -- the economy in free fall, a financial system on the verge of collapse -- the actions this administration has taken have been very effective in helping stabilize conditions, help repair the financial system, bring down the cost of credit."
Geithner was speaking on ABC's This Week program. He was quick to add that many Americans continue to feel economic pain.
"Unemployment is very high in this country," Geithner said. "We need to make Americans more confident about their future."
Geithner said one key to a sustained economic recovery will be to reduce U.S. federal deficits and stop adding to America's national debt.
"We will not get this economy back on track, recovery will not be strong and sustained, unless we can convince the American people that we are going to have the will to bring these deficits down," Geithner said."
The Treasury secretary said reforming America's costly health care system is one of several steps needed to put America's fiscal house in order. He did not rule out tax hikes to cut the deficit, once the U.S. economy is growing.
The Obama administration's efforts to combat the recession include an $800 billion economic stimulus package enacted earlier this year. For all the government's initiatives, Geithner said it is the private sector that will lead the United States to recovery.
But Republicans accuse the Obama administration of swelling government and burdening private industry and ordinary citizens. Indiana Congressman Mike Pence spoke on Fox News Sunday.
"We have lost two-million jobs since the stimulus bill was passed," Pence said. "And I think what we are seeing in the economy right now is the inherent resilience of the American economy and the American people. What we ought to be doing is pursuing the kind of broad-based prescription for recovery and stimulating this economy that has always worked: fiscal discipline in Washington and tax relief for working families, small businesses and family farms."
At more than 18 months, the recession is the longest suffered in the United States since World War Two. Economists say unemployment will likely continue to rise for several months even after a recovery begins.