Page last updated at 10:35 GMT, Thursday, 19 February 2009

Obama diary: Days 21-30

Barack Obama was elected on a message of change. Now he is in office, change is expected both in foreign and domestic policy. Here the BBC's team in Washington tracks developments in the first 100 days of the Obama presidency.

1735 EST Afghan problem

Adam Brookes
Adam Brookes: The commander of US and Nato forces in Afghanistan, General David McKiernan, says the fresh US combat troops to be deployed to Afghanistan will undertake operations in the south of the country.

He said they would used to "break the stalemate" in Helmand Province. Gen McKiernan was speaking to journalists at the Pentagon.

He appeared preoccupied with certain facets of the conflict. First, insufficient intelligence, surveillance and reconnaissance (ISR) capability to ensure a secure border with Pakistan. There are "hundreds" of unattended crossing sites between Pakistan and Afghanistan, he said.

Next, the continued existence of 'sanctuaries' for Taleban, al-Qaeda and related insurgents in Pakistan. And, also, the need for "governance" at all levels from village to nation.

1050 EST 'Under water'

Kevin Connolly
Kevin Connolly: When your mortgage is for a larger amount than your house is worth, the British say euphemistically that you are in "negative equity". The equivalent expression in America is more brutal and direct; you are "under water".

Mr Obama's housing rescue plan aims to help the flood waters recede a little around millions of American householders who are in that fix; it might be as many as one in six mortgage-holders.

The simplest part of the plan is to allow borrowers with the state institutions Fannie Mae and Freddie Mac to re-finance, taking advantage of rock-bottom interest rates, even if they didn't originally put down a large deposit.

But in a sense, the details don't matter.

Lots of Americans were horrified by the absence of a detailed plan in anything George W Bush said. They voted for interventionism, and Mr Obama is supplying it.

If fewer homes are repossessed, the market won't be flooded with properties being sold off cheap by the banks and values will stabilise.

And less widely reported today were the latest figures for new housing starts. They are down by 56.2% on last January.

Ordinarily, that would seem rather shocking but it does mean that the problem of over-supply is being corrected too, and in the long run that should help stem the catastrophic drop in house prices.

The market is beginning to correct itself. It doesn't mean an end is in sight, but at least we know what an end will look like when it comes.

1000 EST Afghan problem

Adam Brookes
Adam Brookes: Remarkable news emerging from Afghanistan today: An alarming number of Afghan policemen appear to be drug users, and British and Afghan forces destroy a large scale drug operation in Helmand.

It's a reminder of the complexity of the Afghan problem: Insurgency is intertwined with criminality where the Taleban meets the drugs trade.

The problem of the safe haven in Pakistan adds yet another dimension.

How will Obama's people shape a strategy that can untangle and address all these different threats?

Look for the National Security Council's strategy review, the one being written by Bruce Riedel.

This seems to be the most important of the various review efforts underway.

President Karzai seems hopeful of the Obama administration's new approach to Afghanistan.

But in Washington, Barack Obama's icy comment that Hamid Karzai seems "disconnected" from his country is still resonating.


1730 EST More troops to Afghanistan

Adam Brookes

Adam Brookes: The president announces his first military decision. An extra Marine Expeditionary Unit and Army Stryker brigade, along with support, will deploy to Afghanistan in the next few months.

That means perhaps 17,000 more troops, we're told, can look forward to many months in the beauty, filth and danger of the Afghan theatre.

Mr Obama had long promised an intensification of the US military effort there; commanders had long sought it.

But what we still do not know is how this deployment sits in the broader strategic vision the Obama administration is formulating for Afghanistan. That strategy is still under review in Washington. Expect results in March.

1615 EST Obama's bold words

Richard Lister

Richard Lister: So not the end, but the "beginning of the end" of this economic crisis, according to Barack Obama as he signed the American Recovery and Reinvestment Plan into law.

Bold words from a president who has acknowledged that his term in office will be judged on the success of his efforts to halt the impact of recession.

The speech he gave in Denver, Colorado, where he signed the bill, could have been an inauguration address with its lofty rhetoric about "remaking the American landscape", and references to previous Big Commitments by former Presidents Kennedy and Eisenhower.

By going to Denver, he was able to highlight the investment in renewable energy (which the state promotes) in the stimulus package and also avoid the mixed message that would have been sent if he had signed the measure in Washington, surrounded by Democrats and the bare minimum of Republicans - just three - who support this legislation.

1015 EST Repackaging the stimulus

Richard Lister

Richard Lister: Air Force One has just left for Denver, Colorado, where President Obama is going to sign the long-awaited and much battled-over stimulus bill into law.

Usually such signings are an inside-Washington job, with the president at the White House, surrounded by smiling members of Congress who supported the legislation, and perhaps a few token civilians as well.

Not this time. The usual parade of lawmakers will be absent, replaced by leaders of the kind of green energy companies that will get a boost from the American Recovery and Reinvestment Act.

The new president is trying to repackage this measure after weeks in which it has been seen simply as a political football, kicked between one chamber of Congress and the next.

He wants to remind people what this bill is actually for, and take the attention away from the politically bruising process that created it.

0600 EST Spotlight Japan

Kim Ghattas
Kim Ghattas: If the Japanese were worried they would be neglected by a Democratic administration, their fears have been put to rest.

Hillary Clinton is the first US Secretary of State to choose Japan as a first stop on a first foreign trip.

She used words like "vital" and "cornerstone" when speaking about the relationship with Japan.

And the country's Prime Minister Taro Aso scored the first invite to the White House for a foreign leader. He'll be meeting Barack Obama next week.

He may also be on his way out of government. So it may be just a symbolic gesture, but still an important one.

The Obama administration seems to signal that it will put much more emphasis on Asia.

Washington still needs its allies in Europe to help with problems like Afghanistan and the Middle East but the US needs all the help it can get, so reaching out to Japan and especially China is essential.

Countries in Asia will also be key to dealing with climate change and the global economic crisis.

Briefing reporters before Mrs Clinton left Washington, a senior state department official said the road to solutions for the problems of the 21st Century lies through Asia.

0500 EST Earthquake

Kim Ghattas
Kim Ghattas: It took 22 hours total door-to-door from Washington to Tokyo.

We ate pasta and meatballs on the plane, bought crisps at the airport in Alaska where we stopped to refuel (no, Sarah Palin didn't put on a welcome ceremony), and snacked on ginger snaps the secretary sent to us at the back of plane in a red tin box.

We compared Mrs Clintons' first trip to Colin Powell's, Madeleine Albright's and Condoleezza Rice's, we watched the film Juno and argued over who sat in which seat.

We grabbed a quick bite upon arrival in Tokyo, sent our stories from the main filing centre set up for travelling journalists and then collapsed in bed.

A few hours later, at 0430, I was woken by an earthquake.

Japan has earthquakes of various magnitudes very regularly, but it seemed particularly befitting on the day when Tokyo announced that its economy had shrunk at an annual pace of 12.7% during the October to December period.

Mrs Clinton and the Japanese officials she met emphasised that the world's two biggest economies would be working together to pull through the economic crisis.

These trips can be gruelling affairs where the travelling press is bussed around from one event to the other, without ever having time to wander around the city.

I managed to eat a bowl of fantastic Ramen noodles and Japanese gyoza dumplings in a small noodle bar and so, along with the earthquake, hopefully I can claim I've experienced Tokyo.


1415 EST - Bill Clinton's verdict

James Coomarasamy

Jamie Coomarasamy: On Presidents' Day, Barack Obama gets a thumbs up, more or less, from the last Democrat to occupy the Oval Office.

On NBC this morning, Bill Clinton said "I think he's off to a good start" - and that the Obama administration had handled the economic stimulus package well "given the fact they'd had to do it in a hurry".

His own experience, 16 years ago, was a bit different. Having set himself a target of 100 days to get his economic plan enacted, President Clinton initially failed to get a $16bn stimulus package (about 49 times smaller than Mr Obama's) through a Congress with a similar Democratic majority to the current one.

Like Barack Obama, he faced blanket opposition from House Republicans, but, unlike him, he failed to persuade any Senate Republicans to come on board. With a handful of conservative Democratic Senators failing to toe the party line, he had to wait until August to get the package passed.

Although there was talk at the time of the US facing its worst economic crisis for 50 years, the stimulus bill was almost a footnote to Clinton's main budget resolution, which he did get through quickly.

Interestingly, insider accounts from that period show a White House struggling to sell the need for a stimulus plan to the American public. No such problem for Obama, but probably not for the reasons he'd want.

Another political difference: Bill Clinton knew that Ross Perot, one of his 1992 election rivals, had struck a populist chord with his call for deficit reduction. No-one's talking about that at the moment.

1200 EST - Buying a car?

Kevin Connolly

Kevin Connolly: It is Presidents' Day in the US, the public holiday that began as a tribute to George Washington and was then expanded into a homage for the rather mixed bag of leaders who have followed him.

It is a big day economically - most stores have sales of one sort or another - but, above all, historically this was the day that marked the opening of the spring car-buying season. What a sign of the times that, this year, executives at GM and Chrysler will be finishing their reports to the government on how they can be made viable in the future.

They agreed to produce the reports after receiving interim bail-out money a few weeks back and it will be interesting to see how radical their plans are.

Will they argue that they may have to be less generous to the hundreds of thousands of former workers to whom they provide pensions and health care? Will GM contemplate bankruptcy to protect it from its creditors?

The US can't contemplate losing the auto-industry, which is fundamental to its manufacturing base - but maintaining it is going to be tricky and expensive. But then, isn't everything these days...


2200 EST Nationalise the banks?

Kevin Connolly
Kevin Connolly: Remember the concept of "too big to fail" - the idea that some financial entities were so important to the functioning of the American economy that the government didn't dare to allow them to fail?

Welcome to "too weird for words" - a conservative Republican senator suggesting that it might be necessary to nationalise America's banks.

Lindsey Graham of South Carolina has been warning that the option "shouldn't be taken off the table".

This is staggering stuff on the face of it - what a historical irony it would be if the United States followed its victory over the Soviet Union in the Cold War by duplicating its banking system.

The thinking is obvious. Largely thanks to their own greed and folly America's banks are weighed down by half-a-trillion dollars' worth of bad debts based on the crashing housing market. Maybe only the Federal Government is big enough to cope.

And maybe it's not so crazy. Many of the big banking reforms in American history followed financial crises (including the creation of the Federal Reserve) so we can expect things will change when the dust has cleared after this latest little difficulty.

1300 EST Honeymoon by air

Kim Ghattas
Kim Ghattas: Hillary Clinton is on her way to Asia and just before take off she came to the back of the plane to meet the reporters travelling with her. As the BBC's State Department correspondent, I'm on that plane, a C-32, and our very first stop on this long journey across the Pacific will actually be Alaska for refuelling purposes.

Sitting in the VIP lounge at the Andrews Air Force Base before take off, we met some her staff travelling with her, a few of them are well-known faces like Kiki McLean who was on her campaign and helped prepare for the confirmation hearing.

The team is clearly reaching out to the media and they'll score some points. For now, the honeymoon at the State Department continues.


1930 EST 'Transpacific' power

Kim Ghattas
Kim Ghattas: It's not heard very often in Washington but "transpacific" was the buzzword of the day ahead of Hillary Clinton's week-long trip to Asia.

In an interview with the BBC, she emphasised that America was not just a transatlantic power but also a "transpacific one".

Washington wants to deepen and broaden its ties with Asia and countries in the region will probably welcome that announcement.

Mrs Clinton said not enough attention had been paid to Asia in recent years. It is also the first time in decades that a US secretary of state chooses Asia as a destination for a first trip.

Europe may wonder where that leaves transatlantic ties, but President Barack Obama will be visiting soon and Vice-President Joseph Biden was just there.

Picking the destination of her first trip may have had to do with that, and also with the fact Mrs Clinton's special envoys have been touring the Middle East and Afghanistan and Pakistan.

So China, the economic crisis, and North Korea's nukes are the other top, pressing matters this administration has to deal with.

Mrs Clinton will be visiting the Middle East next.

Hillary and the media

Hillary Clinton went on a maximum exposure media blitz ahead of her trip to Asia.

She started with a speech at the Asia society, where she also took some questions, then she sat through about 20 minutes of questions from journalists during a conference call.

She did phone interviews with Voice of America (VOA), National Public Radio (NPR) and the BBC.

She will also get considerable coverage during the trip - she's expected to speak to local media at every stop and she will be leaving from Washington on a plane full of journalists.

I'll be travelling with the secretary to Asia and posting regularly here about what happens behind the scenes on such trips.

1545 EST Heading home to Chicago

Rajini Vaidyanathan

Rajini Vaidyanathan: President Obama will be heading home to Chicago this weekend, for his first trip back since he moved to Washington DC.

He will be making the most of what is a long weekend in the US; Monday is Presidents' Day, a national holiday. Wife Michelle and daughters Sasha and Malia will be in tow.

Mr Obama has often spoken of how he wants to stay in regular contact with his life and friends back home, to keep him in touch with the real world outside the Washington "bubble".

Aides to the president say he is planning a low-key trip, which will include a Valentine's dinner with his wife on Saturday and possibly a basketball game with some friends.

Last weekend, the Obama family took some time out of the capital when they travelled to the Camp David presidential retreat.

1430 EST The House votes

Richard Lister

Richard Lister: Deja vu? The House of Representatives has just voted in favour of a $789bn stimulus package - $30bn smaller than the one they passed earlier this year. This measure is the result of a compromise between the House and Senate - which voted for a $837bn bill and will vote on the smaller bill later.

Once again, no Republicans supported the bill in the House. Seven Democrats voted against it, while 11 opposed it last time.

This vote was a foregone conclusion in the House, where Democrats have a much more comfortable majority than in the Senate.

The smaller compromise bill has been a source of frustration among some House Democrats, who would have preferred more money to be spent on boosting America's economy, but the measure needs at least two Republican votes in the Senate and moderates there said they would only vote for the measure if it was under $800bn.

President Barack Obama is expected to sign the bill into law next week.

1215 EST Law of the market

Kevin Connolly

Kevin Connolly: Here's a further thought on the property market - the original root of all our problems - to cheer you into the Presidents' Day weekend holiday in the US.

I found this snapshot of one local property market in Florida, courtesy of the good people at the Orlando Business Journal.

It reports that in January the number of properties sold in Orlando was UP by 17.7% over the same period last year but the average price was down by a whopping 33.3%.

So - further evidence that the basic law of the market works. When the price of anything falls low enough, there will be buyers.

Orlando may be a particularly volatile market but those figures give you a feel for what's really happening out there.

In recent years, many people's sense of prosperity was built on a sense of their home having a high value. It made them happy, prepared to borrow and spend and keep the wheels turning. Now that sense has disappeared overnight: even people who have money are reluctant to spend.

On top of that, there are signs that perhaps one in six American mortgage holders owe more on their property than it is currently worth - they are under water in the jargon of American finance.

Timothy Geithner, the new US Treasury Secretary, was much criticised for the lack of detail so far in his housing rescue programme - but when you consider just how deep and complex the problems are, you can see why it's taking a while.


1700 EST Bad news for homeowners

Kevin Connolly

Kevin Connolly: At the heart of the bulging portfolio of problems inherited by the Obama administration of course was the housing slump - and today came news that it continues to worsen.

Average house prices fell by more than 12% between January 2008 and January 2009 - they now stand at $180,100.

The reason for the falling prices and values is simple. Banks and mortgage companies have now repossessed so many people's homes and put them back on the market (about 250,000 a month) that they're dragging down average sale prices.

Living near a house that's repossessed gives you the economic equivalent of the plague, because when it's sold off cheaply it drags your home value down by about $9,000.

The result is that maybe as many as one American family in six now lives in a house that's worth less than the mortgage outstanding on it.

That matters for two reasons - it makes some people really poor, when they're forced out of their homes - and it makes lots more people feel poor - and that stops them spending and keeps the cycle spiralling downwards.

1650 EST Peoria overshadowed

Adi Raval

Adi Raval: The event in East Peoria, Illinois, was somewhat overshadowed even before it began. Minutes before President Obama took the stage here at the Caterpillar plant, news came in that his commerce secretary nominee, Judd Gregg, had decided to withdraw his candidacy.

A group of White House reporters almost simultaneously looked around for a White House press aide to comment. The statement, when it came, spoke of a "change of heart" by Gregg over his ability to support Mr Obama's agenda.

But back to the speech. This event was purposely designed by the administration to be low-key, according to a White House official.

The speech was short on specifics but Mr Obama began to talk more about job losses than he has in recent days. A new poll by the Pew Research Center says: "The proportion of Americans citing jobs or unemployment as the nation's most important economic problem has more than quadrupled - from 10% to 42% - since early October, and job worries now far surpass concerns over the financial crisis."

The president spoke of how Caterpillar's financial problems mirrored those of the entire country. "If we fully devote ourselves through this ordeal... there will be a better day," he said.

1645 EST Another nominee down

Jonathan Beale

Jonathan Beale: Republican Senator Judd Gregg, picked by President Barack Obama for the job of commerce secretary, has withdrawn his nomination.

This is another blow for Mr Obama in trying to shape his cabinet. It's also a setback in the president's efforts to reach out to Republicans.

In a statement, Mr Gregg said it had become apparent during the vetting process that his appointment would not work because, he said, there were "irresolvable conflicts" on policy. He cited Mr Obama's stimulus package as an example; it has been widely criticised by Republicans who say it will lead to wasteful government spending.

Mr Obama has already lost four nominees for senior posts - and it's the second time a nominee has withdrawn from the post of commerce secretary. Just over a month ago, New Mexico Governor Bill Richardson withdrew his name following questions about his links to big business.

1350 EST Fancy working for Obama?

Rajini Vaidyanathan

Rajini Vaidyanathan: At the moment, the headlines are dominated by job closures rather than openings, but there's one area where there are still some opportunities.

The White House has today posted a jobs section on its website, inviting people to upload their CVs to the site. It says it is looking to fill "several thousand politically appointed positions in the Executive Branch", and is already interviewing for many of the upper level positions.

During the transition period, people were invited to submit their CVs to the website for consideration. More than 350,000 applicants applied back then, so we can expect competition to work for the Obama White House to be more than tough...

1330 EST In Peoria, Illinois

Adi Raval

Adi Raval: The Land of Lincoln welcomes back its favourite new son as Barack Obama visits East Peoria, Illinois, where he will hold another town hall meeting to highlight US financial concerns. Today's visit is to a factory run by Caterpillar, a global manufacturer of construction equipment which has shed more than 20,000 jobs just in the past two months.

White House officials tell me that the president will be introduced by a Caterpillar worker, Dan Armstrong, who might be out of a job by April. Caterpillar executives have said recently that the fiscal stimulus package plan championed by the president could allow for the company to re-hire some laid-off workers.

But the visit is not without some political controversy. The company and the Obama administration do not exactly see eye-to-eye on free trade issues or on provisions in pending legislation demanding the purchase of American products.

Unlike the campaign-style meetings in Indiana and Florida this week, White House officials say this event will only include 250 Caterpillar workers.

1230 EST First Lady fashion

Rajini Vaidyanathan

Rajini Vaidyanathan: For fashionistas it's the ultimate accolade - the front cover of Vogue magazine. Michelle Obama is to appear on the cover of the March issue, the second First Lady to do so, following Hillary Clinton in 1998.

In the pictures, taken by Annie Leibowitz, Michelle Obama wears a magenta silk dress designed by Jason Wu, who also created her inaugural ball gown.

In the accompanying interview, conducted before the Obamas moved into the White House, Mrs Obama talks about her family, her fashion tastes and First Lady duties. She discusses her role as "mom-in-chief" to daughters Sasha and Malia, promising to try to take them to school and get to know their teachers.

Unsurprisingly, given Vogue is a fashion magazine, she is also asked about her sense of style, something which has come under much scrutiny. The First Lady concedes that not everyone will like what she wears, saying she opts for practical outfits.

The article's author, Andre Leon Talley, says Mrs Obama selected the clothes for the fashion shoot. One sign, perhaps, of her independent mind.

1145 EST Running up debt

Kevin Connolly

Kevin Connolly: It's hard to make your voice heard here above the sound of clinking champagne glasses coming from Capitol Hill, but here's a sobering thought about the $789.5bn stimulus package now agreed by the Senate and the House of Representatives and due to be signed soon by President Obama: it is, of course, money that the United States doesn't actually have.

It is being "created" by altering the rules of the game to allow the National Debt to rise to a whopping $11.3tn.

For the technically minded, the budget deficit will now be running at around 14% of GDP.

Some American politicians used to argue that the country could grow itself out of those debts, but to do that it would have to enjoy double-digit growth for 75 years.

I don't want to spoil the party, but sooner or later someone's going to have raise taxes here - and by a lot. I hope I'm still around for THAT election campaign.

0945 EST Rethinking Afghanistan

Adam Brookes

Adam Brookes: The scale of Washington's rethink on Afghanistan is breathtaking. Large scale strategy reviews are taking place in Centcom, the defence department, the National Security Council, USAID and elsewhere.

The National Intelligence Estimate, in circulation for a while now, hovers, classified, in the background of the debate.

Richard Holbrooke, the President's envoy to Afghanistan and Pakistan is due in Kabul today - just a day after the attack on a government facility there which killed 26.

Meanwhile, the General Accounting Office in Washington reports that the US military may have lost track of hundreds of thousands of light weapons shipped to Afghanistan by the US and Nato countries in recent years.

These, presumably, are weapons that would have been used to arm the new Afghan security forces.


1615 EST Deal or no deal?

Richard Lister

Richard Lister: So it's all over - Democrats in the House and Senate (and White House) have finally agreed on a single stimulus package. Or have they?

The Senate Majority Leader Harry Reid and the other key negotiators involved in pulling a compromise deal together came out about an hour and a half ago to say they had reached agreement on a single measure which both the House and Senate could vote on (both chambers had previously approved different stimulus bills).

The Republican leadership says it won't stand in the way - although all but three Republicans are expected to oppose it.

But conspicuously silent is the Democratic House Speaker Nancy Pelosi - and President Barack Obama has not commented on this deal either.

Could it be that some leading Democrats worry the latest incarnation of the bill gives away too much in the name of keeping the three Republicans on board?

1330 EST No unqualified apology

Greg Wood: For those expecting US bank bosses to be skewered by members of Congress over multi-million dollar bonuses and extravagant office redecoration, this hearing before the House Financial Services Committee has been something of a disappointment.

Chairman Barney Frank was his usual forthright self, telling the eight assembled chief executives that they needed to understand how angry it made people that their banks had received so much taxpayers' money.

The bosses appeared to empathise, with acknowledgements of public "anger" and even "outrage" littering their prepared statements. But none of them made an unqualified apology for their part in helping to create the biggest financial crisis since the Great Depression.

John J Mack, the chief executive of Morgan Stanley, came closest, conceding that: "We didn't do everything right."

Vikram Pandit, the boss of Citigroup, which recently cancelled an order for a new $50m private jet, said he'd been slow to adapt to the new world order where banks are supported by taxpayers' money. He promised to do better in future.

But on this evidence, Wall Street still has some adjustment to do.

1245 EST Where are the fireworks?

Kevin Connolly

Kevin Connolly: The proceedings of the House Financial Services Committee are normally a little dry, but we expected fireworks when its members held to account the leading figures from Wall Street at the centre of the bail-out crisis.

Sadly those reckless, piratical Masters of the Universe whose folly got us all into this mess weren't available; instead we got eight serious, sober bankers doing a good job in difficult circumstances with the taxpayers' money.

Highlight of the day so far - chairman Barney Frank asking John J Mack of Morgan Stanley which part of his job he'd refuse to do if he didn't get a bonus - would he take longer lunches? Or leave early on Wednesdays?

Why, in other words, pay bonuses at all, let alone the $18bn Wall Street paid itself in what was hardly a good year last year? Mr Frank generously said there'd be no charge for his consultancy services.


2100 EST Unapologetic bankers?

Kevin Connolly
Kevin Connolly: Now that Britain's bankers have set the tone with their (admittedly rather stilted) apologies for their follies and failures, what price a round of grovelling apologies from the eight banking CEOs due to appear before the Financial Services Select Committee?

Don't hold your breath. True, the eight are preparing to travel by public transport rather than corporate jet (remember the guys from Chrysler, Ford and GM bringing the company begging bowls here to DC in their private planes?).

But there have not been too many signs of contrition from the banking industry here.

First there was John Thain of Merrill Lynch who spent $1.22m re-decorating his office - including $13,000 on a chandelier (he paid it back after it made it into the papers.)

Then came news that Wells Fargo, a bank which received $25bn from the bailout fund, was planning a trip to Las Vegas for some of its staff.

There was outrage as you would expect, and the trip was duly cancelled.

But Wells Fargo had to have the last word - taking out expensive ads in leading newspapers to complain that the media's one-sided coverage had hurt deserving employees and the tourist industry.

If any of the big eight are feeling similarly feisty, it should be an interesting day up on the Hill.

1600 EST Obama's a TV hit

Rajini Vaidyanathan

Rajini Vaidyanathan: So, the figures are in... almost 37 million Americans tuned into President Obama's first prime-time press conference last night. These figures from Nielsen Media Research don't include people who watched it on cable television channels, like some of the 24-hour news channels, so expect the actual figure to be higher.

To put this into context, the audience was higher than the season premiere of American Idol, the most watched US TV show, which attracted an audience of 30.1 million.

Right now you could say there are many parallels between the president and the reality show. Having won an election on a huge wave of anticipation and excitement, it is now down to him to prove he can perform.

There's always huge expectation around the first album, but will it be a hit?

1500 EST Live blogging the president

Rajini Vaidyanathan

Rajini Vaidyanathan: Another new media technique has been employed by President Obama's team. Today's town hall-style meeting at Fort Myers in Florida was "live blogged".

Could an official White House Twitter be next?

1250 EST 'Campaign trail' Obama

Adi Raval

Adi Raval: This reminds me more of Mr Obama on the campaign trail than as president. He entered this standing-room only crowd to the all too familiar chants of "Yes, we can, yes, we can".

Save for the palm trees and the warm temperature, this event was similar to ones he held in Iowa and New Hampshire more than a year ago.

But back to the speech. It is increasingly apparent that President Obama is trying to present himself as an outsider to the ways of Washington. He received one of his biggest applause lines when he said, off the cuff, that he did not agree with all aspects of the stimulus proposal in part because it was "produced in Washington".

Although the Fort Myers area is considered moderately conservative, the crowd here is clearly in favour of this president.

A senior administration official told me to expect more of these economy-related events in the coming weeks. "Get prepared for a lot more domestic travel," the official said.

1230 EST More talk on Iran

Kim Ghattas

Kim Ghattas: There's yet more talk about talk today on Iran. Obama said he saw the possibility of diplomatic openings with Iran in the coming months.

Iran's Mahmoud Ahmadinejad responded by saying that Iran was ready for talks in a "fair atmosphere with mutual respect". Hillary Clinton reacted by saying she hopes there will be an opportunity for the US and Iran to develop a better understanding of each other.

It's unclear, though, when all the talk will be replaced by the face-to-face meetings mentioned by Obama.

Those kinds of meetings would not be totally new. The US ambassador to Iraq, Ryan Crocker, met his Iranian counterpart in Baghdad in May 2007, but the talks were focused solely on Iraqi security issues.

This is why a lot of people, especially the Europeans, are wondering what sort of engagement Obama is planning exactly.

A lot is still unclear yet about this administration's plans for Iran except perhaps for one thing - it's likely to be central to any wider Middle East initiative. I'm told that the Middle East tour of US envoy George Mitchell was as much about Israeli-Palestinian peace and Gaza as it was about Iran, if not more.

1100 EST Obama in Florida

Adi Raval

Adi Raval: President Obama continues his pitch to the American people to support the fiscal stimulus package here in Fort Myers, Florida. The area was selected by the White House for a presidential event because Fort Myers has the highest foreclosure - or repossession - rate in the country.

According to administration sources, the president will spend a good portion of his remarks before 1,500 residents talking about the second part of his overall economic rescue package - focused on home ownership and assistance with troubled mortgages.

And the president will be joined on stage by a rather unlikely ally. Charlie Crist, the popular Republican governor of Florida, who supported John McCain during the election campaign, will introduce Mr Obama.

There's less than an hour to go now before the event starts and already the auditorium here at the Harborside Event Center is almost completely full.

0245 EST What about Iran?

Kim Ghattas

Kim Ghattas: In the dying days of the Bush administration, the question was "should we engage Iran?". Under Obama it has become "how do we do it and when?"

For a few weeks now, people in Washington and probably in Tehran have been waiting for Obama to announce he is appointing someone to handle the Iran portfolio.

The man for the job is apparently Dennis Ross, a former US envoy to the Middle East. It has yet to be officially announced but sources at the state department tell me it is a done deal, it's just a question of timing.

Maybe, maybe not. The delay underscores how vexing the Iran file is for the US.

How indeed do you engage a country with which you have had no diplomatic ties since 1980? Act now and risk empowering President Ahmadinejad before the Iranian elections, as he claims steadfastness eventually brought America around?

Or wait and hope that the more moderate Khatami will be the interlocutor?

Observers in Washington say Ross - who has written forceful opinion pieces about how to deal with Iran - is a smart pick if Obama is planning something far-reaching. His credentials will help do away with any claims that the president's efforts to engage are naive.


2130 EST, Washington

Kevin Connolly
Kevin Connolly: Mr Obama's lightning trip to Elkhart County, Indiana, provided him with food for thought, and material for his prime-time televised news conference - throwing the glare of the global spotlight on a troubled place with an unemployment rate double the US average at 15.3%.

The president noted that local TV there now carries announcements giving the locations of food banks - even though the food banks are struggling to meet demand.

But Elkhart - home of the American RV (mobile home) industry - provided an illustration of one of the nuts and bolts problems underpinning the recession.

Customers who want to buy RVs cannot get a loan even if their credit is good.

Even the most solid companies in the industry cannot get money from their banks. The financial institutions - who caused most of these problems - are compounding them by refusing to start lending again.

Mr Obama promised we would hear the government's plans for dealing with that from Treasury Secretary Timothy Geithner on Tuesday.

It is going to be complicated, and it will not be as dramatic as the legislative mud-wrestling up on Capitol Hill - but it could be one of the most important announcements of the year.

1945 EST White House

Adam Brookes

Adam Brookes: A packed East Room. Under chandeliers, the White House press corps is excited, even raucous. The atmosphere belies the seriousness of the topics.

Mr Obama will address the need to pump life into the world's largest economy, and the difficulty of building consensus in Washington.

1530 EST Leaving Elkhart, Indiana

Adi Raval

Adi Raval: "I've got to go back to Washington to convince everybody to get moving on this package," said President Obama as he left the stage in Elkhart, Indiana, for the short flight home.

But did he convince the roughly 2,500 people who gathered to hear his remarks? It depends who you ask.

For Rob White, life-long resident of Elkhart, the president did a good job of making a bridge between Democrats and Republicans. But asked whether the stimulus package would provide the kind of economic activity needed, Mr White said the key point "was to find new industries" for this area, which is heavily dependent upon the manufacture of motor home vehicles.

Curtis Graham was just the kind of the person the White House was trying to convince. Graham, a 45-year-old unemployed motor home salesman, came away impressed with the president's oratory skills but wished Mr Obama had spent more time discussing protection of American jobs. "I know it's a global economy, but let's put American jobs first," he said.

Mr Obama will continue taking his message directly to the people tomorrow in Fort Myers, Florida, another financially hard-stricken area of the country. And later in the week, he will pay a visit to a construction company in Illinois.

1330 EST Indiana town hall meeting

Richard Lister: President Obama is back on the campaign trail trying to re-build public momentum for the stimulus package after a week dominated by Republican criticisms of it.

There was no talk today of "changing the tone" in Washington, or reaching out to Republicans - quite the opposite in fact. He again lambasted the "failed ideas" which he said created the current crisis.

He made clear that the audience hadn't been screened and he would take any questions - something that was potentially risky in the county with the highest unemployment rate in America. In the end, he took eight questions - and none of them directly criticised the stimulus bill.

The president said little that was new, but round one of this week's PR battle was his. He was able to use the event to send a message to his Congressional opponents: I won the election, I have the country behind me - get over it.

He also hinted that the Congressional battle was not over - despite having won sufficient Republican support to get this bill through.

He made clear he didn't like the education cuts in the bill that brought those Republican Senators on board, and would fight to get them back in before the final bill comes to his desk.

1200 EST Reality behind the rhetoric

Kevin Connolly

Kevin Connolly: A quick thought on language. American politicians and the media have settled into the habit of referring to the various economic plans being considered on Capitol Hill as "stimulus programs".

The White House, sensing that Americans are wearying of all the gloomy talk of recession, prefers to speak of "reinvestment and recovery packages".

It's worth bearing in mind that what they're all talking about are all really variations on a conventional scheme - borrowing large amounts of money to increase government spending - both directly and in subsidies to the private sector.

That borrowing is being undertaken by a country with a growing budget deficit and a colossal national debt. That's not to say the strategy won't work - merely a reminder of the stark reality behind the political rhetoric.

These are desperate times in America, and they're certainly getting desperate measures.

1200 EST Obama on the road

Adi Raval

Adi Raval: I'm here in Elkhart, Indiana, where President Obama is holding a "campaign style" town hall meeting with residents to try to sell his fiscal stimulus package. The pressure is clearly on the White House to help the likely Senate version marry up with the House version.

So Mr Obama will hold two other events just like this one in economically hard-hit areas of America.

Elkhart has an unemployment rate above 15%. Some people waiting outside told me they want to hear exactly how the package will lead to more jobs in this area.

Tom Kavanagh, who runs Job Works, an organisation that helps the unemployed, gives the president "much credit for coming to a typically Republican area" but what he is concerned about is how long the stimulus package will take to create jobs.

Some Republicans have organised a small demonstration outside the event and are holding cardboard cut-out signs of pigs, with the slogan "Take out the pork of the stimulus" - referring to wasteful spending.

Census workers were shouting to anyone who could hear that jobs are available for the census for this year. But alas, those jobs would be temporary.

1100 EST A weekend retreat

Rajini Vaidyanathan

Rajini Vaidyanathan: After a succession of weekends in Washington DC, the Obama family has finally taken a weekend break post-inauguration. The family spent Saturday night at the famous Camp David presidential retreat, in Maryland's Catoctin Mountains.

President Obama told reporters that the trip, which he took with his wife Michelle and daughters Sasha and Malia, was "beautiful".

He said: "The girls just had a great time. They had a lot of fun... You can see during the summer it's going to be a nice place to spend a lot of time."

The president took his mind off the current economic crisis by hitting a few golf balls and indulging in his favourite sport, basketball. Camp David has been a getaway for presidents for more than half a century.

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