In a meeting to discuss the stimulus proposal with Vice President Joe Biden and Democratic and Republican congressional leadership, Obama said America also needs an improved financial system stability program as well as financial market regulation reform.
"The recovery package that we're passing is only going to be one leg in, at least, a three-legged stool," said Obama. "We are also starting to put in place the kinds of reform elements - oversight, transparency, accountability - that's going to be required in order for the American people to have confidence in what we're doing."
The president cited a Government Accountability Office report released Thursday that said the government's regulation of the financial markets had "major weaknesses" that can lead to wasteful government spending.
He also said financial institutions that get bailout funds from the government must manage those funds appropriately.
Obama made an apparent allusion to reports that former Merrill Lynch CEO John Thain spent over $1 million renovating his office after he was hired as an executive at Bank of America (BAC, Fortune 500), to which he sold Merrill late last year.
He cited reports about companies "going out and renovating bathrooms or offices" and "the lack of accountability and transparency in how we are managing some of these programs to stabilize the financial system."
As for the first leg of the stool - the economic stimulus package - the president said he stressed swift and aggressive movement to pass the bill. Though he said the plan appears to be on the path towards reaching his desk on Presidents Day, much more maneuvering to reach a bipartisan agreement on the expensive and sweeping recovery plan appears likely.
The president has received some pushback from both sides of the aisle on his stimulus plan, as he tries to sell a plan that includes tax cuts and massive spending efforts.
After Friday's meeting, House Minority Leader John Boehner, R-Ohio, said he was concerned about the size of the bill, arguing that less spending and more tax cuts were needed to have a real and fast impact on the economy.
"At this point we believe spending nearly $1 trillion is really more than we ought to be putting on the backs of our kids and their kids," Boehner said. "[With tax cuts], the American people can invest it, spend it or save it, all of which are good for the economy."
House Speaker Nancy Pelosi, D-Calif., countered that the cost of the stimulus plan is less important than the quality of the recovery it creates.
"It's not just about how big the package is," Pelosi said. "It's about how fast jobs are created and how those initiatives that were added in the spending will contribute to long-term stabilization of our economy."
Those negotiations are set to continue next week, as the House is expected to hold a vote on its stimulus plan on Wednesday. The Senate is set to begin its own deliberation over its stimulus proposal next week, after announcing its own plan on Friday to meet Obama's goal of creating three to four million jobs.
As economy falls, more people put money away in savings
Obama address: ‘unprecedented action’ needed
