The snake oil "cure" for all that ails us

Mitchell: After Monday's historic plunge, stocks are on the rise today for now, but underneath it all nothing has really changed and now all eyes are on the fed. Gene Sperling is director of the national economic council and assistant to the president and joins us now. Gene, what can the president do?

Sperling: I think what the president needs to do is what he said yesterday, Reemphasize, do everything in his power to make clear that we as a country have got to act in a bipartisan way both to do more in terms of short-term growth and job creation and to make clear that we've got greater certainty of long-term fiscal discipline. We need both of those things. I think what we've seen many the last week is that there is real harm to the kind of firm line drawing in the sand that gives not only our American people but markets the sense that we can come together to solve the important problems we need both for short-term growth and long-term fiscal discipline. I think the president reaffirmed that yesterday. I think there are more members of congress, more in the American people who understand that type of putting our economy first, politics second is what is an imperative for all of us right now.

Mitchell: so far, it's been a lot of politics first, putting the economy second from all sides. there's just been a a lot of finger pointing all around. What do you want to see from the Fed today? Do you want to see a third round of quantitative easing?

Sperling: You know that smart economic advisors at the white house don't comment on the independent federal reserve and particularly not an hour before they're about to speak.

Mitchell: well, what about the ideas and what about possible ideas for calling congress back? there's actually been some criticism even from friends. You heard from a number of Democrats that the president should have been stronger yesterday. That he should have been more focused. He should be by this time calling congress back.

Let me play a little bit of a conversation today from former governor and former senator and former Goldman Sachs Ceo Jon Corzine with Joe Scarborough.

Corzine: first of all, we ought to send out signals of confidence. It's easy to sit on the sidelines when you're not governing. I would love to see the president call the leaders of congress back to washington in the next week, walk out together and say we're going to do the Grand Bargain.

Scarborough: what a great signal that would send.

Corzine: it would send an enormous confidence setting tone for the market.

Mitchell (to Sperling): why not call them back?

Sperling: Andrea, as you know, there is not a single leader who did more, worked harder went more the extra mile than president obama did to put that grand bargain together. He has helped sign this important downpayment on deficit reduction. He's made clear in every way possible that he wants a grand bargain. That that requires having both entitlement reform --

Mitchell: This is a crisis. Why not? Why not have John Boehner come back to Washington and have them sit down and try to pick up where they left off?

Sperling: Andrea, the issue, let's be very clear, the issue is not how many times they meet together. The issue is getting a meeting of the minds that we need bipartisan compromise. People can be assured this president will do everything that is constructive and productive to bring together that Grand Bargain. But what we need is we need everyone to stop drawing firm lines many the sand. every budget expert, every independent expert. Everyone knows that requires a combination of entitlement reform and tax reform that both contribute to deficit reduction. The President's reached out, will continue to reach out.

What we need is more pressure on those who are insisting on just firming up their positions, refusing to compromise to decide nothing's off the table and that they're willing to come to that table with an open mind and the spirit for job growth measures and to take the tough entitlement and revenue measures that are needed to give us, put us on a path of long-term fiscal soundness.

Mitchell: but, Gene, finally, even the New York Times today is saying, where is the broader vision from President Obama? Can you tell us did the President even pick up the phone and call John Boehner? Have they had private conversations since the s&p downgrade?

Sperling: Andrea, what this president has done has been as significant as anything I've seen and courageous as anything I've seen a president do. This is a president at a time when many of his supporters said we should save Medicare to make it more of a political issue said, "we are going to be serious, we are going to be willing to do modest, reasonable Medicare reforms and other entitlement reforms as part of a comprehensive effort with tax reform that would raise revenues on those who can most afford it to bring down our deficit. I don't know how much more the president can do in sending that message.

And anything that the constructive, anything that will help lead to that effort this president's going to do. We're going to focus on the results not just having public meetings. We're focused on what will bring that result. That's what the president is calling for. That's why I went out yesterday and made clear. Drawing firm lines in the sand has real negative consequences for our economy.That's been very clear over the last week.

We have got to bring everybody together for a compromise, a Grand Bargain to give us the confidence and soundness we need on our long-term fiscal situation and the room to do more significant things on spurring job growth in the short-term.

“Indeed, the White House seems to want to tamp down the sense of urgency, given Jay Carney’s statement that they do not believe a double-dip recession is imminent,” Sides notes, referring to the White House press secretary’s comments last week. “If people are panicking, they’re only going to go with the other guy,” adds the Democratic aide.