President-elect Barack Obama announced as expected that Hillary Clinton would be his top diplomat and Robert Gates would stay on as defense secretary.

President-elect Barack Obama on Monday officially introduced the members of his national security team, including former Democratic primary rival Hillary Clinton as his secretary of state and Robert Gates, who will be remain as defense secretary.

Obama also announced that retired Marine Gen. James L. Jones — a former top commander of NATO and U.S. forces in Europe — would be his national security adviser.

“I am confident that this is the team that we need to make a new beginning for American national security,” Obama told reporters during a morning news conference in Chicago.

Obama’s team will advise him on foreign and national security issues in an era marked by wars in Iraq and Afghanistan and terrorism around the globe. Obama takes office Jan. 20.

Obama said his team “must pursue a new strategy that skillfully uses, balances, and integrates all elements of American power: our military and diplomacy, our intelligence and law enforcement, our economy and the power of our moral example.

“The team that we have assembled here today is uniquely suited to do just that,” he added as his Cabinet picks stood behind him on a flag-draped stage. “They share my pragmatism about the use of power, and my sense of purpose about America’s role as a leader in the world.”

Obama named Washington lawyer Eric Holder as attorney general and Arizona Gov. Janet Naploitano as homeland security chief. He also named two senior foreign policy positions outside the Cabinet, including campaign foreign policy adviser Susan Rice as U.N. ambassador.

Obama introduced Clinton first, saying of his former presidential rival, “She possesses an extraordinary intelligence and toughness, and a remarkable work ethic. … She is an American of tremendous stature who will have my complete confidence, who knows many of the world’s leaders, who will command respect in every capital, and who will clearly have the ability to advance our interests around the world.”

Clinton will give up her seat as a senator from New York to join the Obama Cabinet. Her appointment was preceded by lengthy negotiations involving her husband, the former president, whose international business connections posed potential conflicts of interest.

The former president also agreed to disclose the donors to the foundation that built his library, as well as contributors to his international foundation.

She said to Obama, in brief turn at the lectern, “Mr. President-Elect, I am proud to join you on what will be a difficult and exciting adventure in this new century.”

Sen. Clinton had scarcely finished speaking when her husband issued a written statement.

“She is the right person for the job of helping to restore America’s image abroad, end the war in Iraq, advance peace and increase our security, by building a future for our children with more partners and fewer adversaries, one of shared responsibilities and opportunities,” he said.

Gates said he was “mindful that we are engaged in two wars and face other serious challenges at home and around the world.”

“I must do my duty as they do theirs,” he said of the men and women in uniform in Iraq, Afghanistan and elsewhere. “How could I do otherwise?”

He said he was “honored to serve President-elect Obama.”

Gates’ appointment fulfilled a campaign promise by Obama, the naming of a Republican to his Cabinet.

Obama said Napolitano understands the need to protect against terror attacks and to respond to natural disasters — and that she also understands as well as anyone the danger of unsecured borders.

Obama now has half of the 15-member Cabinet assembled less than a month after the election, including the most prominent positions at State, Justice, Treasury and Defense.

The Associated Press contributed to this report.

Read more at http://www.foxnews.com/politics/2008/12/01/obama-unveils-national-security-team/

President-elect to lay out his budget belt-tightening vision and introduce Peter Orszag as his new director of the Office of Management and Budget.

WASHINGTON — President-elect Barack Obama wants to project fiscal restraint even as his economic team assembles a massive recovery package that could cost several hundred billion dollars.

A day after introducing the captains of his economic team and promoting a giant jobs plan, Obama on Tuesday was to lay out his budget belt-tightening vision. The dual images — big spender and disciplined budget watcher — were designed to give both political and economic assurances to the public, the Congress and the financial markets.

Obama also was expected to introduce Peter Orszag as his new director of the Office of Management and Budget, the White House office that serves as a funnel for federal agency budget requests. Orszag is the current director of the Congressional Budget Office.

Obama’s economic team embodies what at first glance seem to be mutually exclusive goals.

Timothy Geithner, Obama’s choice for treasury secretary; Lawrence Summers, who will head the National Economic Council; and Orszag all have links to Robert Rubin, who as President Clinton’s treasury secretary pushed for a balanced budget.

But all three will also be part of an administration that will drive deficits to new heights with an economic plan designed to save or create 2.5 million jobs and redirect the economy over the next two years. Economists from across the political spectrum, including some who have served as informal advisers to Obama, have put the size of an economic recovery package as high as $700 billion over two years.

Obama summed up the challenge Monday.

“The way to think about it is short term, we’ve got to focus on boosting the economy and creating 2.5 million jobs, but part and parcel of that is a plan for a sustainable fiscal situation long-term, and that’s going to require some reforms in Washington,” he said during a news conference in Chicago to introduce Geithner and Summers.

“To make the investments we need,” he said at another point, “we’ll have to scour our federal budget, line by line, and make meaningful cuts and sacrifices, as well, something I’ll be discussing further tomorrow.”

Obama is already starting in the red. The federal government reported a record deficit of $237.2 billion in October, which reflected only a portion of the $700 billion Congress approved last month to rescue the financial markets. The government’s red ink has been rising over the past eight years, reversing a surplus achieved during the Clinton administration.

Leonard Burman, director of the nonpartisan Tax Policy Center, said Geithner and Summers reflect both the need for a large-scale stimulus to the economy and for fiscal restraint once the economy shows signs of improvement.

“What’s good about the appointments that Obama has made is that it suggests, in ways that his campaign never did, that he really understands this,” Burman said.

Read more at http://www.foxnews.com/politics/2008/11/25/obama-promotes-fiscal-restraint-big-spending/

President-elect to formally unveil his team of economic experts to battle the most severe U.S. financial crisis in eight decades

WASHINGTON – President-elect Barack Obama names his economic team Monday and may call for the next Congress to quickly pass a massive stimulus plan that would dwarf even his campaign proposals to salvage the country’s financial wreckage.

Obama speaks at a Chicago news conference against a backdrop of increasing calls for him to assert himself well before he takes office Jan. 20 in the midst of the most severe U.S. financial crisis in eight decades.

Obama senior adviser David Axelrod confirmed that the president-elect would name Timothy Geithner, the New York Federal Reserve president, as his treasury secretary. Wall Street stocks jumped on Friday when word of Geithner’s appointment began to leak. Geithner will team with Lawrence Summers, a treasury secretary under former President Bill Clinton and former Harvard University president, who will take over the National Economic Council. Both Geithner and Summers will appear with Obama at a Monday news conference in Chicago.

Democratic officials also said Obama plans to name New Mexico Gov. Bill Richardson as commerce secretary, adding a prominent Hispanic and one-time Democratic presidential rival to his Cabinet. Richardson served as U.N. ambassador in the Clinton administration and later as energy secretary.

The troika will confront an economic crisis that continues to deepen in spite of hundreds of billions of dollars in federal emergency spending in recent weeks.

Top aides said Sunday that Obama also wants Congress to use its large Democratic majority when it convenes Jan. 6 to prepare tax cuts for low- and middle-income earners as part of the massive government intervention designed to pull the country out of its frightening economic nosedive.

Some economists have endorsed spending up to $600 billion to revive the economy. Sen. Charles Schumer, a New York Democrat, and former labor Secretary Robert Reich, a member of Obama’s economic advisory board, both suggested $500 billion to $700 billion. Before winning the presidency Nov. 4, Obama had said he looked to create a $175 billion stimulus package. While the new plan will be significantly larger, it was expected to incorporate his campaign other ideas for new jobs in environmentally friendly technologies and tax cuts.

“I don’t know what the number is going to be, but it’s going to be a big number,” Obama economic adviser Austan Goolsbee said on Sunday. “It has to be. The point is to, kind of, get people back on track and startle the thing into submission.”

Over the weekend Obama directed his team to erect plan to create 2.5 million new jobs by the end of 2010, and aides said his broader economic program was designed to quickly offer tax relief to lower- and middle-income earners. Significantly the plan would not offer an immediate tax increase on wealthy taxpayers. During the campaign, Obama said he would raise taxes on people making more than $250,000.

Axelrod unambiguously voiced Obama’s overall expectations.

“Our hope is that the new Congress begins work on this as soon as they take office in early January, because we don’t have time to waste here, ” he said on Sunday. “We want to hit the ground running on January 20th.”

Congress will have two weeks to hold hearings and write legislation between its return to Washington in early January and Obama’s inauguration.

Rep. Steny Hoyer of Maryland, the second-ranking Democrat in the House of Representatives, acknowledged a readiness for quick action.

“We expect to have during the first couple of weeks of January a package for the president’s consideration when he takes office.”

Axelrod also warned executives of the U.S. auto industry to draw up plans to retool and restructure their industry if they want the billions of dollars they are seeking from Congress. Otherwise, Axelrod said, “there is very little taxpayers can do to help them.”

Obama also delved into one of the most pressing foreign policy issues facing his presidency, calling Afghan President Hamid Karzai by telephone and telling him that fighting terrorism there and in the region would be a top priority, Karzai’s office said on Sunday.

The Saturday conversation between Obama and Karzai was the first reported contact between the two leaders since the Nov. 4 U.S. election. The United States has some 32,000 American troops in Afghanistan, a number that will be increased by thousands next year.

Fighting terrorism and the insurgency “in Afghanistan, the region and the world is a top priority,” Karzai’s office quoted Obama as saying during the conversation.

Read more at http://www.foxnews.com/politics/2008/11/24/obama-set-unveil-new-economic-team/

A source close to Barack Obama’s transition team is feeling out Senate Republicans to see if former Clinton Assistant Attorney General Eric Holder would pass confirmation after his role in the 2001 Marc Rich pardon.

WASHINGTON — President-elect Barack Obama’s aides have privately asked senators whether Washington attorney Eric Holder would be confirmed as the next attorney general, according to a person involved in the talks.

The talks suggest that Obama is deeply interested in Holder, who served as the No. 2 official in the Justice Department under President Clinton.

In the past week, Obama aides have asked Senate Republicans whether they would support Holder. In particular, the aides questioned whether Holder’s confirmation would be delayed because of his involvement in the 2001 pardon of fugitive Marc Rich by President Bill Clinton.

Newsweek, quoting unidentified legal sources close to the presidential transition team, reported Tuesday that Obama offered Holder the job and he accepted. Newsweek said Holder still has to undergo a formal “vetting” review by the Obama transition team before the selection is final.

One person involved in the talks told The Associated Press that the Obama team has received some assurances that, while the Rich pardon would certainly come up during hearings, the nomination likely wouldn’t be held up over that. The person spoke on condition of anonymity to describe the private conversations.

On the last day of Clinton’s term, Holder was asked whether the president should pardon Rich, a wealthy commodities dealer who had been spent years running from tax charges. Holder said he was “neutral, leaning towards favorable” on the pardon. Clinton later cited that as among the factors that persuaded him to issue the pardon.

Holder has publicly apologized for what he said was a snap decision that he should have paid more attention to. Had he taken more time to review the case, he would have advised against a pardon, he said.

A former U.S. attorney, Holder is among Washington’s most prominent defense attorneys. He would be the first black attorney general in U.S. history.

Administration aides say President Bush is unhappy that his discussion Monday with President-elect Barack Obama was leaked and cast as a horse trade between signing a second economic stimulus bill in exchange for congressional passage of the Colombia Free Trade deal.

President Bush is unhappy the conversation held Monday between him and President-elect Barack Obama has been cast as a trade-off between Bush signing a second stimulus package in exchange for congressional passage of the Colombia Free Trade Deal,” administration officials told FOX News on Tuesday.

Obama asked Bush to help the sagging auto industry during their private meeting in the White House, senior aides to both men said. Bush stressed the need to work with Colombia, but to make it sound like a horse trade is unfair and inaccurate, an aide told FOX News.

The Bush administration, along with Congress, negotiated a $700 billion rescue package last month for the financial industry, but federal officials are resisting Democratic calls for a similar bailout for automakers, despite warnings that General Motors might not survive the year.

Democrats want a second stimulus that would include aid to Detroit’s big three automakers, unemployment benefits and infrastructure projects.

Bush’s desire to pass the Colombia Free Trade deal on its merits is no secret, a senior White House aide told FOX News. But that deal has been frozen by the Democratic majority in Congress.

The U.S. and Colombia are close allies, and the president wants to increase trade between the two countries. But Democrats say a deal would mean more jobs being exported, which is taboo for a party supported by a heavily unionized workforce that elected Obama.

Democrats say they also object to the human rights climate in Colombia, which union leaders have described as seriously threatening to workers. Colombia’s government says such claims are blown out of proportion and workers are protected.

The New York Times reported Tuesday that Democrats have suggested that neither Obama nor congressional leaders are willing to concede the Colombia pact to Bush and they may choose to wait to hold off on a new stimulus bill until Obama becomes president on Jan. 20.

Bush aides said the president is unhappy the conversation between him and Obama was leaked to the media at all, and insisted the two leaders were not engaged in a quid pro quo between the automakers and a free trade pact.

“President Bush did not suggest a quid pro quo. Both leaders discussed ideas for the economy. The president has long said free trade helps create jobs and opens markets to our businesses. We believe the free trade agreements can and should pass today on their merits,” said press secretary Dana Perino.

Senior aides to both men said the two issues were part of a long discussion about automakers and the ability of the trade deal to help not only the economy but also a key ally. A senior administration official suggested that Obama be careful to keep his counsel.

Deutsche Bank on Monday downgraded GM to sell from hold, with a price target of $0, saying the carmaker may not be able to fund its U.S. operations beyond December without government intervention, FOX Business Network reported.

Deutsche Bank said it believes the U.S. government will be compelled to intervene through a capital infusion or loan.

“Without government assistance, we believe that GM’s collapse would be inevitable, and that it would precipitate systemic risk that would be difficult to overcome for automakers, suppliers, retailers, and sectors of the U.S. economy,” the broker said. Even if GM avoids bankruptcy, equity shareholders are unlikely to get anything back, it added.

FOX News’ Bret Baier contributed to this report.

More at http://elections.foxnews.com/2008/11/11/obama-urges-bush-help-auto-indusstry/