Economic problems ‘to get worse,’ Obama warns

? President-elect Barack Obama warned Sunday that the nation’s economic problems “are going to get worse before they get better,” pointing to the fragility of the financial system and to recent numbers showing the U.S. with its highest unemployment rate in 15 years.

He later sought to balance that stark assessment with optimism about the economy’s future, as he voiced support for a proposed government bailout of the nation’s automakers that would be tied to restructuring and a push for greater fuel efficiency.

In comments a day after he proposed a massive public works program, Obama said Congress was doing the “exact right thing” by rapidly responding to the automotive crisis while holding the industry’s “feet to the fire.”

Speaking in a pretaped interview on NBC’s “Meet the Press,” Obama seemed to be trying to brace the nation for tougher economic times ahead. But at a news conference in Chicago later Sunday, he tempered his earlier remarks with a dose of optimism.

“I am absolutely confident that if we take the right steps over the coming months that not only can we get the economy back on track, but we can emerge leaner, meaner and ultimately more competitive and more prosperous,” he said.

Pressed by NBC’s Tom Brokaw, Obama said his economic advisers were still “crunching the numbers” for a post-inauguration economic stimulus package. In his weekend radio address, he said the package would include a massive public works program to build roads and other infrastructure projects.

Some Republicans have said the stimulus plan would be far too expensive. But Obama said it was more important to spend money to revive the economy and create jobs than worry about the short-term impact on the national debt.

“We have to provide a blood infusion to the patient right now to make sure the patient is stabilized,” he said.

Obama said the full scope of the economic pain is only starting to come into focus, as he noted that more than 500,000 jobs were lost in November.

“These aren’t just abstract numbers,” he said at the news conference. “They ripple throughout the economy, and people are really suffering, which is why we’ve got to act swiftly and boldly.”

Obama said he believes the current administration understands the severity of the problem, but he criticized what he called a lack of “aggressive steps” in the housing market to stem foreclosures.

As he has since his election, Obama sidestepped a question about whether he intends immediately to fulfill a campaign pledge to raise taxes on Americans earning more than $250,000 a year, or whether he would fulfill the pledge by waiting until a tax reduction for those earners expires in 2011.

He also declined to say whether he backed Caroline Kennedy, daughter of President John F. Kennedy, as the replacement for Sen. Hillary Rodham Clinton, D-N.Y., following Clinton’s expected appointment as secretary of State.