Obama Not Optimistic

With the election behind him, President-elect Obama can afford to be brutally frank with the American public. And he was just that on Sunday.

Appearing on “Meet the Press” on NBC, and at a later news conference, Mr. Obama said the economy will get worse before it gets better. To temper the harsh message, he pledged a recovery plan “equal to the task”, including a large economic stimulus plan and help for homeowners facing imminent foreclosures.

"We've got to provide a blood infusion to the patient right now to make sure that the patient is stabilized. And that means that we can't worry short term about the deficit. We've got to make sure that the economic stimulus plan is large enough to get the economy moving," he said.

But while saying it is important that domestic carmakers survive the current crisis, he had few specifics as to how he would help do that. And I have some advice. He may want to keep some money in reserve for the bad days ahead, because as he indicated, the worst is yet to be.

One out of ten homeowners is behind on their mortgage payment, or is already in foreclosure. The commercial Real Estate market may be next, as businesses and retailers faced with bankruptcy default on their leases. Another concern to experts is the threat of increased personal bankruptcies from consumers who decide to rip up their credit cards and stiff the banks.

As home prices drop, companies go out of business, and consumers go to unemployment lines, state and local governments will see continued deterioration of tax revenues. They will then pressure the federal government for aid, which will be tough to get.

If there is light at the end of this dark economic tunnel, it just may be a train.

(Brian Banmiller is a national Business Correspondent for CBS News Radio, free lance writer and public speaker. The former television business news anchor in San Francisco can be reached at brian@banmilleronbusiness.com .)