President unveils recovery plan in his first 'fireside chat'

Obama outlines £607bn investment in clean energy, health care, education and infrastucture

(EPA)

Barack Obama got down to the serious business of rescuing America's troubled economy yesterday, revealing details of the $825bn (£607bn) recovery plan which he hopes will combat "an unprecedented crisis that calls for unprecedented action".

In his first weekly address since taking office, the President said he intends to create between three and four million jobs by investing heavily in four fields: clean energy, education, health care, and the country's infrastructure. The "American Recovery and Reinvestment Plan" goes before Congress next week, and Mr Obama hopes it will become law within a month. It will be headlined by a pledge to double the US's renewable energy capacity within three years.

Mr Obama also announced a massive investment in biofuel, wind and solar power, which will see 3,000 miles of power lines built. Three-quarters of government buildings will be made energy efficient, he said, and more than two million homes "weatherised".

Average taxpayers, who felt little benefit from recent financial bailouts, will be helped by an expansion of the Child Tax Credit, and widening of Cobra, the temporary healthcare package that people can access when they lose their jobs.

More than 10,000 schools will have their buildings upgraded, and the government will treble the number of university fellowships in science.

Mr Obama drew comparisons with Franklin Roosevelt, the US President famed for his "fireside chats" during the Great Depression, with yesterday's five-minute speech, broadcast on the White House website.

He asked America to "hold my administration accountable" for the outcome of the stimulus package, which has been lent increasing urgency by figures out this week showing the fastest growth in unemployment for 26 years.

"Experts agree that if nothing is done, the unemployment rate could reach double digits," he said. "Our economy could fall $1 trillion short of its full capacity... In short, if we do not act boldly and swiftly, a bad situation could become dramatically worse."

Mr Obama also promised to lift the "veil of secrecy" that has shrouded efforts to shore up the economy, saying he would publish every decision about where the cash injection would be spent.

"Some are sceptical about the size and scale of this recovery plan," he said. "I understand that scepticism, which is why this recovery plan must and will include unprecedented measures that will allow the American people to hold my administration accountable."

The increased spending was approved at a meeting of Mr Obama's economic team at the White House yesterday. However, it has yet to gain the support of Republicans who are needed to help ease its swift passage through Congress.

At a bipartisan meeting of congressional leaders at the White House on Friday, Republicans said the economy would be better stimulated by tax cuts. At one point during a strained discussion, Mr Obama responded to criticism by saying: "I won."

The President further demonstrated his readiness to pick a fight with ideological opponents by reversing a ban introduced by George Bush on giving federal money to charities and aid organisations that perform abortions, or provide information about them.

Liberal groups applauded the move, which had been promised by Mr Obama during the election. But critics claimed its announcement late on Friday marked an effort to bury bad news that might upset the religious right. The concerns of Catholic voters were laid bare in a fierce statement issued by the Vatican's Pontifical Academy for Life yesterday, criticising "the arrogance of those who, being in power, believe they can decide of life and death".

"If this is one of President Obama's first acts, I have to say, with all due respect, that we're heading quickly towards disappointment," Monsignor Rino Fisichella, who heads the academy, told the Italian newspaper Corriere della Sera.