WASHINGTON President George W. Bush on Wednesday emphasized that the government's steps to take stakes in financial institutions were temporary and limited, and that eventually the U.S. economy would turn around.
"It's very important for the American people to know that the program is designed to preserve free enterprise not replace free enterprise," Bush told reporters before beginning a meeting of his cabinet.
"Decisions we took to enhance liquidity and make sure our financial instruments are strong is a temporary decision," he said, adding that the shares being purchased by the government would eventually be sold.
The United States unveiled plans on Tuesday to inject up to $250 billion into the battered banking system in an effort to thaw the frozen credit market which resulted from the collapse in the U.S. housing market.
"Secondly the program is limited, in other words, the government will buy only a certain number of shares in individual banks," Bush said. "These banks will be privately controlled."
Bush was flanked in the meeting on one side by Treasury Secretary Henry Paulson who helped design the bailout plan as the administration tries to revive the economy and prevent it from sinking into a deep recession.
The president acknowledged that the government was taking extraordinary measures, but argued they were well-thought out and were being taken because the country was facing extraordinary circumstances.
"I'm confident in the long run this economy will come back," Bush said. Later on Wednesday he will travel to Grand Rapids, Mich., to talk to business leaders about why the government had taken these steps to address the financial crisis.
(Reporting by Jeremy Pelofsky, Editing by Tom Hals)