Video: Geithner sees deepening recession

updated 3/4/2009 1:49:12 PM ET 2009-03-04T18:49:12

President Barack Obama's Treasury secretary is defending proposed tax increases on the wealthy, saying they are necessary to limit future budget deficits.

Timothy Geithner responded on Wednesday to Republican criticism that the administration wants to increase taxes during a recession. Geithner noted that tax increases on couples making more than $250,000 per year would not take effect until 2011.

Obama inherited a $1.3 trillion budget deficit that is expected to balloon to $1.75 trillion this year. Obama says his plan would reduce the deficit to $533 billion in four years.

Also Wednesday, the president's budget director said the administration inherited "a big mess" economically and the public is going to have to be patient as a rescue plan goes forward.

Peter Orszag, director of the Office of Management and Budget, echoed Obama's statement about Wall Street, saying policymakers get caught up in day-to-day swings in the stock market.

Interviewed on CBS's "The Early Show" Wednesday, Orszag said the administration's goal is "jump-starting job growth and then tackling long-term problems" like education, infrastructure and environment.

Orszag said, "It's way too soon to be start judging success or failure here. We inherited a big mess. We inherited a trillion dollar gap between how much the economy can produce and how much it is producing."

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