Obama says economic crisis will worsen before it improves

The U.S. economy will get worse before it gets better, despite a major new stimulus plan in the works, U.S. president-elect Barack Obama said on Sunday.

Obama said when he takes office on Jan. 20, he will inherit an “enormous” federal budget deficit, but he's still planning a variety of construction projects to pull the country out of the deepest recession since the early 1980s.

“Things are going to get worse before they get better,” he said in an interview on NBC’s Meet the Press program broadcast Sunday morning.

"We've got to provide a blood infusion to the patient right now to make sure the patient is stabilized. That means 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."

Analysts believe the deficit for 2009 will exceed $500 billion US.

Obama's comments come as his team of economic advisers forge ahead with a stimulus plan, which he outlined in a radio address on Saturday.

He said the plan would employ millions of people by "making the single largest new investment in our national infrastructure since the creation of the federal highway system in the 1950s."

He said state officials would lose the federal dollars if they did not quickly use the money to repair highways and bridges.

In Sunday's television interview, Obama said he would not allow the country's ailing car industry to collapse, but any government help must come with strict conditions.

He told the NBC program that assistance would be provided, but that the industry and its stakeholders would have to restructure.

The country's struggling Big Three automakers have asked for a $34-billion US rescue plan.