The latest figures on job growth have triggered a war of words over which policies can best get Americans back to work and over who is to blame for May’s lackluster employment growth.
Sensing trouble after Friday’s announcement that the economy added only 54,000 jobs last month, President Barack Obama grew defensive from the start.
“Even though the economy is growing, even though it’s created more than two million jobs over the past 15 months, we still face some tough times,” the president said. “You know, it’s just like if you had a bad illness, if you got hit by a truck, it’s going to take a while for you to mend. And that’s what’s happened to our economy. It’s taking a while to mend.”
The president’s call for patience, however, got nowhere with his political opponents. Republican leaders held a press conference after the Labor Department released the jobs figures and renewed calls for conservative fiscal policies.
“Our economy is not creating enough jobs, and Democrats’ binge of taxing, spending, borrowing and over-regulating is a big part of the reason why,” said House Speaker John Boehner, R-Ohio.
The president’s critics are getting attention because May’s disappointing numbers followed months of solid jobs growth, raising speculation the recovery has stalled. In addition, other subtle indicators — such as the slowdown in temporary worker hiring — suggest the pace of recovery will continue to stall for some time.
To make matters worse, the bad economic news came one day after Moody’s Investors Services warned that it may put the U.S. government debt rating on review for a downgrade if the government doesn’t straightening out the debt ceiling issue that many predict would trigger a default.
Obama’s critics pounced: “It is sometimes unfair to tag presidents with blame for an underperforming economy. Not this time,” Daniel Henninger wrote in the Wall Street Journal. “This president made conscious policy choices during a deep recession to reorder vast swaths of American industry. Strong-performing economies need clarity. Barack Obama has given ours indecision stretching to the horizon.”
Henninger and others blamed the economy’s troubles on the controversial $814 billion economic stimulus package the Democratic Congress passed at the urging of Obama.
Liberals (many of them had recommended a larger stimulus package) struck back at the president’s conservative critics.
“This [Republican] plan is a rehash of the same unsuccessful plan that led our economy into the Great Recession during the Bush administration,” said Heather Boushey, a senior economist at the Center for American Progress. She added that the problem with the Republicans’ economic approach of giving economic breaks to top income earners and corporations “is that it undercuts our nation’s prospects for a prosperous future.”
Many economists say the setback is temporary. They blame the Japanese tsunami in March for interrupting auto parts supplies to assembly plants in the United States. Increasing gas prices and natural disasters, they add, combined to harm job growth in May.
But not all economic experts are convinced. Mohamed El-Erain, a columnist with the Financial Times, the British newspaper, says “meager job creation goes beyond those issues.” He points to structural problems, such as the over-reliance on sectors like construction and retail as the employment engine in the U.S. job market.
An additional fiscal stimulus and Federal Reserve action, he said, is politically untenable. “It is high time to move beyond financial band-aids if the goal is to address properly what is now an unemployment crisis,” he stated.
El-Erain concluded, “Unless policymakers respond to the obvious implications of the highly disappointing jobs report … the United States will experience a series of unsatisfactory and socially worrisome monthly employment reports of which today’s would unfortunately be just an example.”