After Vacation, Obama Vows To Focus On Jobs

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Prices and jobless numbers are up and the markets are down. Thursday, the president leaves for Martha's Vineyard with his approval ratings at record lows. What's his strategy for the economy this fall?

MELISSA BLOCK, host: With economic alarm bells ringing, President Obama has decided to gamble on new government spending to encourage hiring. The president met with his economic team this morning to plot strategy before he set off on a late-summer vacation with his family. When he returns, the president has promised to outline new proposals to kick start job growth. NPR's Scott Horsley reports on how he plans to make the case.

SCOTT HORSLEY: President Obama is under mounting pressure to show progress on the jobs front. A report from the Labor Department today showed continued weakness in the job market, and meanwhile, a new Gallup poll finds only about one in four Americans think the president's doing a good job of handling the economy.

During his Midwestern bus tour this week, Mr. Obama said he gets the message. With millions of Americans still out of work, efforts to boost job growth can no longer wait.

President BARACK OBAMA: And over the course of the next few weeks, I'm going to be putting out more proposals to put people to work right now and some of them - yes. Some of them cost money.

HORSLEY: This focus on jobs comes after months in which Washington has been preoccupied with spending less money to control the deficit. This week, Mr. Obama began to make the case more forcefully that the two goals don't have to be mutually exclusive.

OBAMA: When folks tell you that we've got a choice between jobs now or dealing with our debt crisis, they're wrong. They're wrong. We can't afford to just do one or the other. We've got to do both.

HORSLEY: Former White House economic advisor Jared Bernstein says the key to making this argument is timing. He says the government can encourage job growth with more spending now and offset the cost with bigger savings later.

JARED BERNSTEIN: If you actually attack your jobs program, get some people back to work, get the economy spinning off some more revenues, you actually help your deficit problem. So getting that sequencing right means jobs now and focus more on deficit reduction in the outer years.

HORSLEY: Bernstein, who is now with the Center on Budget and Policy Priorities, was in the administration when the government crafted its $787 billion stimulus program two and a half years ago. Many economists say that stimulus helped to cushion the economy's fall during the recession, but with unemployment still above nine percent, the stimulus is widely perceived as a failure and President Obama has been wary about trying anything like it again.

BERNSTEIN: The president and his political advisors know that anything that reeks of Keynesian stimulus is unpopular with the public, so if you can just stand back and let the economy take care of itself, of course, you'd rather do so. But reality is such that they just can't do that.

HORSLEY: The reality is that, instead of gathering momentum and growing on its own, the economy appears to be in more and more danger of stalling out. So Mr. Obama's made the calculation that the risk of doing nothing on jobs is greater than the risk of another round of stimulus.

Don't expect the White House to use that word to describe the president's proposal and it's likely to be a lot smaller than the last big stimulus. Details are scarce, but Mr. Obama hints one piece might be help for public works projects.

OBAMA: We need roads and bridges and schools all across the country that could be rebuilt, and all those folks who got laid off from construction because the economy went south or the housing bubble burst, they're dying for work.

HORSLEY: Whatever the president suggests is likely to get a chilly reception from congressional Republicans. In a memo this week, House majority leader Eric Cantor called for stopping the discussions of new stimulus spending with money that we simply do not have.

Mr. Obama appears ready to wage that battle. If he doesn't succeed in passing a jobs plan, he'll at least have another issue to campaign on next year.

OBAMA: And my attitude is: get it done. And if they don't get it done, then we'll be running against a Congress that's not doing anything for the American people and the choice will be very stark and will be very clear.

HORSLEY: Bashing Congress may not help the president's re-election chances, though, unless Americans see some prospect of the economy getting better.

Scott Horsley, NPR News, the White House.




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