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Not the Summer He Planned

More grim news for embattled Obama as unemployment rate rises, again.

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Obama, flanked by his economic team, says a full recovery will take much longer. (Chip Somodevilla / Getty Images)

You could see it in his face. When President Obama spoke to reporters from the Rose Garden this morning, it was to address the latest round of employment numbers released today by the Department of Labor. There were some bright spots, such as news that private companies added 67,000 new jobs last month. But overall the news was grim. The broader economy lost 54,000 jobs last month, and the unemployment rate rose slightly to 9.6 percent (from 9.5 percent in July), with the clear and present danger of hitting 10 percent by the end of the year. Just two days before Labor Day, it hasn’t exactly been the Recovery Summer the White House had planned.

Obama, ever the self-proclaimed pragmatist, normally wouldn’t be swayed by a flash-in-the-pan snapshot of the economy, especially considering meaningful economic change doesn’t happen from month to month. But the stakes are high for the White House and especially the president. Nineteen months after the $819 billion stimulus package that he vowed would jump-start sluggish sectors, it appears the sugar high has worn off. Growth is now progressing slower than Greenland’s glaciers.

It’s true that it could have been lots worse, which has been the White House’s top argument during most of the summer. If we had done nothing, frustrated Obama staffers tell reporters, we’d be much worse off, with employment topping 15 or even 16 percent by now. In a posting on the White House blog, outgoing chief economic adviser Christina Romer called the latest statistics better than expected. “Against the backdrop of some unsettling economic data in the past few weeks, today’s numbers are reassuring that growth and recovery are continuing.”

But the problem is even if that’s true, not enough people feel it is. Unemployment is high, but long-term unemployment—the number of people who have been jobless for 27 weeks or more—is at a shocking 42 percent. Underemployment, at 18 percent, isn't much better. The private sector is adding jobs, but not nearly fast enough to warrant a national sigh of relief. Two months before an election reflecting almost exclusively the state of the economy, time is running out to ensure that Obama’s ideas are working, and that he and his party deserve more time in power. “Where are the jobs?,” top Republicans have asked, led by House Minority Leader John Boehner, the man who would be speaker if the Democrats lose their majority in the lower chamber.

Options are limited for Obama, mostly because of politics. Even though several leading economists agree that the stimulus has had a positive effect—some say it should have been much bigger, even twice the size—the impact hasn’t been clear enough. The word has also become toxic inside the Beltway, leading Press Secretary Robert Gibbs yesterday to say that no matter what the administration’s economic team decides, it will not include another stimulus. More likely is a set of more-focused ideas, including a payroll tax holiday to encourage small businesses to keep hiring and a permanent extension of tax credits for American researchers. The package, according to The Washington Post, could end up being worth hundreds of billions of dollars.

Before Obama finished his brief remarks to reporters, someone shouted out, asking if he regretted using the term “Recovery Summer” to describe what he hoped the past few months would be. No, he said, "I don't regret the notion that we are moving forward, because of the steps that we have taken." It’s true that a recession a decade in the making won’t end quickly, but if the president could find a way to pick up the pace, those who can’t find jobs—not to mention his party—certainly wouldn’t complain.

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