Obama's Economic Advisers Sending Mixed Messages...No Jobs!

Economic Advisers' mixed messages


Two of President Obama’s top economic advisers disagreed Sunday about whether the recession had ended.

Lawrence Summers, director of the National Economic Council, flatly said that it had.

"Today, everybody agrees that the recession is over, and the question is what the pace of the expansion is going to be," Summers said on ABC's "This Week."

But Christina Romer, who heads the White House Council of Economic Advisers, offered a more cautious view on NBC’s “Meet the Press.”

Asked by moderator David Gregory if the recession were over, Romer replied: "Of course not. For the people on Main Street and throughout this country, they are still suffering, the unemployment rate is still 10 percent."

The divergent message from two senior Obama officials reflects the twin tasks the administration faces. As voiced by Summers, it wants to project optimism and send the message to nervous Democrats up for re-election next year and voters alike that the economy is already recovering.

“We were losing 700,000 jobs a month when President Obama took office,” Summers noted on CNN’s “State of the Union.” “Last month, we lost 11,000. So we are getting there. And most professional forecasters expect job growth by spring, and I think that's a reasonable judgment in an uncertain world.”

But as much as they want to instill hope that jobs will start returning next year, Obama and his aides also want to make it clear that they understand the difficulties Americans are facing right now and are not minimizing the challenge in a way to make them appear insensitive.

So when Romer was asked when the recession would be over, she was hesitant to offer a timeline and instead said: "I'm not going to say the recession is over until the unemployment rate is down to normal levels,” which she described as around 5%.

Further, in an effort to prepare the country for potentially worse economic news, Romer also said that the current 10% unemployment rate could rise.

"I would anticipate some bumps in the road as we go ahead," she said.

Yet just as there is a political rationale for the sort of optimism Summers offered, there is also a strategic reason behind Romer’s caution, as demonstrated by the comments of Senate Minority Leader Mitch McConnell (R-KY) on Sunday.

Asked on CBS’s “Face the Nation” about Summers’ more upbeat view of the economy, McConnell shot back that “the 11 percent who are unemployed in Kentucky don't think [the recession is] over.

The two Obama economic advisers were, however, more in sync in discussing the new regulations Congress is moving to place on Wall Street institutions, some of which were bailed out by the federal government over the past year.

“For $300 million to be spent on lobbyists trying to gut serious efforts at financial reform is not how this country should be operating,” Summers said on CNN. “For firms that have benefited from taxpayer support to be complaining about the government burdening them is, frankly, a bit rich.”

Previewing the message the president will deliver when he meets with bank CEOs in the White House Monday, Summers said on ABC: “They need to recognize that they've got obligations to the country after all that's been done for them, and there is a lot more they can do, and President Obama is going to be talking with them about what they can do to support enhanced lending to customers across the country. We were there for them. And the banks need to do everything they can to be sure they're there for customers across this country.”

In his own Sunday television appearance, the president channeled the frustrations of those in the country who are angry at Wall Street for taking taxpayer dollars and still offering million-dollar bonuses.

Asked on CBS’s “60 Minutes” if some of the banks that received bailout money paid back the federal loan so as to avoid the pay caps imposed on those companies taking TARP funds, Obama acknowledged that was likely.

“Which I think tells me that the people on Wall Street still don’t get it,” he said.


Sources: Politico, Meet the Press, ABC News