Facing resistance from within his own party on his almost US$800 billion economic recovery plan, US president-elect Barack Obama pointed to alarming new unemployment figures to urge its passage in Congress.
Obama sought to patch fissures with senior Democrats on Friday over key features of the still emerging plan, that he vowed to “hone and refine” with help from both Republican and Democratic lawmakers.
The need for a plan grew more pressing with the release of a US Labor Department report showing job losses of 524,000 last month and a 7.2 percent unemployment rate, the highest in 16 years.
Democratic congressional officials said that Obama aides came under pressure in closed-door talks to jettison or significantly alter a proposed tax credit for creating jobs.
Democrats also sought inclusion of relief for upper middle-class families hit by the alternative minimum tax (AMT). The AMT was originally designed to make sure the very wealthy did not escape taxes, but it now hits many more people because inflation has pushed up average incomes. Congress every year tries to prevent it from reaching tens of millions of middle-income families.
The package is getting off to a rocky start, with top Democrats openly complaining about key provisions, especially the design of his tax cuts.
“If members of Congress have good ideas, if they can identify a project for me that will create jobs in an efficient way that does not hamper our ability over the long term to get control of our deficit, that is good for the economy, then I’m going to accept it,” Obama said at a press conference. “What we can’t do is drag this out when we just saw a half-million jobs lost.”
He noted that jobs were lost in all 12 months of last year and said it was the worst year since World War II.
The Labor Department’s unemployment report showed widespread damage across US industries and workers — hitting blue-collar and white-collar workers, people without high school diplomas and those with college degrees.
“One word comes to mind — dreadful,” said Stuart Hoffman, chief economist at PNC Financial Services Group.
There’s no relief in sight. The year got off to a rough start with a flurry of big corporate layoffs and there were more on Friday. Airplane maker Boeing Co said it planned to cut about 4,500 jobs this year and uniform maker G&K Services Inc is eliminating 460 jobs.
Employers are also cutting workers’ hours and forcing some to go part-time. The average work week last month fell to 33.3 hours — the lowest in records dating to 1964 — and a sign of more job reductions in the months ahead since businesses tend to cut hours before eliminating positions entirely.
“There is no indication that the job situation would stabilize anytime soon,” said Sung Won-sohn, economist at the Martin Smith School of Business at California State University. “This could turn out to be one of the worst economic setbacks since the Great Depression.”
Economists predict a net total of 1.5 million to 2 million or more jobs will vanish this year and the unemployment rate could hit 9 percent or 10 percent, underscoring the challenges Obama will face and the tough road ahead for job seekers.
The Dow Jones Industrial Average fell 143.28 points, or 1.64 percent, to 8,599.18 on Friday, ending the week down nearly 5 percent, the worst week since November.
The S&P 500 index fell 19.38, or 2.13 percent, to 890.35, and the NASDAQ composite index fell 45.42, or 2.81 percent, to 1,571.59.
Also See: Obama’s spy chief promises clean start
RETHINK? The defense ministry and Navy Command Headquarters could take over the indigenous submarine project and change its production timeline, a source said Admiral Huang Shu-kuang’s (黃曙光) resignation as head of the Indigenous Submarine Program and as a member of the National Security Council could affect the production of submarines, a source said yesterday. Huang in a statement last night said he had decided to resign due to national security concerns while expressing the hope that it would put a stop to political wrangling that only undermines the advancement of the nation’s defense capabilities. Taiwan People’s Party Legislator Vivian Huang (黃珊珊) yesterday said that the admiral, her older brother, felt it was time for him to step down and that he had completed what he
Taiwan has experienced its most significant improvement in the QS World University Rankings by Subject, data provided on Sunday by international higher education analyst Quacquarelli Symonds (QS) showed. Compared with last year’s edition of the rankings, which measure academic excellence and influence, Taiwanese universities made great improvements in the H Index metric, which evaluates research productivity and its impact, with a notable 30 percent increase overall, QS said. Taiwanese universities also made notable progress in the Citations per Paper metric, which measures the impact of research, achieving a 13 percent increase. Taiwanese universities gained 10 percent in Academic Reputation, but declined 18 percent
CHINA REACTS: The patrol and reconnaissance plane ‘transited the Taiwan Strait in international airspace,’ the 7th Fleet said, while Taipei said it saw nothing unusual The US 7th Fleet yesterday said that a US Navy P-8A Poseidon flew through the Taiwan Strait, a day after US and Chinese defense heads held their first talks since November 2022 in an effort to reduce regional tensions. The patrol and reconnaissance plane “transited the Taiwan Strait in international airspace,” the 7th Fleet said in a news release. “By operating within the Taiwan Strait in accordance with international law, the United States upholds the navigational rights and freedoms of all nations.” In a separate statement, the Ministry of National Defense said that it monitored nearby waters and airspace as the aircraft
UNDER DISCUSSION: The combatant command would integrate fast attack boat and anti-ship missile groups to defend waters closest to the coastline, a source said The military could establish a new combatant command as early as 2026, which would be tasked with defending Taiwan’s territorial waters 24 nautical miles (44.4km) from the nation’s coastline, a source familiar with the matter said yesterday. The new command, which would fall under the Naval Command Headquarters, would be led by a vice admiral and integrate existing fast attack boat and anti-ship missile groups, along with the Naval Maritime Surveillance and Reconnaissance Command, said the source, who asked to remain anonymous. It could be launched by 2026, but details are being discussed and no final timetable has been announced, the source