US President Barack Obama turned his attention yesterday from Afghanistan to the battle against unemployment, which has sapped his popularity and may shape his political future.
Obama is hosting a forum with business leaders at the White House to discuss how to boost jobs after US unemployment hit a 26-year peak of 10.2 percent in October. But the gathering has been dismissed by critics as a public relations exercise.
The president’s public approval ratings have dipped as unemployment has risen, alarming members of his Democratic party, who face congressional elections next year. Republicans say his economic recovery policies have failed to deliver.
PHOTO: EPA
Democrat losses in the mid-term polls could hinder Obama’s ambitious legislative agenda, especially if Democrats lose control of one or both houses of Congress.
Today he will visit Allentown, Pennsylvania, the first stop on a “White House to Main Street” jobs tour that caps a busy week in which Obama also announced the deployment of 30,000 extra troops to Afghanistan.
Critics charge the jobs summit is more about politics than policy, and the president has already stressed the need for low-cost solutions that rule out a second stimulus package.
Only about a third of the US$787 billion in the emergency spending bill Obama signed in February has been spent so far.
Financial markets could react badly to much more government spending that adds to the record US$1.4 trillion deficit.
Policies that provoked an investor scare could also lead to a run on the dollar and force up borrowing costs, choking off the recovery. Obama recently acknowledged the threat of a double-dip recession if the deficit was not tackled.
That’s why the White House has stressed that the forum will focus on what the private sector can do.
“When businesses seem hesitant to hire and productivity is surging, we need to harness the private sector,” Christina Romer, chairwoman of the White House Council of Economic Advisers, wrote in the Wall Street Journal on Tuesday.
Company executives attending the forum will include the chiefs of Google, AT&T, Quest Diagnostics, FedEx Corp and Comcast Corp.
US economic growth swung positive in the third quarter, ending the most prolonged economic slump in 70 years, but companies have boosted output by squeezing greater productivity from existing workers rather than adding to payrolls.
Some economists dismiss the deficit threat as less damaging than the social effects of persistent high unemployment.
“I am very critical of deficit fetishism,” said Nobel laureate economist Joseph Stiglitz, who is taking part in the forum at Obama’s request.
“The long-run cost of not addressing this issue is greater than the [deficit] cost imposed on our society by a long shot. I think that it is not a close call,” he said.
Stiglitz and other like-minded economists argue that the value to society of investment in education and infrastructure trumps problems caused by adding to the deficit.
The White House has highlighted green jobs that improve energy efficiency and incentives to help small businesses.
Dean Bank of the Center for Economic and Policy Research in Washington, recommended Obama consider direct public service job creation, aid to help states avoid laying off civil servants and employment credits to help firms that would otherwise trim their workforce.
SEEKING CHANGE: A hospital worker said she did not vote in previous elections, but ‘now I can see that maybe my vote can change the system and the country’ Voting closed yesterday across the Solomon Islands in the south Pacific nation’s first general election since the government switched diplomatic allegiance from Taiwan to Beijing and struck a secret security pact that has raised fears of the Chinese navy gaining a foothold in the region. The Solomon Islands’ closer relationship with China and a troubled domestic economy weighed on voters’ minds as they cast their ballots. As many as 420,000 registered voters had their say across 50 national seats. For the first time, the national vote also coincided with elections for eight of the 10 local governments. Esther Maeluma cast her vote in the
Nearly half of China’s major cities are suffering “moderate to severe” levels of subsidence, putting millions of people at risk of flooding, especially as sea levels rise, according to a study of nationwide satellite data released yesterday. The authors of the paper, published by the journal Science, found that 45 percent of China’s urban land was sinking faster than 3mm per year, with 16 percent at more than 10mm per year, driven not only by declining water tables, but also the sheer weight of the built environment. With China’s urban population already in excess of 900 million people, “even a small portion
UNSETTLING IMAGES: The scene took place in front of TV crews covering the Trump trial, with a CNN anchor calling it an ‘emotional and unbelievably disturbing moment’ A man who doused himself in an accelerant and set himself on fire outside the courthouse where former US president Donald Trump is on trial has died, police said yesterday. The New York City Police Department (NYPD) said the man was declared dead by staff at an area hospital. The man was in Collect Pond Park at about 1:30pm on Friday when he took out pamphlets espousing conspiracy theories, tossed them around, then doused himself in an accelerant and set himself on fire, officials and witnesses said. A large number of police officers were nearby when it happened. Some officers and bystanders rushed
HYPOCRISY? The Chinese Ministry of Foreign Affairs yesterday asked whether Biden was talking about China or the US when he used the word ‘xenophobic’ US President Joe Biden on Wednesday called for a hike in steel tariffs on China, accusing Beijing of cheating as he spoke at a campaign event in Pennsylvania. Biden accused China of xenophobia, too, in a speech to union members in Pittsburgh. “They’re not competing, they’re cheating. They’re cheating and we’ve seen the damage here in America,” Biden said. Chinese steel companies “don’t need to worry about making a profit because the Chinese government is subsidizing them so heavily,” he said. Biden said he had called for the US Trade Representative to triple the tariff rates for Chinese steel and aluminum if Beijing was