Wed, Jun 06, 2012 - Page 7 News List

US jobs data fail to spur compromise

HAPPY TO LANGUISH:Congressional Democrats and Republicans are blaming each other for poor US jobs growth, with no sign of any cooperation in an election year

Reuters, Washington

It takes a lot to jolt the US Congress into action, especially in an election year when partisanship runs highest, and the dismal jobs report last month apparently is not enough.

Friday’s employment data — described by investors as “awful,” “horrid” and “ugly” — marked the third straight month of slowing job growth.

However, it is not spurring Congress to accelerate work toward a grand fiscal bargain. Washington’s tax and budget deadlock persists, despite hopes that an early deal would give businesses certainty over tax rates and halt automatic government spending cuts that could sap growth, according to lawmakers and aides interviewed on Monday.

Nor has the jobs data, which showed the US unemployment rate rising for the first time in nearly a year, caused Republicans and Democrats to soften their differences over a long-delayed transportation construction bill that could help create a slew of new jobs.

Instead, lawmakers were sticking to their plan of letting the Nov. 6 elections decide, which party should shape the country’s budget and tax policy, leaving it until after that vote to pass major legislation in a mad dash to Dec. 31.

Thus, Democrats and Republicans seemed content on Monday to dig deeper into partisan positions and blame each other for the US jobs malaise.

“Republicans have acted with urgency on jobs, passing nearly 30 bills that would help encourage economic growth and job creation,” said Kevin Smith, a spokesman for Republican US House of Representatives Speaker John Boehner. “Unfortunately, these jobs bills are gathering dust in the Democratic-controlled [US] Senate.”

Democratic US Representative Allyson Schwartz shot back: “Republicans have chosen to pass bills that are basically campaign rhetoric that they know are going nowhere. That’s not getting us where we need to go to help Americans find jobs.”

The jobs data released on Friday showed employment growth slowing to a paltry 69,000 jobs — less than half of what economists had forecast.

US President Barack Obama, trying to contain the damage to his re-election hopes, demanded Congress act on his jobs “to-do list,” which includes tax credits for small businesses and federal aid to help states prevent layoffs of teachers, firefighters and other public employees.

Analysts said Obama could expect little help from lawmakers on these plans, which would likely do little to change the jobs outlook in the six-month run-up to the election anyway.

“The odds are against anything before the election,” said Greg Valliere, chief political strategist at the Potomac Research Group, a private firm that tracks Washington for institutional investors.

Individual tax cuts enacted under former US president George W. Bush are set to expire on Dec. 31, and days later, automatic spending cuts arranged in last year’s debt limit deal are due to hit in a series of deadlines dubbed the “fiscal cliff.”

The Congressional Budget Office warned last month that these tax hikes and spending cuts would slam the US economy back into recession in the first half of next year.

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