The White House warned on Sunday that the recession-plagued US economy, while somewhat improved in recent weeks, will not turn a corner until the soaring unemployment rate declines.
US President Barack Obama’s top economic aide, Christina Romer, said that the 10 percent unemployment rate could rise further, while the president’s top economic adviser, Larry Summers, forecast an uptick by spring.
“By spring employment growth will start turning positive,” Summers told ABC’s This Week program.
However, the pair gave opposing views of the state of the recession as the White House faces deep US public worry over unemployment running at a quarter-century high and redoubles its efforts to tackle the problem ahead of next November’s congressional mid-term elections.
“Today everyone agrees that the recession is over. And the questions are around how fast we’ll recover,” Summers said on CNN, while Romer said in a separate interview that any such declaration should be based on improvement in the employment picture.
“I’m not going to say the recession is over until the unemployment rate is down to normal levels ... where we were before the recession — certainly in the 5 percent” range, Romer told NBC.
Summers cited upbeat signals, noting that the economy was shedding 700,000 jobs a month when Obama took office, compared with 11,000 last month.
“Most professional forecasters expect job growth by spring, and I think that’s a reasonable judgment in an uncertain world,” Summers said on CNN.
Romer, the chief of the White House Council of Economic Advisers, also acknowledged that high unemployment still stings US families.
“The president has always said, and what I firmly believe, is you’re not recovered until all of those people that want to work are back to work,” said Romer on NBC’s Meet the Press program, adding that it was possible that “there will likely be further rises” before unemployment numbers fall definitively.
“These things certainly do bounce around. I would anticipate some bumps in the road as we go ahead,” Romer said, adding that the economy will only rebound if employment falls to about half of its current rate.
In his comments, Summers, an independently wealthy investor with longstanding ties to Wall Street, stressed the dramatic economic turnaround that has occurred since Congress passed an administration-backed bailout of banks and investment firms.
“We are not where we would like to be as a country, but gosh, it’s different from where it was when the Recovery Act was passed, when the question was whether we would have another Great Depression, and the question was whether the financial system would collapse,” he said on Sunday.
But in a bid to clear up the seemingly contradictory statements on the recession, White House Spokeswoman Jennifer Psaki issued a statement saying that jobs were the administration’s top priority.
“The bottom line is that the president and the economic team will not be satisfied until more Americans are working again,” she said.
“While outside economists define recessions by economic growth, the president and our economic team will not be satisfied until we’re getting people back to work so they can pay their bills and put food on the table,” she said.
Obama this week is juggling a crisis-filled agenda, as he prepares to travel to Copenhagen, Denmark, for international climate change talks, and as he continues to monitor the progress of legislation on health care reform, which he has called his top domestic priority.