The estimated 14 million unemployed Americans have virtually disappeared from Washington’s political discussion.
Congressional Republicans are focused on ways to cut federal spending as deeply as possible and have offered few details on proposals to spur the economy. In between dealing with recent national security crises, President Obama has released plans on education, energy and to encourage innovation.
But most of his ideas are unlikely to be approved in Congress anytime soon and even if they were would have limited impact on an unemployment rate of 8.9 percent. The president’s new “Win the Future” mantra says little about the present.
“I frankly don’t understand why policy makers aren’t more worried about the suffering of real families,” said Christina Romer, who was head of Obama’s Council of Economic Advisers until last fall. In a speech last week, she said, “I think there are tools, we have tools that we can use, and I think it’s shameful that we’re not using them.”
Both parties’ approaches are not surprising. Obama administration officials privately argue they would consider other ideas, such as aid to states which are struggling, but Republicans in Congress wouldn’t support additional “stimulus” money.
Republicans meanwhile say the original $787 stimulus ballooned the deficit, but failed to create enough jobs. They argue they do have a job creation agenda: stopping President Obama’s proposals, which they say are causing uncertainty for businesses, that in turn delays hiring. And Republicans have called for other policies to create jobs, such free-trade agreements.
The two positions have created an unusual debate in Washington. After weeks of wrangling, Republicans and Democrats are close to an agreement on $33 billion in additional cuts in federal spending for the rest of the year, a combination that does little to solve the long-term budget deficit problem and could add to the nation’s jobless. (A study Democrats circulated last month suggested a GOP bill that included $61 billion in cuts would eliminate 700,000 jobs over the next two years. No analysis has been done on the $33 billion reduction plan.
After this current budget debate, Republicans will move to other proposals to reduce spending and are unlikely to offer any kind of jobs plan, for reasons both political and ideological. (Many Republican members of Congress were elected on promises to cut spending, and most of them also oppose jobs created by government spending in principle.)
Some liberals say Obama should offer some kind of detailed jobs proposal, even if it is likely to die in Congress, to illustrate an alternative to the GOP. And Romer says there are other ideas, such as a short-term reduction in the taxes employers pay for Social Security, that the two parties could agree on that would create jobs.
But embroiled in the budget debate and wary of being cast again by the GOP as big spenders, the administration has so far not taken this route.
The president is largely out of public view, but his point-man on the budget negotiations, Vice President Biden, is likely to appear on Capitol Hill.