Obama pivots his attention to economic health
WASHINGTON -- President Obama, after working on health care for most of the past month, turns attention this week to the overall economy — and Republican attacks on his $787 billion stimulus bill and the unemployment rate.
Obama returns this week to the economically battered city of Elkhart, Ind., which he visited on Feb. 9 to promote the then-pending stimulus bill. The White House also is bracing for an end-of-the week report that Obama said will likely show another rise in unemployment.
In recent days, Obama has credited what he calls the "Recovery Act" for signs that the recession is slowing, including a better-than-expected report on the gross domestic product (GDP). The increased spending by local, state and federal governments as a result of the stimulus was the key reason for the sharp improvement in the GDP.
The stimulus package of tax cuts and jobs projects, along with foreclosure help and aid to banks, "have helped put the brakes on this recession," Obama said in his weekend radio address.
Nevertheless, this is cold comfort to people out of work, Obama said, and Friday's unemployment report for July "is likely to show that we are continuing to lose far too many jobs in this country."
Republicans have been quick to point out that the jobless rate jumped to 9.5% in June. In February, the month Obama signed the stimulus bill, the unemployment rate was 8.1%. Republicans also note that the annual budget deficit now exceeds $1 trillion.
"The American people know we can't borrow and spend and bail our way back to a growing economy," Rep. Mike Pence, R-Ind., said on Fox News Sunday.
On other Sunday morning shows, Treasury Secretary Timothy Geithner and Obama economic aide Lawrence Summers said they could not rule out tax hikes because of the deficit and the potential cost of the health care overhaul. Asked whether "new revenues" are in the offing, Geithner said on ABC's This Week With George Stephanopoulos: "I think what the country needs to do is understand we're going to have to do what it takes."
Obama extolled the latest report on the GDP, which contracted only 1% during the second quarter of 2009, less than what most economists projected. The economy fell 6.4% in the first three months of this year.
In an interview with Univision that aired Sunday, Obama said, "We maybe are beginning to see the end of the recession, but it's still going to be some time before we are seeing companies hiring again."
Geithner said on ABC that most economists believe the jobless rate won't start to fall until the second half of next year.
Obama doesn't plan to ignore health care in the coming days. In the radio address, Obama said he is returning to Elkhart because it has been hit by "the broader economic changes of recent decades" that include higher health costs. As it was during Obama's visit in February, Elkhart is among the nation's leaders in unemployment, at 16.8%.
The economy needs a "new foundation" to ward off future crises, Obama said, including a better health care system, improved education and development of "a new clean energy economy."
Contributing: The Associated Press