Obama Adviser Romer Says U.S. May Soon Add Jobs
Jan. 10 (AFP) The government may need to continue “targeted” programs to stimulate the U.S. economy even as growth over the first half of this year likely will be enough to create jobs, President Barack Obama’s chief economist said.
“We are getting closer to stability in employment. The next step is to finally start adding jobs,” Christina Romer, the head of the White House Council of Economic Advisers, said today on ABC News’s “This Week” program. “I think we are on the path of steady progress.”
Romer said the administration will continue pursuing measures such as tax credits for businesses to expand and hire and spending on infrastructure, though not on the scale of the $787 billion stimulus enacted last year.
The Department of Labor’s latest unemployment report, which showed an unexpected loss of 85,000 jobs in December, was “somewhat of a setback,” Romer said, “but they are still part of this trend of greatly moderating job losses.”
The unemployment rate remained at 10 percent.
Since the recession began in December 2007, the U.S. economy has lost 7.2 million jobs. Obama administration efforts to accelerate job creation are constrained by his promise to also reduce the deficit from the record $1.4 trillion last year.
Tax Credits
Obama announced Jan. 8 the awarding of $2.3 billion in tax credits intended to reward companies that expand manufacturing of alternative energy technology, such as Vestas Wind Systems A/S and First Solar Inc. The credit was part of the stimulus and the administration forecasts it will create 17,000 jobs.
The administration last month announced its support for a $5 billion expansion of the tax credit to cover more companies that made a bid for the program.
Obama already has laid out plans to seek more spending for repairing and modernizing the nation’s infrastructure, expanded credit availability for small businesses, and tax credits to encourage greater energy efficiency for homes and businesses.
Driving down the unemployment rate also will help shrink the federal budget deficit, Romer, 51, said.
“You don’t get your budget deficit under control at a 10 percent unemployment rate,” she said in a separate interview on CNN’s “State of the Union” program.
Health-Care Overhaul
The president’s drive to overhaul the U.S. health-care system is also crucial for getting the budget under control, she said. Romer cited forecasts by the Congressional Budget Office that the Senate version of the legislation would reduce the shortfall over 10 years.
One part of the health-care legislation that would help control costs is a tax on so-called Cadillac insurance plans that is part of the Senate bill, she said.
As one way to pay for the changes, the Senate would impose a 40 percent tax on employer-provided insurance plans that exceed $8,500 for individuals and $23,000 for families, with higher allowances for retirees and workers in high-risk professions such as mining and firefighting.
Obama “has been convinced by experts across the ideological spectrum that this is one of those things that genuinely slows the growth rate of costs,” Romer said. “Anybody that’s worried about the budget deficit knows that we’ve got to do that.”
“The important thing is the incentive it provides to genuinely slow the growth of our costs,” she said. “We certainly have looked very hard at the CBO estimates and think they are very reasonable.”
Labor leaders, including AFL-CIO labor federation President Richard Trumka and Service Employees International Union President Andy Stern, are scheduled to meet with Obama tomorrow to discuss the tax.
Restraint on Compensation
Romer also said she hopes banks and other companies that received federal bailout money will show restraint on bonuses for their executives.
The bailout “was the right thing to do for the American people because we know that when credit stops, the economy stops,” Romer said. “But we’ve provided extraordinary aid and the idea that as the financial system heals they just go back to business as usual is simply outrageous.”
The administration is going to “redouble our efforts” on overhauling financial regulations, she said.
Obama supports giving shareholders a non-binding vote on executive compensation.
“We simply have to put in place rules of the road so that this system doesn’t bring this economy to the edge of collapse like it did a year or so ago,” she said.
Jan. 10 (AFP) The government may need to continue “targeted” programs to stimulate the U.S. economy even as growth over the first half of this year likely will be enough to create jobs, President Barack Obama’s chief economist said.
“We are getting closer to stability in employment. The next step is to finally start adding jobs,” Christina Romer, the head of the White House Council of Economic Advisers, said today on ABC News’s “This Week” program. “I think we are on the path of steady progress.”
Romer said the administration will continue pursuing measures such as tax credits for businesses to expand and hire and spending on infrastructure, though not on the scale of the $787 billion stimulus enacted last year.
The Department of Labor’s latest unemployment report, which showed an unexpected loss of 85,000 jobs in December, was “somewhat of a setback,” Romer said, “but they are still part of this trend of greatly moderating job losses.”
The unemployment rate remained at 10 percent.
Since the recession began in December 2007, the U.S. economy has lost 7.2 million jobs. Obama administration efforts to accelerate job creation are constrained by his promise to also reduce the deficit from the record $1.4 trillion last year.
Tax Credits
Obama announced Jan. 8 the awarding of $2.3 billion in tax credits intended to reward companies that expand manufacturing of alternative energy technology, such as Vestas Wind Systems A/S and First Solar Inc. The credit was part of the stimulus and the administration forecasts it will create 17,000 jobs.
The administration last month announced its support for a $5 billion expansion of the tax credit to cover more companies that made a bid for the program.
Obama already has laid out plans to seek more spending for repairing and modernizing the nation’s infrastructure, expanded credit availability for small businesses, and tax credits to encourage greater energy efficiency for homes and businesses.
Driving down the unemployment rate also will help shrink the federal budget deficit, Romer, 51, said.
“You don’t get your budget deficit under control at a 10 percent unemployment rate,” she said in a separate interview on CNN’s “State of the Union” program.
Health-Care Overhaul
The president’s drive to overhaul the U.S. health-care system is also crucial for getting the budget under control, she said. Romer cited forecasts by the Congressional Budget Office that the Senate version of the legislation would reduce the shortfall over 10 years.
One part of the health-care legislation that would help control costs is a tax on so-called Cadillac insurance plans that is part of the Senate bill, she said.
As one way to pay for the changes, the Senate would impose a 40 percent tax on employer-provided insurance plans that exceed $8,500 for individuals and $23,000 for families, with higher allowances for retirees and workers in high-risk professions such as mining and firefighting.
Obama “has been convinced by experts across the ideological spectrum that this is one of those things that genuinely slows the growth rate of costs,” Romer said. “Anybody that’s worried about the budget deficit knows that we’ve got to do that.”
“The important thing is the incentive it provides to genuinely slow the growth of our costs,” she said. “We certainly have looked very hard at the CBO estimates and think they are very reasonable.”
Labor leaders, including AFL-CIO labor federation President Richard Trumka and Service Employees International Union President Andy Stern, are scheduled to meet with Obama tomorrow to discuss the tax.
Restraint on Compensation
Romer also said she hopes banks and other companies that received federal bailout money will show restraint on bonuses for their executives.
The bailout “was the right thing to do for the American people because we know that when credit stops, the economy stops,” Romer said. “But we’ve provided extraordinary aid and the idea that as the financial system heals they just go back to business as usual is simply outrageous.”
The administration is going to “redouble our efforts” on overhauling financial regulations, she said.
Obama supports giving shareholders a non-binding vote on executive compensation.
“We simply have to put in place rules of the road so that this system doesn’t bring this economy to the edge of collapse like it did a year or so ago,” she said.
sourceAFP
