President Barack Obama on Saturday tempered excitement about a growing economy with a sober outlook that more people will lose their jobs. He called that a heartbreaking reality and cautioned that even a burst of upbeat news “does not mean there won’t be difficult days ahead.”
Obama’s straddle served to set expectations for a nation emerging from recession but anxious for an economic security that has not nearly returned.
The good news of the week: The economy is on the rise for the first time in more than a year. Fro m July through September the economy grew by 3.5 percent, the strongest uptick in two years. Obama called the development no cause for celebration, but a welcome sign after so many months of distressing news.
“While we have a long way to go before we return to prosperity, and there will undoubtedly be ups and downs along the road, it’s also true that we’ve come a long way,” Obama said in his weekly radio and Internet address. “It is easy to forget that it was only several months ago that the economy was shrinking rapidly and many economists feared another Great Depression.”
Yet the economic indicator that matters most to the majority of families — stable, solid employment — is still lagging.
Unemployment hit a 26-year high of 9.8 percent in September, and the October report due in the coming week could show it topping 10 percent.
“Economic growth is no substitute for job growth,” Obama said. “And we will likely see further job losses in the coming days, a fact that is both troubling for our economy and heartbreaking for the men and women who suddenly find themselves out of work. But we will not create the jobs we need unless the economy is growing.”
He added, “Positive news today does not mean there won’t be difficult days ahead.”
Obama’s assessment came a day after the White House said the economic stimulus plan it championed has so far saved or created 1 million jobs.
Senate GOP leader Mitch McConnell of Kentucky said the administration’s claim of success was “bewildering” given that many more people have lost their jobs since the $787 billion stimulus package was put in place. He said the will of the people would keep driving an economic rebound as long as Washington “doesn’t shackle our growth with more taxes, more spending and more debt.”
The White House’s figures are pegged to an independent federal board’s report that nearly 650,000 direct jobs have been saved or created because of stimulus program money provided to businesses, contractors, state and local governments, nonprofit groups and universities. The 1 million jobs cited by Obama also includes those from direct economic assistance, plus those linked to the boost from $288 billion in tax cuts under the stimulus program, the White House says.
Obama took the time to underscore, as he often does, that the investment of tax money is paying off. He said his administration has taken steps to help get credit to people and businesses of all sizes, stem home foreclosures, cut taxes, create jobs and help people who need it, such as seniors and the unemployed.
“These investments aren’t just helping us recover in the short term,” Obama said. “They’re helping to lay a new foundation for lasting prosperity in the long term and they’re giving hardworking, middle-class Americans the chance to succeed and raise a family. Because of the investments we’ve made and the steps we’ve taken, it’s easier for middle-class families to send their kids to college and get the training and skills they need to compete in a global economy.”
Many analysts caution that it will be hard to sustain the growth at the pace seen in the third quarter.
Government stimulus programs including the popular Cash for Clunkers auto rebates and tax credits for first-time home buyers bolstered the economy. Once the government’s stimulus measures run their course, the economy could run afoul of lingering problems such as high unemployment and weak consumer spending.
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