President Obama summoned former President Bill Clinton and business leaders to the White House on Wednesday to talk about how to improve the nation’s employment situation, on the same day that the administration released a report alleging that their $862 billion stimulus has saved roughly three million jobs.
The meeting with Clinton was announced mid-morning on Wednesday and was yet another sign that Obama is worried by the increasing perception that his policies — particularly the regulatory regimes created by the health care and financial regulation legislation — are anti-business and are having a negative impact on the economy.
Obama and Clinton met with Honeywell CEO David Cote, Bank of America CEO Brian Moynihan, Centerbridge Partners Managing Principal Mark Gallogly, Johnson Controls VP David Myers, Hannon Armstrong CEO Jeff Eckel, and Ameresco executive VP David Anderson.
The message sent by the meeting also undercuts the administration’s attempt to promote the effect of the stimulus. Many Americans are already dubious about the stimulus, according to most polls.
Only 23 percent of those surveyed in a CBS News poll released Tuesday said they think the stimulus has improved the economy at all.
However, the U.S. Chamber of Commerce’s President Thomas Donahue gave a surprising defense of the stimulus Wednesday, following a speech where he blasted the administration’s overall economic agenda.
“We thought we were days away from a global recession, so we backed it. America had to do something,” Donahue said of the Chamber’s support for the stimulus early in 2009. “Has it done everything we wanted it to do? No. Has it created as many jobs as everybody hoped? No.”
“Would I do it again at the same time? Hell yes,” Donahue said. “Would I do it now for another one? No.”
But Alan Simpson, one of the two co-chairs of Obama’s fiscal commission, acknowledged that the stimulus has acquired a bad name.
“I hate to use the word stimulus. Now that’s a flash word,” Simpson said at a jobs summit hosted by the Chamber.
Adding to the stimulus stigma, ABC News reported Wednesday that the government has spent $20 million on signs advertising stimulus projects, including $10,000 just for one sign near Dulles Airport.
But Douglas Holtz-Eakin, a former director of the Congressional Budget Office, said the stimulus is really a secondary debate at this point.
“It’s not a stimulus question. The economy as recovered. We’re growing. We need pro-growth policies so that we grow faster,” said Holtz-Eakin, who was Sen. John McCain’s top economic adviser during his campaign for the presidency.
The Obama White House, Holtz-Eakin said, has “nothing in their arsenal that helps business and exports grow more rapidly. Households are too strapped and governments are too strapped to lead us out of this.”
Further, he said, the tax credits in the stimulus all expire at the end of this year, “so this is the time for us to figure out what we want our tax code to do and not do.” He said tax credits and loopholes should be closed but taxes on top marginal tax rates and on dividends should not be increased, that small businesses should not be hit with onerous requirements like the one in the financial regulation bill that will increase their reporting burden, that the corporate tax rate should be lowered, and that the government’s plan to reduce its deficit and debt should be more concrete.
The White House released a report Wednesday stating that the stimulus “has saved or created between 2.5 and 3.6 million jobs.”
The report emphasized the amount of private sector capital being “leveraged” by stimulus spending, such as $46 billion in federal spending that they say is making possible the expenditure of $107 billion on renewable energy projects.
But the “green jobs” initiative has turned out in many cases to be more of a long-term investment than an immediate producer of jobs. That has created one of the central tensions of the stimulus for the White House, as they have increasingly had to defend the program with arguments that the massive expenditure of taxpayer funds will at some point create jobs down the road, at a moment when most of the country wants to see jobs right now.
White House officials have acknowledged that the job market needs marked improvement but argue that the president’s policies stopped a recession from becoming a depression and have at least begun to grow the economy, even if it’s at a pace that will not bring unemployment under nine percent any time soon.
“We’re not unfurling the ‘mission accomplished’ banner. Seeing an increase and an improvement in our economy does not mean that the job is done,” said White House press secretary Robert Gibbs on Tuesday.
Gibbs said that the causes of the economic downturn built up over time and that it will take a long time to build the economy back up.
“This was a long time coming, and the hole that it left in our economy, particularly with jobs, was as deep as it has ever been. That is going to take some time,” Gibbs said.
Jared Bernstein, a top economic adviser to Vice President Joe Biden, compared the “green jobs” and renewable energy initiatives this week to the Internet in terms of its long-term promise.
“There’s a view that crisis sometimes provides opportunities,” Bernstein told the Washington Post.
But telling the country that jobs will be coming eventually is not a winning political argument, and the White House knows it. That explains the meeting with Clinton Wednesday, who is not only considered one of the Democratic Party’s most brilliant political minds but who also presided over a period of economic prosperity and worked with a Republican-controlled Congress to pass conservative, free market legislation such as a reduction in the capital gains tax and welfare reform.
Brad Dayspring, a spokesman for House Minority Whip Eric Cantor, surmised that Clinton was being brought in as a “mediator” between Obama and business leaders.
“How badly has the train gone off the tracks down at 1600 Pennsylvania [Ave.] that policy meetings with American entrepreneurs have become a hostile environment?” Dayspring said.
White House officials rejected that notion, pointing to numerous meetings the president has had with top business leaders at the White House. Obama met with investment titan Warren Buffett at the White House on Wednesday morning, and the White House released a photo of the president listening and looking at a sheaf of papers in Buffet’s hand.
Obama and Buffett discussed “the economy and our ongoing efforts to work with the private sector to stimulate growth and create jobs,” a White House official said.
Rep. Darrell Issa, California Republican, said the stimulus report was an attempt by the White House to “intentionally mislead” Americans about the impact of the president’s economic policies.
“Less than a year ago, the Recovery Board abandoned efforts to count jobs saved or created by the stimulus and decided to instead count jobs paid for with stimulus funds regardless of whether or not they were ever in jeopardy of being lost,” Issa said. “The reality for the American people is that we have lost 2.3 million jobs since the stimulus passed and are now 7.4 million jobs short of the president’s promised level of jobs the economy would support by 2010.”
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