- The Washington Times - Wednesday, February 18, 2004

ASSOCIATED PRESS

President Bush distanced himself yesterday from White House predictions that the economy will add 2.6 million jobs this year, the second embarrassing economic retreat in a week and new fuel for Democratic criticism.

“Now they’re already walking backwards on their own predictions,” Democratic presidential front-runner Sen. John Kerry said in Ohio, where unemployment has risen from 3.9 percent to 6 percent since Mr. Bush took office.

The jobs controversy came on the heels of White House economist N. Gregory Mankiw’s assertion that “outsourcing” American jobs overseas was good for the U.S. economy in the long run. Mr. Bush, House Speaker Dennis J. Hastert, Illinois Republican, and other Republicans quickly disavowed Mr. Mankiw’s remarks, and the economist had to apologize for a “lack of clarity.”

Jobs are a sensitive political issue for Mr. Bush as he fights to keep his own job in a second term. The economy has lost 2.2 million payroll jobs since Mr. Bush took office, the worst job-creation record of any president since Herbert Hoover.

The forecast of 2.6 million new jobs was contained in the annual Economic Report of the President, a 412-page volume of charts, graphs and text that predicted a bright economic future. The forecast came under special scrutiny after Treasury Secretary John W. Snow and Commerce Secretary Donald L. Evans refused to repeat the optimistic prediction as they toured Washington and Oregon to promote the president’s economic programs.

Mr. Bush himself avoided embracing the 2.6 million number when asked about it yesterday. “I think the economy is growing,” Mr. Bush said. “And I think it’s going to get stronger.” He said he was pleased that 366,000 jobs have been added since August.

“We are interested in reality,” White House spokesman Scott McClellan said.

Democrats jumped on the White House retreat.

“This administration is floundering on the most basic concern of most Americans — jobs,” said Sen. Edward M. Kennedy, Massachusetts Democrat. “When two key architects of the president’s economic policy won’t even back up the White House’s own projections, it raises serious questions about their credibility. This is nothing less than a candid admission by the Bush administration that its economic program fails to create jobs.”

Mr. McClellan said the economic forecast was simply the work of “number crunchers.” He said Mr. Bush was not a statistician or predictor.

The administration’s economic forecast, on which it based its budget projections, predicted that payroll jobs would average 132.7 million per month this year, an increase of 2.6 million from the 2003 monthly average.

To achieve that average, the economy would have to create more than 2.6 million jobs in coming months because the level of jobs at the start of the year was lower than the administration had built into its forecast.

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