- The Washington Times - Thursday, February 11, 2010

The White House said Thursday that unemployment will remain high for the near future and could climb back above the current 9.7 percent rate even as employers start hiring again.

The administration’s annual report to Congress reaffirms the bleak forecast that accompanied President Obama’s fiscal 2011 budget, as well as its description of the George W. Bush administration’s role in ballooning the federal deficit.

The economy is forecast to grow 3 percent this year while employment should rise to its normal growth of about 100,000 jobs a month, the Council of Economic Advisers wrote in the 462-page report. In an attached letter, Mr. Obama touted his efforts to counter the recession, saying last year’s $787 billion stimulus package helped the nation avert an economic catastrophe, and called for Congress to act on his proposals for a new jobs bill and an overhaul of the financial regulatory system.

“Through these reforms, we seek not to undermine our markets but to make them stronger: to promote a vibrant, fair and transparent financial system that is far more resistant to the reckless, irresponsible activities that might lead to another meltdown,” Mr. Obama said.

The CEA report, which calls for “rebalancing” the tax code so that households earning more than $250,000 are subject to pre-Bush income-tax rates, comes just days after Mr. Obama told Bloomberg News he was “agnostic” on the idea of raising taxes on the middle class to help chip away at the deficit.

“The whole point of it is to make sure that all ideas are on the table,” Mr. Obama told Bloomberg of his proposed commission that would be charged with tackling the nation’s long-term fiscal woes. “So what I want to do is to be completely agnostic, in terms of solutions.”

The administration’s new budget, unveiled earlier this month, predicts a deficit of $1.55 trillion this year, which it would reduce to $1.2 trillion in fiscal 2011. Mr. Obama announced plans to create a bipartisan commission after the Senate defeated a bill that would have created a similar body but with legislative authority.

Republicans were quick to criticize the report, which they said contained little substance, noting the White House buried in the report the news that a full employment recovery to pre-Obama levels will take years.

“The Obama administration’s report is full of blame for the policies of the past, praise for its own failed policies, and promises about their ideological agenda to grow government. Cutting beyond the fluff, the truth that unemployment won’t fall back to its 2008 level for another seven years shows up on Page 75,” said Rep. Eric Cantor, Virginia Republican, who is the minority whip. “Instead of praising themselves and blaming others, a greater focus on small businesses and smart solutions to reduce uncertainty and create jobs would be welcome and long overdue.”

LOAD COMMENTS ()

 

Click to Read More

Click to Hide