President Bush on Wednesday distanced himself from his economic advisers’ claim that the economy would add 2.6 million jobs this year, enough to erase virtually all of the job losses incurred during his first term.
The jobs projection was included Feb. 9 in Bush’s annual economic report to Congress, but during an Oval Office appearance Wednesday, he refused to endorse the estimate. When a reporter asked about the projection, Bush said, “I think the economy is growing. And I think it’s going to get stronger.”
Bush’s comment came a day after two of his top economic advisers, Treasury Secretary John Snow and Commerce Secretary Donald Evans, refused to publicly endorse the job estimate, issued nine days ago by Bush’s Council of Economic Advisers.
“I think we are going to create a lot of jobs,” Snow said Tuesday in Washington state. “How many I don’t know, but we’re going to keep working on it.”
Congressional Democrats on Wednesday assailed Bush for providing only “broken promises and mixed messages” to the 2.3 million workers who have lost their jobs since Bush took office in 2001. In a letter sent to the president, Democratic leaders said Bush’s shift on jobs estimates raised serious questions about whether “the administration’s economic policies are in disarray.”
“We urge you to provide meaningful jobs predictions that all Americans, including your own Cabinet, would find credible,” the six Democrats, including Senate Minority Leader Tom Daschle of South Dakota, wrote.
Sen. John Kerry, the Democratic presidential front-runner, also took the administration to task during a campaign stop in Dayton, Ohio.
“Now they’re already walking backwards on their own predictions,” Kerry said.
The Massachusetts senator said the president needs to do a better job putting Americans back to work.
Kerry’s comments
“What it says to me is they don’t know what they’re talking about when it comes to economic policy,” he said.
The jobs estimate is only the latest partisan flap over the economy, the top issue for voters heading into the campaign season. Last week, Gregory Mankiw, chairman of Bush’s Council of Economic Advisers, sent shock waves through Capitol Hill and the campaign trail by advocating the benefits of having U.S. businesses ship jobs overseas.
“This president faces a credibility gap with his own economic team that’s as wide as the employment gap for millions of American workers,” Rep. Rahm Emanuel (D-Ill.), an adviser in the Clinton White House, said.
Bush’s decision not to endorse the jobs projection indicates concern among Bush aides that the number of jobs to be added before November’s election would fall short of that mark.
It also removes a benchmark by which the effectiveness of Bush’s policies could be measured. Democrats, who earlier denounced the estimate as overly optimistic, could have used it against the president if job growth fell below Bush’s own higher projection.
Not yes, not no
While the White House will not affirm its jobs projection, it also will not acknowledge that it erred in predicting the number of jobs to be created this year.
In a sometimes contentious briefing with reporters, White House spokesman Scott McClellan played down the significance of the projection and insisted that Bush is worried only about actual job growth and not some economist’s prediction.
“Economists do economic modeling. They make forecasts,” McClellan said. “There are a number of different economists out there with different interpretations, and [the jobs estimate] is based on assumption at that point in time.
“People can debate the numbers all they want, but the president is going to be looking at the actual number of jobs being created,” he said. “And the number of jobs being created is growing.”
366,000 jobs added
The economy has added 366,000 jobs since August.
Sung Won Sohn, chief economist at Wells Fargo Bank, called the administration’s original projection “on the high side,” saying growth of 1.8 million jobs this year is more likely.
The economic models used by the White House made assumptions about how much economic activity is needed to create a certain number of jobs, Sohn said.
“But the problem is that the traditional relationship between economic growth and employment has broken down,” he said.
David Wyss, chief economist at Standard and Poor’s, said, “They just figured out the arithmetic doesn’t work.”
Job growth was so sluggish in January and February that it would have to surge in the next several months to meet such a projection, he said.
“I just think someone got a bit sloppy with the numbers,” said Wyss, who noted that even adding 1.8 million jobs would be “optimistic.”
Credibility a concern
The flap comes at a time when the administration is already under fire for its faulty assessments on the threat posed by Iraq, the estimated size of the deficit and the cost of a Medicare drug benefit that Bush pushed through Congress.
But McClellan fired back at Democrats who assert that the jobs estimate again raised questions about Bush’s credibility, saying their economic proposals, including rolling back some of Bush’s tax cuts, would hamstring the economy just as it is recovering.
“There’s an important debate going on in this nation, and there’s a clear choice,” said McClellan, who usually declines to publicly address campaign issues. “Some people want to turn back and take actions that would raise taxes on people at a time when our economy is really starting to grow strong.”
