Obama tries to sell ‘recovery summer’ amid slow economy

President Barack Obama and his team are trying to sell Americans on an economic recovery this summer, but the economy is stubbornly refusing to cooperate.


Obama and his Cabinet officials will fan out across the country over the next few days to spread the message to voters about how effective their $787 billion recovery plan has been, an effort they’re calling “recovery summer.”

The administration’s message has run into several negative economic headwinds that have led to worries the economy is at risk of entering a double-dip recession, not a recovery.
 

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As Obama travels Thursday to a Kansas City, Mo., truck manufacturer and delivers an address on the economy Friday in Las Vegas, economists and even administration officials say there is very little for him to brag about.
Unemployment will probably rise above 10 percent and stay there or higher for the next nine months, well after the November midterm elections, according to Heidi Shierholz, who tracks labor figures closely for the Economic Policy Institute.
 
“The main story in the labor market right now is that we are adding jobs, but at a devastatingly slow pace, not even fast enough to start bringing the unemployment rate down,” Shierholz said. The economy added 83,000 private-sector jobs in June, but that’s not nearly enough to make up for the 7 million jobs lost during the recession.
 
Unemployment is exacerbating the housing crisis: People without jobs can’t buy homes. New home sales dropped 33 percent in May as a federal tax credit expired.
 
The administration did get a boost Wednesday from a spike in the markets. The Dow Jones Industrial average jumped 274 points on expectations of a positive corporate earnings season. That followed a horrible last week on Wall Street, in which the Dow fell by hundreds of points.
 
Still, the White House is clearly aware the dismal job figures will bring criticism from Republicans, Democrats and voters.

“The president was never under the illusion that economic recovery was going to happen overnight,” White House press secretary Robert Gibbs said Wednesday. “It is going to take some time. We will deal with the political ramifications of that.”


Obama and the White House take comfort the economy is moving in the right direction. They point out that the economy has added jobs in six of the last seven months and stress that when Obama took office the economy was losing 750,000 jobs a month.

“The most important thing is, are we moving in the right direction, are we making progress, and is the economy getting stronger, even if the pace is not all together like we'd want to see it?” Gibbs asked Wednesday.
 
At the same time, the administration is trying with the “recovery summer” to show things would have been worse without the much-maligned stimulus bill.
 
Dean Baker, co-director of the left-leaning Center for Economic and Policy Research, said Obama has himself to blame for the fact that so many Americans do not appreciate the steps Obama took to resurrect the economy.
 
Obama and his team did not do a strong job of communicating the necessity of the steps they took, and they have not been effective in convincing the country the situation would be much worse had Obama not pressed forward with his stimulus, he said.
 
“People don't understand what the stimulus is about,” said Baker, who advocated for a more robust stimulus package. “He just really lost that debate.
“I don't doubt it would be worse without their policies, without their stimulus, but it's hard to put too good a face on that.”


Jared Bernstein, Vice President Joe Biden's chief economist, conceded Wednesday that the administration must do more to advance the economy.

“We've got to do more — a lot more — to build on the momentum achieved thus far,” Bernstein told reporters during a briefing previewing Obama’s trip to Kansas City. Obama will tour the facilities of Smith Electric Vehicles, which received a $32 million stimulus grant to build all-electric trucks.
 
Gibbs said Obama is frustrated but understands the public doesn’t realize how much worse things would be if he had not acted as he did.


Obama is “frustrated in the sense that, look, obviously, you would like everyone to look back and say, ‘Here's where I am, and here's where I could have been,’” Gibbs said. “It's understandable why people don't necessarily think that.

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Thus the president will continue to hit the road, trying to make the case that his policies were necessary to avoid all-out disaster, Gibbs said.
“They may not have always been politically popular, but they were the right thing to do,” he said.
Obama has his work cut out for him in delivering this message, Baker said.


“I don't really see any good stories for them in the near future,” said Baker.
 
He pointed to the housing market as one reason for pessimism, but also noted that budget constraints are expected to lead state and local governments to lay off workers, exacerbating an already brutal labor market.
 
“If anything, it's likely to get worse,” he said of the economy.

This article was updated at 10:15 a.m. It initially contained incorrect information about the president's travel schedule.