Money in the Morning

BLAME GAME — President Obama and Republicans pointed fingers at each other Tuesday over an economy showing signs of slowing down.

Obama, in his first remarks at the White House after his family vacation, tried to reassure the country that the economic recovery will hold, and pressed Republicans to allow a vote on a small-business lending bill.

Obama, in the Rose Garden, called GOP opposition “directly detrimental to our economic growth," reports The Hill's Sam Youngman.

The president "said his administration 'remains focused every single day' on improving the economy, and complained that the small-business bill has 'been languishing in the Senate for months.' "

GOP leaders Sen. Mitch McConnell (Ky.) and Rep. John Boehner (Ohio) hit back, saying Democrats have increased debt and would increase taxes by letting the Bush-era tax cuts for the wealthy expire.

McConnell: "So it’s no surprise that most Americans think the country is on the wrong track and that Democrat policies have failed to do anything to fix their top concern, the economy."

Worth noting... GOP gets "unprecedented" 51 percent of support in Gallup generic ballot.

Despite last week's downgrade of 2Q GDP growth, consumer spending rose 0.4 percent in July, the biggest jump since March.

Still, income growth was weak, and auto sales may hit a 28-year low.

Obama to address AFL-CIO on Labor Day. Sam Stein:


WH press secretary Robert Gibbs, when asked at his Tuesday briefing if the $814 billion stimulus was too small, said "nobody had, in January of 2009, a sufficient grasp at the sheer depth of what we were facing."

Left-leaning economists blog their disagreement.

CalculatedRisk recalls reports of Christina Romer pushing for a larger stimulus.

Brad DeLong finds Gibbs "off message."

But Megan McArdle doubts the stimulus could have been much bigger: "...even if Republicans had simply magically disappeared, the government still would not have been able to borrow and spend $2.5 trillion in any reasonably short time frame, much less $4-5 trillion."

Matt Yglesias finds Fed vacancies forcing Bernanke to muddle the message, thus hurting the economy — and Dems' chances in the fall.


Gibbs also said Tuesday that Alan Simpson will remain on the WH panel, despite his Social Security-as-a-cow e-mail.

Dems on the fiscal commission more centrist than Republican members, Ezra Klein finds.

Something for the right: WSJ edit board says Obama is using the commission's talks on Social Security reform to play "bait-and-switch" on Republicans: "This has all the earmarks of a political bait and switch designed to ambush Republicans if they're gullible enough to believe his bipartisan pleas."

Sounds like the scenario Rep. Paul Ryan (R-Wis.) has warning about.

And something for the left: WaPo: "Women Set to Bear 72% of British Austerity Cuts." 

NOW and other women's groups last week warned of the disproportionate effect that Social Security benefit cuts will have on women last week in going after Alan Simpson.

Budget impact story of the day: "Cash-Poor Governments Ditching Public Hospital." WSJ:

Coming Wednesday/Thursday... Financial Crisis Inquiry Commission to hold hearing on "too big to fail" with Bernanke, FDIC Chairwoman Sheila Bair, and former Lehman CEO Dick Fuld.