Research Briefing

Obama’s “Recovery Summer” Ends

With Millions Of Americans Still Unemployed

“Let’s See, What Happened This Summer? Easy Question. The Recovery Went Missing.” (Bill Bonner, “The Summer The Recovery Went Missing,” The Christian Science Monitor’s “The Daily Reckoning” Blog, 9/2/10)

TODAY’S BLS SHOWS MORE JOBS LOST DURING OBAMA’S “RECOVERY SUMMER”

Today, BLS Reported That 54,000 Jobs Were Lost In August.  (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 9/3/10)

And The Unemployment Rate Increased To 9.6 Percent.  (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 9/3/10)

• Real Unemployment, Which Includes Workers Who Are Working Part-Time But Who Want Full-Time Work, Increased From 16.5% To 16.7%. (Bureau Of Labor Statistics, BLS.gov, Accessed 9/3/10)

During “Recovery Summer” 108,000 Jobs Were Lost.  (U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 9/3/10)

“RECOVERY SUMMER” LACKING ONE KEY INGREDIENT – A RECOVERY

MSNBC’s Chuck Todd: “I Have To Say These Housing Numbers, This Entire Summer, Remember It Began – The Administration Called It ‘Recovery Summer.’ Every Economic Indicator Has Collapsed In The Last Two Months.” (MSNBC, “The Daily Rundown,” 8/25/10)

“The Economy Is The No. 1 Issue For Voters, Polls Show, And As The Midterm Elections Near, It's Becoming Increasingly Clear That What The Administration Dubbed The ‘Summer Of Recovery’ Has Not Yet Met The Public's Expectations.”  (“Obama Juggles Thorny Issues In Week Ahead,” CNN’s “Political Ticker,” Blog, 8/30/10)

Democrats Privately Admit That “Recovery Summer” Is Not Going To Show Up In Time For The Fall’s Elections. “They no longer believe the jobs and housing markets will recover – or that anything resembling the White House’s promise of a ‘recovery summer’ is under way. They are even more concerned by indications that House Democrats once considered safe – such as Rep. Betty Sutton, who occupies an Ohio seat President Barack Obama won with 57 percent of the vote in 2008 – are now in real trouble.” (Jim Vandehei, Alex Isenstadt, and Mike Allen, “Democrats Privately Fear House Prospects Worsening,” Politico, 8/25/10)

• Some Dems Are “Furious” That The White House Has Been Responsible For A Variety Of Distractions And Not Focused On The Economy. “Several House Democratic sources said they are furious with the White House for keeping the debate over a New York mosque in play for two weeks — and then announcing Obama will use a prime-time address next week to discuss Iraq, not the economy.” (Jim Vandehei, Alex Isenstadt, and Mike Allen, “Democrats Privately Fear House Prospects Worsening,” Politico, 8/25/10)
• “By The Calculations Of House Democrats, This Means That By Labor Day They Will Have Spent Nearly Nine Weeks This Summer Beating Back Negative Or Unhelpful Story Lines Instigated, In Part Or In Total, By The White House.” (Jim Vandehei, Alex Isenstadt, and Mike Allen, “Democrats Privately Fear House Prospects Worsening,” Politico, 8/25/10)

After The Economy Deteriorated During “Recovery Summer” Dems Are Going To Have To “Eat Their Words.” “The White House dubbed it ‘Recovery Summer’ and President Obama declared the economy had begun ‘growing at a good clip.’ Vice President Joe Biden predicted weeks earlier that creation of 250,000 to 500,000 new jobs a month could soon be on the horizon. But with summer quickly coming to an end, those jobs gains and a robust economic recovery have not yet materialized, leaving Democrats on the verge of a fall election campaign in which Republicans are poised to make them eat their words.” (Devin Dwyer, “GOP Targets Obama's 'Recovery Summer' Amid Economic Gloom,” ABC News, 8/24/10)

AND THE ECONOMIC OUTLOOK REMAINS BLEAK FOR THE FALL

A Small Business Survey By Citibank Finds That Nearly All, “A Massive 86 Percent”, Are Bracing For A Double-Dip Recession. “The recession has unquestionably taken a psychological toll on entrepreneurs. But it's also caused them to brace their businesses for the worst. A massive 86 percent of small-business owners fear a double-dip recession, according to a quarterly survey by Citigroup. That said, three-quarters of those polled say they are somewhat or very prepared for another downturn.” (Courtney Rubin, “Survey: Nearly All Small Firms Fear Double-Dip Recession,” Inc., 9/1/10)

83 Percent Of Small Business Will Not Be Hiring Anytime Soon. “Hiring freezes will remain constant, with 83 percent saying they'll keep their workforce numbers steady or reduce them. (Seven percent of those surveyed said they planned to trim their employee numbers, down from 8 percent in April.) That leaves 17 percent who are planning to hire – the same as the previous quarter. Nine in 10 said they'd need to see sales increase for at least two consecutive quarters before hiring.” (Courtney Rubin, “Survey: Nearly All Small Firms Fear Double-Dip Recession,” Inc., 9/1/10)

A Survey Of Mid-Western Manufacturers Finds That  More Than A Third Expect The US To Fall Into Another Recession. “More than a third of supply managers in nine Midwest and Plains states surveyed for a regional business index expect the U.S. economy to fall into another recession next year, even as key measures of the index remained positive.” (“Midwest Survey Suggests Some Recession Fears,” The Associated Press, 9/1/10)

Their Pessimism May Be Tied To The Prospect Of Tax Increases In 2011. “‘These results are very similar to what we recorded coming out of the 2001 recession,’ said Creighton University economics professor Ernie Goss, who oversees the report. ‘Of course, the big difference is that tax cuts were passed in 2001 and 2003. At this point in time, Americans are staring at a significant tax increase on Jan. 1, 2011.’” (“Midwest Survey Suggests Some Recession Fears,” The Associated Press, 9/1/10)

Small Business & Entrepreneurship Council President And CEO Urges Dems To Stop Pushing Small Business Bill Saying It Does Not Address The Real Reasons Small Businesses Are Hurting. “Small Business & Entrepreneurship Council President and CEO Karen Kerrigan on Tuesday urged Democratic leaders to stop pushing for passage of the small-business lending bill because it does not address the underlying reasons for why small-business expansion has stalled. ‘The concerns and needs of most business owners go much deeper, and this legislation does not address broader issues related to taxes, regulations and excessive spending which threaten to aggravate currently poor economic conditions,’ she said in prepared remarks. ‘At the end of the day, proposed tax hikes along with legislation and regulatory initiatives in the pipeline will drive business costs higher and drain more private capital from our economy.’” (Jay Heflin, “Small-Business Advocate Says Lending Bill Will Not Help Economy,” The Hill, 8/31/10)

• Kerrigan Argues That The Threat Of The Dems’ Tax Hike And New Healthcare, Energy, And Financial Services Regulations Have Hurt Small Businesses. “Kerrigan, however, argues that new regulations from the Department of Labor, the Environmental Protection Agency and the IRS, along with the expiration of Bush-era tax cuts and new proposals affecting telecommunications, energy, healthcare and financial services have helped small-business owners feel as if they are under siege from Washington. These issues have also stopped them from hiring until they have a clearer picture of what the regulatory landscape will look like in the near future.”  (Jay Heflin, “Small-Business Advocate Says Lending Bill Will Not Help Economy,” The Hill, 8/31/10)