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Summers: Rising Employment Shows US Economy on ‘Right Road’

Sunday, 05 Feb 2012 02:07 PM

Former U.S. Treasury Secretary Lawrence Summers said the latest jobs report shows the economy is “on the right road” while Glenn Hubbard, an adviser to Republican presidential candidate Mitt Romney, downplayed the impact of recent jobs data.

“Unlike many of the favorable past reports, if you look beneath the surface of this one almost every indicator within it is favorable,” Summers said Sunday on ABC’s “This Week,” where he appeared with Hubbard, dean of the Columbia Business School.

Employers added 243,000 jobs in January, the biggest gain in nine months, and the unemployment rate dropped to 8.3 percent from 8.5 percent in December, the Labor Department reported last week in Washington. The improvement exceeded the most optimistic forecasts in a Bloomberg News survey of economists.

Summers, director of the National Economic Council under Democratic President Barack Obama until last year, said the administration needs to build on the momentum reflected in the jobs report.

Hubbard said the improved employment data was driven a drop in the number of people who are looking for jobs while the rate of underemployment remains high. Administration policies have stood in the way of the recovery, he said.

Serious Debate

“There needs to be a serious debate on what we can do in tax policy, in health care, in regulation and financial reform to actually create jobs,” Hubbard said.

Obama administration officials offered a calibrated public response to the report last week, with nine months to go before the November election and the U.S. economy still vulnerable to risks such as a worsening of the European debt crisis.

Obama said that while too many people in the U.S. still don’t have jobs, the data show “the economy is growing stronger” and “the recovery is speeding up.” In remarks Feb. 3, Obama appealed to Congress to pass an extension of the payroll tax cut for workers and unemployment benefits.

“Do not slow down the recovery that we’re on,” Obama said, directing his words at lawmakers. “Don’t muck it up.”

Romney, 64, said upon winning Nevada’s caucus yesterday that Obama didn’t deserve credit for January’s drop in the unemployment rate.

“Mr. President, we welcome any good news on the jobs front,” Romney said. “But it is thanks to the innovation of the American people in the private sector and not to you.”

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