Democrats Struggle to Deliver on Jobs Vow Before Election

Friday, 30 Jul 2010 04:56 PM

 

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With November congressional elections fast approaching, time is running out for Democrats to deliver on voters' top concern: job creation.

President Barack Obama's Democrats have only managed to pass a handful of bills that tackle the nation's 9.5 percent unemployment rate in the face of unified Republican opposition and rising public concerns about government spending.

"The sand is almost out of the hourglass," said Chris Krueger, an analyst with the Concept Capital research firm.

While Obama scored major legislative successes on healthcare and Wall Street reform, the lack of action on jobs this year could lead to a painful reckoning for his party.

Some 67 percent of those surveyed in a Reuters/Ipsos poll last week said Obama is not focusing enough on job creation. Voters in that survey said the economy and jobs were the most pressing issues facing the country.

Even if Congress does manage to pass more jobs legislation this year, it would likely come too late to lower the unemployment rate before the November 2 election in which all 435 House of Representatives seats and 37 of the 100 Senate seats will filled.

Democrats hoped early this year to extend many programs included in the $862 billion Recovery Act that Congress passed in February 2009 in response to the sputtering economy. Those included highway construction, expanded safety-net programs and aid to help cash-strapped state and local governments avoid layoffs of teachers, police and other public employees.

The House of Representatives passed a $155 billion package in December and the Senate responded in March with a $149 billion bill that paired safety-net spending with business tax breaks.

But the two chambers have been unable to reconcile their proposals as Republicans and some centrist Democrats have insisted that any new spending be offset by cuts elsewhere, rather than adding to the huge budget deficit.

A measure to expand lending to small businesses also has stalled in the Senate.

Congress has only sent two significant job-creation bills to Obama this year to sign into law — a $17 billion package centered on a payroll tax break for businesses that hire unemployed workers, and a $34 billion measure that extends unemployment benefits through November.

Congress goes into recess until the middle of September after next week and many lawmakers are likely to drift away in the fall to campaign for re-election.

Senate Democrats say they hope to pass more aid to state and local governments that are facing hundreds of thousands of job cuts in coming months.

They also point out that other legislation on the agenda, such as a measure to upgrade the nation's air-traffic control system, would create work.

But other job generators like expanded highway construction appear to be off the table.

"Let's not kid ourselves," said Rod Bennett, an official with the Laborers International Union of North America, which has pressed for more transportation spending. "I don't really hold out much hope for getting anything done before November."

Although Democrats have managed to pass six job-creation bills in the House, they have had less success in the Senate, where Republicans have greater power to block or delay legislation.

Unemployment benefits have been disrupted on three occasions this year by Republicans who brought the Senate to a standstill.

But blaming Republicans for obstructing progress may not register with voters.

"I could try to run a campaign talking about how the Senate's the problem, but people back home don't care. They just care whether we got it done or not," said Representative Tom Perriello, a Virginia Democrat who faces a tough re-election campaign.

Rising public concern about record federal budget deficits is complicating the jobs push.

Many economists agree with Democrats that deficit spending is the right approach to stimulate a slack economy. But that argument may not sit well with voters who view government spending through the lens of their own household finances.

"The public, based on personal experience, thinks that if you're in trouble and you have debt, one of the reasons you're in trouble is because you have debt. That logic doesn't carry over to the national economy," said Chad Stone, chief economist at the liberal-leaning Center on Budget and Policy Priorities.

Roughly half of those surveyed recently by the center-left Third Way think tank said the government should act now to balance the budget even if it meant reducing job-creation efforts. Only 42 percent said it was more important to create jobs in the short term.

Deficit concerns have prompted some centrist House Democrats who represent areas with relatively low unemployment to vote against jobs bills that do not offset their costs.

"The deficit is more important at this point — any bill you have to pass has to be neutral to the budget," said Ethan Siegal, an analyst with The Washington Exchange research firm. "Even then Republicans won't vote for it."

© 2014 Thomson/Reuters. All rights reserved.

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