U.S. jobs forum seeks cheap growth

Obama said last week he was interested in measures to speed job creation without spending money and warned that running up more debt could risk a double-dip recession.

The White House has already stressed that the Dec. 3 jobs conference will not be about a second stimulus package.

Obama is under pressure to tackle the highest U.S. unemployment in a generation, which, at 10.2 percent, is dragging down his once lofty poll ratings and could hurt his fellow Democrats in congressional elections next year.

There is a long history of presidents hosting “economic summits” to show their concern about the economy, including Bill Clinton's in December 1992 — before he had even taken office — and George W. Bush's in August 2002.

But economists say that by appearing to rule out significant additional spending to lift the economy, Obama will limit what the forum can achieve, and he risks making it look like an exercise in public relations.

“You need more demand for goods and services in order to have people willing to hire people,” said Chad Stone, chief economist at the Center on Budget and Policy Priorities, a liberal think-tank in Washington.

“I don't know how you do it without things that are really effective at stimulating demand growth,” he said.

Obama signed a US$787 billion emergency stimulus bill in February that, among other things, extended unemployment benefits, aided cash-strapped state and local governments to help them avoid laying off workers, and spent money on infrastructure, education and healthcare.

Stone advocated extending jobless benefits again and continuing to help out the states.

This could be cast as an extension of aid already agreed under Obama's first spending package, rather than a new stimulus bill, although the money involved could add up to US$100 billion if all the expiring programs were renewed, Stone said.

Likewise, the largest U.S. labor federation, the AFL-CIO, recommends extending unemployment insurance and aid to states.

It also wants more money for food stamps, spending on schools and infrastructure, and diverting resources from a US$700 billion bank bailout fund to help small businesses get credit.

The jobs forum, which will gather business, labor and financial experts, will include six separate so-called breakout sessions on creating green jobs; boosting credit for small businesses; more infrastructure spending; U.S. exports; retraining workers; and a discussion about how to encourage businesses to hire.

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