It's Crunch Time on Jobs, and Time for Obama to Make His Move

There's no way to spin your way out of the highest unemployment rate in 26 years. There's probably no way to blame it on your predecessor, either. The only way for President Obama to fix this political problem is to fix the actual problem, or at least seem like he's trying extremely hard.

The Labor Department's stunning announcement of a 10.2 percent jobless rate is the second blow in a week for Obama and the Democrats. The first came in Tuesday's elections, when exit polls in New Jersey and Virginia showed widespread concern about the economy. Incumbents and their parties lost big in both states.

Presidents may inherit good economies or bad ones, and they can't do much to control economic trends. Still, they almost invariably get the blame or the credit for what happens on their watch.

White House aides have been discussing ways to accelerate job creation for months. On Friday, signing a bill that cuts business taxes and extends unemployment benefits and homebuyer tax credits, Obama said those ideas include "additional investments in our aging roads and bridges, incentives to encourage families and businesses to make buildings more energy efficient, additional tax cuts for businesses to create jobs, additional steps to increase the flow of credit to small businesses, and an aggressive agenda to promote exports and help American manufacturers sell their products around the world."

If Obama is a smart politician, and usually he is, the double jolt of the election and the jobs report should make this the moment he ends the deliberations and moves into an action phase. The recession is ruining and constricting American lives everyday. Some people will never recover financially or psychologically. And the political consequences of less-than-bold moves could be devastating in next year's congressional elections.

The Tuesday results, particularly Republican Bob McDonnell's victory in the Virginia governor's race, set the terms of political debate for the next 12 months. The jobs report reinforced that in spades, providing instant ammunition to conservatives and Republicans. Within minutes of its release, they seized on it as evidence that the Obama stimulus plan is not working. "The numbers speak for themselves," the Heritage Foundation said.

House Republican leader John Boehner said more than 3 million private-sector jobs have been lost since the "stimulus" -- his quotation marks -- was signed into law. "Americans are asking, 'Where are the jobs?' but all they've gotten from Democrats in Washington is more spending and more debt," he said.

Republican Party Chairman Michael Steele said Obama and his administration should stop with the "phony 'saved or created' talking points" about the stimulus plan. "President Obama promised jobs during his campaign for president, and the elections in Virginia and New Jersey on Tuesday were a clear referendum on his failure to deliver on this promise," Steele said.

The White House and its allies argued that the economic glass is both half full and half empty. Obama pointed to 3.5 percent GDP growth in the third quarter and said his administration had stopped "the free fall that caused our economy to shrink at an alarming rate." He also said, however, that "job growth always lags behind economic growth, which is why we have to continue to pursue measures that will create new jobs."

Christina Romer, chairwoman of the White House Council of Economic Advisers, said in a blog post that the Labor Department report contained "both signs of hope for recovery and painful evidence of continued labor market weakness." Job losses are abating, Romer said, and employment rose in the temporary hiring sector -- often a leading indicator of broader improvement. The motor vehicle industry also posted gains. "These are hopeful signs that the unprecedented policy actions are working to stabilize the economy and put us on a path toward recovery," she said.

Since its all-out effort for the stimulus package last winter, the administration has been taking smaller, less publicized steps to try to goose the economy. But its main focus has been on health reform. That may have to change now, even if it means the Senate doesn't get to health until next year.

That's not to say people have suddenly fallen in love with our health care system. In fact, CNN just released a poll in which 59 percent of the public said Congress should keep working on health care reform bills. But in the same Oct. 30-Nov.1 poll, 47 percent rated the economy the most important issue facing the country today. Health was a distant second at 17 percent. (For those who'd argue that Congress should not spend borrowed money to create jobs, the deficit was in fourth place, just behind the wars in Iraq and Afghanistan).

There are some economic proposals, such as giving employers a tax credit for jobs they create, that have supporters from across the political spectrum. It's possible they could pass quickly. That will be more likely when and if Obama lays out what he wants and makes clear he's serious about getting it done.