Jeremy Hobson: And the big story this morning is the Labor Department’s monthly jobs report, which says the U.S. economy added 163,000 jobs last month. The private sector accounted for all the job creation, adding 172,000. Government employment actually declined by 9,000. And the unemployment rate ticked up from 8.2 percent to 8.3 percent.
Earlier this morning, I spoke with Alan Krueger, who is the chairman of the White House Council of Economic Advisers.
Alan Krueger: When the president came into office we were losing over 800,000 jobs a month. This month we’ve added 163,000 jobs and 4.5 million over the last 29 months. So we’re slowly digging our way out of the deep hole that the recession created, and there are steps that we can take to build on the steps that we’ve made.
Hobson: But the unemployment rate did tick up to 8.3 percent.
Krueger: Any increase in the unemployment rate is unwelcome. I think we need to recognize that the high level of unemployment, which is unacceptable, is a result of the deep recession. That’s why we need more job growth. That’s why the president is focused on making proposals to Congress to strengthen job growth.
Well for another take on this, let’s bring in a member of Mitt Romney’s economic team. Glenn Hubbard is the dean of the Columbia University Graduate School of Business and an adviser to the Romney campaign. Good morning.
Glenn Hubbard: Good morning.
Hobson: How would you characterize this morning’s job report?
Hubbard: I think it’s fair to say that the jobs report is pretty much where we’ve been in the labor market, having the economy stuck in first gear. And we’ve had unemployment above 8 percent since February 2009 — that’s really the longest spell in the post-war period. So I think we’ve got a lot of work to do.
Hobson: But 163,000 jobs is obviously much better than we’ve seen in the last several months.
Hubbard: Yes, and that just shows how our expectations have been lowered. In a vigorous recovery, if you compare this recovery to, say, the ’74-’75 recession or ’81-’82, we should be seeing jobs numbers more in the 200,000 to 300,000 mark, not where we are. So we should all be happy every time an employment report has any good news, but I think it would be very much of a stretch to say this report tells us we’re out of the woods.
Hobson: Of course the White House response to that would we’re in the worst recession since the Great Depression, which started during the Bush administration.
Hubbard: Well we did a terrible recession, but the White House may want to go back and look at history, because financial historians will tell you that it’s not baked in the cake that recoveries — at least from U.S. financial crises — have been necessarily slow. And the fact that every year the White House has issued a rosy forward-looking scenario, only to have that dashed, says it must not believe the financial crisis story quite either.
Hobson: Well then what would Gov. Romney do if he were to become president to change this recovery and make it better without going back to the kinds of policies that created the bubble that burst in the first place?
Hubbard: It’s a great question. The first thing is to decide what you want to focus on as president. And I think for Gov. Romney, that really is about economic growth and job creation. Once you’ve decided what you focus on, what do you do about it? I think in Gov. Romney’s case, it’s first of all, let’s stop the policy uncertainty that we’ve been seeing in tax policy, in regulatory policy and spending policy. And then second, affirmatively, what do you do? We need to a bold tax reform that’s pro-growth, and we need to make sure that we put the budget on a path toward fiscal sustainability, while at the same time doing intelligent regulatory policy, energy policy and trade policy. Those things will get the economy going.
Hobson: Glenn Hubbard is the dean of the Columbia University Graduate School of Business. He’s also an adviser to the Romney campaign. Thank you so much for your time this morning.
Hubbard: My pleasure.
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