Austan Goolsbee, chairman of the U.S. Council of Economic Advisers, said today that “we got a long way to go” on adding jobs and that the numbers released today are “below where we needed to be.’
Goolsbee, speaking in an interview on Bloomberg Television from Washington, said it is necessary to extend tax cuts for the middle class while high-end tax cuts give the “lowest bang for the buck.” He said there isn’t an unemployment problem “among billionaires.”
President Barack Obama is scheduled to speak on the jobs report at 11:15 a.m.
The Labor Department reported earlier today that the economy added 39,000 jobs in November, far fewer than the most pessimistic forecast. The nation’s unemployment rate unexpectedly climbed to 9.8 percent last month from 9.6 percent in October.
Analysts expected the government to report an increase of about 150,000 jobs last month, according to a median forecast of 87 economists surveyed by Bloomberg News.
“It’s a disappointing report,” said Augustine Faucher, economist and director of Moody’s Analytics in West Chester, Pennsylvania. “It’s a one-month speed bump; other numbers are looking better. This proves that we need to come to resolution on tax cuts and extend those unemployment insurance benefits.”
The department raised to 172,000 its estimate of the number of jobs created in October, up from 151,000 previously reported. Even so, that is short of the 200,000 jobs most economists say are needed to keep ahead of population growth and reduce the overall jobless rate.
More than 15 million remained jobless in November, the Labor Department said.
Goolsbee said the report showed gains in the private sector for the 11th straight month. “We’re at a fragile spot, but we’ve got to grow our way out of it,” he said.
The White House chief economist reinforced the administration’s goal to win congressional approval of an extension of unemployment insurance benefits, which have expired, as well as renewed tax cuts for individuals with incomes of $200,000 a year or households earning $250,000 a year or less.
Tax Cut Extension
“We need to extend the tax cuts for the people who are going to use the money right now,” Goolsbee said, adding that there are five people available for each job.
The administration remains opposed to renewing tax cuts for households earning $250,000 a year or more. Republicans say they want tax cuts extended for everyone, which the White House says would cost another $700 billion over 10 years, adding to the deficit.
“The high-income tax cuts did not work the first time we did it,” Goolsbee said. “Why borrow $700 billion to pay for tax cuts that are not going to go into the economy immediately?”
He said, “I really, really hope” Congress will extend the tax cuts before they expire at the end of the month, otherwise, “we are not going to be in a good spot.”
Incoming House Speaker John Boehner, Republican of Ohio, said the unemployment rate has now topped 9.5 percent for 16 consecutive months, the longest such stretch since the Great Depression of the 1930s.
Congress needs to “vote immediately to cut spending and stop all the tax hikes,” Boehner said in a statement. “If they don’t, the new House majority will in January.”
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