White House battles to claim credit but avoid blame on economy

President Obama touted upbeat economic news as proof his stimulus spending was working, but Republicans cited the jobless recovery as a reason to shift priorities.

“The steps we've taken have made a difference,” Obama said at the White House. “But I also know we have a long way to go.”

The economy grew by 3.5 percent in the third quarter of the year, according to the Commerce Department. The positive growth ended four consecutive quarters of economic contraction.

The news, better than many economists had predicted, was widely hailed as the beginning of the end of the recession.

But critics noted that the improved consumer spending was partially attributable to car sales and the “cash for clunkers” rebates, noting that publicly funded recovery comes up short of a true economic rebound.

“Was this the equivalent of pouring Red Bull into the economy and now we're going to have to come down from that caffeinated sugar high?” Rep. Mike Burgess, R-Texas, said at a hearing of the Joint Economic Committee.

Republicans have been urging the administration to better help the economy by doing more to help small businesses create jobs, and by being more creative with tax breaks rather than spending.

Republicans also have urged that some of Obama's future spending proposals, such as a $13 billion so-called senior stimulus plan to give $250 checks to older taxpayers, be paid for out of what remains from the $787 billion stimulus bill.

Rising unemployment and a persistent lack of significant job creation have the administration lately in a defensive crouch. The White House lashed out at a report by the Associated Press detailing inflated claims on job creation, and Obama worried openly about jobs even as he touted new gross domestic product numbers.

“The benchmark I use to measure the strength of our economy is not just whether our GDP is growing, but whether we are creating jobs,” the president said.

Republicans agreed, and so far the lack of job creation has proved their most powerful argument against the administration's claims of economic turnaround.

House Republican leader John Boehner of Ohio noted that Obama promised the stimulus would create jobs immediately and keep unemployment below 8 percent.

“Any positive signs for our economy are welcome, but a jobless recovery is not what the American people were promised,” Boehner said. “For millions of out-of-work families struggling to make ends meet, this recession feels far from over.”

Unemployment currently hovers near 10 percent, and Christina Romer, chairwoman of Obama's Council of Economic Advisers, warned it would take “sustained, robust” GDP growth to produce results in the employment sector.

That sustained growth may be elusive. The 3.5 percent growth in the third quarter doesn't fully restore more significant declines of 6 percent a year ago.

Administration officials have said the economy has already seen the biggest boost it will get from stimulus spending.

jmason@washingtonexaminer.com

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