Washington Report: January Jobs Numbers, Healthcare Reform and Obama on Egypt

Good and bad news in recent job report (Thinkstock)

• January Job Reports a Mixed Bag
• If you’re a glass half-full kind of person, then the January jobs report released today is good news. The unemployment rate fell from 9.4% to 9%,  the lowest the rate has been for 21 months.  In a conference call with reporters, Labor Secretary Hilda Solis said that the drop is encouraging and that the tax package that President Obama signed into law in January will be a “crucial incentive” for businesses, large and small, to invest in and create jobs in the U.S. this year.
• “While there is still work to be done, the data show the unemployment rate fell in January because more people are working and not because people are leaving the labor force,” Solis said.
• Dr. Thomas Boston, a Georgia Tech economics professor and member of the BLACK ENTERPRISE Board of Economists, disagrees. “People are celebrating the drop, but that’s where I see concern because of the number of [unemployed] people who are no longer being counted,” he said.
• Approximately 504,000 people dropped out of the labor market: some feel too discouraged, some may have decided to wait until the job outlook in their area improves, and others may have postponed their job search because of bad weather, Boston explains.
• “Generating jobs is one of our nation’s greatest challenges these days — only 36,000 jobs were created in January,” says Rep. Sam Graves (R-Missouri) “We can do better, but not through the administration’s plans for more stimulus spending and debt. That didn’t work before, and it won’t work now.”
• But Boston is less concerned about the number of jobs created because he maintains that it was, in large part, due to unexpectedly bad weather conditions that have hit large swaths of the country. “The industries that were the hardest hit and most sensitive to adverse weather patterns are industries where all the job losses occurred,” Boston says, citing sectors such as transportation and warehousing, construction and temporary help services.
• For African Americans,
  however, the glass remains nearly empty, with an unemployment rate of 15.7%. “Nothing has happened there and that’s an area of big concern,” says Boston, adding that the unemployment rates for both whites and Hispanics declined to 8.0% and 11.9%, respectively. “There has to be a concerted effort to look at sectors and groups in the economy that are the hardest hit by unemployment,” Boston says.

 

• Obama Calls on Egyptian President to Listen to His People
• Television viewers in every corner of the world have spent the past several days being virtual witnesses to the escalating political unrest in Egypt. During a joint press conference with Canadian Prime Minister Stephen Harper, President Obama condemned the violence and attacks on journalists and human rights advocates and called for the embattled nation to begin its political transition. President Hosni Mubarak announced earlier in the week that he would step down in September.
• Hinting strongly that the time has come for Mubarak to resign, Obama says: “He needs to listen to what is voiced by the people and make a judgment about a pathway forward that is orderly, that is meaningful and serious.” He also made it clear that the Egyptians must determine their own future, not outsiders.
• In a conversation with his Egyptian counterpart Omar Suleiman on Thursday, Vice President Joe Biden urged the country to immediately begin the negotiations necessary to transition to a democratic government that addresses its citizens’ aspirations.
• Aljazeerah, which has been live streaming today the “Day of Departure” protest currently taking place in Egypt, is reporting that Prime Minister Ahmed Shafiq has said that Mubarak does not plan to cede his presidential power to Suleiman until September and that there will be no early exit.

 

• Healthcare Reform: It Keeps Taking A Licking
• Senate Democrats successfully blocked their Republican colleagues’ efforts to repeal the bill on Wednesday, although the chamber approved a measure to eliminate a tax-reporting requirement in the bill that small business owners opposed by a vote of 81-17.
• “This fight isn’t over,” Senate
  Republican Leader Mitch McConnell said in a statement. “We intend to continue the fight to repeal and replace Obamacare with sensible reforms that would lower the cost of American health care, like medical malpractice, like selling insurance across state lines.” And according House Speaker John Boehner, “The debate has just begun.”
• Such thinking puzzles Congressional Black Caucus Chairman Emanuel Cleaver of Missouri, who believes that Republicans have better things to do.  “It was a waste of time,” he says of the Senate repeal effort. “Instead of focusing on creating jobs, their focus turned to putting insurance companies back in charge. Repealing the Affordable Care Act would negatively impact all Americans, but especially people of color.”
• On Thursday, Virginia Attorney General Kenneth T. Cuccinelli announced plans to bypass the appellate court process and take his state’s constitutional challenge to healthcare reform legislation directly to the U.S. Supreme Court. In December, a U.S. District Court in Virginia ruled that it is unconstitutional to require individuals to purchase health insurance and a number of challenges to the bill are under review in several appeals courts, following split decisions from four lower courts.
• But only U.S. District Judge Roger Vinson of Pensacola, Florida, has ruled that the entire Affordable Care Act is unconstitutional because the individual mandate provision cannot be severed from the bill. If lawmakers could force people to buy insurance, they could also force them to eat broccoli, he argued.
• In response, the White House said that Vinson’s ruling was “well out of the mainstream of judicial opinion” and “overreaching.” But you’ve got to wonder what stung more: his decision or his use of Obama’s own words to underscore his point.
• “Then-Senator Obama supported a health-care reform proposal that did not include an individual mandate,” Vinson wrote, “because he was at that time strongly opposed to the idea, stating that, ‘If a mandate was the solution, we can try that to solve homelessness by mandating everybody to buy a house.’” Touché!
• In the end, however, the bill’s fate may depend more on Obama’s reelection than the courts.

 

• White House Pushes Energy Efficiency and Investments in High-growth Startups
• As GOP lawmakers continue to press for the repeal of healthcare reform, President Obama has turned his attention to improving his relationship with the business sector and developing job creation strategies.
• The White House this week unveiled a Better Buildings initiative, which offers a package of tax breaks and financing to companies that make their buildings more energy efficient. “Making our buildings more energy-efficient is one of the fastest, easiest and cheapest ways to save money, combat pollution and create jobs right here in the United States of America,” said the president during remarks delivered at Penn State University.
• According to senior administration officials, the initiative will make commercial buildings 20% more energy efficient by 2020 and reduce business’ annual energy bills by about $40 billion. It also seeks to provide workforce training for a variety of energy-related jobs such as retrofitting and energy auditing. Both the Small Business Administration and the Energy Department will offer increased loan guarantee programs to encourage lenders to offer retrofit loans to small businesses. Obama is also proposing a competitive grant program for states and municipalities that streamline regulations and attract private investment for retrofit projects.
• Earlier in the week, the White House announced another initiative called Startup America, a public-private partnership that aims to promote investment in high-growth start-ups and small businesses and expand entrepreneurship training and mentoring. The SBA has committed $2 billion to match private-sector investment over the next five years in companies located in underserved communities and for early-stage companies that are having a difficult time accessing capital. AOL co-founder Steve Case will help lead the effort and several big ticker names have signed up, including Facebook, Hewlett-Packard Co., IBM and Intel.
• “I am encouraged President Obama has introduced initiatives to accelerate high-growth entrepreneurship and I am hopeful these kinds of initiatives will encourage more enterprise, specifically in the black community,” says freshman Rep. Allen West (R-Florida), who has been named to the House Small Business Committee. 
”This is something that the president has ignored for far too long.”

 

• House Republicans Prepare to Make Budget Cuts
• House Republicans have made what Budget Committee Chairman Paul Ryan (R-Wisconsin) calls a “down payment” on its pledge to slash government spending. Thursday morning he announced plans to reduce this year’s budget by $32 billion in non-security discretionary spending–a far cry from the $100 billion the GOP pledged to cut last year if it gained control of the House.
• “Washington’s spending spree is over,” Ryan declares. “Last year, House Democrats failed to pass, or even propose, a budget and the spending binge continued unchecked. After two consecutive trillion dollar budget deficits and with unemployment remaining unbearably high, we must chart a new course.”
• But according to South Carolina Rep. James Clyburn, Republicans are starting to realize that some things are easier said than done, but it’s the American public that will pay the price.
• “With great fanfare last fall, Republicans made a campaign promise to cut the budget by $100 billion.  Today’s proposal falls $68 billion short.  And at this level, we can expect serious job loss in critical sectors like law enforcement, education, and health care,” he says. “We have to find ways to tighten our belts and tackle the deficit without cutting investments that create jobs. Democrats want to build on the progress made over the last two years.”
• It also will be easier to talk about budget cuts, which the Appropriations Committee will recommend next week, and they will almost certainly pass in a vote the House has planned for the week of February 14. But then what? Neither Senate Democrats nor the White House will approve the approved cuts, and thus the budget battle royale begins.

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