Obama job creation panel suggests modest steps

By Alister Bull

DURHAM, N.C. (Reuters) – With few tools left to heal the U.S. economy, President Barack Obama pledged Monday to act on job-boosting ideas from a panel of top executives whose modest proposals fell short of a quick fix for stubbornly high unemployment.

Obama’s jobs council, led by General Electric chief Jeffrey Immelt, called for measures to cut red tape, provide more loans, invest in energy efficiency and attract more tourists, many of which have been suggested before.

The president, whose 2012 reelection prospects hinge on his ability to address unemployment, was enthusiastic about the panel’s recommendations but made no specific commitments.

“I promise you we we’re going to act on a range of these recommendations,” Obama said.

“There are some common-sense ideas that we can all embrace to make ourselves more competitive that should not be subject to the usual political gamesmanship.”

With a raft of opinion polls showing Americans unhappy with Obama’s stewardship of the economy, he has been counting on fresh ideas from the jobs council, which also includes the CEOs of Eastman Kodak, American Express, DuPont and Xerox.

The council’s ideas are helpful but not nearly enough, said Sherle Schwenninger, director of economic growth and American strategy of the nonpartisan New America Foundation.

“I generally view the jobs council as operating within the current serious political constraints. These are extremely modest suggestions in terms of the scale of the problem,” Schwenninger said.

Monday marked the second meeting of the full panel, which Obama inaugurated in March to brainstorm on the economy and find ways to encourage business growth and employment.

Brendan Buck, a spokesman for House Speaker John Boehner, the top Republican in Congress, dismissed the North Carolina event as a “photo op” and signaled more pressure from Congress on Obama to cut deficits, not spend more in the run-up to the election.

“Photo ops with business leaders only reinforce that no one in this administration has ideas to create the private sector jobs our economy desperately needs,” he said. “Republicans have a Plan for American Job Creators, and we hope the president will work with us to implement it.”

 

POLITICAL CONSTRAINTS

A weak jobs report in May, in which unemployment rose to 9.1 percent, hardened national unease over the economy, which many Americans think has barely climbed out of recession.

Obama has been trying to show that the tools he has used so far — including a big economic stimulus package, the auto and financial sector bailouts and a tax-cut deal reached last year — have stabilized an economy that was in freefall when he took office and put it on the path to full recovery.

Analysts see little scope for the president to deliver much more economic stimulus with Republicans opposing any more government spending that adds to U.S. debt and annual deficits.

The member companies of the White House jobs council will hire 100,000 people in the United States in 2011, according to GE spokesman Andrew Williams.

Still, some executives on the panel have a record of cutting jobs, not creating them.

Antonio Perez, CEO of Eastman Kodak, embarked on a costly restructuring plan in 2003 that slashed more than 45,000 jobs as the photographic film market collapsed, shrinking the company’s payroll to around 18,000.

Immelt slashed thousands of jobs during the downturn as his storied company struggled to weather a credit crunch that forced its lending unit, GE Capital, to seek a government guarantee for $139 billion in debt.

GE, the world’s largest maker of jet engines and electric turbines, laid off 19,000 workers globally in 2009, or about 6 percent of its workforce. But it will add 16,000 manufacturing and high-tech services jobs in the United States in 2010 and 2011, Williams said.

(Additional reporting by Liana B. Baker, Anurag Kotoky, Tiffany Wu, Nick Zieminski and Matt Spetalnick; Writing by Laura MacInnis; Editing by David Lawder)