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Chief economist calls on Congress to 'finish the job of economic recovery'

WASHINGTON — Departing White House chief economist Christina Romer called Wednesday on Congress to summon the political will to "finish the job of economic recovery" by pumping more cash into the economy through additional tax cuts for businesses and middle-class families, as well as fresh investments in the nation's infrastructure.

In an advance copy of her remarks before the National Press Club, Romer did not say how much more she thinks Congress should spend to combat a jobless rate stuck at 9.5 percent. With massive deficits looming, Romer said much of the cost of any new package should be covered by spending cuts or tax increases, after the economy has fully recovered.

But, she said, the election-year anxiety about current deficits that has blocked so much of President Barack Obama's economic agenda "cannot be an excuse for leaving unemployed workers to suffer."

"We have tools that would bring unemployment down without worsening our long-run fiscal outlook," she said, "if we can only find the will and the wisdom to use them."

The speech, Romer's last as chairman of Obama's Council of Economic Advisers, underscored her long-standing view that the chronically high jobless rate requires additional government action. Romer has long been a champion for additional spending, such as the $26 billion in state aid recently approved by Congress, barely half what the administration requested.

Another measure, aimed at boosting small-business hiring, is pending in the Senate, but Romer — an expert on the Great Depression — has made no secret of her opinion that more federal spending to spur job creation is needed.

Earlier this week, Obama announced that his economic team is discussing another possible jobs initiative. Such a package is likely to contain more business tax breaks, possibly including another temporary reduction in payroll taxes for new hires.

Republicans have relentlessly attacked the package as ineffective, noting that a paper prepared by Romer and White House economist Jared Bernstein forecast that the package would prevent unemployment from rising above 8 percent. In fact, employment briefly soared above 10 percent and is not expected by economic analysts to drop back to 8 percent until the end of 2012.

Chief economist calls on Congress to 'finish the job of economic recovery' 09/01/10 [Last modified: Wednesday, September 1, 2010 11:21pm]
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