Publicly, White House aides and Congressional leaders have responded with incessant attempts to highlight benefits from the $787 billion economic stimulus package they enacted earlier this year. Privately, Mr. Obama’s economic advisers are sifting options for a new package of tax cuts and other job creation measures to be unveiled in next year’s State of the Union address — or earlier if pressure for action becomes irresistible.
Republicans entered the age of Obama with hope in the traditional pattern of midterm election losses by a president’s party. But now unemployment trends have heightened their confidence that their political luck has turned more sharply and rapidly than most Republicans had expected.
“It is the Democrats’ turn to go through the historical meat grinder,” said Representative Tom Cole of Oklahoma, a Republican strategist who says he sees his party on track to gain 15 to 25 House seats. “So far they don’t have much to brag about, and the political clock is ticking.”
Pointing to Good News
Democrats girded for the last week’s bad news in typical fashion. Two days before the Labor Department’s jobs report, Mr. Obama appeared at the National Institutes of Health in suburban Maryland with the local Democratic congressman, Chris Van Hollen, to promote the award of $5 billion in stimulus money to finance biomedical research.
That research will spur high-quality employment, the president said, rebutting adversaries’ portrayal of the stimulus package as larded with wasteful projects. “It’s not just about creating make-work jobs, it’s about creating jobs that will make a lasting difference for our future,” he said.
Mr. Van Hollen, who leads the Democrats’ midterm election effort as chairman of the party’s House campaign committee, sees two critical factors in withstanding the Republican jobs assault. One is Democrats’ ability to point to signs of economic recovery, like improving real estate, credit and stock markets; the other is avoiding premature declarations of “mission accomplished” on the economy.
“Most of our guys have gone home and talked to their constituents about how this is going to be a long, tough recovery,” Mr. Van Hollen said. “The main test is, did the economy turn around, and who was on your side?”
Obama advisers also count on voters’ memories of the unpopular Bush administration and of the badly wounded economy they inherited. But Ronald Reagan and Bill Clinton discovered that economic recovery programs Americans ultimately judged successful did not protect their parties in midterm elections.
“ ‘It could have been worse’ is of little utility in politics,” David Axelrod, Mr. Obama’s top political adviser, acknowledged.
Moreover, even Mr. Obama’s economic team now concedes that unemployment, which they once hoped to keep from exceeding 8 percent, will get worse through the end of the year. One outside economist, Mark Zandi, predicts the economy will shed 750,000 more jobs over the next six months, with unemployment peaking at 10.5 percent in June.
Republicans say the trends will only magnify voters’ doubts about the effectiveness of the administration’s anti-recession policies. “For a lot of people, the ‘whether it’s working or not’ is filtered through jobs,” said a Republican pollster, Bill McInturff.
All in the Timing
Those doubts help explain why Mr. Obama said in a recent interview that he was strongly inclined against a second infusion of economic stimulus money. But Democrats are considering other steps in addition to the extension of unemployment benefits now moving through Congress.
Mr. Zandi recommends that the administration extend existing measures, like a tax credit for homebuyers and accelerated depreciation for businesses. Yet even if those steps succeed economically, the political question is how quickly they could help Democratic candidates.