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Weak report leaves Obama on defensive

Published: Saturday, Sep. 8, 2012 - 12:00 am | Page 1A
Last Modified: Tuesday, Sep. 11, 2012 - 9:26 am

IOWA CITY – Only hours after accepting his party's nomination for a second term, President Barack Obama found himself on the defensive over a jobs report that was weak in almost every way.

The disappointing report leaves the president and his advisers with fading hopes that the economy will surge ahead before Election Day – much as it did late last year – and allow them to amplify his case that the country is on the road to recovery.

And so on Friday, Obama found himself making the complicated argument that the flagging recovery, while not good enough, is at least persistent enough to show that he has put the country on the right path. He has also found himself in the bleak position of having to prove to voters in the 59 days before they head to the polls that despite the sluggish economy and high unemployment, Americans would be even worse off with Mitt Romney at the helm.

"It's certainly not what I would call the position we wanted to be in at this point in the race," one Obama administration official, who requested anonymity to talk candidly about the campaign, said Friday. "He's going to have to make the case that we wouldn't even be at 8 percent if it weren't for him."

For the past two years, Obama based his campaign on the argument that Democrats had reversed an economic free fall and helped put millions of people back to work.

But that argument has proved harder to make with middling-or-worse jobs reports month after month. The August report shows that the unemployment rate fell only slightly, and even that drop was largely because hundreds of thousands of workers had given up looking for jobs.

"Today we learned that after losing around 800,000 jobs a month when I took office, businesses added private-sector jobs for the 30th month in a row," Obama told a campaign rally in Portsmouth, N.H.

Still, the pace of job growth was "not good enough," Obama was forced to acknowledge.

The bad economic news, with the August jobs report showing continued misery particularly for the less-educated and the long-term unemployed, electrified Republican pollsters and politicians eager to interpret it as yet more evidence of the failure of Obama's economic policies.

On Friday, Romney made a full-throated argument that Obama is failing as an economic steward, referring on Twitter to the Democratic National Convention as a party and the jobs report as the hangover.

"There's almost nothing the president has done in the past 3 1/2, four years that gives the American people confidence that he knows what he's doing when it comes to jobs and the economy," Romney said on his way to a campaign stop in Sioux City, Iowa.

His surrogates and supporters piled on.

"If this labor market were a horse, they'd send it to the glue factory," said Andrew Biggs, an economist at the American Enterprise Institute, in a statement. "Lucky for the horse, the factory is closed, too."

Obama's advisers say the president in the next two months will hammer home his argument that Republicans have stood in the way of better jobs numbers. He will argue that Republican opposition to his jobs bill has hampered growth. And he will continue to refine the accusation that his opponents are obsessed with tax cuts, an argument he unveiled at the convention in Charlotte, N.C., on Thursday night.

On Friday, in a joint campaign appearance with Michelle Obama, Vice President Joe Biden and his wife, Jill, Obama was refining – and expanding upon – his tax cut argument, until it took an almost humorous turn.

Instead of a jobs agenda, Obama said, "all they've got to offer is the same prescriptions that they've had for the last 30 years: tax cuts, tax cuts, gut some regulations, oh, and more tax cuts," he said.

Then, apparently liking the line he was on, he added: "Tax cuts to help you lose a few extra pounds. Tax cuts to improve your love life."

Behind the jokes though, the president, who traveled to Iowa on Friday before heading to Florida for a weekend campaign bus tour, and his advisers are clearly worried, and with good reason.

Economic growth slowed through the first half of the year, leading many economists, including those at the Federal Reserve, to raise their year-end unemployment forecasts. U.S. businesses added only 96,000 jobs in August, below expectations.

As disappointing as the report may be, both economic and political analysts said they did not think it changed the fundamentals of either the presidential race or the economy. The stock market on Friday closed virtually unchanged.

The economic narrative seemed to remain the same: The economy is in poor condition, and the recovery anemic, but persistent.

"While there is more work that remains to be done, today's employment report provides further evidence that the U.S. economy is continuing to recover from the worst downturn since the Great Depression," said Alan Krueger, the chairman of the White House's Council of Economic Advisers, in a statement.

Polls have remained stable in recent months even as the economic news has become more and more tepid. Many voters seem to have absorbed the state of the economy – slowly recovering from a deep downturn – and made up their minds, political scientists and pollsters believe.

"There's not a lot of undecided voters out there, and the impact of any given piece of economic news is going to be relatively small," said John Sides, a political scientist at George Washington University. "While it's not good, it's not a decisive shift."

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