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Obama: US Economy Moving In Right Direction

President Barack Obama (r) and the new director of the Consumer Financial Protection Bureau, Richard Cordray, Jan. 6, 2012
President Barack Obama (r) and the new director of the Consumer Financial Protection Bureau, Richard Cordray, Jan. 6, 2012
Kent Klein

President Barack Obama is cautiously welcoming Friday's news that the U.S. unemployment rate continues to fall.  The president says the December jobless numbers show that the nation’s economy is moving in the right direction.

With unemployment at its lowest level in almost three years, President Obama indicated that Americans have reason to be encouraged.

“It is important for the American people to recognize that we have now added 3.2 million new private sector jobs over the last 22 months, nearly 2 million new jobs last year alone," said President Obama.

December’s jobless rate was 8.5 percent, two-tenths of a percent below the revised rate for November.  More than 200,000 non-government jobs were added to the economy last month.

Still, the president acknowledged Friday that the recovery has not yet touched everyone.

“There are still a lot of struggles that people are going through out there," Obama said. "A lot of families are still having a tough time.  A lot of small businesses are still having a tough time.  But we are starting to rebound.  We are moving in the right direction.  We have made real progress.  Now is not the time to stop.”

Experts across the political spectrum also welcome the improved unemployment figures.  But Liz Rose, with the liberal think tank Campaign for America’s Future, says some segments of the population are not yet receiving the recovery’s benefits.

“Particularly, you know, if you are African-American, or if you are over 50, or if you are a student or someone who just graduated from school, the economy is still rough," said Rose. " We cannot just start celebrating.  We really want to still work on fixing the economy and making sure that those people get jobs.”

At the conservative Heritage Foundation, research fellow Rea Hederman says the December jobs numbers are a good sign, especially if the downward trend continues.

“It confirms that the sharp drop in the unemployment rate that we have seen in the last couple of months is real, so that is very positive news," said  Hederman. "But we still want to be cautious, because we saw a similar report like this back in 2010, in April, and unfortunately, at that point, the good news was fleeting as the labor market continued its slog.”

Mr. Obama said Friday the increase in job creation can be credited partly to the middle-class tax cut enacted last year.  And he called on Congress to pass a full-year extension of the payroll tax cut, to take the place of the two-month extension that passed recently.

Rea Hederman says uncertainty over whether the longer extension will pass is hindering further economic improvement.

“Businesses want certainty, and right now coming out of Washington is a whole bunch of uncertainty." he said. "There are a lot of regulations, and even worse, there are policies such as a two-month extension of tax cuts that will do nothing to help the economy.”

Nearly all the jobs created in December were in the private sector.  At the same time, state and local governments cut another 12,000 jobs.

Liz Rose says government job cuts are also holding back the economic recovery.

“Federal, state and local governments are still laying off cops, teachers and firefighters," she said. "And so this is not the time for a premature turn to austerity.  We need to keep the government programs going that support people who do not have jobs.”

The president spoke at the Washington office of the new Consumer Financial Protection Bureau.  Mr. Obama was introduced by the agency’s director, Richard Cordray.

The president appointed Cordray earlier this week without approval from Congress, infuriating many Republican lawmakers, some of whom said the move was illegal.  

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