Christina Romer tries a little pirouette of spin on her way out of the Obama administration in this interview with PBS on her last day as chair of Barack Obama’s Council of Economic Advisers. Romer chirps about adding 67,000 private-sector jobs and six straight months of job growth, even though she and every other economist in the US knows that anything falling below 100,000 net new jobs in a month means that population growth outstripped new jobs — in other words, falling behind. Romer also suggests that the White House has tapped out in terms of ideas on how to grow the economy, and shifts blame to Congress for any notion that the stimulus wasn’t large enough:
Cubachi has the transcript, emphases mine:
You know, I think one of the things I tried to describe is, we were in unchartered territory. This is not a typical postwar recession. It was caused by a financial crisis in the biggest economy, the center of the world economy, something we haven’t seen since the Great Depression.
And I certainly was very frank that there were things that I got wrong, that none of us really knew or anticipated. You know, what I do feel good about is, one, that we have learned, that we certainly — you know, we gave it our best shot. We very much told the president that this was a serious crisis, we should do all that we could.
And I think we did get as big a Recovery Act as we could have gotten through Congress. But, you know, what we have done ever since then — we didn’t just stop there. It’s been a constant process of thinking about, what more do we do for the financial system? What are the evolving steps? And I think that is really the test of policy…
I think, you know, what — what all of us need to think about is, where are we now? Where do we go from here? And I think, with the unemployment rate where it is, with job growth — again, it is incredibly important that we are now growing again. The change from where we are when we came into office is dramatic.
Let’s dispense with this Congress-made-us-do-it nonsense about the stimulus. I covered this in detail when Joe Biden first attempted this argument in July, so be sure to read that post in full. Suffice it to say that Romer’s proposal for a stimulus requested exactly the money Obama eventually got, and promised that would be enough to keep unemployment under 8% without having millions of people bail out of the workforce. Obama himself pronounced himself pleased with the scope, saying that he got “the right size, the right scope” from Congress.
The truth is that Romer blew it by assuming that the Keynesian principle of getting $1.50 of economic growth for every $1 of government spending actually happened anywhere outside of the halls of Academia. All this administration did was create an illusion of substantial growth for two quarters, and when the money ran out, so did the illusion.
Jake Tapper notes the end of Recovery Summer, and the debate to come after the utter failure of Romer & Co: