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Obama gets grief for saying private sector 'fine'

By Philip Elliott

Associated Press

Published: Friday, June 8 2012 1:39 p.m. MDT

WASHINGTON — President Barack Obama declared Friday that "the private sector is doing fine," drawing instant criticism from Republicans who said it showed a lack of understanding of the nation's economic woes. GOP presidential candidate Mitt Romney responded, "Is he really that out of touch?"

Reacting to the GOP critique, the president later sought to clarify his remarks, saying that it was "absolutely clear that the economy is not doing fine." He said that while there had been some "good momentum" in the private sector, public sector growth lagged behind, making it imperative that Congress act on his proposals to boost state and local government jobs.

"I cannot give you a good reason why Congress would not act on these items other than politics," Obama said after being asked to respond to the Republican criticism.

The president made similar assertions in a White House news conference Friday morning, saying that businesses had created 4.3 million jobs during the past 27 months and the primary problem with employment is that state and local governments had been forced to cut jobs in the private sector.

Republicans pounced.

Romney, holding a campaign event in Council Bluffs, Iowa, said Obama's remark was "defining what it means to be detached and out of touch with the American people." He said the comment "is going to go down in history as an extraordinary miscalculation and misunderstanding."

But while "doing fine" is in the eye of the beholder, Obama was correct that the job picture in the private sector is brighter than in the public sector. Since the recession officially ended in June 2009, private companies have added 3.1 million jobs. Largely because of cuts at the state and local level, governments have slashed 601,000 jobs over the same period. According to the government, corporate profits have risen 58 percent since mid-2009.

Even so, by historical standards, private job gains in the last three months have been weak after such a deep recession.

Obama pressed Congress to enact parts of his jobs agenda, including proposals to help state governments rehire teachers, police officers and firefighters. Yet his comments about the strength of private sector hiring were bound to be replayed in television ads meant to discredit his message on the economy, the top issue for voters.

Seconds after Obama made the remark, Republicans circulated the quote on Twitter and Romney seized on it about an hour later after meeting farmers.

Behind the scenes, Romney aides worked furiously to push what they hope could be a shift in the campaign. Many remember four years ago, when Republican nominee John McCain asserted that "the fundamentals of our economy are strong" in the midst of a meltdown. Obama's team went after McCain then and voters were left wondering what the Republican was thinking.

Using a similar approach, the Republican National Committee posted an online video by midday repeating Obama's comment and asking: "How can President Obama fix our economy if he doesn't understand what's broken?"

The question was a direct rehash of the one Obama's campaign asked voters in a very similar video four years ago.

Obama campaign spokesman Ben LaBolt said Obama had taken office "in the midst of a severe economic crisis and fought back against that to the point where businesses have now created more than 4.3 million private sector jobs. The president has always been clear that we need to do more than recover from the recession." He later said on Twitter, "Being called out of touch by a candidate who joked about being unemployed and said he likes to fire people is rich."

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