“We did get some positive news this week,” Romer said of reports that the gross domestic product contracted just 1.0 percent in the second quarter of this year.
“The slowdown is certainly slowing down,” Romer said, comparing the second quarter GDP figure to the 6.4 percent GDP contraction in the first quarter. “But we still have a ways to go before we hit bottom and certainly it’s gonna be a long, hard slog getting out of this.”
“We, like most private forecasters, think that real GDP growth will probably turn positive before the end of the year,” Romer told CNN National Political Correspondent Jessica Yellin, ”but that’s just the first step. You’ve got to start growing again before you start adding jobs. But the other thing is you’ve got to grow quickly to really bring the unemployment rate down.”
With the national unemployment rate hovering just under ten percent (and expected to climb in the next jobs report), and with President Obama saying in his weekly address that he will not “rest until every American who wants a job can find one,” Romer also said that a further extension of unemployment benefits is on the table in discussions between the Obama administration and Congress.
Romer also said Sunday that the administration still believes Obama’s $787 billion stimulus package will save or create 3.5 million jobs by the end of 2010 as originally anticipated.
Finally, Romer said the administration continues to work on financial regulatory reform intended to prevent another near collapse of the financial system like the one that occurred last fall.
“We are working very hard on this,” Romer told Yellin.
“I don’t promise anything for the Congress,” Romer said when asked whether she could assure that the financial reforms would be enacted this year.
“We’re going to absolutely do everything we can,” said Romer.