L'AQUILA, Italy (CNN) – President Obama said Friday that leaders of the industrialized nations have agreed to continue fueling economic growth while strengthening regulatory measures but they also realize that full recovery is "still a ways off."

Obama listed some of the achievements of the Group of Eight summit this week in Italy as the conference neared the end, and he stressed the need for collective action.

In addition, the G8 nations agreed to stop the spread of nuclear weapons, set goals for reducing carbon monoxide emissions and invest $20 billion in food security. That money is in addition to humanitarian aid already provided.

Full story

Obama senior adviser David Axelrod discussed the economy and health care reform in an interview that aired Sunday on CNN's State of the Union.

WASHINGTON (CNN) — President Barack Obama's $787 billion stimulus package is beginning to work, his senior adviser told CNN's "State of the Union" on Sunday.

David Axelrod cited the latest unemployment figures that showed the rate of new job losses slowing.

Although those figures showed the overall unemployment rate at a 26-year high, Axelrod said the stimulus money takes time to infiltrate the economy.

"Hopefully that is a sign that this is turning," Axelrod said. "It feels as if we're moving, and the stimulus package now is not nearly done, it's just really at its beginnings."

In a wide-ranging interview with CNN's John King, Axelrod also said Obama believes that capping tax deductions for high-income Americans is the best way to help offset the cost of expanding national health care.
Read the rest of this entry »

NEW YORK (CNNMoney.com) - Job losses slowed dramatically in May, according to the latest government reading on the battered labor market, even as the unemployment rate rose to a 26-year high.

Employers cut 345,000 jobs from their payrolls in the month, down from the revised 504,000 job decline in April.

This was the fewest jobs lost in a month since last September, when the bankruptcy of Lehman Brothers caused a crisis in U.S. financial markets and choked off credit for many businesses. Economists surveyed by Briefing.com had forecast a loss of 520,000 jobs in May.

The unemployment rate rose to 9.4 percent from 8.9 percent in April. Economists expected unemployment would rise to 9.2 percent.

WASHINGTON (CNN) – White House Budget Director Peter Orszag offered a window Sunday into President Obama’s ambitious plans to reform the nation’s health care system while dealing with record budget deficits and the nation’s struggling economy.

“We have always said health care reform has to be deficit-neutral over a five- or ten-year window,” Orszag said on CNN’s State of the Union when asked whether the White House might take on higher deficits in order to fund one of the president’s big domestic agenda items.

“And then much better than that over the long term. So we are very committed to making sure that health care reform is self-financing and also brings down costs over time both for families and for the federal government. So you are not going to see a deficit-increasing health care reform.”

Obama’s budget guru refused to say whether the president would sign a health care reform legislation that included a provision taxing employer-provided health care insurance benefits as one means of helping to finance health care reform.

“It was not in the president’s campaign plan, it wasn’t in our budget. Clearly there are some members of Congress who are putting it on the table. We’re going to have to let this play out,” said Orszag said
Read the rest of this entry »

NEW YORK (CNNMoney.com) — The recession has taken its toll on Social Security. The officials who oversee the program forecast Tuesday that the Social Security trust fund will be exhausted by 2037 — four years earlier than estimated last year.

The trust fund reflects a $2.4 trillion surplus paid into Social Security over 20 years that Uncle Sam has borrowed, spent and promised to pay back. Trust fund exhaustion represents the point at which only 76% of benefits could be paid out.

The main reason for the change in forecast: Demand for benefits has grown while money paid in has fallen because of growing unemployment and new tax breaks in the economic stimulus package passed in February.

Since the start of 2008, 5.7 million payroll tax jobs have disappeared. And another 4.3 million jobs are being filled on a part-time basis.

In the nearer term, the trustees estimate that Social Security will take in fewer taxes than the benefits that will be paid out by 2016. Last year, they estimated the near-term shortfall would occur in 2017.

Full story

WASHINGTON (CNNMoney.com) — The Obama administration estimates that the economic stimulus plan will create or save 750,000 jobs by early August, a senior administration official said on Monday.

The comments came as the administration's Council on Economic Advisers released a report that explained the methodology behind its estimates for how many jobs will be created by the $787 billion American Recovery and Reinvestment Act.

Full story

Editor's note: On CNN's "State of the Union," host and chief national correspondent John King goes outside the Beltway to report on the issues affecting communities across the country.

LOS ANGELES (CNN) — The tears begin and her voice trembles as Ruth Martinez remembers the first few days of her new world.

She would leave work, pick up her son Jacob at school and drive aimlessly, sometimes sneaking back to the office, "to watch TV there without my boss knowing."

Her husband had lost his job, and the stress drove them apart. Then Martinez was evicted. Suddenly, her car was her home. And she was afraid to ask for help.

"We just prayed," Martinez told us. "And I was embarrassed because a Hispanic Latina does not ask for help. The way I was raised, you put your pride to the side and did what you had to do."

Rudy Salinas finds them in cars, under bridges, in abandoned homes, and even in protected trenches artfully dug by the military veterans who put survival skills learned in Iraq and Afghanistan to use in America's inner cities.

Salinas has been working to help the homeless here for eight years now, driving the streets every day looking for people hiding under bridges and in abandoned properties. More and more of late, there are people in business clothes, heading off to work. More and more, they are women with young children.

Full story

WASHINGTON (CNN) – Picking up on a phrase often used by the Obama administration, a Republican senator said Sunday that things may be turning around for the struggling financial sector of the economy.

“There are glimmers of hope” in the financial sector, Tennessee Sen. Bob Corker said Sunday on CNN’s State of the Union when asked if the industry had turned a corner.

“I think it was a positive step,” said Corker of the Obama administrations’ recent “stress tests” on the nation’s largest banks.

“But there will possibly be additional government dollars [for some financial institutions]. I think that hasn’t fully been said and I think that what we’ve got to be concerned about as we move into the future is not causing [the Troubled Asset Relief Program] to be codified so that it’s there forever.”

“I actually am feeling better about it. I really am,” Corker, a member of the Senate Banking Committee, added.

Even with improvement for financial firms, Pennsylvania Democrat Bob Case said Sunday that the country’s tough economic times may not yet be over.

“When we describe, we use language like ‘the unemployment rate is a lagging indicator,’ that gives no hope and doesn’t reflect the reality that so many people are living through,” Casey said Sunday on State of the Union.

“If you lose a job or your home or your hopes and your dreams, these economic statistics don’t mean much,” said Casey. “So we have a long way to go and I think we have to continually focus on the job numbers even as maybe the financial sector numbers or other data improves.”

A homeless woman sits on a bench in Los Angeles, California.

LOS ANGELES (CNN) — The tears begin and her voice trembles as Ruth Martinez remembers the first few days of her new world.

She would leave work, pick up her son Jacob at school and drive aimlessly, sometimes sneaking back to the office, "to watch TV there without my boss knowing."

Her husband had lost his job, and the stress drove them apart. Then Martinez was evicted. Suddenly, her car was her home. And she was afraid to ask for help.

"We just prayed," Martinez told us. "And I was embarrassed because a Hispanic Latina does not ask for help. The way I was raised, you put your pride to the side and did what you had to do."

Rudy Salinas finds them in cars, under bridges, in abandoned homes, and even in protected trenches artfully dug by the military veterans who put survival skills learned in Iraq and Afghanistan to use in America's inner cities.

Full story

The president spoke about the importance of education Friday.

WASHINGTON (CNN) — President Barack Obama announced new steps to help unemployed Americans Friday, targeting people out of work who want to go back to school.

The president outlined a plan under which the Department of Education will send colleges legal guidance encouraging them to increase financial aid packages for the unemployed so they can enroll in educational and training programs, while keeping their unemployment benefits.

Under Obama's initiative, colleges would consider a person's current financial situation to make it possible for them to receive Pell grants, which are available for low-income students. The unemployed person would not lose any unemployment benefits and the maximum Pell grant would be increased in July by
$500 to $5,350.

The Labor Department will also issue guidance "strongly encouraging" states to modernize their rules to allow more unemployed to continue their education without forfeiting their benefits.

"In a twenty-first century economy where the most valuable skill you can sell is your knowledge, education is the single best bet we can make," Obama said.

The unemployment system should not just be a safety net, but "a stepping stone to a new future. … It should offer folks educational opportunities they wouldn't otherwise have, and give them the measurable and differentiated skills they need to not just get through these hard times, but to get ahead when the economy comes back."
Read the rest of this entry »

WASHINGTON (CNN) — The quickest reaction to this morning's unemployment report apparently goes to House Minority Leader John Boehner.

His office sent out a statement of Boehner's reaction to the April jobs report just six minutes after the Labor Department announced the news, which shows that the nation's unemployment level jumped to 8.9 percent.
(Read Boehner's full statement after the jump)

Read the rest of this entry »

NEW YORK (CNNMoney.com) – The unemployment rate hit a 25-year high in April, but there were signs of hope as the monthly job loss total fell to the lowest level in six months.

The Labor Department reported that employers cut 539,000 jobs from payrolls in the month. That's an improvement from the revised reading of 699,000 that were lost in March, and the best reading since October, when the economy shed 380,000 jobs.

Still, that brings job losses since the start of 2008 to 5.7 million.

The unemployment rate, based on a separate survey rose to 8.9% from 8.5% in March, the worst reading since September 1983. Economists surveyed by Briefing.com had forecast the rate would rise to 8.9%.

Economists had forecast a loss of 600,000 in April, but there had been signs in recent days that the job losses might not be as bad as they expected. A reading on private sector employment by payroll services firm ADP showed a big drop in job losses in April, and there has been a steady decline in recent weeks in people filing for first-time unemployment benefits.

More on CNNMoney.com

Listen: CNN Senior White House Correspondent Ed Henry on the economy.

President Obama will announce educational help for the unemployed on Friday.

WASHINGTON (CNN) — New unemployment numbers are due out Friday and president Barack Obama will use the opportunity to announce new steps to help unemployed Americans.

The target of the rules will be people out of work who want to go back to school. Rules now create a catch 22: In most cases, if you are receiving unemployment compensation you have to be actively looking for a job. If you want to get more education or training, you have to give up unemployment benefits. But if you return to school you don't qualify for federal education grants since, in most cases, your qualification is based on your previous year's income.

The president is scheduled to outline a plan under which the Department of Education will send colleges legal guidance encouraging them to increase financial aid packages for the unemployed so they can enroll in educational and training programs, while keeping their unemployment benefits.

The colleges would consider the person's current financial situation to make it possible for them to receive Pell grants, which are available for low-income students. The unemployed person would not lose their unemployment benefits and the maximum Pell grant would be increased in July by $500 to $5,350.

The Labor Department will issue guidance "strongly encouraging" states to modernize their rules to allow more unemployed to continue their education without forfeiting their benefits.

President Obama, in prepared remarks, will say, "Our unemployment insurance system should no longer be a safety net, but a stepping stone to a new future. It should offer folks educational opportunities they wouldn't otherwise have, and give them the measurable and differentiated skills they need to not just get through these hard times, but to get ahead when the economy comes back."

The government is started a new Web site with information on the plan: www.opportunity.gov.

NEW YORK (CNNMoney.com) – Federal Reserve Chairman Ben Bernanke said Tuesday that the U.S. economy is stabilizing and will begin to rebound later this year, but the recovery will be slow and cautious.

At a hearing of the Joint Economic Committee of Congress, Bernanke said consumer sentiment, the housing market and spending have begun to show signs of life.

But he expects the economy will continue to shed jobs and credit will remain tight for some time. He said the recent frugality trend will continue due to deflated household wealth, and business spending will be slow to bounce back as well.

"We continue to expect economic activity to bottom out, then to turn up later this year," said Bernanke in prepared testimony. "Even after a recovery gets under way … we expect that the recovery will only gradually gain
momentum and that economic slack will diminish slowly."

Bernanke said the recent gross domestic product report, which showed the economy contracted by 6.1% in the first quarter, was disappointing. But he said
the economic contraction will "moderate considerably in the near term and recover later this year," as businesses look to replace their liquidated inventories.

Read the rest of this entry »

Americans think the Obama Administration's performance on improving the economy deserves a C.

(CNN) — A new national poll suggests that Americans think the Obama Administration's performance on improving the economy deserves a C.

The CNN/Opinion Research Corporation survey released Wednesday, as President Barack Obama marks 100 days in office, asked respondents to use a grading scale of A, B, C, D and F, where A is excellent and F is very poor.

Eighteen percent of those questioned gave an A, 29 percent a B, 21 percent a C, 12 percent a D and 20 percent a F. The Obama administration's grade for its performance on improving the country's economy averaged out to a C.

The CNN/Opinion Research Corporation poll was conducted April 23-26, with 2,019 adult Americans questioned by telephone. The survey's sampling error is plus or minus two percentage points.

WASHINGTON (CNN) – Americans are becoming slightly more optimistic about the nation's economy, a CNN/Opinion Research Corporation survey showed Wednesday, but the glow surrounding President Barack Obama is wearing off for some as the president marks his first 100 days in office.

Thirty-seven percent of the people questioned in the poll say the current economic conditions in the country are very poor — a figure that's down from 48 percent last month and 66 percent in December. Seventeen percent now say economic conditions are good, up six points from last month.

Fifty-five percent say the economy is the most important issue facing the country today, down eight points from March.

"When the economy is bad, it is the top issue on the public's mind," said CNN Polling Director Keating Holland. "So when the number who say the economy is the number-one problem facing the country goes down, it may be a leading indicator that things are looking up a bit."

The survey also suggests that nearly two in three Americans think Obama has the right priorities and has paid enough attention to the country's most important problems. The 63 percent who feel that way is 17 points higher than those who felt that way about George W. Bush's performance 100 days into his presidency in 2001 and 26 points higher than the numbers for Bill Clinton in 1993.

Read the rest of this entry »

Among the positive indicators Federal Reserve Chairman Ben Bernanke mentioned were recent upticks in home sales and new home construction.

NEW YORK (CNNMoney.com) — Federal Reserve Chairman Ben Bernanke said Tuesday he sees "tentative signs" that the economy's dramatic decline is easing, but that full recovery won't come until the financial system is stabilized.

"Recently we have seen tentative signs that the sharp decline in economic activity may be slowing," Bernanke told students and faculty of Morehouse College in Atlanta.

Bernanke said "a leveling out of economic activity is the first step toward recovery." But an economic recovery will not be sustainable "without a stabilization of our financial system and credit markets," he added.

Among the positive indicators Bernanke mentioned were recent upticks in home sales and new home construction. He also pointed to improvements in consumer spending, notably sales of new vehicles.

Full story

(CNN) – President Barack Obama on Tuesday will outline how the steps his administration is taking to confront the economic crisis will move the economy from "recession to recovery," the White House said.

In an address at Georgetown University in Washington, Obama also will detail the work that still needs to be done to get the economy back on track.

The speech, which will air live on CNN and CNN.com at 11:30 ET, comes a day after the president declared that his stimulus plan is "starting to work" and that transportation projects are coming in ahead of schedule and under budget.

CNN contributor and Republican strategist Ed Rollins said Tuesday that Obama needs to remind the country that the economy is steadily moving forward. He also needs to provide encouragement, considering that Wednesday is tax deadline day, Rollins said.

Read the rest of this entry »