Job-Creation Panel Leery of Spending

From the Wall Street Journal | Nov 3, 2009

By JOHN D. MCKINNON and ELIZABETH WILLIAMSON

WASHINGTON
-- A top White House advisory committee Monday recommended ways to
expand jobs in exports, energy-efficient buildings and infrastructure,
but in an apparent nod to the U.S.'s growing debt, stopped short of
suggesting such policies be promoted by large federal spending.

The ideas -- some of which echoed Obama campaign proposals -- will
likely be considered along with the various job-creation initiatives
the White House and Congress are now mulling.

So far, the White House and Congress have been weighing a range of
short-term tax ideas to spur job growth, such as expanded refunds for
big companies that suffered losses; extension of a first-time
home-buyer tax credit; and a new tax credit for hiring. But
administration officials and congressional Democrats have been
struggling with how to fashion a big jobs package that doesn't add
considerably to the worrisome and unpopular budget deficit.

President Barack Obama, meeting with a team of outside advisers
headed by former Federal Reserve Chairman Paul Volcker, underscored the
need to reduce the federal debt. White House Budget Director Peter
Orszag is expected to sound a similar theme again on Tuesday, when he
speaks in New York.

Monday's event, Web cast live by the White House, reflected the
looming political pressure created by the U.S.'s budget woes. Much of
the discussion focused on relatively small-bore measures the government
could employ, beyond costly tax breaks, to spur the private sector,
including boosting the role of the U.S. Export-Import Bank, which helps
companies finance trade deals overseas.

"We are not going to be able, through government spending, [to]
replace business investment," Mr. Obama said. "The most important thing
we can do is create an environment in which business investment is
triggered and they are leading us on this path of economic growth."

On exports, members of the President's Economic Recovery Advisory
Board proposed a goal of sharply increasing such overseas sales as a
percentage of gross domestic product. Jeffrey Immelt, chairman and
chief executive of General Electric
Co., said that would be an important step in encouraging businesses to
increase output and add jobs, instead of simply boosting efficiency.
Specific ideas include boosting exportable clean-energy technologies.

On infrastructure, panel members suggested leveraging private-sector
investments through several devices, such as a national infrastructure
bank. Mr. Obama proposed an infrastructure bank during the presidential
campaign last year, but it largely disappeared from the big $787
billion stimulus bill last winter.

Write to John D. McKinnon at john.mckinnon@wsj.com and Elizabeth Williamson at elizabeth.williamson@wsj.com