Obama stimulus plan halted economic freefall: White House

WASHINGTON (Reuters) - President Barack Obama’s $787 billion stimulus prevented another Great Depression while creating or preserving 2 million jobs, according to a White House report to be released on Wednesday.

A sign announces a section of road work funded by the American Recovery and Reinvestment Act U.S. economic stimulus plan in the Denver area September 10, 2009. REUTERS/Rick Wilking

The report, signed by Vice President Joe Biden who oversees how stimulus money is spent, stressed the depth of the crisis confronting Obama when he took office 13 months ago, as the President constantly reminds Americans in his speeches.

But it also highlighted Obama’s challenge of trying to cut a 9.7 percent jobless rate that has fueled voter discontent.

The report said the package of stimulus spending and tax cuts “clearly halted an economic freefall.” Obama will get the document at his economic intelligence briefing on Wednesday and he will speak about the economy to mark the anniversary of his signing of the American Recovery and Reinvestment Act at 10.25 a.m. (1525 GMT).

Opposition Republicans, as they have been doing for months, hammered the White House for what they called a “poorly conceived and badly executed” stimulus plan.

“Self-congratulatory ‘stimulus’ spin from this administration is hopelessly out of touch with reality and has about as much as credibility as prior claims that unemployment wouldn’t exceed 8 percent or that jobs would be created ‘immediately’,” John Boehner, Republican leader in the House of Representatives, said in a statement.

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Obama has said job growth will be his top priority this year, recognizing that Americans are anxious about high unemployment and the record deficit.

A survey last week showed he is also battling a public perception that the stimulus package has created few jobs.

The CBS/New York Times poll found that only 6 percent of Americans believed the $787 billion package had created jobs. Another poll by CNN/Opinion Research Corporation showed a majority opposed the stimulus program.

That could hurt Obama’s fellow Democrats, whose majorities in both the House of Representatives and the Senate could be under threat in the November congressional elections.

“It’s hard to get out positive news stories when people tend to focus on what’s going wrong as opposed to what’s going well,” Valerie Jarrett, a top adviser to Obama, told Reuters in an interview.

She acknowledged the administration had perhaps not done a “good enough job of explaining” how the plan helped people.

“Ninety-five percent of families received a tax break in the stimulus. So, maybe people aren’t fully appreciating that. But they did get the tax break, for example,” she said.

A senior administration official, speaking on condition of anonymity, said the recovery was proceeding as expected.

“You don’t go from massive hemorrhaging of jobs to robust job growth without passing through a period like this one, where GDP recovers first and diminished job losses precede the net gains we expect to see this spring,” he said.

According to Biden’s report, the Recovery Act had obligated $334 billion in spending by the end of January, spent $179 billion of that amount, and provided an estimated $119 billion in tax relief.

Additional reporting by Jeff Mason, Steve Holland and Lisa Lambert, editing by Alan Elsner