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Treasury chief hedges on jobs forecast

U.S. Treasury Secretary John Snow wouldn't affirm a White House forecast of 2.6 million new jobs to be created this year as he toured the Pacific Northwest. But he remained upbeat that "a lot" of jobs would be added to payrolls.
CHAO SNOW EVANS BARRETO HASTINGS
Labor Secretary Elaine Chao, center, leads a discussion forum for women business owners Tuesday in Richland, Wash. Also taking part in the discussion were Rep. Doc Hastings, R-Wash., far left, Treasury Secretary John Snow, second from left, Commerce Secretary Don Evans, second from right, and Small Business Association Administrator Hector Barreto, far right.Ted S. Warren / AP
/ Source: Reuters

U.S. Treasury Secretary John Snow said on Tuesday he was certain employment growth will pick up as the economy strengthens but steered clear of firm jobs forecasts as he toured the Pacific Northwest.

On a two-day swing by luxury bus through hard-hit areas of Washington and Oregon with Commerce chief Donald Evans and Labor Secretary Elaine Chao, Snow was asked whether he agreed with a White House forecast that 2.6 million new jobs will be created this year.

“I think we are going to create a lot of jobs. How many I don’t know, but we’re going to keep working on it,” Snow said when asked about the 2.6-million figure presented last week in the Economic Report of the President.

Soft hiring and voter anger at the drain of U.S. jobs through so-called “outsourcing” to cheap-labor countries looms as a vital issue for November presidential elections.

In a morning interview in Spokane with Bloomberg Television, Snow painted an upbeat picture of prospects for the economy, noting it has endured exceptional shocks in recent years, from corporate scandals to the impact of terror attacks.

“The economy has really been through the wringer and we’re finally starting to come out of it with good growth,” Snow said. “With good growth, we’re going to get jobs.”

Snow, Chao and Evans, along with Small Business Administration head Hector Barreto and Secret Service escorts, were traveling on a plush bus used in the past by rock groups including Bon Jovi, Smashing Pumpkins and Styx. The secretaries’ bus, complete with mirrored ceiling, was trailed by a more modest one carrying media and government staff.

The two states have suffered heavy job losses since 2001. Unemployment in Washington was at 6.8 percent in December and in Oregon it stood at 7.2 percent -- well above the national average of 5.7 percent, which ticked down to 5.6 percent in January.

’Outsource Bush’
At the first stop in Spokane, a half dozen protesters held signs reading “Weapons of Mass Economic Destruction” and “Outsource Bush” -- reminders of the two issues, Iraq and jobs, on top of voters’ minds heading into the fall elections.

Treasury officials say the tour is intended to sound out economic conditions rather than figure as part of President George W. Bush’s re-election campaign.

But at the secretaries’ stop at the Spokane Intercollegiate Research and Technology Institute -- a Washington state agency that helps local technology firms -- Evans announced a $3 million grant to help construct a new building for the agency.

Asked why the taxpayer-funded trip should not be labeled a campaign event, Snow said it was “a listening tour” to hear the complaints and suggestions of taxpayers and business people on how to improve the economy.

The secretaries met women entrepreneurs in Richland, Wash., for their assessment of economic conditions, and were scheduled to meet families at Yakima, Wash., later on Tuesday to seek support for the Bush administration contention that its tax cuts should be made permanent rather than allowed to expire.

The officials' tour featured some areas of the Northwest most impacted by the economy's slowdown, but did not include a stop in Seattle, the region's largest city.

In his television interview, Snow repeated his backing for a strong U.S. dollar, which has slid sharply against other major currencies in the past two years.

“We believe in a strong dollar,” he said. “But the best way to set the relative value of currencies is open, competitive currency markets, with interventions kept to a minimum.”

“That’s our policy,” he added. “That’s the right policy.”

Bush: Optimism 'undeniable'
On Monday in Florida, Bush called again for the tax cuts to be made permanent and cited an “undeniable” sense of optimism about the recovery from the 2001 recession.

The White House has been keen to downplay concern about U.S. companies moving jobs overseas and to dispel a controversy sparked by comments last week from the chairman of White House Council of Economic Advisers, Gregory Mankiw, pointing out the potential economic merits of the shifting of jobs overseas.

Late last week, Mankiw said in a letter to House of Representatives Speaker Dennis Hastert that his remarks had left “the wrong impression.”

Since Bush took office in 2001, nearly 2.8 million U.S. factory jobs have been lost, an issue already a lightning rod for Democratic criticism of Bush’s leadership in the run-up to November presidential elections.