The Daily Rundown | January 31, 2013
>>> good morning from washington , it's friday, february 1st , 2013 . let's get to the first read of the morning. i'll get to the jobs report in a minute, but i want to get to hagel . i want to start there. no doubt chuck hagel had a rough outing before the armed services committee , the question is whether hostility to hagel 's nomination breaks down so completely along partisan lines. that he's still able to survive. there's clearly a lot of republican opposition to hagel , some of it may be personal. the white house for now is chalking up the eight painful hours to political theatrics and believe these republican senators were simply tougher on hagel than they were on john kerry or on john brennan because they view hagel as a turncoat, but, wow, did hagel just sit there and allow himself to get flogged.
>> i have already stated that i regret the terminology. i've already noted that i -- that i should have used another term. the bigger point is what i was saying, i think -- what i meant to say, should have said, it's recognizable. it's been recognized, is recognized. i should have said recognized instead of legitimate. i said it, and i don't remember the context or when i said it. well, i've said what i said. i've said many, many things over many years. that's what i should have said, and thank you.
>> notice the pattern there. anyway, time and time again hagel would get hammered, beaten up by republicans, fumble, and the democratic senators would have to jump in and bail him out. the most painful example? when hagel stumbled on iran saying the obama administration supports containment and calling iran an elected legitimate government.
>> i've just been handed a note that i misspoke and said i supported the president's position on containment. if i said that, i meant to say that i obviously -- his position on containment, we don't have a position on containment.
>> just to make sure your correction is clear, we do have a position on containment, which is that we do not favor containment.
>> yet another example of a democratic senator having to correct chuck hagel . two topics dominated the hearing, one was iran and the other was something that members of the senate almost obsessively could not stop talking about.
>> israel .
>> of israel .
>> israel .
>> on israel .
>> israel .
>> israel .
>> israel .
>> israel .
>> supporting of israel .
>> israel . pro- israel .
>> hagel repeatedly proclaimed support for israel , but at times even democrats wanted more reassurance. though hagel did prep sessions in advance, he appeared unprepared for questions that we all knew were coming. he was manhandled by south carolina senator lindsey graham over his 2006 reference to the, quote, jewish lobby .
>> name one person in your opinion who's intimidated by the israeli lobby in the united states senate .
>> well, first --
>> name one.
>> i don't know.
>> name one dumb thing we've been goaded into doing because of the pressure from the israeli or jewish lobby .
>> i have already stated that i regret the terminology.
>> but you --
>> by the way, though, hagel was asked exhaustively about past conflicts and potential future conflicts. he was asked almost nothing about the war we're still in right now. during the hearing there were 178 mentions of israel . nearly five times the number of mentions of afghanistan which got just 38 mentions. in fact, when buzz feed did a word cloud of the hearing based on the transcript, afghanistan didn't even make it on their word cloud because it didn't come up enough. folks, we have 66,000 troops still stationed in afghanistan , some questions deserve to be asked. it was hagel 's former republican colleagues and even friends who staged the coordinated attack on this nomination, in the weeks he spent in one-on-one meetings with gop senators didn't seem to help him. fellow vietnam veterans john mccain and hagel were mavericks in the senate. in 2000 hagel co-chaired mccain 's campaign. he was only one of a handful of senators who endorsed him and at a town hall in nashua, new hampshire, mccain even floated this possibility --
>> as far as secretary of defense is concerned, there's a lot of people that could do that. one of them i think is senator chuck hagel .
>> but yesterday the air in the hearing room was thick. maybe it was bitterness. we don't know. mccain may feel about his old friend as mccain hammered hagel for the opposition to the 2007 troop surge in iraq.
>> were you correct or incorrect, yes or no?
>> my reference to the surge being --
>> are you going to anxious the question, senator hagel ? the question is, were you right or wrong? that's a pretty straightforward question.
>> well, i'm not going to give you a -- a yes-or-no answer on a lot of things.
>> let the record show you refused to answer that question.
>> by the way, incoming secretary of state john kerry who glided through his nomination hearing was also opposed to the iraq surge . republican senators who hadn't much criticized hagel before the hearing rushed to do so during and after it. florida's marco rubio said he would not support him. lindsey graham said it's not looking good. alabama's jeff sessions called himself uneasy about hagel 's answers. but is it enough to sink the nomination? you're unlikely to see a democrat vote against him or peel off against him today, in fact, the hostile republican questioning might make democrats more united. and do republicans really want to filibuster the defense secretary nominee? one of their former colleagues who served in vietnam. meanwhile, if you needed an example of why cutting budgets is so politically hard in congress, notice how many of them from both sides of the aisle, mind you, had no problem getting in pitches and plugs for their own home state defense projects.
>> on this strategic issues, i wonder if i could talk to you for a moment about submarines.
>> air force academy is well positioned to train those new cybersecurity experts. we're also the home of space command .
>> there's a ceremony in arlington tonight for the commissioning of a new amfib, the " uss arlington ."
>> north carolina we have seven military institutions, installations.
>> particularly of concern to us in maine and other parts of the country, the multiyear procurement program.
>> i share the important work done at the portsmouth naval shipyard .
>> the senators join me in inviting you to come and visit the portsmouth naval shipyard .
>> i wonder if they are worried about sequester? just like twitter and instant analysis shaped history's sense of romney's field speech, solicitor general virilly supreme court argument and president obama 's first debate made it all seem worse and it didn't help hagel yesterday. but romney went on to win the gop nomination and the supreme court upheld the health care law and obama won the general election by four points. yes, hagel bombed on style. but did he bomb enough to cost him the job of the secretary of defense? it doesn't look like it this morning.
>>> turning to the january jobs report, no big surprises in this month's numbers, and although there were some major revisions to take into account for the end of 2012 , first the top-line numbers. 157,000 jobs were added in january. almost exactly what analysts had been expecting. the analysts were right on this front this time. the unemployment rate ticked up a tenth of a point to 7.9% but the real headline is what happened to the numbers in november and december. the government now reports 247,000 jobs were added in november. that's up from the original mark of 161,000. and, by the way, that's the highest mark since february of last year. december jobs were -- were revised from 155,000 to 196,000. back to january's numbers. here are the sectors that saw the biggest changes -- retail added 33,000 jobs. construction added 28,000. health care added 23,000. transportation lost 14,000. and government, once again, lost 9,000. mostly at the federal level . well, if it's friday, and it's a jobs report, it's mark zandi, the chief economist for moody's analytics. mark, happy new year, i think this is our first one of the new year so --
>> i heard the crack about the analysts and their job predictions.
>> you guys nailed it! come on, man. it is almost -- i've never seen you guys this close within 2,000 according to what my favorite e-mail --
>> you don't pay enough attention.
>> no, i tease. this -- what's the bigger headline, the report this morning or those revisions from november and december?
>> i think the revisions. and it wasn't only to november and december. the bureau of labor statistics revised the data much further back in time and they were big upward revisions, so we got a lot more jobs in 2012 than we originally estimated and that, of course, is very good news.
>> i want to -- you look at all the numbers we got this week, the gdp report, the economy technically shrinking by 0.1 for the fourth quarter and most of it being chalked up to government -- to the lack of government spending particularly in the defense industry . and yet there were other parts of it in the private sector that looked strong. what's the reality here? are we an economy that's growing, that's recovering, or are we in an economy that's still on shaky ground ?
>> we're growing and we're recovering. the economy as measured by, say, gdp, that's kind of the economy's bottom line , that's the value of all the things we produce, that's been going 2%, 2.5%, and i don't think it's changed, that's about what we're growing right now. that's okay. but it's certainly not good enough in the context of the 7%, now 7.9% unemployment rate . yes, the economy is growing. yes, with each passing month we're on more sound ground but, you know, i don't think anyone's going to feel really good until unemployment is below 6%.
>> and the big issue continues, one of the odd issues has to be consumer confidence . and we're finding in our own polling that there may be a tie to washington gridlock in consumer confidence . because if you look at all of the other private data , housing starts are up, everything looks like it should be in better shape, but consumer confidence from december to january went down. and the intervening event was what? the fiscal cliff. we found in our own polling people feel less confident about the economy when there's no deal in washington . is that what you guys see?
>> yeah. i would say it's more dollars and cents than that, though. chuck, you know, the payroll tax holiday went away in january. everyone got their first paycheck in 2013 and said, it's a lot smaller, what's the heck's going on. and that's reflected in the confidence numbers. no one really likes the back-and-forth and vitriol in washington , it makes people nervous, particularly business people . but for consumers what really matters is the paycheck and the paycheck is smaller and they're not really comfortable with that.
>> what will it take for the unemployment to get below 6% or in that range, we got to start seeing jobs added, we got to start seeing it in the 300s, in the 400s, in the 500s, when will we see it in this economy? it still feels like treading water.
>> i don't think it's in the next three, six numbers, because we have to digest the tax increases and we have more government spending cuts coming. that's going to weigh on growth. my sense is by the end of the year we'll get job growth over 200k and by 2013 when the housing markets is in full swing, it will be 300k, we should be in 300k territory in 2014 and that's when the unemployment will start coming back in a big way.
>> we'll save this tape and play it for you in 2014 .
>> please do.
>> yeah. no, it's good to see you. thanks for coming on.